Interactive Brokers maybe but I'm skeptical : they allow small order size, not very good proof of real interban
In general, brokers have A-book and B-book. Depends on your trading size you will handle on A-book or B-book. As a professionnal trader, IB will give you the interbank fx market.
{quote} In general, brokers have A-book and B-book. Depends on your trading size you will handle on A-book or B-book. As a professionnal trader, IB will give you the interbank fx market.
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Booking is used by Market Makers. IB pretends they have an ECN trading environnement. That's means all particpants have access to the same quote feed and liquidity.
In a ECN, there's no broker, only an agency which match orders between participants.
There's two models :
- either : STP/DMA : the broker STP orders to the interbank market, minimum trade size : 100k of the based currency (IG Matkets)
- or : ECN/STP : the agency match electronically orders, minimum trade size : USD 100K. It depends on ECN. But a good ECN with good liquidity providers can't go lower than USD 100k.
A lot of brokers try to say they are ECN or STP and offers mini lots. Doesn't make sense.... Generally they outsource market making... but doesn't change anything for clients with direct market maker. I think it is even worse : these brokers are less transparent than true market makers because you don't know who is the true market maker.
For instance FXCM wants to be a true STP/DMA but they take the overside of client trades... It is written in their trading agreements....
Banks don't accept micro lots....
That's why LMAX for its business has three differents liquidity pools : interbank, institutionnal and "professionnal" (retail one). Results are not good...
IB has institutionnal liquidity pools, how can they accept small orders. Moreover, how do you do to match orders when you can take 11000, 12000 etc. No more structure.... In real Interbank , you deal with 1 contract, (100k of the base currency). Exchange are much easier... IB lost 120M during CHF event, if they are an agency as they should be in an ecn, how can they loose money ? Did Currenex or Hotspotfx loose money ?
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The best would be citifx. This is a retail version of their prime broker offereing. As they are a bank prime of prime they would have to be the safest for sure.
Booking is used by Market Makers. IB pretends they have an ECN trading environnement. That's means all particpants have access to the same quote feed and liquidity.
In a ECN, there's no broker, only an agency which match orders between participants.
There's two models :
- either : STP/DMA : the broker STP orders to the interbank market, minimum trade size : 100k of the based currency (IG Matkets)
- or : ECN/STP : the agency match electronically orders, minimum trade size : USD 100K. It depends on ECN. But a good ECN with good liquidity providers...
What I was trying to say is that a broker may offer the both A-book and B-book. He can offers an STP or a market-making solution related to the client.
For example, if your volume per month is important you may be an Active Trader at FXCM and therefore have an access to the market depht of the FXCM liquidity's pool.
If you trade with 1 mini-lot only you'll be putted into the B-book.
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B has institutionnal liquidity pools, how can they accept small orders. Moreover, how do you do to match orders when you can take 11000, 12000 etc. No more structure....
Because they offer the both solutions like a lot of brokers.
Another example with CFDs. CFDs are only provided by the broker. There is no interbank or centralized market. When an STP/ECN/NDD/blabla broker provides CFDs, this same broker has to be the counter-part. For example, Duka offers CFD.
The best would be citifx. This is a retail version of their prime broker offereing. As they are a bank prime of prime they would have to be the safest for sure.
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You obviously have no idea wtf you're talking about
Prime broker is not an execution venue if you dont use them as LP and come on CitiFX is no where near the prices you get at Velocity, it's a huge markup.
This what fake ECN want you to know... Genuine ECN is not a broker and so on can't be a MM. The aim of an ECN is to erase the middle man. They have a liquidity pool you can access to and match orders between buyers and sellers.
Dukas is the new generation of MM, nothing more. Too small ordrers you offer as a liquity provider are not sent in price feed.
if you're looking for prime broker go EBS first, they're literally THE liquidity and you won't find anything more serious than that, you can trade pretty much anything money can buy, the thing is they just don't open an account for anyone and they'll most likely ask for a few millions to open one.
the seconds would be fixi (dunno what name their using anymore lol), serious business too, last time i checked they had a minimum of 1 million to open an account.
the third would've been Marex Spectron, same as EBS, they just don't take anyone but the minimum account is 500K, they don't seem to offer Forex anymore.
then you have Baxter-fx and Vcap-fx, they offer access to many platforms/LPs, minimum was 50K for both last time i checked
{quote} The seconds would fixi (dunno what name their using anymore lol), serious business too, last time i checked they had a minimum of 1 million to open an account.
{quote} the third would've been Marex Spectron, same as EBS, they just don't take anyone but the minimum account is 500K, they don't seem to offer Forex anymore.
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No more FX.
What about IG Markets ? Their DMA seems good. I'm going to try them.
