STP Broker– Straight through Processing model
2. ECN Broker– Electronic communications network model
DMA Broker – Direct market access model
MM Broker– Market maker model
P2P Broker – Peer to Peer model
The STP/ECN and DMA Brokerage models are the COMMON brokerage versions that send out all your trade moves to the operators of the common market. The administrators of the traditional market are called the Market Makers.
, Market Makers brokers are the players who you are trading against.
Hence if you gain, they lose. In the similar vein, in cases where you perpetually profit, it means the provider is losing and vice versa.
The market makers possess the right to reject your trade flows. This factor is a significant component. You can trade with a provider that is operating an STP/ECN/DMA model and nevertheless have your trading gains canceled or an even worse event, your deposit may hold back temporally. This type of unethical practice of an STP broker may happen to be due to their Market Makerrejected your trades at some time, and consequently, any profit you realized becomes invalid. The market maker may well furthermore choose to punish the Broker for permitting such streams by retaining your deposit. These are some of the real points of the traditional CFD brokering models.
All the CFD Providers are regulated by the FCA, at Pdextrading, we make all the necessary research to guarantee you safe trading. Traders can find additional info at live4trading.co