Your Definitive Guide to FXOpen ECN Account

Evan:
i will try to answer your question.

In the forex world, he has three types of brokers to know.

First is A market maker broker above all else. Instead of delivering orders to the market, brokers deliver orders to other traders. And if your order does not match any traders, your order will instead go against the broker. Brokers usually take profits when trader losses occur. Because of this, all the brokers that have this mechanism are called Market Maker Brokers.

The second is STP broker or NDD broker which traders usually use. And I think your broker is this type. This broker delivers orders to the secondary liquidators of the forex market. A secondary here could be a small bank or other financial institution connected to a major forex clearing house. It means that orders are not sent directly to the market. It is very common broker that you can find but about the order that jump from one liquidator to another liquidator is still fast thanks to internet technology.

Last is the ECN broker. Instead of sending orders to a secondary liquidator, brokers send orders to a primary liquidator such as a central bank! So all terms of the market are revealed, including the actual spreads. So don't be surprised if an ECN broker can offer you a spread of 0.00! But remember that brokers don't charge for spreads, so they charge higher commission fees!

You can read the details of broker type in here : Forex Broker Type

Johnson: This article shows the differences in market execution comparing standard and ECN accounts. As noted above, if you read carefully, limit orders are different when an ECN is notified of the best price bid/bid. For the time being, this feature is not available for standard accounts.

in the meantime,

For market orders, ECN accounts can avoid requotes and slippage, while standard accounts cannot avoid slippage at high volatility.

And the last is a market order, and if the order is not executed even if you click on the open position of the ECN account, the price will not move for a while. This allows you to change your order without changing the price. On the other hand, the price of the standard account fluctuates every second.

Is ECN good for beginners? Nope, actually ECN is not so friendly for beginner. Read at here for information : What Are ECN Account and its Fee

Can ECN be used by a beginner like me? Can ECN be used by a beginner like me? 

Johnson: Can ECN be used by a beginner like me?

-->> I think it is can as long you have funds for minimum deposit. The minimum deposit of FX ECN account is at $100 meanwhile for other account, like standard account, can deposit only $10.

And for beginner those doesn;t have enough funds, it is better to don't trade in here.

Johnson: Beginner or not, I think ECN offers really good trading conditions for scalping and EA trading. For what? This is because the spreads there are very low and there are few requotes. Meanwhile, if brokers do not offer ECN, the spread will be higher and the possibility of re-quotes is huge. There is also another feature called market depth. Only sponsored experience can use this feature with max,

So, is it good for beginners? I don't think so, because the conditions in there are actually higher commissions and sloppy trading is not possible. But great for scalping and EA Trader

William Fofana: No, it is imposibble to have ECN feature in demo account. Because the ECN account is linked to the main liquidator. Meanwhile, a demo account is just a tool that brokers provide to monitor real market movements. So basically the demo account has no spreads or commissions because trading is done by the broker's server without passing your order to the LP (Liquidity Provider).

The demo account only provides trading tools and other basics learned in live trading. So don't be surprised if some events that will happen in the live account will not happen in the demo account. This is why, after defining your strategy, it is important to test it in the real market after testing it back with a demo account.

@William Fofana:

TLDR: YES and NO, 

Yes, it is possible to have a demo account with ECN functionality to simulate trading in ECN conditions. ECN stands for Electronic Communication Netwrkk, and it is a type of trading environment where buyers and sellers can directly interact with each other thru a network.

To get a better understanding of how ECN trading works, you can use a demo account provided by a broker that offers ECN trading. The demo account will allow you to test the ECN platform and practice trading in a simulated environment without risking any real money.

And NO, it is important to note that the trading conditions in a demo account may not perfectly match those of a real ECN account. This is because demo accounts are designed to give you a feel for the platform and trading environment, but may not include all the features and functionality of a real trading account.

Remember, the keyword is SIMULATION, not exact match of real ECN trading condition! (so, those demo accounts aren't totally useless afterall)

In fact, when you start actual trading in an ECN account, you might find out that occasional slippage or huge spread suddenly spikes during specific trading sessions (e.g. news release, or server updates). So, in essence you can learn how to hone your trading strats in demo account, but eventually you have to come prepared when random factors starts to pop up in real ECN account.

