The best ECN Brokers
The following is a list of the best ECN brokers today. For each of these companies, its main characteristics are indicated and a link is included where the trader can consult a complete review of the broker in which he is interested. Most of the brokers in this directory are regulated companies and are located in countries with strong financial legislation.
| Broker | Regulation | Trading Instruments | Trading conditions | Minimum Deposit | Broker Review |
|---|---|---|---|---|---|
FPMarkets | ASIC | -Forex -Commodities -CFD -Stocks | Spreads: From 0.0 pips Leverage: 1:500 | $200 | Review |
Axi | ASIC and FCA | -Forex -Commodities -CFD | Spreads: From 0.0 pips Leverage: 1:500 | $10 | Review |
RoboForex | CySEC | -Forex -Commodities -CFD | Spreads: From 0.5 pips Leverage: 1:1000 | $10 | Review |
ICMarkets | ASIC | -Forex -Commodities -CFD | Spreads: From 0.1 pips Leverage: 1:500 | $200 | Review |
Tickmill | FCA | -Forex -Commodities -CFD | Spreads: From 0.5 pips Leverage: 1:500 | $25 | Review |
Admiral Markets | FCA, CySEC and ASIC | -Forex -Commodities -CFD -Stocks | Spreads: From 0.0 pips Leverage: 1:500 | $1 | Review |
ThinkMarkets | ASIC and FCA | -Forex -Commodities -CFD | Spreads: From 0.5 pips Leverage: 1:500 | $200 | Review |
Alpari | - | -Forex -Commodities -CFD | Spreads: From 0.0 pips Leverage: 1:1000 | $10 | Review |
Pepperstone | ASIC | -Forex -Commodities -CFD | Spreads: From 0.1 pips Leverage: 1:500 | $200 | Review |
Valutrades | FCA | -Forex -Commodities -CFD | Spreads: From 0.0 pips Leverage: 1:500 | $50 | Review |
FXCC | CySEC | -Forex -Commodities -CFD | Spreads: From 0.5 pips Leverage: 1:500 | $100 | Review |
ForexTime | CySEC IFSC | -Forex -Commodities -CFD | Spreads: From 0.1 pips Leverage: 1:1000 | $5 | Review |
FXPrimus | CySEC | -Forex -Commodities -CFD | Spreads: From 0.5 pips Leverage: 1:500 | $200 | Review |
HotForex | CySEC | -Forex -Commodities -CFD | Spreads: From 0.2 pips Leverage: 1:1000 | $5 | Review |
FXOpen | FCA ASIC | -Forex -Commodities -CFD | Spreads: From 0.5 pips Leverage: 1:500 | $1 | Review |
FBS | CySEC IFSC | -Forex -Commodities -CFD | Spreads: From 0.5 pips Leverage: 1:1000 | $1 | Review |
Forex4you | - | -Forex -Commodities -CFD | Spreads: From 0.5 pips Leverage: 1:500 | $10 | Review |
What are ECN Brokers?
ECN (Electronic Communication Network) brokers are those that act only as intermediaries for the transactions of their clients in the Forex market or other types of financial assets. They do not have to carry out trades on their own behalf, nor act as counterparts through their own trading desk. This type of broker, called ECN, is integrated directly and electronically with multiple liquidity providers and market participants (such as banks, financial institutions, Market Makers, other brokers, other customers of the same broker, etc.); thus creating a trading network and managing to offer its customers the best buy and sale prices (bid and ask quotes) to trade in the market at all times. The buy/sale orders that are placed through an ECN Broker reach the market, so that the broker does not assume the opposite position as in the case of the market maker brokers.
ECN brokers dynamically show their clients the best Bid and Ask price for each currency pair or financial instrument, just as they receive these price quotes from their liquidity providers. In this way, they get the best prices, among several providers, so that the trader can invest with low spreads. However, these companies usually charge a commission for their services depending on the volume of the transactions performed by their clients. Even so, in most cases, the sum of the spreads plus the ECN Broker commissions is usually less than the amount that must be paid with other types of brokers that directly offer higher spreads (although they do not charge another type of commission).
ECN brokers belong to the group of NDD brokers (an acronym for Non-Dealing Desk) which refers to those who only act as intermediaries and not as a counterpart to the transactions of their own customers. The ECN broker looks for another participant that acts as a counterpart for the transactions of its customers, in this way the buy and sale orders are matched. If, for example, a customer requests to buy a currency pair, the ECN Broker looks for the seller that offers the best price and if the customer requests a sale trade, the broker looks for a buyer to complete the transaction. By acting in this way there is no conflict of interest between the broker and his clients. The broker transmits the buy and sale orders to the market and charges a commission for its services, regardless of whether the transactions end as winners or losers for the trader.
In the opposite case, we have the brokers with a dealing desk (DD brokers), as, for example, in the case of the Market Makers: the broker acts as a counterpart for the transactions of its customers, therefore In certain cases, conflicts of interest may occur. That is, the broker can benefit from customer losses and this is because it is the broker itself who assumes the sale side when the customer buys or vice versa. Occasionally, this way of trading may result in policies for order execution that are not transparent or the prohibition of certain trading techniques, which could be beneficial for the trader (such as scalping, hedging, etc.). To avoid problems, you should always open a trading account with a duly regulated broker who has an internal procedure for the resolution of conflicts of interest.
The more transactions the trader performs, the more profits the ECN brokers obtain, so they do not put any inconvenience when allowing certain types of trades: any trading strategy is allowed. There are no prohibitions against scalping, hedging, or any other strategy. ECN Brokers today represent the best option for many professional investors, especially those who do day trading. These brokers are usually regulated by an official body, although, in this regard, the trader must verify that the supervisory body is prestigious (for example, the Financial Conduct Authority of the UK).
After having tested and analyzed numerous online brokers, in the previous table you can find, in our opinion, the best ECN brokers.