What is Difference Between STP and DD Account in Forex?

STP Account vs DD Account - STP Forex Trading Account vs DD Trading Account

STP Accounts

STP Account stands for Straight Through Processing, the STP Account forex brokers will send client orders direct to their Forex Liquidity Provider, the Liquidity Provider is a large bank with deep liquidity to trade on the inter-bank network.

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

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

STP Accounts will not charge commissions, but will charge spread on forex trades. Because traders have access to the interbank market execution, there is no requotes on FX orders neither any order waiting for execution, the trading order execution is instant.

DD Accounts

DD stands for dealing-desk, these DD account forex brokers have a dealing desk model where they can match orders & execute forex order in the online interbank exchange market.

The forex trader trading with a DD account will get a lot of requotes.

Dealing Desks will issue forex traders with a lot of order requotes, meaning prices of orders are not realtime & broker can requote a forex trader's order if the price of the market changes quick enough before the broker's dealing desk places the order online or before they match the trade order in online inter-bank forex trading market.

Dealing Desk accounts therefore means that order execution of forex orders is not instant & therefore this execution model might mean that orders executed using a DD Account are not executed as quickly as when compared to an ECN account or an STP trading account.