@Anmar: You've got a good grasp of the key distinction between ECN brokers with and without Direct Market Access (DMA). DMA offers traders a direct link to the liquidity pool, enhancing pricing transparency and revealing the true market depth. Let's dive into how DMA influences trading, its pros and cons compared to non-DMA ECN brokers:

In terms of order execution speed, DMA typically means quicker trades as it cuts out intermediaries, resulting in relatively lower slippage. Conversely, ECN brokers lacking DMA might execute orders slightly more slowly, with slippage influenced by their specific procedures.

The advantages of DMA are numerous. It brings transparency by exposing the complete market depth, facilitating more informed decision-making. Additionally, it grants direct market access, potentially leading to improved pricing. DMA brokers often have fewer conflicts of interest, promoting fairer trading conditions.

However, DMA isn't without drawbacks. It can be more intricate and possibly more expensive due to commission charges, making it a better fit for experienced or institutional traders rather than beginners. Beyond these factors, DMA also appeals to advanced traders, particularly those employing algorithmic or high-frequency strategies, offering greater control and access to advanced order types.

You can find the account you need and read more FXOpen reviews on this broker review website. Click the link here. There are 9 account types there but I think as an international trader you can choose 4 account types and the rest can be chosen by Australian, UK or EU traders. One of the accounts is Micro and the other is Crypto and the rest are standard STP and ECN accounts.


As for STP, like any standard account, STP is basically a different type of broker. There are two types of brokers: market makers and STPs. STP brokers link client orders to liquidators with market access. So basically, brokerage services allow traders to trade directly on the market. It's just like a regular standard account, and it's actually a standard account itself. ECN, on the other hand, is a sophisticated trading system.

ECN allows you to view other offers and see the highest bids and highest bids on the market. You can also trade these details through negotiations. Unfortunately, ECN accounts require more deposits than standard accounts.

Yes there is a difference, but the difference is very small. For UK and EU (European Union) traders, you need to make a minimum deposit of 300 USD with a trading position of at least 0.01 lot. This is a standard STP and ECN account. For AU traders, the minimum deposit is $200, but if you choose an ECN account, you will not be able to use scalping and Expert Advisors. The STP account allows a minimum deposit of 10$, scalping and expert advisors. On the other hand, crypto accounts are only allowed for international traders. Also, the trading conditions for international traders are friendlier than those in the UK, EU and AU.

I think it's because UK and EU regulations are different to AU regulations. In addition, the regulations of these countries are different from the regulations of other countries such as the details of the countries regulated in FXOpen namely China, India, Cyprus, Hong Kong, Japan and other countries. So about regulation.

FXOpen Broker Company was founded in Cairo in 2003. It started trading services in 2005 and has since become one of the leading players in the forex industry. The company has provided a high level of service through optimal trading conditions, innovative technologies, and various financial services. FXOpen was the first broker to offer its clients a unique opportunity to trade via an electronic communication network (ECN) based on the MetaTrader 4 terminal. FXOpen is a member of the International Financial Commission and a member of the Federal Council Committee on Budget and Financial Markets.

I started trading at FXOpen about 5 years ago. We started trading currency pairs. I currently work with cryptocurrencies because this broker offers the most optimal conditions. Given the current situation, I think it's safer to deal with cryptocurrencies. Of course, there are no problems with scalping, but in the medium term, it is quite normal... By the way, FXOpen has an easy-to-use interface, perfect for beginners.

The company holds licenses from the various countries in which it operates and has been granted by the relevant regulatory bodies in these areas. These regulatory agencies demand several measures to be enforced and among them is the security of client funds entrusted to them. In accordance with these regulations, FXOpen has installed the following measures for the safety of clients' money

• Use segregated bank accounts to separate client funds from company operating funds to prevent mix-ups.
• Using credible and legitimate bank services to deposit this client's funds.
• It is a member of the forthcoming compensation scheme to pay the client money in the event of liquidation.
• Among the regulatory agencies that have granted FXOpen a clean license to operate include the following:
• Licensed to operate in the UK by its regulatory body, the Financial Conduct Authority (FCA).
• Licensed to operate in Australia by the Australian Securities and Investments Commission (ASIC).

