Join the professionals - maximise your trading and investment potential with a Retail FX ECN platform
“If you’re looking at an ECN because you like to make larger traders, say around $5 million, check the fine print to understand if your margin requirements will be higher for larger trades, or if the amount of liquidity on the ECN is sufficient to allow you to trade size at the tighter spreads. In some cases, the depth of liquidity is not always there for larger trade sizes, or you’ll receive volume weighted average price fills on your larger trades; either way you could end up paying more,” she warns.
When trading on a retail ECN, your account and funds are held with a retail broker. Terefore, the firm’s reputation, financial wherewithal, and regulatory oversight are still important considerations, continues Roady. “Te broker’s technology infrastructure should be firmly established to ensure connectivity, speed, and low latency. Make sure your broker is regulated by one of the primary regulators, such as the UK, Japan, Australia or the US, where you’ll have added confidence knowing the broker must abide by a full set of rules and regulations, plus there is a framework for dispute resolution and, in most cases, safety of funds protection.”
Roady adds that if you qualify as an eligible contract participant (ECP), your options are significantly better as you can trade on an institutional ECN. (ECP qualifications vary from region to region, but most have a net worth and investable asset requirement).
Support for strategies
An ECN platform, whether provided from a third party vendor or from in-house development, should always include an option to run a strategy, states Droguett. “Jforex, our inhouse platform, offers such functionality, and offers an API capable of handling even the most complex algorithms. Back testing and demo testing are parts of such functionalities, and are a very big part of our customer’s attraction to our ECN.”
Salem adds: “Trading on an ECN feed and execution model allows clients to implement more accurate strategies, with the abundance of resources clients are able to build, test and implement their own trading strategies. Teoretically these trading strategies are built to perfection to work on a fair trading basis. Previously, these clients had no access to the liquidity that would help them achieve those theoretical results.” “Currently, with brokers providing ECN trading conditions to retail clients, these clients can now build better strategies and leverage opportunities from the market related to execution models and spread pricing,” Salem concludes.
Mariusz Potaczała T
MS Brokers has recently launched a new FX trading platform called TMS MT4 which uses STP and NDD
execution and is integrated with the MetaTrader4 platform. It allows retail customers to perform online FX operations directly, immediately and automatically on the interbank market. Te new platform compliments the existing GO4X platform which TMS operates as a Market Maker. Mariusz Potaczała, CEO at TMS Brokers comments: “Te requirements of Polish consumers, as well as the emergence of ECN platforms, prompted us to launch this new service, dedicated to more advanced users than those on GO4X. Te most important feature for this group is access to very tight spreads and extremely fast execution, without a dealing desk. Our new product meets these requirements” He continues: “TMS MT4 sets new standards in Poland. We are the first Polish broker to offer direct access to the interbank market, with variable, often zero spreads, low commissions and extreme speed of execution in conjunction with the most popular technology in our country; MT4. What is also very important for us is the transparency of this model, in which all customers’ transactions are executed directly on the market. I would like to emphasise this because I notice a negative tendency to use a hidden partial or even complete Market Maker model by some brokers, who define themselves as STP dealers. It’s very bad for our industry, because it causes a lack of confidence in institutions that define their services in a fair manner.”
october 2011 e-FOREX | 169
Platform Launch
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