ECN Accounts – The Advantages and Disadvantages

An ECN account is an online trading account that allows you to trade directly with other market participants, without the intervention of a middleman. ECN stands for “Electronic Communications Network”.
Professional traders who want the best trading conditions can choose an ECN (Electronic Communication Network) account. With an ECN account, buyers and sellers can do business directly with each other, without a middleman. To open an ECN account, you have to put down a $1000 deposit.

ECN Accounts – The Pros and Cons

There are many advantages to trading with an ECN account. One of the main advantages is that you can trade with very low spreads, as low as 0.0 pips in some cases. This is because ECN brokers don’t take a commission on your trades, and instead make their money from the spreads. This means that your costs are lower, and you can potentially make more money from your trades.

Another advantage of ECN accounts is that you can trade with high leverage. Leverage is a double-edged sword, but if used correctly it can help you to make more money from your trades. With an ECN account, you can trade with leverage of up to 1:500, which means you can control a large amount of money with a relatively small amount of capital.

ECN accounts also offer fast order execution, and you can often get your trades executed in less than a second. This is because ECN brokers are connected to a large number of liquidity providers, and can offer you the best possible price for your trade.

There are some disadvantages to ECN accounts as well. One of the main disadvantages is that you will usually have to pay a commission on your trades. This can be around $5 per trade or more. This means that your costs are higher, and you need to make sure that your trading strategy is profitable enough to cover these costs.

Another disadvantage of ECN accounts is that they are only available to traders who have a large amount of capital. This is because most ECN brokers have a minimum deposit requirement of $5,000, and sometimes even more. This means that ECN accounts are not suitable for beginners or traders with a small amount of capital.

Characteristics of an Electronic Communication Network (ECN) Broker

An Electronic Communication Network (ECN) is a type of broker that uses electronic means to connect different market participants, in order to trade securities. ECNs are typically used by large institutions and professional traders, who require access to the best possible prices and liquidity.

ECNs typically charge a commission, rather than a spread, for each trade. This means that they are often very competitive in terms of pricing. ECNs also offer a high degree of anonymity, as orders are not displayed publicly. This can be appealing for traders who wish to keep their activities private.

ECNs offer a number of advantages, including:

Access to deep liquidity: ECNs offer access to a huge pool of liquidity, from a variety of different sources. This means that trades can be executed quickly and at the best possible prices.

Low costs: As ECNs charge commissions rather than spreads, they can be very cost-effective for active traders.

Anonymity: Orders placed on an ECN are not publicly displayed, so traders can remain anonymous if they wish.

Speed: ECNs use electronic means to connect market participants, so trades can be executed very quickly.

Advantages of trading with an Electronic Communication Network (ECN) Account

An electronic communication network (ECN) is an electronic system that matches buy and sell orders for securities in the market.

ECNs are used by large institutions, small and medium-sized firms, and individual investors to trade stocks, bonds, foreign exchange, and other securities anonymously and at faster speeds.

ECNs are fast becoming the preferred trading method for active individual investors and traders. ECNs provide many advantages over traditional brokerage firms, including:

Anonymity: When you place a trade through an ECN, your identity is not revealed to the market maker or broker. This protects you from potential price manipulation by people with insider information.

Speed: ECNs can match orders much faster than traditional brokerages, which can make a big difference when you’re trying to execute a trade quickly.

Lower Costs: ECNs typically charge lower fees than traditional brokerages, since they don’t have the same overhead costs. This can save you a significant amount of money over time.

Better Prices: ECNs can provide you with better prices than you would get from a traditional brokerage firm. This is because they have access to multiple liquidity sources, so they can fill your order at the best possible price.

ECN Accounts – The Benefits and Risks

As we have seen, there are both advantages and disadvantages to trading with an ECN account. One of the main benefits is that you can trade with very low spreads, which can save you a lot of money in the long run. However, you will usually have to pay a commission on your trades, which can eat into your profits.

Another benefit of ECN accounts is that you can trade with high leverage. This can help you to make more money from your trades, but it can also increase your losses if you don’t use it carefully. You need to be aware of the risks before you start trading with leverage.

Before you decide to open an ECN account, you need to weigh up the pros and cons carefully. You need to consider your own trading style and goals and decide whether an ECN account is right for you. If you are a beginner, or if you don’t have a lot of capital, then an ECN account is probably not suitable for you.

If you do decide to open an ECN account, be sure to research the different providers carefully. Make sure you understand the fees and commissions that you will be charged and the leverage that they offer. Also, be sure to test out their platform with a demo account before you commit to trading with real money.

Keynote:

ECN accounts are for professional traders who want to trade in more advanced ways. ECN accounts stand out are the very low spreads, which start at 0 pips, and the low transaction fees, which depend on the number of transactions.

