Forex Trading Platforms

Forex brokers make it easier for customers to exchange their currency. Each broker has an important quality that makes them more suitable for a customer. Before choosing your broker make sure you look around and weigh your options. These Forex Trading platforms are the main types of Forex Brokers you will encounter.

ECN Brokers

Electronic Communication Network or ECN style brokers will help guide investors to a direct link to other Forex traders which can be both retail and institutional. They usually pass on certain prices and they provide their customers with the best bid/ ask quotes.

Other advantages to these types of brokers is that they are not opposed to the reselling of the currency at a price higher than the established value, they can get you very low spreads, and they will generally not trade against you.

One major disadvantage is the fact that they do charge a commission which could become costly. Some examples of ECN style brokers include Hotspot FX, Interactive Brokers, and MB Trading.

NND Brokers

No Dealing Desk brokers use a search engine that will automatically match up orders between its liquidity providers and their clients. Instead of exchanging with a single broker, you can now go through banks and institutional investors in order to make your trades.

The broker does have a small commission fee that is based on the pip per round turn. One major advantage over a regular broker is that they charge a fee upfront that is less than a broker who can manipulate the price to benefit themselves. Some common NND brokers include FXCM and InterbankFX.

Market Maker

Another type of broker is a Market Maker and they help provide or convert assets into cash for clients. Market Makers display both the bid and ask price on their system. They are ready to make the necessary transactions for their customers at those prices, but for each trade the market maker must take the opposite side of your trade.

So if you were to sell currency then they would have to buy currency from you and the same works when you buy currency. This is one problem with market makers as they can trade against you which causes a direct conflict in interest. Another con is that they may display a worse bid/ask price then you would find with an ECN provider.

The exchange rate that market makers set is based on their own interest which can create a large spread for their customers. One main advantage though is that they normally provide free charting software and news for trading. Some examples of Market Makers include CMS Forex, Gain Capital, and Saxo Bank.

MetaTrader

MetaTrader Forex brokers use the new MetaTrader 4 trading software for their trading platform. MT4 has very prestigious advisors that allows for an open and free trading environment.

MetaTrader allows you to trade from anywhere in the world, obtain forex trading news in real-time mode, and work on many types of accounts. Some brokers that use this software are FXDD, Mig investments, and ODL securities.

There are many other types of broker firms, but these are the most popular and trusted across the globe.