Lets end this once and for all... looking for a true ECN

Hi guys. Im looking at moving funds from my current broker. Ideally, i am looking for a true ECN broker. This has turned into a harder decision than i had anticipated. It seems no matter which broker your research, there are undoubtedly unsatisfied customers for each and every one. There are no brokers which have 100% positive reviews. The problem is, when reading these reviews i cant help but feel that many of them are written by misinformed traders who just made bad trading decisions and felt some of the fault was the brokers. Its hard to sift through all this information without being totally confused and after days of searching for answers i kind of feel like flipping a coin and seeing what happens. I decided to start this thread in the hopes of getting some clarification from real forex traders who earn their living trading the markets. No offense to new traders, demo traders, micro lot traders or anyone else who "thinks" they know this business, but please refrain from giving your opinion. What this thread is designed to do is hear from real FX traders who make their living trading and have a thorough knowledge regarding the structure of forex brokers, ECN's, NDD's STP's etc. So far i am leaning towards dukascopy for a couple of reasons. ECN, ability to hedge and lets face it the swiss banking reputation is very high. The problem is, i was told that accounts under 50k are not true ECN at dukascopy (my account will be 10-20k), and they also have various problems with customer service and money withdrawals. MB trading has also popped up as well as FXDD with currenex and although oanda is essentially a bucketshop, i know several traders who make a living trading with them. So if anyone is out there and can offer some solid advice, it would be greatly appreciated but please remember, I would rather have 0 replies than 100 replies giving me bad info. Who is the best TRUE ECN broker? What were your experiences? What are the best options for a trader opening an account my size? And please guys, no guessing or opinions based on "what you have heard". I am already confused enough, so lets get to the bottom of this!

Hello Agame
Trying to understand

'Oanda is a bucket shop' >> what does bucketshop mean here ?

and what does ECN stands for ?

I also share the same problem in finding a reputable and trustworthy broker. Being screwed couple of times ...

Cheers

I am currently having the same problem. I have a similar funds and I am looking for the best place to put them. Oanda is a no go for me as they do widen stops to suit themselves and as I am a short term trader I am hoping to avoid this. You might be ok, as I recall you trade 4 hour chart set ups so 3 or 4 extra pips during your trade wont hurt too much. I have narrowed it down to MBT and currenex as the best I can find with MBT being the cheaper of the two.
There used to be Hotspotfx, which was a true ecn with low commision. You only needed 7k to open an account. It was awesome execution and no b.s. You could see your order come onto the book. They have gone strictly institutional now. Sorry I couldnt be more helpful

I am waiting a confirm from LCG if i can use HOTSPOTFX with them.......also i am doing a test with divisafx........

interactive brokers

Thanks for the replies guys. After reviewing the brokers suggested, i am still confused. Both have positive and negative reviews. Interactive brokers minimum lot size is 25k which rules them out for the time being as i occasionally scalp. LCG looks ok with 10k minimum lot size however currenex, hotspotfx etc all have mixed reviews and some real horror stories regarding slippage amongst other things. Im starting to get the feeling that although Oanda is a MM, their practices are not setup for you to lose like most bucket shops. I dont mind the ECN platforms having no charting but after reading extensively there is still no light at the end of the tunnel. Any one else care to chime in?

Hi A-game. I personally use Alpari UK. I know there is a thread in here at the moment telling a horror story about them on their classic account (market maker), but I will pass on my experience with them on their ECN side.

I initially opened an account on their currenex ECN platform with £40,000 to test them out. I trade intra-day making in the region of 10-20 trades per day. They allow you to trade as low as $10,000 units, and above that you can use exact dollar amounts. i.e you do not need to trade in multiples of $10,000 but could be specific such as $17,550 if you want, so you can adjust your trade size to exactly match a percentage of your equity if you want.

Their spreads are good, with EURUSD typically being around 0.4 - 0.9 pips, and more volatile pairs like GBPCHF or GBPJPY being typically between 2.5 - 3.2 pips. They do charge commission on top of this of course but this is negotiable depending on your traded volume per month. You should expect to pay a round turn commission initially equal to about 0.4 pips, but you can talk this down significantly when you get your volume up to a couple of hundred million dollars per month.

Execution at the amounts I trade has always been excellent. I do obviously get slippage which I expect as normal and would be wholly worried if I didn't. The slippage works equally for and against me so nothing suspicious. I occasionally get partial fills, but this is rare and again completely normal when trading in the real world. As for slippage, you can set a maximum amount you are willing to accept and if you can't get filled within that limit they will remove your order. This is a nice feature because it means your market orders (which is all I use) are not at risk of excessive slips, so I can still calculate fairly accurately my risk. In all honesty slippage very rarely exceeds a few tenths of a pip......but I do only trade at high volume/liquidity times of day.

The first time I withdrew money I had to jump through a couple of hoops like sending additional proof of my address and linked bank account, but I had my money within a day of them receiving my scanned documents. Every other withdrawal after that first one has been hassle free and easy. As soon as I was comfortable with them, I deposited over 6 figures in to my account which is the level I maintain my account at all time. Leverage is reduced with them once you have an account over £100,000, but still far more than you really need anyway so not a problem.

They assigned a dedicated account manager to me, so I now have the direct number to his desk on my phone and can call him whenever I like. Occasionally I've had problems such as my internet connection going down, and I've called my account manager, instantly got through to him, and he has managed my trades as per my instructions over the phone until my connection has come back up, so for me their customer service has been outstanding.

In all fairness the currenex platform is not the greatest when it comes to charting, but they are improving it all the time. In the time I've been with them, the charting package has been updated and improved repeatedly and it is now much better. The actual order side of the platform I think is excellent and very easy to use. The one click trading feature is perfect for my type of trading and I've got no complaints at all.

