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What advantages do ECNs offer?

Started by PocketOption, Jan 29, 2023, 03:03 pm

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What advantages do ECNs offer?

ECN Forex brokers are the most popular when it comes to online forex trading. Trading with ECN forex brokers requires a certain level of expertise if you are out to make substantial profits trading the markets. More and more forex traders tend to switch to an ECN forex broker over a period of time. Trading with an ECN Forex broker reduces the risks associated with price manipulation, an issue that is often faced by traders when trading with a Market Maker forex broker.

In this article, we highlight a few key factors about ECN Forex brokers.

Advantages of Trading with ECN Forex brokers

1. Trading Economic Releases

Most market maker types of forex dealers do not allow their forex clients to trade during key economic releases unlike when trading with an ECN Forex broker. Trading the news is mostly used by forex scalpers who have the expertise to be able to make quick profits due to the high volatility that currency pairs experience during economic news releases.

2. Client-To-Bank

An ECN Forex Broker would allow the client-to-bank trading on their ECN network. Traders can instantly trade with the price quotes that are streamed by leading FX banks to the ECN Forex broker is connected.

3. Client/Trader Anonymity

Most traders are anonymous when using the ECN forex broker and ensure that their client's trades and account identity remains anonymous so the trader cannot be traced back. This is one of the important factors why most traders prefer to trade with ECN forex brokers.

4. Be your own Market Maker

Trading with ECN Forex Brokers gives traders the advantage to be their own market maker. ECN Forex Traders can either make their own markets or just act as market makers. ECN Forex brokers allow their traders to place orders between the bids and ask spread.

5. Price Volatility

ECN forex prices are never fixed. Therefore, traders can experience several large price fluctuations within a short span of time, which can be clearly noticed during peak trading hours. At such times, ECN forex traders can potentially make huge profits within a short time. ECN Forex brokers are scalper friendly.

6. Better Trade Execution

The ECN Forex model makes for the most advanced trade execution. When using an ECN forex broker, the traders are not trading directly with the forex broker but only using their ECN network. The ECN matches all the orders while the opposite side is held by a different market participant such as a liquidity provider.


There are many more advantages of trading with ECN Forex brokers. Of the many factors that stand out is that when trading with an ECN forex broker, the spreads are not fixed. As a result, traders aren't tied during highly active trading periods. Every currency pair continuously displays varying spreads that are dependent on the actual volume being traded and the available liquidity that effectively supports the trade.

ECN Forex Broker model makes for the most preferred way for traders to trade the forex markets. Traders who want to be successful in Forex trading should ideally choose an ECN Forex broker due to the great connectivity features and access to various liquidity pools. Besides the free interaction between clients' orders, ECN Forex brokers offer a wealth of features developed to make the process of trading forex, simple.

The best aspect of dealing with an ECN Forex Broker is that traders can start with a small capital.

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