It really depends on your trading style and what you're looking for. ECN accounts typically offer tighter spreads, but the commissions can add up. STP accounts might have slightly wider spreads but no commission. As for risk, it’s more about your strategy and risk management than the account type. It’s worth considering both and seeing which aligns best with your approach.
I like tighter spreads on ECN accounts. ECN accounts are the best choice right now if you are an intraday trader and make frequent trades.
True, ECNs are great for tight spreads, but commissions add up. STP can be better for fewer trades. Depends on your style!
Since there is no centralized market all is OTC, even if you are using so called ECN/ STP where do the order go? The counter party risk is still there,also many brokers say they are Mixed model? so you never know if there is conflict of interest where as with Futures on major exchanges the broker is just that a facilitator not a market maker , all orders are visible and can be questioned, same bid ask spread applies to every trader..
ECN (Electronic Communication Network) and STP (Straight Through Processing) are two forex broker execution models that differ mainly in trade routing and pricing. ECN brokers, like LMFX, connect traders directly to a pool of liquidity providers, offering raw spreads and charging a separate commission—ideal for scalpers and experienced traders who value transparency and market depth. On the other hand, STP brokers like HFM (HotForex)route orders directly to external liquidity providers without intervention, typically offering slightly wider, all-inclusive spreads with no additional commission, making them more beginner-friendly and easier to manage for most retail traders.
So is LMFX a true exchange like CME/ NYSE / SGX etc? the entire concept of ECN is just like a centralized exchange? but where is it? who makes sure the counter party pays up? NO Bodsy
LMFX is not a true exchange like CME or NYSE, but it's a forex broker that offers ECN-style trading, which means you can get access to real market prices and fast execution without dealing desk interference.
What is "v" when there is no central clearing? is it few liquidity providers getting together in a region? say one in LATAm one in Eu etc and who makes sure counter party pays up!
Oh I see, thanks for the useful insight. Actually if it requires for my broker (currently Exness, HFM) to act as a market-maker to ensure tight spreads I don't mind as long as they pay profit from my scalping strategy
A market maker model means for you to win they have to loose.. ( unless they can match it internally) long term they are not going to like it