The 3 Best ECN Forex Brokers
Finding the best ECN forex broker is relatively challenging because, unlike futures and stock exchanges, the forex market is largely unregulated. Some of the best ECN forex brokers offer multiple ECN trading plans, negotiated commissions, and robust trading capabilities. While some of these options may slightly differ from a pure ECN, each broker is non-dealing desk and is well regulated.
ECN forex brokers bring a level of transparency to the forex market because they pass on prices from multiple market participants, such as banks and market makers, as well as other traders connected to the ECN, and display the best bid/ask quotes on their trading platforms based on these prices. Electronic Communications Networks (ECN) hold a clear advantage over Dealing Desks, who often trade against their clients presenting a clear conflict of interest.
MB Trading, based in the U.S., provides two trading plans that utilize their Electronic Xrossing Network, MB’s version of an ECN. In one plan, MB pays you $0.50 per 100,000 traded for placing limit orders, which provide liquidity to the system. The other choice is to choose a more traditional approach by paying spread-based fees. In either case, MB provides both retail and institutional clients with the same level of transparency through their ECN. Whether the trade is $1 or $1 million, the trade gets routed to the market, or if it is a limit order, it is displayed for all counterparties to see, creating the best bid/ask spread available.
For professional traders, the best ECN forex broker may be Forex.com’s GTX network. With GTX Direct, eligible clients leverage GAIN Capital’s prime brokerage relationships with major FX banks. Trade on liquidity from a wide variety of market participants on a fully anonymous basis. Traders view price depth and access a range of order types including OCO, peg, and iceberg orders. GTX offers robust algorithmic trading capabilities that enable clients to develop and implement a wide range of trading strategies using GTX’s Java or FIX-based APIs.
FXCM is a non-dealing desk broker that combines spread compensation and commissions to lower transaction costs. The Active Trader platform helps you drive down cost. If you plan to trade a large notional amount per month, or if you maintain $25,000 in your account, you can save an average of 42% through this platform. If you are very active, commissions can actually be negotiated, which is a warm departure from standard practice among ECN forex brokers.