Different Types of Oil Brokers - Types of Crude Oil Trading Broker

Electronic Communication Network Broker, STP

Different Types of Oil Trading Brokers List - below is an explanation of the Different Types of Oil Trading Brokers.

ECN - Electronic Communication Network Broker - Types of Oil Trading Brokers

ECN Broker stands for Electronic Communication Network, these ECN oil brokers are connected to the inter-bank network directly through an electronic communication network & oil orders from the ECN Oil Trading Broker are placed straight to the electronic network. The ECN Broker will display different oil quotes from different liquidity providers. The quotes placed by these ECNs network of liquidity providers are direct from the interbank network and oil orders are executed directly in the interbank oil market - once a trader trading with an ECN broker places a oil order with their crude oil trading broker.

These ECN brokers will charge commissions + spreads for every oil trade transaction order. For these ECN Broker execution technique every oil trade is matched to another in real time over the interbank network - ECN Network.

STP - Straight Through Processing Broker - Types of Oil Trading Brokers

STP Broker stands for STP, the STP oil brokers will send client trading orders direct to their Oil Trading Liquidity Provider, the Oil Trading Liquidity Provider is a large bank with deep liquidity to trade on the inter-bank net-work.

An STP Broker can either have one oil liquidity provider or many liquidity providers.

The best thing about STP Oil Trading Brokers is that crude oil traders can place their crude oil trades immediately on the online oil market with instant execution because they have access to the interbank market through their STP oil trading broker.

STP Oil Trading Brokers will not charge commissions, but will charge spreads on crude oil trades. Because oil traders have access to the inter bank markets trading execution, there is no requotes on the oil orders neither is there any oil order waiting for execution, the order execution is instant.

NDD - Non Dealing Desk Broker - Types of Oil Trading Brokers

NDD stand for Non-Dealing Desk oil execution of orders, these NDD oil brokers do not implement a dealing desk and this makes this type of order execution to have less trading restrictions as opposed to the Dealing Desk Oil Trade Execution.

NDD Execution means that crude oil trades from the traders account will be executed directly to the online inter bank exchange crude oil trading market. The oil orders will be matched with other trading oil orders in the interbank exchange market using the broker Non Dealing Desk order execution model.

DD - Dealing Desk Broker - Types of Oil Trading Brokers

DD stands for dealing desk, these DD oil brokers have a dealing desk where they can match oil orders and execute oil orders in the online inter bank exchange market.

The oil trader trading with a DD broker will get a lot of requotes.

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

Dealing Desk oil brokers therefore means that order execution of oil orders isn't instant & therefore this oil execution model may mean that oil orders executed using a DD Broker aren't executed as quickly as when compared to an ECN broker or an STP broker.

Market Maker Broker - Types of Oil Trading Brokers

Market Maker are oil brokers which have a dealing-desk where they can match oil orders in house without going to the interbank exchange market.

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