{quote} They require 100k {quote} No more FX. What about IG Markets ? Their DMA seems good. I'm going to try them.
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I agree IG DMA might be a good option. Also they have been around for 40 years and are one of the largest forex brokers in the world by volume according to Forex magnets.
<p>Citifx isn't what it seems to be... They offer Saxo bank white label... I've heard customers having troubles with their withdrawals. {quote} This what fake ECN want you to know... Genuine ECN is not a broker and so on can't be a MM. The aim of an ECN is to erase the middle man. They have a liquidity pool you can access to and match orders between buyers and sellers. Dukas is tne new generation of MM, nothing more. Too small ordrers you offer as a liquity provider are not sent in price feed.
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A Broker like Dukascopy couldn't be a fake ECN. I'm living in Geneva and I can tell you it's just impossible to get a regulation from FINMA by lying. If Dukascopy is known an ECN, it means that they are actually are.
SWFX is the Dukascopy liquidity's pool. You can even open an account in some banks and trade trough SWFX without opening a Duka's account. BUT on the other hand, it doesn't mean that Dukascopy can't be your conterpart on some products in some cases. I.e CFDs. A broker may provide an ECN solution to professionnal traders and dealing desk solution to others. And there is nothing wrong or illegal about that.
{quote} A Broker like Dukascopy couldn't be a fake ECN. I'm living in Geneva and I can tell you it's just impossible to get a regulation from FINMA by lying. If Dukascopy is known an ECN, it means that they are actually are. SWFX is the Dukascopy liquidity's pool. You can even open an account in some banks and trade trough SWFX without Everiopening a Duka's account. BUT on the other hand, it doesn't mean that Dukascopy can't be your conterpart on some products in some cases. I.e CFDs. A broker may provide an ECN solution to professionnal traders...
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About FINMA : FINMA doesn't care if you are an ECN or a MM to give the license. They got it because the value of their technology is CHF 20M.
Everything depends on what is an ECN. There's no official definition of an ECN...
Originally, the genuine ECN are Currenex and Hotspotfx :
- They are never the counterpart of their clients : they match orders, nothing more.
- They do not make price : participants inside ECN make it...
The question is : an ECN can it be the counterpart of their clients and make price ? Here is the conflict of interest.
Dukascopy says they erase the conflict of interest by providing the same liquidity and price feed to all participants. I'm not completly agree since they make price, they can manipulate prices... It is legal since Forex is over-the-counter market....
My question is : what is the difference between Dukascopy, FXCM and MM ?
- FXCM outsource MM.
- MM : they make price for their clients and they have the choice :
- either they send orders to interbank because the orders are too big : A book
- or they take the overside : B Book.
What's the difference between Dukascopy and MM ? They are more transparent : they offer the same quotes and liquidity for everybody, trades are executed STP, you can become a liquidity provider and you can access to market depth. MM hold their own marketplace like dukas...
I just want to say there's a difference between Curenex, Hotspot and Dukascopy... Currenex and Hotspot are pure ECN... It is all I say... Dukas is a mixed between MM and ECN.
About FINMA : FINMA doesn't care if you are an ECN or a MM to get the license. They got it because the value of their technology is CHF 20M.
Finma cares about truth too. If Dukascopy wasn't an ECN broker (or wasn't able to provide ECN solution) despite claiming it, it would be really problematic. Swissquote is a regulated broker and a market-maker. There is no problem because it said on their website.
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Originally, the genuine ECN are Currenex and Hotspotfx :
- They are never the counterpart of their clients : they match orders, nothing more.
- They do not make price : participants inside ECN make it...
They do not offer neither CFDs nor small account I guess. So they "could" only offer ECN solution.
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The question is : an ECN can it be the counterpart of their clients and make price ? Here is the conflict of interest.
The problem is you picture the ECN thing like sth exclusive. A broker may offer an ECN solution some of its clients and another one to others. For example, you're trading trough the ECN solution when you trade fx products at Duka. However, Duka is the counterpart when you trade a CFD. It's written on their website.
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Dukascopy says they erase the coflict of interest by providing the same liquidity and price feed to all participants. I'm not completly agree since they make price, they can manipulate prices... It is legal since Forex is over-the-counter market....
Don't forget that in ECN:
1) Traders (retail, institutional, banks) provide liquidity too. It means that in a very liquid environment, traders may trade directly with each other.
2) When liquidity isn't enough, the broker provide it and hedge its position by taking a trade on the interbank market. A sophisticated technology allows to hedge even HFT trades.
The conflict of interest is erased if the broker does its job well.
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I just want to say there's a difference between Curenex, Hotspot and Dukascopy... Currenex and Hotspot are pure ECN... It is all I say...
