What is Difference Between Electronic Communication Network and Straight Through Processing Account in CFD?

ECN CFD Account vs CFD Account

ECN CFDs Accounts

ECN CFDs Account stands for Electronic Communication Network, these ECN CFDs Account cfd brokers are connected to the interbank network directly through an electronic communication network & the cfd orders from the ECN CFDs Account are placed straight to the electronic net-work.

The ECN CFDs Account will display different orders from different banks. The cfd quote placed by these ECNs network of banks are direct from them to the interbank net-work and orders are executed direct to the interbank markets once a trader trading with this ECN account places an order with their cfd trading broker.

These ECNs account will charge commissions + spreads for every cfd trade. For these ECN CFDs Account execution technique every trade is matched to another in real time over the interbank network - ECN Network.

STP CFDs Accounts

STP CFDs Account stands for STP, the STP CFDs Account cfd brokers will send client orders direct to their CFD Liquidity Provider, the CFD Liquidity Provider is a large bank with deep liquidity to trade on the inter-bank net-work.

An STP CFDs Account provided by an STP cfd broker can either have one CFD Liquidity Provider or many liquidity providers.

The best thing about STP CFDs Accounts is that cfds traders can place their cfds trades immediately with instant execution because they have access to the inter bank markets via their STP cfd trading broker.

STP CFDs Accounts will not charge commissions, but will charge spreads on cfds trades. Because traders have access to the inter-bank markets execution, there is no re quotes on the cfd orders neither any order waiting for execution, order execution is instant.