ECN brokers (Electronic Communication Network brokers) are among the fastest emerging brokerages in the Forex world, and there's no question that new ECN brokers are opening their doors regularly. In short, ECN Forex brokers provide a marketplace where traders and market makers can place competing bids against each other. Minimum deposits for ECN accounts are often higher than they are with standard Forex accounts, but there are several significant advantages offered by the best ECN brokers, such as the ability for scalping and lower spreads.
With so many attractive options to choose from, choosing between different ECN trading options can be surprisingly difficult. Compounding the decision is the fact that many traditional brokers offer ECN accounts in addition to their standard trading accounts, which widens your pool of options.
To make your decision easier, we've compared critical aspects of some of the top ECN brokers to give you a starting point in your search for the best ECN Forex broker.
How to Choose the Best ECN Forex Broker
As compared to market makers, ECN brokers never trade against their clients, which makes this type of trading extremely popular with serious, long-term traders looking for solid trading conditions. It is important to note, however, that many companies claim to be the top ECN broker, when in fact they're not an ECN broker at all. You can determine whether a broker truly offers ECN trading by asking some basic questions. Are the spreads variable or fixed? True ECN brokers only offer floating or variable spreads. Is there a dealing desk? If you see any mention of a dealing desk on the broker's website, it's likely that the broker does not offer a full ECN trading experience. You can determine whether the broker is a dealing desk or not by opening real and demo accounts and observing the difference in pips being offered during news reports. If there is a difference, it's not a true ECN broker. Is there only negative slippage during trading? If so, you are not looking at a real ECN Forex broker.
Perhaps most importantly, a truly top ECN broker will allow you to place a trade bigger than 5 standard lots. If your broker does not offer this flexibility, you are not using a real ECN broker.
Once you've determined which brokers are not ECN brokers, make sure you choose the best ECN broker for your specific needs. Compare the spreads, regulation and trading conditions of at least two or three brokers and make sure you find one that offers everything you're looking for. Check out the ECN broker list below to start with your research and see who we've tried, tested and confirmed as some of the best options out there. With so many brokers to consider there's no need to settle when choosing a top ECN broker.