ECN, STP, NDD, DD and Market Maker

ECN, STP, NDD, DD, Market Makers

The list below shows the different categories of brokers classified depending on their execution technique.

ECN

ECN Account is synonymous for Electronic Communication Network, these ECN Account brokers are connected to the interbank network directly through an electronic communication network and the orders from the ECN Account are placed straight to the electronic network. The ECN Account will illustrate different orders from different banks. The xauusd quote placed by these ECNs net-work of banks are direct from them to the interbank network and orders are executed directly to the inter bank markets once a trader trading with this ECN account opens a trade order with their broker,

The ECNs account will charge commissions + spreads for every trade. For these ECN Account execution method every trade is matched to another in real time over the inter bank network - ECN Network.

STP

STP Account is synonymous for STP, the STP Account brokers will send the trader orders direct to their Trade Liquidity Provider, the Trading Liquidity Provider is a large bank with deep liquidity that's required to trade on the inter-bank network.

An STP Account provided by an STP broker can either have one Gold Liquidity Provider or a number of liquidity providers.

The best thing about STP Accounts is that traders can open their gold trade transactions immediately with instant execution because they have access to inter bank markets via their STP broker.

STP Accounts won't charge commissions, but will charge spread on trades. Because traders have access to inter-bank market execution, there's no re-quotes on the orders neither any trade order waiting for execution, order execution is instant.

Difference between STP and ECN Execution

NDD

NDD stand for Non Dealing Desk xauusd execution of orders, these NDD Account brokers do not implement a dealing desk and this is what makes this type of order execution model to have less trading restrictions as opposed to Dealing Desk Order Execution Model.

NDD Order Execution means that trade transactions from the traders account will be executed directly to the online inter bank exchange market. Orders will be matched with other orders in inter-bank market using the broker NDD Non Dealing Desk order execution trade model.

DD

DD stands for dealing-desk, these DD account brokers have a dealing desk model where they can match orders and execute order in the online inter bank gold market.

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

Dealing Desks will issue traders with a lot of order re-quotes, meaning trading prices of orders aren't real-time & the broker can re-quote a trader's order if the price of the market changes quickly enough before broker's dealing-desk places the order online or before they match the order in online inter-bank gold market.

Dealing Desk accounts hence mean that order execution of orders isn't instant and hence this execution model may mean that orders executed using a DD Account aren't executed as quickly as when compared to an ECN account or an STP account.

Market Makers

Market Maker are broker accounts where MM brokers have a dealing desk model where they can match orders in house without going to the inter bank gold market.

XAUUSD orders also can be executed against their traders - meaning the broker can take the opposite side of a traders open trades. This broker can make decision to either open a order that's the opposite of a trader's order thus if the trader makes a loss the broker makes a profit, & if trader makes a profit the broker makes a loss.

Regulated Brokers

Regulated Brokers are those that operate under a financial regulatory authority, these companies will adhere to a strict code of ethics lest they lose their operating license, these are the genuine companies that are trusted by traders as they do not carry out unshady practices against their clients because they are audited by their regulators annually

Regulated + STP Execution is the best choice to trade with.

XAUUSD Brokers Type - Brokers Types - ECN, STP, NDD, DD, Market Makers - XAUUSD Liquidity Provider - XAUUSD Liquidity Providers