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ECN, STP, NDD, DD and Market Maker

ECN, STP, NDD, DD, Market Makers

Brokers fall into categories by execution style. Check the list below for types.

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 show different orders from different banks. The xauusd quote placed by these ECNs network of banks are direct from them to the inter-bank 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 have fees + price differences for each trade. For this ECN Account way of doing things, each trade request is matched to another one right away on the 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 Trade Liquidity Provider is a large bank with deep trading liquidity that's needed to trade in the inter-bank network market.

An STP Trading Account from an STP broker can have just one XAUUSD provider of money or many different money providers.

STP accounts let traders start gold deals right away. Execution happens fast. They link straight to bank markets via the broker.

STP Accounts don't charge extra fees, but they do add a bit to the price when you trade. Traders get direct access to the market, so trades don't get rejected or have to wait: they happen right away.

Difference between STP and ECN Execution

NDD

NDD means orders are done without a dealing desk for xauusd. These NDD brokers don't use a dealing desk, which means there are fewer rules for trading compared to using a Dealing Desk.

NDD Order Execution means that when traders make trades, those trades go directly to the real online market where banks exchange money. The broker matches orders with other orders in that market by using the NDD Non Dealing Desk order execution model.

DD

DD stands for dealing desk. These brokers match orders in-house for the online interbank gold market.

Traders using a DD account often face many re-quotes.

Dealing Desks, or DD, often provide traders with numerous order re-quotes, indicating that the trading prices of orders are not based on real-time data. If market prices fluctuate too rapidly, the broker may re-quote a trader's order before it is finalized or before it is matched in the online inter-bank gold market.

Dealing Desk accounts mean that orders aren't executed right away, and this execution style can mean that orders placed through a DD Account aren't filled as quickly as those placed through an ECN or STP account.

Market Makers

Market makers use in-house desks to match orders. They skip the interbank gold market.

XAUUSD trades can sometimes be executed contrary to the trader's position, meaning the brokerage might take the opposing side against the direction a xauusd trader has established. This broker has the discretion to place an order moving in opposition to the trader's chosen trend: consequently, if the trader incurs a deficit, the online broker accrues a gain, and conversely, a trader's profit results in a loss for the broker.

Regulated Online Brokers

Brokers that are Regulated operate under the oversight of a recognized financial regulatory body. These entities must adhere to a rigorous code of conduct, risking their operational licenses if they fail to comply. Such firms are deemed trustworthy by traders because they refrain from engaging in actions detrimental to their clientele, subject to mandatory annual audits by their regulators.

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

Types of XAUUSD Brokers: ECN, STP, NDD, DD, Market Makers - Insights on Liquidity Providers for XAUUSD trades.

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