Difference between Market Maker, ECN and STP broker

Choosing the right Forex Broker is not easy, there are several Forex Broker models to choose from and each broker offers benefits and tools to make your trading easier and to give you more value.

                                   

However, there is no Forex Broker that is ideal for every trader. Choosing your broker should be based on your specific needs, expectations and most importantly, your trading strategy. The three broker models should be understood fully to help you choose the best Broker for your trades.

                                                                                                   

Market Making Forex Brokers, as the name suggests, this broker model actually makes the market where you trade. With a Market Maker, the broker can feed prices that have no correlation with the real Forex markets (Interbank market) and more importantly,  each time you buy or sell an order, your broker is the counter-party to your trades. This means when you win the broker losses, and when you lose, the broker wins.

Naturally, there are many traders that have serious concerns with market makers due to the conflict of interest between client and broker. Traditionally,  Market making brokers have issue accepting profitable trading strategies, Forex Robots and systems and to protect their own interests, they use techniques such as trading restrictions, minimum market limits and levels, re-quotes and dealer plug-ins to protect their profitability. 

ECN Brokers use an execution flow that is completely opposite to a market maker. Through technology, the ECN broker allows trader direct access to the real Forex markets through institutional broker accounts with Banks, Forex Exchanges and Liquidity Providers. Generally, an ECN broker will feed core/raw spreads to the MT4 platform and charge an ECN commission on the traders volumes to generate a profit.

As the ECN model requires larger volumes for the Broker to make adequate profits, there will be specific deposit, minimum trade size or volumes requirements and as such, normal retail traders are often priced out of trading with an ECN broker.

ECN trading is highly beneficial for professional or high volume traders looking to avoid the conflict of interest that a Market Making broker presents.  ECN offers the most transparent and fair true market conditions and execution flows. 

The STP Broker Forex model offers more affordable direct-to-market trading to retail clients using real market price feeds, automatic order execution to the real Forex markets and the benefits of using banks, FX exchanges and other liquidity sources for order filling.  

STP trading gives Forex traders the same execution advantages as ECN brokers such as no -conflict order filling, real market pricing , order filling at real market pricing using best bid and best ask and best execution policies, but instead of offering core/raw spreads, the spread is marked-up and no commissions are charged to traders.

The mark-up allows the broker to generate profits without having to act as the counterparty for its client's orders, but does however rely on higher volumes to make money. Many tools and benefits an STP (or even ECN) brokers offer will be based on traded volumes or minimum deposits to ensure that the broker can reward its clients and still generate business profitability.

Both STP and ECN brokers are specifically suitable for Expert Advisors, Forex Robots, Auto-Clickers, News trading, High Frequency Trading and other profitable trading strategies due to the conflict free order execution flow and the "no risk" policies used by these brokers.

Yadix operates as a true direct-to-market execution with both ECN and STP trading accounts available to professional and retail traders, with no dealing desk intervention and no market making. 

Based on this philosophy, Yadix has built a strong reputation for Scalpers, EAs, HFTs and profitable traders. Our services are within reach for any trader, professional or beginner and our mission is to support all profitable traders with fair and transparent order execution,  tools  and rewards so high frequency traders can truly benefit and get additional value from their broker. 

You are invited to learn more about Yadix benefits by visiting the website or visit our live chat for a professional consultation.

Best Performing Forex PAMM Managers 2015

The Yadix PAMM Community is a investors community where clients, traders and investors can choose to diversify their investment portfolio with a proven Forex account manager.  

The difference between the Yadix PAMM community and other brokers PAMM/MAM/Money Managers is that Yadix will always choose Forex managers who have traded with Yadix privately and generated good performance before the Forex management service is made public.

All Forex Managers are fully vetted and are backed up with statistics of their trading strategy, and only Low to Medium risk trading strategies or managers are offered publically for investors to choose from.

The Auto-Trading team also verify the trading strategy, Manual or Automated to ensure that our clients and investors have varies investment options based on their investment and risk appetite.

Please review the impressive performance statistics of the best performing Forex Account Manager in the second quarter of 2015.

The manager has displayed a growth of 19.93% on his investors portfolio and is very focused on risk management with low draw-down stats (6.69%) using a disciplined auto-trading algorithm and manual monitoring to achieve the extraordinary performance figures below displayed in the statistics below (taken from an investors account).

How to invest?

1. Login to the secure client area: https://secure.yadix.com
2. Open a new Yadix Trading account from your client area
3. Fund your account
4. Request support@yadix.com to be connected to Manager # 20115

For more information, please contact our live chat support.

The Real Value of STP Trading

In today's market, with many traders buying ready-made EAsand trading systems, or investing through a fund manager, there are many traders are not aware of the real value of trading with an STP Forex broker. 

This article is to highlight, directly, the value of trading with an STP Forex broker comparing to a market maker broker.

No Re-quotes, Stop Hunts or any other Dealing Desk Intervention

When trading on the DMA, STP or ECN Forex model, you are guaranteed no re-quotes, stop loss hunting and other strategies that are employed by market makers to ensure that they profit from your losses.

The interbank model is as pure a model of trading forex as is possible. The broker does not benefit from losses and therefore, its interest is in helping its clients generate higher Forex volumes. Yadix provides many beneficial conditions and trading tools to help you grow into a better, more profitable Forex trader.

