ECN Forex Brokers

Introduction

From beginner to expert, whether the type of the retails is, the term ‘ECN Forex Broker’ is one of the most common and necessary things to know about. Today’s global trading industry is highly depended on ECN technology. And that’s why choosing an ECN broker can be a great move in your Forex trading journey. But choosing a right ECN broker is not that easy. To do so, first, you need to know how the ECN system works & then what ECN broker is. Then gradually you can find and sort out ECN broker list & finally, choose true ECN brokers for your regular trading. Now let’s dive into the main discussion.

What is an ECN Broker?

ECN or Electronic Communication Brokers are also called non-dealing desk brokers.

Account size: Both the minimum deposit and trade size are higher in ECN broker than other Online Brokers. Even sometimes ECN brokers insist their client for a minimum 1 mini-lot trade size which is 10 times than tradition 1 micro-lot trade size.
Execution Quality: As trading is executing by means of the automated electronic system, the execution speed becomes significantly higher than other brokers. But if there is no market maker to take the trade, then low liquidity occurs. It reduces the speed of execution at a high rate. So, be careful about this situation.
Spreads and Liquidity: ECN brokers contain the lower spread and higher liquidities. Even if you add the commissions, the total amount is very small and reasonable. However, sometimes a situation happens when liquidity becomes lower. But this is a rare case.
Choice of Instruments: The scope for choosing instruments are little unfriendly because ECN brokers are not focused on all trading instruments. That’s why for some instruments like gold, share, CFDs its better look for other type brokers.
Maximum & Minimum Trade Size: Since ECN brokers don’t have much trade processing constraints, they sometimes offer larger trade size. For example, sometimes dealing desk brokers will not allow you to sell more than 3 lots at once where ECN brokers are more open-minded. In the case of minimum trade size, usually, ECN brokers have the 1 mini lot size where other brokers have the minimum lot size of 1 micro lot. (10 micro lot = 1 mini lot)
Lower Latency: Latency is an important factor because it defines server speed, ping status and other technical configuration of the ECN server. So, latency is responsible for faster trade execution & overall broker’s server performance.

Who are the “True/Real” ECN Forex Brokers?

Now maybe you think who are True ECN Forex Brokers. Yeah, this is a very important factor for every retailer. Generally, many brokers claimed to be ECN brokers. But in real practice, they have their dealing desk and try to manipulate the trade manually.

Now the question is how to trace these scams?

Genuine ECN brokers plug your order into the electronic network to match your order to a liquidity provider automatically. As a result, execution time becomes quicker, and the spread becomes lower in case of ECN trades. This is the most useful and easiest way to identify true ECN Forex brokers.

Additionally, you can also read online reviews, take a suggestion from your friends and if necessary consult with expert traders to find a true ECN broker.

How to Choose the Best ECN Forex Broker?

Although choosing an ECN broker is not that different choosing other brokers. Still, you can consider the following factors carefully:

Broker’s Location & Regulation: Since all brokers launch their trades online, the location might not be a considerable factor. However, unofficially almost all brokers try to give extra focus on their local clients. Furthermore, for local people, there is always native language support. That’s why from this view location is a very good trait to consider. For regulations, the things are same as other brokers. That means the more regulated a broker is, the more quality service it ensures.
Trading Spreads & Platform: As we know spreads are very small for ECN brokers, we must confirm it before signing up to the brokers because scammers took higher spreads. And for trading platform check for Meta Trader 4, C Traders, Web Traders and other common platforms to analyze and execute your regular trading.
Trading Style & Trading Instruments: As we already said, ECN brokers are not suitable for wide range of instruments, so before starting your trading profile, check whether your broker has your desired instruments or not.
Deposit amount & Payment Method: Like regulations and locations, the payment methods are also common for ECN brokers. That means you should look for common options like Paypal, Neteller, Payza, Visa card, and other common payment processors. And the deposit amount varies from broker to broker. So, research for the most optimum deposit amount for you.

FAQ: Frequently-Asked Questions

Is an ECN Forex broker the best choice for you?

Since the world is getting automated, it’s high time to choose an ECN broker. Right now, traditional brokers are even entering into ECN network.

ECNs versus the Market Makers?

Since ECN finds your liquidity provider electronically, the chance of manipulation is lower than Market Makers. On the other hand, if you deal with a wide range of instruments, then Market Makers can give you better performance than a regular ECN broker.

Are there any Disadvantages of the Electronic Communications Network?

If you don’t have a sound amount for minimum deposit or you are not willing to launch larger trade sizes, then you’ll face difficulties with ECN brokers. Besides, for the wide range of trading instruments, ECN brokers are not recommended.

ECN Forex Brokers 2024 List

Broker

Country

Min. Deposit

Regulators

Leverage

Action

Dukascopy

Switzerland

100 USD

FINMA

1:300