@Rendo: Well, in ECN accounts, SL and TP orders work pretty much the same as in standard accounts. They let you automatically close your positions when certain price levels are hit. SL helps you limit potential losses, while TP allows you to lock in those sweet profits. But here's the twist when it comes to ECN accounts. In ECN accounts, these orders get executed differently because of the whole direct market access thing. You see, in ECN trading, your trades go straight to the interbank market.

Now, let's talk pricing. In ECN accounts, you usually get variable spreads. That means the prices you see depend on the market's liquidity and the orders from other traders. This can lead to tighter spreads when the market's buzzing with activity.

These differences in order execution and pricing can affect how you use SL and TP orders. In ECN accounts, the direct market access can give you faster execution speeds and potentially better pricing, especially when the market's all crazy.

@Andy: You've got a keen eye for the details! The "depth of market" feature in ECN accounts, such as those in FX Open, does indeed provide traders with a transparent view of the market and its liquidity. It allows you to see the various price levels and the number of buy and sell orders at each level, which is valuable information for making informed trading decisions.

Now, onto your specific question about the spread in ECN accounts: Yes, the transparency generally extends to the spread as well. In ECN accounts, the spread is typically very tight and variable, and traders can often see the real-time bid and ask prices in the market. This means that you can observe the actual spread at any given moment without hidden mark-ups or adjustments. It's this level of transparency that makes ECN accounts popular among traders who value a clear view of market conditions. (Read : Your Simple Guide to Depth of Market)

That's right, not many brokers accept US traders. One of the main reasons why forex brokers do not accept US clients is because of the strict regulations imposed by the US government. The US government has implemented several regulations regarding forex brokers, including the Dodd-Frank Act which was introduced in 2010. This law requires forex brokers to register with the Commodity Futures Trading Commission (CFTC) and the National Futures Association (NFA), which can be a long and expensive process.

In addition, forex brokers are also required to meet a several other requirements, including maintaining minimum capital requirements and submitting periodic financial reports to the authorities. These regulations can be difficult for forex brokers to comply with, which is why many prefer not to accept US clients.

Well, despite the many rules in the US, it is important to remember that these regulations are designed to protect traders and ensure that the forex market operates fairly and transparently. As a result, it is important to choose a regulated and trustworthy forex broker, even if they do not accept US clients. Yeah, even though FXOpen broker can't break into the US market, it can't be denied that it is a good broker with ECN and STP accounts in its ecosystem which competes with other brokers.

But if you are a US trader, I suggest looking for another broker that offers good security in the US region, so that it is easier for you to solve problems related to the security of your account and funds more securely.

Hi Bro,,,

Based on how the broker processes client orders, there are 2 main categories that need attention, namely DD (Dealing Desk) and NDD (Non-Dealing Desk). This type of DD forex broker is also often referred to as a city broker, while globally, another name for a DD-type broker is Market Maker.
A dealing desk forex broker is a type of broker who acts as a party executing traders' orders within their own company. When you open a trading position, your order will be executed by the platform, and they will be your counterparty.

Thus, it can be said that the DD broker has its own created market. The standard bid and ask prices at DD brokers do not reflect the actual market rate but are regulated according to company policy. In this case, the Dealing Desk broker will benefit from the spread which is the difference between the bid and ask prices.

By contrast, Non-Dealing Desk (NDD) is a business model where the broker acts as an intermediary between the trader and the live market. NDD brokers do not have an internal trading desk, so traders' orders are executed directly through the liquidity network with prices sourced directly from external liquidity providers.

Even though trading with the NDD broker model slippage often occurs, I still like this type of model because I don't have to compete with the broker itself in trading interests.

That's true, for beginning traders, it is not easy to compete with Market Makers. yeah, unfortunately, it depends on your choice. But I am willing to deliver some opinions to select among them.

If you want fast and direct order execution, you might choose a Dealing Desk. However, if you prioritize price transparency and execution via external liquidity providers, NDD could be a better choice.