Fast Order Execution                  

Yadix delivers ultra- fast and low latency order execution by using the Equinix Financial Exchange, a leading Financial Services technology provider. 

Equinix servers are located globally and connects clients to the main MT4 trading server through this optic-fibre technology.  All clients trades are executed through the large network of trading hubs and bank servers, located in the Equinix data centres to reduce order execution time and precise order fills. 

Highest Level Liquidity            

A deep pool of liquidity is provided through top FX Banks that compete for your forex trades and deliver the lowest spreads to Yadix clients. Multiple providers of liquidity ensure that there are no strategy restrictions giving you the freedom to scalp as aggressively as you want.

Some of the leading Liquidity Providers competing for your trades: UBS, Citibank, JP Morgan, Bank of America, Deutsch Bank, Barclays Bank.

Price Improvements

Slippage is generally reported as a negative of trading on the interbank market, however, you rarely read about positive slippage. Positive slippage is when an order is executed at a more positive price to give the trader additional profits on a pending order. 

Both positive and negative slippage is a factor that all traders need to consider and cannot be avoided when trading real Forex markets. Furthermore, there are no brokers that can guarantee slippage, unless they employ market making tactics.

When trading economic market data releases, there are a few steps to help traders being affected by slippage, they are using a VPS, balance trading and take into account slippage and avoid trading during these highly volatile periods. After all, when trading on the true Forex markets, slippage is part of trading and cannot be controlled or compensated.

Accurate Order Fills

The combination of Equinix technology and the a large pool of liquidity ensure that your Forex orders are being filled as fast as possible to the biggest liquidity providers, as such orders are executed extremely accurately including tight stop loss and take profit filling.

No restrictions for Scalpers, EAs or HFTs (SL/TP and pending orders)

As a true Inter-bank broker (DMA, ECN, STP), Yadix can deliver no restrictions on any pending orders or order modification. Unlike dealing desk brokers, Yadix gives its clients the ability to trade without a minimum level of pips on stop loss, take profit or any pending order types. There are also no time limits on the time that your orders need to remain open. Ideal for Forex Scalpers.

Low Spreads

As we all know, low spreads are not just important, but a major factor in all Forex trading strategies. At Yadix, we offer two account types that offer Raw Spreads (the spread that the Broker receives from the liquidity providers). These Raw spreads are passed on to clients (without any mark up) on the Pro and Scalper accounts. This ensures low cost and the most accurate triggering of orders when using an EA or Automated trading strategy.

To learn more about how STP should be your broker choice, please feel free to visit our live chat service or read more: http://www.yadix.com/about-us/why-trade-with-yadix/

100% True Hedging + Benefits

As a true STP/ECN Forex Broker, Yadix is focused on providing unrestricted trading conditions and execution benefits to its clients.

Traders that implement hedging strategies, manually or through their expert advisors can take advantage of zero margin requirements for opening hedged positions. 

Unlike many other brokers, that charge margin for at least one leg of the hedged order, when you open a Buy and Sell position on the same instrument and in the same lot size, The Yadix MT4 requires zero margin. 

An additional advantage that traders can take benefit from is hedging even when the order has  negative free margin. This is an underestimated benefit as it can help Forex risk management during periods of draw-down and help you control orders from being stopped out.  Imagine that a long 1 lot EUR/USD order is your biggest cause of negative free margin, by opening a new short leg of  1 lot EUR/USD, your margin used is set to zero and could set your free margin to positive.

To learn more about FX hedging advantages and more benefits, feel free to contact the Yadix customer support team. 

NEW FOREX PROMOTIONS

Yadix Forex Broker offers clients spreads from 0.1 pips, superior order execution, trading with no restrictions and zero limits or levels on stop loss and take profit orders, and welcomes all Expert Advisors, including Scalping Robots and News Traders.

To reward all clients for choosing to trade at Yadix.com, we are offering the highest value and most recent releases of technical devices for free! Exchange your trading volumes for the latest iPhone, iPad, Samsung Galaxy and Samsung Galaxy tablet
Trade to get a iPhone 6 Plus, Samsung S6, iPad 2 or Galaxy Tab S10!
Open an online Forex trading account with Yadix and trade to get a high value welcome gift. Use any Strategy/Robot to get your iPhone 6 Plus, iPad Air 2, Samsung S6 or the Samsung Galaxy Tab S10.

How to earn your welcome gift?

1. Register a classic trading account and choose your welcome gift
2. Login to the secure client area
3. Fund Account: Credit/Debit card, WebMoney, MoneyBookers/Skrill, Wire or Neteller
4. Start Trading for the welcome gift 
5. Qualify with first deposit of $100 or more

Alternative Forex Promotions:

50% Bonus Up to $10,000 
Get a 50% Cash Bonus up to $10,000 on your first deposit. Cash bonuses are credited to your balance after the requirements are met. 

1 Pip Forex Rebates ($10 per lot)  
Yadix offers clients the most unique and exclusive rebates programme within the forex industry to benefit high volume forex traders. Earn 1 PIP per lot traded on the Yadix rebate account or up to 0.5 pips on the Yadix standard account.