I am a professional fx trader and have only just decided to switch from a market maker forex broker to an ECN broker. The primary reason for the move was because of the too much slippage on my deals from the market maker broker that I have been trading with. The slippage that I was getting has cost me 1000s of dollars, after some homework I quickly discovered that slippage generally occurs with market maker forex brokers. Subsequent to this dreadful experience I thought to move to a true ECN forex provider who was able to provide me with a lot tighter spreads in addition to no slippage.

I scoured the web for months and spoke to a number of fx brokers only to discover that none of them were ECN providers despite several of them claiming to be. Finally I found an Australian forex broker called IC Markets who are a true ECN forex broker. After using their demo system for some weeks I fast realised that trading using a true ECN company is incredibly different to trading on a market maker broker platform, the prices were substantially tighter and there was no slippage.

I thought that I would make the promise and open an ECN account with IC Markets and I found that after a few months of forex trading on their system using the the same strategy that I used with my market maker forex broker my account was far more profitable. I discovered that the majority of the increase in gains was due no slippage on my deals. Cost savings in slippage and spread meant that my account was much better off and I won’t ever deal with a market maker company again.

IC Markets Metatrader platform was also much less difficult to utilize than the other brokers platforms, the key reason for this was because their trading platform has a one click trading feature on it. One-click trading means that I can effortlessly scalp the market with one click instead of having to complete all of the fields on the Metatrader deal ticket. The platform also makes it possible for me to drag and drop orders on the chart really easily which makes life dramatically easier when scalping the market.

I do not think that I’d ever trade with a market maker forex provider again the only real choice for any professional fx trader is definitely an ECN broker. One more huge benefit of dealing with an ECN broker is the fact that there are no limits on stop loss order distances. Most market maker brokers impose this restriction since it stops scalping, if you’re a great scalper you could really easily take money from the forex broker as they won’t have the ability to hedge your trades quick enough.

I really encourage anyone trying to trade forex to choose an ECN broker. There are really not all that many true ECN brokers out there, most claim to be ECN forex brokers but they are actually market makers and if you try them out you promptly discover they impose stop loss limits, delay fills and slip you on your fills. I have not had any issues with IC Markets whatsoever and vouch for them if you’re looking for a reputable, regulated true ECN broker. A lot of the members of my trading group have now also switched to IC Markets and are pleased as their account gains have increased dramatically. True ECN forex brokers are the only way to go.

Time and time again my students ask me what to check out in a broker, of course a lot of them are influenced by marketing material produced by forex brokers and are of the assumption that they ought to be trading with a broker that has low spreads, however normally they fail to think about several of the most important elements of choosing a forex provider and low spreads are one of the least important elements.

To help my students in deciding on a fx broker I always urge that they consider the following aspects ahead of deciding on a broker:

1. Execution Latency

2. Depth of Liquidity

3. Spreads Over news Periods

4. Broker Regulation

5. Foreign exchange pair Pairs Accessible

Execution Speed

Picture placing a trade simply to have the order hang on you after which it gets executed at a very dissimilar price. This could come about for 2 separate reasons, the 1st reason that this occurs is simply because the price has changed from when the order is placed to when it’s filled, this often occurs when the you have a bad internet link or when the brokers server is located a good distance away the other reason this happens is because the broker is slowing the order as they’re a market maker and they are intentionally preventing you from being filled at the price quoted cashing in on the price difference. Always select an ECN broker this way you can be guaranteed that your orders will be executed in a timely manner and the broker is not looking to benefit from your losses.

Depth of Liquidity

Not many traders understand that when tight spreads are shown to them on a broker platform it does not always mean that they can trade on those spreads. More often than not fx brokers will display spreads that cannot be dealt on for any decent amount. Not having the ability to deal on broker prices can be irritating for many traders and frequently leads to orders being executed with slippage which will mostly work against the trader. It is imperative that you ask your forex provider what their liquidity is like to make sure that if you’re trading any type of quantity your deals are filled at the price shown on the brokers trading platform or alternately deal with an ECN forex provider where you are guaranteed profound liquidity.

Prices Over News Periods

Prior to selecting a fx broker you should make sure you spend a while checking their spreads over news announcements. On the list of the issues fx traders often face is widened spreads over news periods. Widened spreads are the result of investment banks refusing to quote prices over this period until they can ascertain the effect of the news announcement on the currency. A great fx broker will aggregate many of investment bank forex prices to make sure that if one investment bank isn’t quoting prices there are others that will. If you choose to deal with an ECN broker more often than not you won’t have any problems with spreads over news announcements.

Company Regulation

Choose a forex provider that’s regulated and even better one which is regulated in the country which you reside. If you decide on a broker that is regulated in the country which you live you have the best chance of getting your money back if something goes wrong. If you can not find a suitable broker inside the nation that you live in you should search for a forex broker in a country which has a first-class regulatory regime, brokers in nations like the USA, UK and Australia tend to be the safest in the world.

Foreign currency Pairs Offered

There isn’t any point choosing a broker that doesn’t offer the pairs which you trade so take an in depth look at what your forex broker offers prior to opening an account. There are some forex brokers that do not offer many of the more exotic crosses and only stick to the majors, other fx brokers will offer a full assortment of foreign currencies in addition to gold and silver.

I hope this helps you in selecting the best fx broker, personally I’ve traded with the majority of brokers around the world and in Australia but I have ended up settling with ECN forex broker IC Markets. International Capital Markets (IC Markets) are able to offer me a full array of currencies and commodities, are regulated in Australia by AISC, have deep liquidity behind the prices displayed and fast execution speed that assists my scalping strategy. Obviously you should always do your own research ahead of selecting a broker however I can certainly vouch for IC Markets.