Benefits Of Signing Up With An ECN Broker
09/06/2013 13:29Welcome to my blog! This is Davey again and today I’ll talk about how you can benefit from an ECN broker. As you may have noticed, the electronic communication network is becoming popular nowadays. In fact, more and more forex traders are signing up with an ECN broker because of the benefits being enjoyed by those who have already signed up. If you’re one of those who are still undecided, you can continue reading to better understand what you should expect if you sign up with an ECN broker. By the way, I’ve already signed up with UFX Markets, an ECN broker, and I’m happy with the kind of service I’m getting.
You maintain your anonymity when you make your ECN transactions. This means that your privacy is protected because your identity isn’t known to other traders and no one can trace the transaction back to you. You are assured that your trading strategy and performance aren’t visible to other entities.
When you deal with ECN forex, you should expect trading periods to be very active. As such, spreads vary depending on the foreign currency pair you’re trading. Spreads in ECN transactions depend on the liquidity and trade volume of the currency pair. Because the broker obtains various prices from different institutional participants, you’ll be able to view the best quote for each currency pair. Due to the sheer volume of information, you can expect spreads to reach zero at times. If you’re into day trading or scalping, you can greatly benefit from this spread pricing.
The forex market can become highly volatile. Because of this, news or event trading is very ideal for ECN forex. You’ll have access to various liquidity providers and you can place orders even on the most volatile market. You can have successful entry and exit point decisions at any price you desire. However, you success in ECN forex depends on liquidity and current offers. This means that if there are no offers or if there’s limited liquidity, you won’t be able to execute any forex trades at all.
Lastly, when you sign up with an ECN forex broker, you will be able to create your own forex market. As a market maker, you can place an order anytime and wait for the network to search an entity which will be able to match your order. When you deal under an ECN broker, you will be able to place a limit sell or buy order. In fact, you can place stop or limit orders without any limitation or restriction.
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