1. Home > >

Forex trading platform quote system difference

What exactly cashbackforexbtc a traderless platform, what is an STP platform, East forex cashback what exactly is the difference between these platforms? Some platforms claim to be cashback forex platforms, or that they are bank quoting systems, but in the end are they? What is the difference between each platform, how to identify them, you can look at the classification of foreign exchange margin traders: StraightThroughProcessing, straight-through-processing system, referred to as STP; ElectronicCommunicationsNetwork, electronic communications network model, referred to as ECN; NoDealingDesk, no dealer platform mode, referred to as NDD; inquiry (Dealer) and a single forexcashbackcalculator maker (Marketmaker) mode, referred to as DD or MM; we usually come into contact with more foreign exchange margin brokers usually use the latter trading method (MM), so here also used the most space to introduce the operation of the MM model platform STP straight-through-processing system mode: through the straight-throughprocessingsystem-STP, so that the customers order sent to the bank, according to the banks price level close to the immediate transaction trading volume is high during the single may appear hanging, that the single has been executed but still left in the pending single window generally speaking, such a single has Execution, just need a little time to wait for the bank to confirm the transaction during the frequent period, there may be a number of orders need to wait for the processing of the waiting list increased sometimes affect the bank to delay the confirmation of part of the single, depending on the type of single, the situation may be different ECN electronic trading network model: ECN is an electronic trading network, is a use of centralized - decentralized market structure of foreign exchange trading technology this model by working with banks This model is accomplished by working closely with banks, institutions, foreign exchange markets and technology providers. Traders orders are listed directly and anonymously on this network, and each order is on an equal footing and is fairly aggregated and traded in accordance with price and time optimization, so the price on the ECN is the true market price with variable spreads. With the development of Internet technology, ECN traders serving individual investors, small banks, investment institutions, and hedge funds began to emerge ECNs business operation model is generally recognized by the U.S. securities industry as a typical fully automated electronic stock exchange ECN platform is inclusive of the STP model so the ECN platform is precisely ECN + STP platform NDD dealerless platform model: ECN and STP are both classified as NDD dealerless platform model Traders using dealerless platform rely on collecting trading commissions or earning profits by increasing spreads Dealerless platform traders may belong to STP type or ECN+STP type (ECN for short) NDD dealerless platform has the advantages of transparency, good quotes and The advantage of fast turnover Transparency means that customers have access to the real foreign exchange market, customer orders are delivered directly to the interbank market, automatic execution No dealer quotes are usually lower and turnover is rapid DD inquiry and MM market maker model (with a dealer platform): individual investors face a single pair of home for inquiry and trading, the fairness of the offer depends on the integrity of the dealer dealer itself is a market maker They will generally first sum and filter the price of the bank or ECN, and then add their own profits and then offer to customers, so customers are actually making transactions with market makers (on the ECN is trading with anonymous real traders) customers see and trade is not the real price of the market, and the execution price of the transaction is determined by the foreign exchange market maker, so the transaction price is often in favor of the market maker is also Not surprisingly, the customers single into the market makers system, the first internal hedge between long and short positions, and then the rest of the net position to the bank they are attached to or ECN hedge, can also be partially hedged or simply not hedged, which does not hedge the single belongs to the betting category Now introduce what is betting, betting is that these market makers do not take all the net position Take to ECN or bank to hedge for example, a foreign exchange dealer received a customer 1000 lots (foreign exchange trading units, usually 100,000 units of base currency) to buy EUR / USD orders and 800 lots to sell EUR / USD orders, then internal hedging after the remaining 200 lots of EUR / USD net long position, but the company is willing to assume the risk of market fluctuations in this part of the position, and did not put This 200 lots of EUR/USD net long position into the bank or ECN to do the transaction, which is called and customer betting in the United States in the relevant laws and regulations does not rigidly specify how to hedge risk, which depends entirely on the traders own risk control strategy if the customers single can be fully hedged in a timely manner, then the market maker almost do not have to bear additional market risk, the income obtained is more stable but in reality The existence of this hedging/hedging model means that at certain times (e.g., when major U.S. data is released, or when market prices fluctuate dramatically), you may regularly be unable to connect to the dealers trading system to trade effectively and quickly, because it is difficult for the dealer to In addition, some MM mode traders will also classify their customers, customers may be divided into two categories, profitable customers are separated Divided into slow mode, such customers face multiple obstacles such as slippage, orders difficult to fill (repeated inquiries), but the trader will always operate very carefully to keep customers from noticing and poor profitability of customers are classified as automatic execution mode, because on average, these customers end up losing money, so these customers do not pay attention to the single, let them open and close the toss, and eventually the net value will become zero. Eventually the net value will become zero, and the money naturally all into the pockets of market makers market makers and these customers with poor profitability betting on trading, of course, the odds are great as far as transparency, only depending on the internal policies of these market makers companies