No, Margaret, sorry but that absolutely isn’t so at all. An “STP” broker is also your counterparty. It’s really very clearly explained in the Babypips school, and in literally hundreds of posts here!
Here are just 5 of them, to start your collection!
The voices of the informed are drowned out by the disinformation from the financial services industry. Brokers don’t normally lie outright but they lead new clients to believe that we are all taking part in the multi-billion dollar industry of exchangng currencies.
In fact we are taking part in the multi-billion dollar betting industry. If you don’t like the idea of betting to make money, well, there are plenty of other enterprises available. But you can’t come to babypips and expect the indust…
it’s very, very widely misunderstood
the reality is that it actually signifies very, very little
spot forex “brokers” often claim to be “STP brokers” to encourage their customers to believe that their “broker” doesn’t hold the other side of their trade, but passes it on to a “liquidity provider”, but there’s often no way of knowing whether the brokerage actually owns the “LP” as well, so it sometimes signifies nothing, really
the recent post linked to just below, and the 5 or 6 posts followin…
they do
which is exactly what all the counterparty market-makers want them to think, of course
and many of the conversations in this forum tacitly assume that when people are “trading” with these “brokers,” they’re actually dealing in currencies rather than just having a side-bet on the price-movements of currencies!
Very, very few spot forex brokers aren’t counterparties.
And you can’t tell which are, anyway.
Most people are fooled by the language they use, claiming to be “ECN” or “NDD” or “STP”.
It’s all nonsense.
You’re right.
The terms ECN/STP/NDD are designed to fool naïve retail customers into believing that the party they like to think of as a “broker” isn’t their counterparty and therefore wants them to win, not lose.
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