FXGT: Differences between ECN and STP Advantages and disadvantages Comparing and explaining the characteristics and types of account types

FXGT

All FXGT trading account types include ECN and STP, and we will compare the characteristics and explain the types in this article. Other accounts will be of STP type. But what exactly is ECN? Many people probably have this question. This article explains the differences and characteristics between STP accounts and ECN accounts.

How FX broker order system works

There are FX brokers all over the world, but their ordering methods are summarized into the following four types. You will need to check which method is used for each broker and account type. FXGT has account types such as mini, crypto max, standard, PRO, and ECN, but except for ECN, it is STP method. There are many financial products such as currency pairs, virtual currencies, precious metals, energy, stocks, stock indexes, and you can trade under favorable conditions with maximum leverage of 1000 times.

DD method

The DD method is a trading method in which the FX company intervenes between the trader and the interbank. The FX company decides whether to pass the order through the interbank. Therefore, there are restrictions from a trader’s perspective as the Forex company will intervene.

NDD method

The NDD method is a trading method in which the FX company does not intervene between the trader and the interbank. In other words, you can think of it as the opposite of the DD method. Since customer orders are settled directly interbank, it is much more transparent than the DD method.

STP method

STP is one of the NDD methods. Detailed benefits are explained below. The mechanism is that the FX broker intervenes, adding a spread to the rate and presenting it to the trader.

ECN method

STP is one of the NDD methods. Detailed benefits are explained below. Trader’s orders do not go through any brokers, but instead go to the interbank where orders from investors and major financial institutions are collected.

What is an ECN account?

ECN stands for “Electronic Communications Network”. An ECN account is an ordering method that allows you to trade directly without any broker intervention. In the ECN method, investors can trade directly with each other, so it boasts high contract power. Individual investors are prohibited from directly accessing interbanks where orders from investors and major financial institutions are gathered. However, with the ECN method, FX trading is possible under the same conditions as trading directly with an interbank.

high transparency

ECN trading is a highly transparent trading method. This allows FX trading under the same conditions as trading directly with an interbank, so there is no risk of intervention by a third party.

narrow spreads

A contract is executed when the price at which traders want to buy and the price at which they want to sell match, so there is a tendency for spreads to occur less often. As a result, spreads tend to be narrower than STP, and fees are incurred instead.

Board information

ECN is so transparent that you can see the depth of market information. You can see the market movement well because you can monitor the flow such as the number of orders.

What is an STP account?

STP is an abbreviation for “Straight Through Processing”. The mechanism is intervened by the FX broker, and the spread is added to the rate and presented to the trader. In other words, it lacks transparency because it is the opposite style of ECN.

high leverage

In the case of the STP method, traders’ high leverage trading can also be covered. Therefore, you can trade with ridiculously high leverage. The reason for this is that STP trading is applied.

low transparency

Less transparent than ECN. This is intervening in the case of STP, so traders don’t know what’s going on. , STP trades are executed at the rate presented by the covered party, so the transparency is inevitably lower than ECN.

wide spread

The biggest disadvantage of STP is the wide spread. The STP method only sends the rate of the covered destination to the trader, but this action also costs money. STP is not suitable at all for scalping trades.

Comparison of STP and ECN

So what happens when you compare the two with the above points in mind? It will look like this:

STPECN
Spreadwidenarrow
transaction feeNoYes
contract powerusuallyHigh
Board informationNot seecan see
Indicative priceNot seecan see
Transaction transparencyhighhigh
refusal of contractNoneNone

scalping trade

STP is quite unsuitable for scalping trades that aim for a momentary price range. This is because the spread is extremely wide. If it is not ECN, please think that you cannot compete in scalping trades.

leverage

If you want to trade with high leverage, it will definitely be the STP method. The reason is explained above. In most cases, ECN has lower leverage than STP.

transaction fee

Transaction fees will occur if you have an ECN account. In an ECN account, the spread is the price difference between the trader’s and the interbank’s order. Therefore, ECN accounts do not add the broker’s share to the spread.

Bonus

ECN accounts often do not receive bonuses. Both account opening bonuses and deposit bonuses are available for STP accounts, but neither are available for ECN accounts.

refusal of contract

Execution refusal tends not to occur even with STP, but ECN accounts are structured so that execution speed is fast and there is no refusal of execution. The reason for this is that electronic trading directly and automatically places the orders of the seller and the buyer.

Board information

In STP format, you cannot see any depth information. You can see the board information on the ECN account. Therefore, the amount of information on ECN accounts is overwhelming. Being able to trade while looking at the price and order volume will lead to profits. ECN accounts can sense real-time trading flow.

You can open an account for free

You can open an account for free. You can trade with the smallest spread. There is a swap, but since the leverage is high, it is a company that can aim for large profits from the smallest amount of capital. You can hold many positions, and zero cut and loss cut are also adopted, so you can rest assured even if there is a loss. We have accounts ranging from advanced professionals to beginners.

There are so many brands

There are a wide variety of investment products available. Unusual investments are possible with markets such as basic, NFT, Defi tokens, gti, and synthetic pairs. There is leverage of 500x to 1000x, so you can add profits with a small margin. Trading costs are also low, with margin calls set at around 50% and stop-loss cuts set at 20%. You can invest in multiple stocks. There are demo and real accounts, and the operating company also holds promotions such as luxurious limited-time campaigns and bonuses.

Rich base currency

The base currency is very rich. It supports not only USD, JPY, and EUR, but also virtual currencies. Cryptocurrencies such as BTC, XRP, USDT, ETH, and ADA are also supported. The platform also supports MT4 and MT5. Please also check the official website. There are many stocks offered, and you can invest from a small amount. We also provide financial support, so you can trade advantageously. Assets will increase with the lowest capital and higher lots.

Zero cut is adopted

Since zero cut is adopted, the company will compensate even if the balance becomes negative. Seychelles is also licensed by the Financial Services Agency, so you can feel safe. There are many different types of accounts, and even first-time users can grow their account from just one small amount. There is also a high degree of freedom as automatic trading (EA) tools, scalping, and even double trading are OK. You can use it properly and conduct safe transactions according to your purpose.

More financial services than other companies

We offer better financial services for our accounts than other companies (XM, BigBoss, ThreeTrader, Exness, etc.). In addition to gold, metals, Bitcoin, and Ethereum, we also have synthetics, which are attracting attention, so we provide services tailored to your needs. Although the pips range is a little large, the account specifications are good and you can invest in major to minor stocks such as the US dollar and euro.

Dynamic leverage adopted

Dynamic leverage is used in the operation. The maximum leverage is 1000x, but it varies depending on the account, pair, size, currency unit, and funds. Please also check the terms of use from my page. You can order your own different currencies from your account. We have a wide range of accounts available for everything from live shows to demos.

コメント

Copied title and URL