The Best STP and ECN Brokers

Broker Info Bonus US Traders Get Started
AxiTrader Spread: from 0.1 pips
Leverage: up to 500:1
Min Account Size: $1
Demo Account: Open
30 day free demo trial Open free demo account Read / Submit Review
Forex.com Spread: Low variable spreads
Leverage: 1:1 up to 1:30 and in US up to 1:50
Min Account Size: none
Demo Account: Open
no active bonus USA Allowed Open free demo account Read / Submit Review
FP Markets Spread: Low, fixed spreads
Leverage: 1:1 up to 1:500
Min Account Size: $100
Demo Account: Open
Tight, fixed spreads Open free demo account Read / Submit Review
IC Markets Spread: from 0.1 pips
Leverage: 1:1 up to 1:500
Min Account Size: $1
Demo Account: Open
Free Low latency collocated VPS Open free demo account Read / Submit Review
Pepperstone Spread: from as low as 0.1 pips, depending on account type
Leverage: 1:1 up to 500:1
Min Account Size: $1
Demo Account: Open
Active Trader program rebates paid daily Open free demo account Read / Submit Review

What actually is a forex STP and ECN broker?

One of the most asked questions in online forex trading is what’s the difference between a market maker, dealing desk, STP and ECN?

In this article we will explain the differences and enlist the top STP/ECN brokers.

A Market Maker, also called a Dealing Desk is actually an artificial type of broker because they don’t show real market prices. They make up their own prices, which are similar to market prices, but not the real deal. Any order you place or position you open internally on their platforms, actually never goes out to the real financial market.

The pro of this is fast order execution and no re quotes, the con is that every dollar you gain or profit is paid for by the broker and every dollar you lose goes to the broker, which can be seen as a conflict of interest.

STP stands for Straight Trough Processing. STP brokers route all or just some of your orders directly to the market. Sometimes they maintain a hybrid level between market maker and ECN. Please note that some brokers promise they are STP brokers, whilst actually being market makers. The most common thing for a broker to do, is be a market maker for losing traders and to be a STP broker for winning or profitable traders. With this method, there is smaller conflict of interest and more accurate pricing. The cons are though, slower execution with re-quotes from time to time. If you are a losing trading, your broker might end up switching you to market making servers instead of ECN/STP.

ECN stands for Electronic Communications Network and it’s actually the only type of true broker. Just as with equities, brokers are supposed to allow traders to trade the markets and not be the markets (like market makers and STP brokers sometimes do). A true ECN broker shows you the real actual prices and display the market in a correct way. Trading on ECN accounts your trading against other traders and financial institutions and not against your broker. The pros of ECN trading are obviously direct market access, no conflict of interest and no spread markups. The cons are no guaranteed fills and the smallest lot size is 100k. Also, you pay commission to your broker.

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