Profitable trading systems (expert advisors) often have difficulties choosing the best broker for their forex systems, and there are many reasons for that, the reasons could be conditions, restrictions, execution speeds and broker model.
The most important aspect to consider when choosing a broker is the way the broker works, e.g. is the broker a market maker that makes money when you lose, or is it an STP broker who offers you direct to markets trading with no conflicts of interests?
Market Maker vs. STP Brokers
As mentioned, a market maker will generate profits on client's losses, like a casino, and therefore there is a conflict of interest with their clients. The Market Maker Broker will provide you with restrictions and conditions that will help you lose money, not ideal for a profitable trading system.
An STP Broker however, provides you with the peace-of-mind of no conflicts order execution as all orders are sent directly to the markets (bank liquidity) for filling. As the banks are highly regulated and established leading banks, they have the financial backing to pay gains generated by your trading systems. Moreover, the STP Broker makes money based on volumes, either through commission or spreads, and therefore the STP Broker is incentivised to provide you the best hassle free trading environment.
Trading Restrictions
Market Makers often have hidden restrictions that all traders should clarify before investing. They could be minimum market distances, minimum order entry, exit times, variable leverage (weekends, rollovers and news times) and even withdrawal limits. A true STP Broker will provide traders no trading restrictions to allow you to close orders with no market distance limits, open and close your trade within the same second and no limits or restrictions on withdrawing profits.
Trading Conditions
Trading conditions should be another factor to consider, after all, you want to give your profitable trading system the best platform to make money. A Market Maker Broker will often display marketing messages like no commissions, fixed spreads, max spreads and no slippage; however it's crucial to understand that these are manipulations of the real markets and often, there are other elements that will cost you such as marked-up spreads, marked-up swaps and slippage.
AN STP Broker will provide you the ability to trade using "core" spreads (the forex spreads the broker receives from the liquidity banks), plus a small commission. When choosing a broker, bear in mind that the STP Broker has extra costs of liquidity providers and bridge expenses, therefore the cost to the client should reflect that and make sense.
For example, a Broker offering zero spread plus commissions of $2.50 per lot is likely not to be a true STP Broker as the commission will not cover the liquidity and bridge technology costs. Also pay attention to the advertised spread and actual spreads, if the "core" spreads exceed 0.5 pips on average, it's likely to be marked-up for extra broker profits.
Yadix Broker has been operating as an STP Broker since 2010 and is well known to support scalpers, EAs and profitable trading systems by offering competitive trading conditions and fast execution directly to the markets.
To learn more about profitable trading systems at Yadix, please visit: http://www.yadix.com/about-us/why-trade-with-yadix/
Yadix a leading ECN/STP financial markets broker and provides direct to market order execution to 14 + liquidity providers with precision and lightening speeds, as such, Yadix welcomes all traders and strategies including expert advisors, Day Traders, Scalping and HFT strategies.
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