What is Difference Between Electronic Communication Network and Dealing Desk Account in Commodity Trading?

ECN Commodities Trading Account vs DD Commodities Trading Account

ECN Commodities Trading Accounts

ECN Commodities Trading Account stands for Electronic Communication Net-work, these ECN Commodities Trading Account commodity brokers are connected to the interbank network directly through an electronic communication network & the commodity orders from the ECN Commodities Account are placed straight to the electronic network.

The ECN Commodities Trading Account will display different orders from different banks. Commodity trading quote placed by these ECNs network of banks are direct from the to the inter bank network & orders are executed directly to the inter bank market once a trader trading with this ECN account places an order with their commodities trading broker.

These ECNs trading account will charge commissions + spreads for every commodity trade. For these ECN Commodities Account execution technique every trade is matched to another in realtime over the inter bank network - ECN Network.

DD Commodities Trading Accounts

DD stands for dealing desk, these DD account commodity brokers have a dealing desk execution model where they can match orders & execute commodity trading order in the online commodity market.

The commodity trader trading with a DD account will get a lot of re-quotes.

Dealing Desks will issue commodity traders with a lot of order re quotes, meaning commodity prices of orders are not real-time and the broker can requote a commodity trader's order if the commodity price of the commodities trading market changes quick enough before the broker's dealing desk places the trading order online or before they match the order in the online commodity market.

Dealing Desk accounts therefore means that order execution of commodity orders is not instant & therefore this execution model may mean that orders executed using a DD Commodities Trading Account aren't executed as quickly as when compared to an ECN trading account or an STP account.