As one of the true ECN forex brokers, this means that you get direct access to other participants in the currency market, allowing for quick and easy trading without a dealing desk. Our ECN platform uses a pure agency model and pricing to offer an online trading solution that is transparent and free from manipulation.
Price quotations from many market participants are consolidated to determine the ECN pricing we offer. All our market prices are derived from our aggregation engine that is integrated to top-tier banks and non-bank institutions. This means that tighter bid/ask spreads can be offered as opposed to with a non-ECN broker.
The spreads are variable and not fixed when you trade on our ECN platform due to this pricing structure. However, due to the competitive, narrow spreads, we also charge a fixed commission per transaction. These are set at 0.60 USD round turn for a mini contract (10,000 lot size) and 6.00 USD round turn for a standard contract (100,000 lot size).
When trading currency pairs that are non-USD, the commission will change depending on the current market conversion rate.
ECN vs Dealing Desk Brokers
Many traders can become confused between ECN and Dealing Desk brokers but they both offer different services. Dealing Desk is a form of market making broker which displays its own quotes which are correlated to inter-banking ones. Everything from placing orders to closing them is done automatically and electronically.
Dealing Desk essentially follows a traditional forex trading method whereby trades are placed and the broker is the liquidity provider or counter party to your trade. With a Dealing Desk broker, this process has simply been automated, with any desk dealers replaced by such systems.
At Currency Hedger we are not a market maker. There is no dealing desk and we only provide STP order execution.
Benefits of ECN
With an ECN account this offers an alternative trading method for forex traders. Some of the main benefits of using an ECN broker include:
- Lower trading costs: Narrow spreads and low commissions mean using an ECN broker can be more cost-effective than traditional brokers.
- Anonymity: ECN trading is anonymous, which can be preferred for high-volume traders. Traders can take advantage of neutral pricing and avoid any bias against their direction based on their forex trading strategies or current market position.
- Instant trade execution: Live forex prices can be traded on with instant executions with no interference from market makers.
- Price feed transparency: Every ECN broker has access to the same feed and trade, meaning that price transparency is provided along with current and past information, with equal access ensuring all traders have equal access and no advantage.