ECN Accounts vs Standard Accounts
There are two main types of accounts that traders can use to access the forex market: ECN accounts and standard accounts.
ECN accounts, or electronic communication network accounts, are a type of account that allows traders to trade directly with other market participants and access to liquidity via a network, without the intervention of a middleman.
Where as a Standard account usually has a fixed spread and he broker is the other side of any trade you make so with a Standard trading account the broker is providing the trades and liquidity which can be manipulated and controlled with spreads.
Keynote
How are true ECN and standard accounts different? A true ECN account matches orders and executes them, charging only a commission for execution without a premium on the raw spread.
A standard account is usually managed by a market-making broker, who charges a premium spread to make money from execution.
ECN accounts offer several advantages, including:
Lower transaction costs: because there is no middleman involved in ECN trades, the transaction costs are typically lower than those associated with standard accounts.
Increased market liquidity: ECN accounts offer increased market liquidity because they allow traders to trade directly with other market participants.
Anonymity: ECN accounts offer anonymity because the identity of the participants is not revealed.
ECN accounts also have some drawbacks, including:
Complexity: ECN accounts can be complex, and may require a higher level of experience and knowledge to trade effectively.
Lack of customer support: because ECN accounts do not involve a middleman, there is typically no customer support available.
ECN accounts are not for everyone, and it is important to weigh the pros and cons before deciding if this type of account is right for you.
If you do decide to open an ECN account, be sure to do your research and choose a reputable broker.
The Advantages of Standard Accounts
Standard accounts are the most common type of account used by retail forex traders. Standard accounts offer several advantages, including:
Ease of use: Standard accounts are typically easier to use than ECN accounts, as they usually involve a middleman who can provide customer support and assistance.
Lower minimum deposit requirements: Most standard accounts have lower minimum deposit requirements than ECN accounts.
Greater flexibility: Standard accounts often offer more flexibility than ECN accounts, as they may allow traders to use leverage and take on more risk.
Standard accounts also have some drawbacks, including:
Higher transaction costs: because there is a middleman involved in standard account trades, the transaction costs are typically higher than those associated with ECN accounts.
Reduced market liquidity: Standard accounts can offer reduced market liquidity because trades are often executed through a middleman.
Despite these drawbacks, standard accounts remain the most popular type of account among retail forex traders.
Recommended ECN Brokers
Choosing the correct broker for trading is critical to your trading journey, there are many factors you should take into consideration specifically for ECN trading before settling with the broker you may be trading with or when switching to a new choice broker which is best suited to your needs and factors which are important to you personally.
Broker | Regulators | Leverage | Spreads | Trading Acc. | Instruments | Connect |
FP Markets | ASIC, CySEC | Up to 1:500* | From 0.0 pips | Broker Type: | Forex, Indices, | |
Eightcap | ASIC, VFSC | Up to 1:500 | From 0.0 pips | Broker Type: | Forex, Indices, | |
IC Markets | AFSL, ASIC, CySEC, FSA | Up to 1:500 | From 0 pips | Broker Type: | Forex, Indices, | |
Axi | ASIC,FCA, DFSA, FSC | Up to 1:500 | From 0 - 0.4 pips | Broker Type: | Forex, Indices, | |
InstaForex | CySEC, FSC BVI, FSC | Up to 1:1000 | From 0 - 7 pips | Broker Type: | Forex, Indices, | |
NordFX | VFSC | Up to 1:1000 | Floating spread from 0.9 pips | Broker Type: | Forex, Indices, | |
FXOpen | ASIC, FCA | Up to 1:500* | Floating spread from 0 pips | Broker Type: | Forex, Indices, Metals, Energies, Shares, Crypto | |
Vantagemarkets | CIMA, ASIC, FCA | Up to 1:500* | From 0.4 pips | Broker Type: | Forex, Indices, Metals, Energies, Shares, Crypto | |
RoboForex | IFSC | Up to 1:2000 | From 0.0 pips | Broker Type: | Forex, Indices, | |
Exness | FCA, CySEC, FSA, CBCS, FSC, FSCA | Up to 1:3000 | From 1 pip | Broker Type: | Forex, Indices, | |
FBS | CySEC, FSC, FSCA, ASIC | Up to 1:3000 | From 1 pip | Broker Type: | Forex, Indices, |
Which Account Type is Right for You?
Your trading style and needs will determine your account type.
Forex beginners may benefit from a simple account. Standard accounts are simpler and require less money than ECN accounts.
ECN accounts are suitable for experienced forex traders. ECN accounts reduce transaction costs and boost market liquidity, however they can be complicated and lack customer service.
Choose an account type that meets your needs by weighing all your options.
Ask your broker or financial counselor about account types.
