ECN broker with many currencies to trade?

Discussion in 'Forex Brokers' started by dream1975, Jun 14, 2012.

  1. Cash exchanges would have a much higher transaction cost in terms of spread.

    Even if you found a exchange company who will fill your order of the exotic, they have higher overhead since they have to take delivery of notes and pay a clerk and rent to run a storefront. In most cases, the average spread is ~1.5-3% padded onto the interbank quote at these places for liquid currencies (Euro, AUD, etc..) let alone exotics which can be more.

    If you find a broker that trades in your desired exotic, you'll likely only pay a fraction of the cost to do the exchange, but you might have to pay a cost of carry on the position (even if it's low leverage).... this, of course, could work for you if there's a positive interest differential on your position (which you wouldn't see holding the physical cash.)

    So there's a bit of a trade off. The right choice comes down to exactly what currency pair you want to trade, the leverage amount, how much you expect it to move (making the wide spread not matter as much) and how important it is that you can buy/sell it at a moments notice.
     
    #11     Jun 15, 2012
  2. Davidee2

    Davidee2

    ECN brokers simply charge a small commission for providing a true market place where everyone competes on an equal basis, there is no mark-up on the spread and you just see the actual markets 'true' bid/ask price at any given time.

    Now while this means that you might get spreads as low as 0.1 pips on pairs like the EUR/USD it also means that you will get huge spreads on currency pairs like Turkish Lira vs Venezuelan Bolivar were any ECN broker to actually offer it as ECN spreads are down to liquidity.

    Deltastock and DF Markets offer true ECN to retail clients on 77 currency pairs and that is probably about as good as it gets. Dukascopy Europe are also a great ECN but I think they only allow Forex plus gold and sliver, no CFDs or anything like that with Dukascopy Europe as far as I am aware. Here is an article on ECN brokers that will hopefully be of so help to you.
     
    #12     Jun 24, 2012
  3. Davidee2

    Davidee2

    Problem you've got with an ECN is that the spreads are variable as ECN brokers provide a true market place and the bid/ask prices are whatever people are offering at the time. This is great with a large liquid market like the EUR/USD where spreads can fall as low as 0.1 pips during times of high liquidity, but on an pair involving the Turkish Lira or the Romanian Lei or such like the spread will be massive.


    Good luck!
     
    #13     Aug 12, 2012
  4. adel16

    adel16

    if you are looking for a decent broker to satisfy your requirements and preferences you should consider opening an account with hotforex they are the broker I can trust from so long time ! you can try them via demo so you will have a better idea !
    good luck
     
    #14     Oct 3, 2012