Many people enter the currency trading arena without considering the significance of deciding on a dependable and trustworthy metatrader MT4 broker. A good fx MT4 broker can be the difference between success or failure and regrettably, new traders are not aware of the important differences between currency brokers. Of significant concern is that the currency industry is not centrally regulated such as stock exchanges so this opens the door for brokers to be unfair with their clientele.
The major distinction that you will notice amongst fx brokers is whether they are a dealing desk or non dealing desk metatrader broker. A dealing desk broker makes money via the spreads and by trading against its clients by taking the other side of the trade. A Dealing Desk Currency broker is commonly called a Market Maker.
Non Dealing Desk Fx MT4 brokers do not take the other side of the trade however rather offer accessibility to the interbank market. With a reputable No Dealing Desk broker, there should be no re-quotes and no additional pausing when waiting for the order verification. These metatrader brokers will either charge a commission whilst keeping the spreads extremely tight or select to increase the spread and make your fx trading commission free.
There are also two other types of brokers. Straight Through Processing brokers that send orders directly from clients to the liquidity providers/banks which trade on the Interbank; and Electronic Communications Network brokers which allow client orders to interact with other client orders thus creating a marketplace where all participants, including banks, market makers and independent traders, trade against each other by sending competing bids and offers into the system. Both these types of brokers can be considered No Dealing Desk.
Of these kinds of metatrader brokers, stay away from the Dealing Desk Market Makers. They do not have your best interest in mind. Why would they? After all, they need you to lose in order to make the most money. Many tempt new customers with incredibly thin spreads and even offer you account deposit bonuses comparable to online casinos. However when it comes down to it, they have every cause to make trading difficult so you lose with tactics such re-quotes and stop hunting. Forex trading is tough enough as it is, the last thing you need is your broker to make it more challenging. Go for a no dealing desk broker so that you will not need to worry about being scammed and focus on the task at hand, currency trading!
The major distinction that you will notice amongst fx brokers is whether they are a dealing desk or non dealing desk metatrader broker. A dealing desk broker makes money via the spreads and by trading against its clients by taking the other side of the trade. A Dealing Desk Currency broker is commonly called a Market Maker.
Non Dealing Desk Fx MT4 brokers do not take the other side of the trade however rather offer accessibility to the interbank market. With a reputable No Dealing Desk broker, there should be no re-quotes and no additional pausing when waiting for the order verification. These metatrader brokers will either charge a commission whilst keeping the spreads extremely tight or select to increase the spread and make your fx trading commission free.
There are also two other types of brokers. Straight Through Processing brokers that send orders directly from clients to the liquidity providers/banks which trade on the Interbank; and Electronic Communications Network brokers which allow client orders to interact with other client orders thus creating a marketplace where all participants, including banks, market makers and independent traders, trade against each other by sending competing bids and offers into the system. Both these types of brokers can be considered No Dealing Desk.
Of these kinds of metatrader brokers, stay away from the Dealing Desk Market Makers. They do not have your best interest in mind. Why would they? After all, they need you to lose in order to make the most money. Many tempt new customers with incredibly thin spreads and even offer you account deposit bonuses comparable to online casinos. However when it comes down to it, they have every cause to make trading difficult so you lose with tactics such re-quotes and stop hunting. Forex trading is tough enough as it is, the last thing you need is your broker to make it more challenging. Go for a no dealing desk broker so that you will not need to worry about being scammed and focus on the task at hand, currency trading!
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