Forex is a highly profitable market, and it is attracting people every day who are keen to spend their hard gained money and make it huge in a small span of time. Due to its high interest in the public, new Forex brokers are emerging in the market continuously.
> There are many numbers of Forex brokers in the trading world so picking the right one is certainly crucial to begin your trading route.
> The name ecn account is an acronym for Electronic Communications Network Account.
> It gives a marketplace where people or organisations from various sectors of the world gather to compete for bid and offer against each other thus giving little spreads for traders.
> It is always prudent to choose an ECN broker because they will never trade upon you like Market Makers.
> Their primary source of income is by “commission”, so they certainly don’t bother if your trades gain or lose.
However, many brokers claim to be an ECN broker to grasp clients when they are really not. This is a grave cause for concern, and we all must start proper steps in recognizing them. This would not just help to abolish scam brokers but will also increase your rate of return in the lengthy run.
We’ve come across some terms that we would want to share with you:-
A) True ECN
B) ECN by Association
C) Outright Bucketshop.
> Forex Brokers and traders frequently use these, but if you understand the true meaning, your life would become a lot simpler.
> True ecn account forex brokers give a transparent platform where merchants, banks, organisations can bid against each other by transmitting bids and proposals. Traders get the greatest deal for their orders at that defined time.
> ECN by Association serves as a Level 2 agents that create a bridge between traders and existing marketplace or True ECN brokers. These kinds of agents have their personal in-house platform and can manage your jobs if they need.
> Outright Bucketshop merely is thieves, scams who are over there to withdraw your money.
– Maximum traders usually new and trustful ones never saw the agent agreement that generally shows you if the agent is a True ECN or ECN by association. All organized ECN brokers will declare that as it is compulsory for them to reveal such data to their customers.
– True ECN agents will have changeable spreads. In a case, if any ECN broker guarantees to give a fixed spread, then it’s not a True ECN agent.
– Certainly, NO dealing Dealing Desk if it’s an ECN agent. Normally, Market Makers have Dealing Desk indicating they will exchange against you. Tips: In order to discover out if it’s a dealing Desk agent open a demo account and a little real account. You will notice the pip opposition and how much the rate alters during the news.
– No restraint in setting the range of Stop Loss or Take Profit. If a merchant doesn’t support Scalpers or Day traders take your best what would that agent be? Yes, you’re correct. That’s not an ecn trading account broker.
– Monitor forex brokers chart and your progression chart. Do you notice any inconsistency any BID value? If there is no variation then bingo you’re beside an ECN broker.
– If your Broker is providing you only negative slippages, then it’s not a Real ECN broker. Slippage is a usual experience, and that’s much common in a True ECN market. Slippage can be both accurate as well as negative.
– A True ECN broker always enables traders to put any number of trades. You can definitely believe us on this one. Tips: If you actually need to discover out if it’s a True ECN agent, place a trade more significant than 5 regular lots. If the order gets declined, then it’s not a True ECN agent.
– Usually, True ECN brokers won’t guarantee you big presentations and discount while starting an account. Like we stated before they would create earnings through commission regardless of your success or lose your positions.
– True ECN brokers will represent each pricing updates each minute as the costs are getting live from the business. Tips: Inspect the Platform, and best would be to associate it with a demo program as well.
All these tests can be made by anyone to notice a true ECN broker and a Fake ECN broker.