Now you can Start Trading with an ECN Broker
Choosing the right broker for ECN trading is crucial to your trading journey. There are many factors to consider before settling with your current broker or switching to a broker that better suits your needs and priorities.
These are the brokers we have reviewed:
ECN Execution Recommended Brokers
ExnessSince 2008 | Offices:UK, Cyprus, Seychelles |
Minimum Deposit: | Standard; Cent; Plus: $1 | Raw Spread, Zero, Pro:$200 |
Account currency: | USD |
Leverage: | From 1:100 up to 1:2000 |
Accounts: | Standard, Standard Cent, Standard Plus, Raw Spread, Zero, Pro |
Instruments Offered: | Forex, Indices, Metals, Energies, Shares, Cryptocurrencies |
Trading Platform: | MT4, MT5, WebTrader, Mobile, Free VPS hosting |
Regulation: | FCA, CySEC, FSA, CBCS, FSC, FSCA |
Spreads: | Standard; Cent: from 0.3 pips, Standard Plus: from 1 pip Pro: from 0.1 pips, Raw spread; Zero: from 0 pips, |
Visit Broker | Broker Review |
AXISince: 2007 | Offices:UK, Australia, UAE, Saint Vincent & the Grenadines |
Minimum Deposit: | $1 |
Account currency: | AUD, CAD, CHF, EUR, GBP, HKD, JPY, NZD, SGD, USD |
Leverage: | Up to 1:500 |
Accounts: | Standard, Pro, Elite |
Instruments Offered: | Forex, Indices, Commodities, Metals, Energies, Shares, Cryptocurrencies |
Trading Platform: | MT4, PsyQuation with Axi, WebTrader, VPS hosting |
Regulation: | ASIC,FCA, DFSA, FSC |
Spreads | Standard: from 0.4 pip, Pro: from 0 pip |
Visit Broker | Broker Review |
InstaForexSince: 2007 | Offices:Cyprus, St.Vincent & the Grenadines, British Virgin Isles |
Minimum Deposit: | From $1 |
Account currency: | EUR, USD |
Leverage: | From 1:1 up to 1:1000 |
Accounts: | Demo, Insta.Standard, Insta.Eurica, Cent.Standard, Cent.Eurica, PAMM |
Instruments Offered: | Forex, Indices, Futures, Options, Commodities, Metals, Energies, Shares, Cryptocurrencies |
Trading Platform: | МТ4, МТ5, InstaTrader, WebTrader, Multiterminal, Mobile Trading, VPS hosting |
Regulation: | CySEC, FSC BVI, FSC |
Spreads: | 0 pips: Insta.Eurica and Cent.Eurica; 3–7 pips: Insta.Standard and Cent.Standard |
Visit Broker | Broker Review |
EightCapSince: 2009 | Offices:Australia, Vanuatu |
Minimum Deposit: | $100 |
Account currency: | AUD, USD, GBP, NZD, SGD, EUR |
Leverage: | 1:30 for Australian clients 1:500 for Non-AU clients |
Accounts: | Standard Account, Raw Account |
Instruments Offered: | Forex, Indices, Commodities, Metals, Energies, Shares, Cryptocurrencies |
Trading Platform: | MT4, MT5, Mobile, VPS hosting |
Regulation: | ASIC, VFSC |
Spreads: | From 0.0 pips |
Visit Broker | Broker Review |
IC MarketsSince: 2007 | Offices:Australia, Cyprus, Seychelles |
Minimum Deposit: | 200 US dollars |
Account currency: | USD, AUD, GBP, CHF, JPY, NZD, SGD, CAD, HKD, BTC |
Leverage: | From 1:1 to 1:500 |
Accounts: | Demo, Raw Spread, cTrader, Standard, Islamic, PAMM |
Instruments Offered: | Forex, Indices, Commodities, Metals, Energies, Shares, Bonds Cryptocurrencies |
Trading Platform: | cTrader, MT4, MT5, WebTrader, VPS hosting |
Regulation: | AFSL, ASIC, CySEC, FSA |
Spreads | From 0 |
Visit Broker | Broker Review |
FBSSince: 2009 | Offices:Cyprus, Belize |
Minimum Deposit: | $1 , €10 |
Account currency: | Euro |
Leverage: | 1:3000 |
Accounts: | Standard Account, Cent Account, Demo Standard Account, Demo Cent |
Instruments Offered: | Forex, Indices, Commodities, Metals, Energies, Shares, Cryptocurrencies |
Trading Platform: | MT4, MT5, Multiterminal, WebTrader, FBS Trader, VPS hosting |
Regulation: | CySEC, FSC, FSCA, ASIC |
Spreads: | From 1 pip |
Visit Broker | Broker Review |