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

FCA, CySEC, FSA, CBCS, FSC, FSCA

Up to 1:3000

From 1 pip

Broker Type:
STP | ECN
 6 Accounts

Forex, Indices,
Commodities, 
Metals, Energies,
Shares, Crypto

ASIC, VFSC

 Up to 1:500 

From 0.0 pips

Broker Type:
STP | ECN
 2 Accounts

Forex, Indices,
Commodities, 
Shares, Crypto

AFSL, ASIC, CySEC, FSA

Up to 1:500

From 0 pips

Broker Type:
ECN
6 Accounts

Forex, Indices,
Commodities, 
Metals, Energies,
Shares, Crypto

ASIC,FCA, DFSA, FSC

Up to 1:500

From 0 - 0.4 pips

Broker Type:
STP | ECN
 3 Accounts

Forex, Indices,
Commodities, 
Metals, Energies,
Shares, Crypto

CySEC, FSC BVI, FSC

Up to 1:1000

From 0 - 7 pips

Broker Type:
MM | Binary
 6 Accounts

Forex, Indices,
Commodities,
Metals, Energies, Shares, Crypto

CySEC, FSC, FSCA, ASIC

Up to 1:3000 

From 1 pip

Broker Type:
STP | ECN
 6 Accounts

Forex, Indices,
Commodities, 
Metals, Energies,
Shares, Crypto

ASIC, FCA

Up to 1:500*

Floating spread from 0 pips

Broker Type:
STP | ECN
 6 Accounts

Forex, Indices,
Commodities, 

Metals, Energies,

Shares, Crypto

CIMA, ASIC, FCA

Up to 1:500*

From 0.4 pips

Broker Type:
STP | ECN
4 Accounts

Forex, Indices,
Commodities, 

Metals, Energies,

Shares, Crypto

VFSC

Up to 1:1000

Floating spread from 0.9 pips

Broker Type:
STP | ECN
4 Accounts

Forex, Indices,
Commodities, 
Shares, Crypto

IFSC

Up to 1:2000

From 0.0 pips

Broker Type:
MM | STP | ECN
5 Accounts

Forex, Indices,
Commodities, 
Metals, Energies,
ETFs, Shares, Crypto

ASIC, CySEC

Up to 1:500*

From 0.0 pips

Broker Type:
STP | ECN | DMA 2 Accounts

Forex, Indices,
Commodities, 
Metals, Energies,
Shares, ETFs Crypto, Bonds

Each Broker has their own fees for their ECN accounts these may vary from ZERO to a fraction of a percent or a fixed amount per lot.

Exness has 3 Trading Accounts:

Raw Spread: Lowest spreads with fixed commission per lot. Market execution.
From 0.0 Spread & Up to $3.50 for each side per lot Commission
Zero: Zero spread on the top 30 instruments. Market execution, no requotes.
From 0.0 Spread & From $0.2 each side per lot Commission
Pro: Our instant execution account, with zero commission & low spread.
From 0.1 Spread & Zero Commission

Exness ECN Accounts

AXI has 3 Trading Accounts:

Standard Account: From 0.4 pips Spread with Zero Commission & 5 digit pricing
Pro Account: From 0.0 pips Spreads with $7 round trip (USD) Commission & 5 digit pricing
Elite Account: From 0.0 pips Spreads with $3.50 round trip (USD) Commission & 5 digit pricing

AXI ECN Accounts

Instaforex has 4 ECN Trading Accounts:

Insta.Standard: From 3-7 Spreads & Zero fees
Insta.Eurica: Zero Spreads & 0.03%-0.07% fees
Cent.Standard: From 3-7 Spreads & Zero fees
Cent.Eurica: Zero Spreads & 0.03%-0.07% fees

InstaForex ECN Accounts

Eightcap has 2 ECN Trading Accounts:

Standard Account: 0.5 – 1.8 pips Typical EUR / USD Spread & Zero Commission
Raw Account: 0.0 – 1.0 pips Typical EUR / USD Spread with 3.5 AUD, USD, NZD, SGD, CAD | 2.25 GBP | 2.75 EUR per standard lot traded Fees

Eightcap ECN Accounts

IC Markets has 2 ECN Trading Accounts:

cTrader: Zero Spread & $3.0 ($6.0 per lot roundturn) Commission per lot
Raw Spread: Zero Spread & $3.5 ($7.0 per lot roundturn) Commission per lot
Standard: 0.6 Spread & Zero Commission

IC markets ECN Accounts

How can Trading with an ECN Account Benefit you?

Almost all ECN Accounts have Zero spreads, which is amazing for trading with especially with day and scalp trading. However, with the commission on the lots traded which the brokers charge, you have to weigh the odds and see which situation suites your trading strategy.

Now you can Start Trading with an
ECN Account

Each broker has its own ECN Fees, which can be based on commission on lots or on spreads.

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.
These are the brokers we have reviewed:

ECN Execution Recommended Brokers

Exness

Since 2008

Offices:

UK, Cyprus, Seychelles

Exness

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

InstaForex

Since: 2007

Offices:

Cyprus, St.Vincent & the Grenadines, British Virgin Isles

InstaForex

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

AXI

Since: 2007

Offices:

UK, Australia, UAE, Saint Vincent & the Grenadines

AXI

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

FBS

Since: 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

IC Markets

Since: 2007

Offices:

Australia, Cyprus, Seychelles

IC MARKETS

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

EightCap

Since: 2009

Offices:

Australia, Vanuatu

EIGHTCAP

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