Over all I am very happy with them and am more than comfortable having a large sum of money deposited with them.

I went through the same problems you are facing when I was looking for an ECN style broker, so I hope this helps you in some way at least narrow down your search.

If you live in the US, forget dukascopy. They are no longer putting up with the US rules and are closing US accounts.

I, too, am still looking. Leaning towards MB.

let me know how you get on with the hotspot account/platform
excellent review, I hadnt even bothered looking at alpari as I pre judged them from there market maker side. I thought the minum account size is 30,000 GBP or equivalent

If I remember rightly from the time I joined them, the minimum account opening balance was $20,000, but this may have changed now so it will be worth looking at the site.

On their pro account they offer the currenex platform or MT4. On the MT4 platform they have minimum trade size of 3 lots ($300,000) which seems excessively high to me if you're using an account balance of just $20,000. The currenex platform which I use has a minimum trade size of only 0.1 lot ($10,000) so there is much more flexibility in managing risk. As I said earlier, with the currenex platform there is also the ability to trade exact amounts so that you can always trade a precise % of your available equity per trade, whereas with the MT4 platform I believe you can only trade is set increments which is more restrictive. I have no idea why there is such a discrepancy between the two platforms on essentially the same type of pro account.

just a note ....Divisafx has minimum open 2.500 $ and has currenex viking , currenex classic , Mt4 and MT4 via web....

Today i spoke to a friend of mine who made some interesting points. He was actually quite surprised when i mentioned i was looking at hotspotfx. The only time he ever used hotspotfx was when he worked for a hedge fund and was trading a $1,000,000 account. He told me that hotspotfx and currenex brokers on such small accounts (less than 50k) would probably not be my best option. Such accounts are designed for much larger traders and trading 10-20-30k positions would see me having problems getting filled. Essentially he said they are market makers at that level even though they appear to be ECN. I found the following thread at elitetrader.com which outlines the different types of ECN.


http://www.elitetrader.com/vb/showth...6&pagenumber=1

Tips for trading at ECN Currenex,Hotspotfxi based on my understanding

The problem to scalp on hotspotfxi is just liquidity.

The trouble on Currenex besides liquidity is the so said whitelabel .

Actually there are 2 tiers of FXPB ( FX prime broker ) with currenex:

tier 1 : big name leading banks who are on the list of currenex PB

Clients should have decent fund or credit line with them to handle the business directly with such big name.

PB will not take any position against clients but only charge commision per Round trading .



tier 2 : whitelabel partners shown on currenex.com

in this group there are 2 business models

a. pure tier 2 PB

which means there are just a sub-broker (agent ) to serve smaller clients who are not accepted by tier 1 PB
SO, same as tier 1 , will not take any position against clients but only charge commision per Round trading .

b. whitelabel model

being MARKET MAKER on the platform , they use currenex's platform(technology ) to create an inhouse market while the spreads might be same or differ with the one on currenex's main platform, SO the dealer could direct pass clients' order/position to currenex's main platform or keep them at the in house market as per this makret maker's discretion.
SO, scalping / arbitraging might hurt such group's benefit .

CONCLUSION

To enjoy scalping arbitraging , IMHO the best way is use Tier 1 or Tier 2 a .






The advice my friend gave me in the end was go with Oanda. He has made plenty of money with them and has never had any problems and he is also an introduction agent for dukascopy which says a lot. Once my account grows considerably, then i should look at other options. More research needed haha

Viking currenex was what i was talking about in my original post through FXDD. Same problem i guess.

Hi,
I am currently on a classic account with Alapari using MT4 and I am very satisfied with their service.
I am also testing the two currenex based pro account types: the Java based no-charts version and the desktop version.
I have a question, what type of charting platform(s) do you use in conjunction with the currenex account?

Thanks,

1. are you interested to trade with another platform than MT4? because nothing will be true ECN or STP with it, since theres always a "dealing desk" at the broker
2. what do you use to withdraw? wire-transfer? most of brokers offer this but there will be fees/delays. or do you use e-wallets like moneybookers?
3. are you a scalper? do you need lowest spread possible and high leverage?
4. are you an american citizen? many brokers stopped accept US citizens all together due to regulations
5. do you trade on long time frames? a swap-free account might be interesting for you

That is not true for all MT4 brokers. At FXOpen AU, we have purely ECN accounts with MT4. MT4 is just a frontend for us with all orders being executed by our proprietary MT4-ECN bridge. There is no dealing desk in between you and the market.

You can see a more detailed explanation at http://www.fxopen.com.au/ECNForexTrading.aspx

Unfortunately,
Most people have little confidence in Russian brokers.
What do you think the reason is?

No idea. We aren't a Russian broker if that's what you were implying? We are 100% Australian.

Mt4 has full capabilities now to be a pure ECN. To think otherwise is naive although understandable.

Even Metaquotes has released versions of MT4 that do not operate with the virtual dealer plugin. About 2-3 yrs ago, it was true that you had to hybrid the MT4 platform to make it go direct to the market. But now its not the case.

I would actually consider ICMarkets and ExcelMarkets to be ECN. As of the moment, they both have characteristics that support them, however, anyone care to take another look at them?

But probably my biggest confusion is why these brokers list minimum and average spreads. Couldn't technically the spread be as low as 0 or in ICM's case, be negative to -0.3 pips? What I don't understand is that for some ECNs such as AFBFX, the minimum spread is something like 0.4 pips, which seems odd that they can have a minimum. Also, negative spreads don't happen often, even rarely, so why does ICM list their cTrader platform of spreads to -0.3? I mean, couldn't it possibly be even lower to -0.4 even? So why not?