If you are a scalper or a trader with a short-term strategy that is very sensitive to slippage, you may prefer NDD which offers direct access to the market and lower spreads. However, if you are trading medium to long-term, DD can provide advantages such as protection from extreme volatility.
Check the fee and commission structure of each model. DD usually offers fixed spreads or wider spreads with hidden transaction fees, while NDD usually offers variable spreads with separate commissions.

Yes, there is a difference, but the difference is very small. For UK and EU (European Union) traders, you need to make a minimum deposit of 300 USD with a trading position of at least 0.01 lot. This is a standard STP and ECN account. For AU traders, the minimum deposit is $200, but if you choose an ECN account, you will not be able to use scalping and Expert Advisors. The STP account allows a minimum deposit of 10$, scalping and expert advisors. On the other hand, crypto accounts are only allowed for international traders. Also, the trading conditions for international traders are friendlier than those in the UK, EU, and AU.

I think it's because UK and EU regulations are different from AU regulations. In addition, the regulations of these countries are different from the regulations of other countries such as the details of the countries regulated in FXOpen namely China, India, Cyprus, Hong Kong, Japan, and other countries. So about regulation.

There are two types of forex brokers that currently exist the most, namely ECN (Electronic Communication Network) and STP (Straight Through Processing). However, novice traders are often confused about which one is the best, because the features and services are similar or even seem like there is no difference at all. In fact, even though they have a number of similarities, ECN and STP forex brokers are very different in terms of order execution systems and the structure of fees that must be paid by traders such as spreads and commissions.

Here I only want to explain STP, because the explanation in this article about ECN is quite complete.

In terms of deposits, STP Accounts have a lower minimum deposit of $10, compared to the ECN kean with $100 for deposits. The smallest lot size allowed is 0.01, and accounts with a balance of less than $25,000 are eligible for variable leverage of up to 1:500. ECn also offers commissions of around $1.5 per unit, whereas STP accounts are commission-free. Read here

The advantage for traders is that STP brokers can waive commission fees which are usually applied to each lot (trading volume) because the source of income can be diverted into a markup on spreads only. However, on the other hand, because trader orders are "thrown" to be executed by other parties, traders cannot see the Bid and Ask positions that appear on the forex market (Depth of Market/DoM). Because of this, STP brokers can also conspire to pass trader orders to other companies in the same group or pass orders to liquidity providers who provide certain kickback commissions. This drawback can be avoided if you know who the STP broker's liquidity provider is, or if you use an ECN broker.

I think, ECN accounts suit experienced traders seeking direct access to the interbank market. They offer competitive prices and fast execution but may have higher costs and more complex conditions.

For beginners, simpler account types like micro or standard accounts are often better. These have lower minimum deposits and easier trading conditions, allowing novices to gain experience without the complexity of an ECN account.

TickTrader and MT5 are both awesome trading platforms that FXOpen offers. TickTrader is web-based, so you can use it easily from any web browser, without downloading or installing anything. On the other hand, MT5 is a more advanced platform that offers a ton of features, like the DOM feature that shows the order book, advanced charting tools, and automated trading with expert advisors (EAs).

Both platforms are great for ECN trading, but they have some differences. MT5 has more advanced features for experienced traders who want to customize their trading experience. But if you're new to trading or just want a simple and easy-to-use interface, TickTrader is a great choice. It even lets you trade directly from charts and offers different types of orders like market, limit, stop, and trailing stop orders.

So, when it comes down to it, both platforms have their unique benefits, and it's up to you to decide which one fits your trading style and needs better.

Let me explain to you about HFT. The High-Frequency Trading (HFT), it refers to a strategy where traders execute a large number of orders at extremely high speeds. This technique leverages advanced algorithms and powerful computing systems to make rapid transactions. And it is really different with scalping!

The advantage for a broker in allowing HFT lies in increased trading volumes. High-frequency traders capitalize on small price fluctuations, executing numerous trades in a short timeframe. This heightened activity can translate into higher transaction fees for the broker, potentially making it an attractive proposition. Additionally, the presence of HFT traders can contribute to market liquidity, benefiting other market participants. In summary, the allowance of HFT by a broker may lead to increased transaction volume and liquidity, which can be advantageous for both the broker and the broader market. Hope it can clear your curious! (also read : High-Frequency Trading: Pros, Cons, and Controversies)