If anyone interested very educational article about this topic was written at Finance magnates
Maybe the most interesting part:
Maybe the most interesting part:
QuoteDislikedSTP Broker is a type of a Market Making broker. This broker, most of the time, displays its own quotes (which are correlated to the actual inter-banking quotes).
Now here is the real complexity: sometimes this broker routes your orders to the market (acts as an STP broker) but sometimes it doesnt (acts as a Market Maker)...
... Its very hard to distinguish between MM and STP and most of the time the brokers use a hybrid model anyway. As I mentioned in the first part: most of US and UK regulated brokers will not trade against you in the way that will make you lose money, not because they are moral but because this might cause problems with their license.