The difference between ECN and market maker execution
A lot of the brokers you'll come across fall into two broad camps: dealing desk or ECN. This isn't just terminology. A dealing desk broker becomes the other side of your trade. A true ECN setup routes your order straight to the interbank market — you get fills from real market depth.
For most retail traders, the difference shows up in how your trades get filled: whether spreads blow out at the wrong moment, execution speed, and whether you get requoted. Genuine ECN execution generally give you tighter spreads but apply a commission per lot. Market makers widen the spread instead. Neither model is inherently bad — it hinges on how you trade.
If your strategy depends on tight entries and fast fills, a proper ECN broker is typically the right choice. Tighter spreads compensates for paying commission on most pairs.
Fast execution — separating broker hype from reality
You'll see brokers advertise how fast they execute orders. Claims of under 40ms fills look good in marketing, but what does it actually mean in practice? More than you'd think.
For someone placing two or three swing trades a week, shaving off a few milliseconds doesn't matter. But for scalpers targeting quick entries and exits, slow fills translates to slippage. If your broker fills at in the 30-40ms range with a no-requote policy gives you noticeably better entries versus slower execution environments.
Certain platforms have invested proprietary execution technology to address this. Titan FX, for example, built their proprietary system called Zero Point that routes orders immediately to LPs without dealing desk intervention — they report averages of under 37 milliseconds. You can read a detailed breakdown in this review of Titan FX.
Raw spread accounts vs standard: doing the maths
Here's a question that comes up constantly when setting up an account type: should I choose a commission on raw spreads or zero commission but wider spreads? The answer depends on how much you trade.
Take a typical example. The no-commission option might have EUR/USD at 1.0-1.5 pips. The ECN option offers true market pricing but applies around $3.50-4.00 per lot traded both ways. With the wider spread, the cost is baked into the spread on each position. If you're doing more than a few lots a week, the raw spread account saves you money mathematically.
Many ECN brokers offer both account types so you can pick what suits your volume. learn more here What matters is to work it out using your real monthly lot count rather than trusting the broker's examples — those usually favour one account type over the other.
Understanding 500:1 leverage without the moralising
The leverage conversation polarises forex traders more than most other subjects. The major regulatory bodies have capped leverage to 30:1 in most jurisdictions. Offshore brokers still provide ratios of 500:1 and above.
Critics of high leverage is simple: inexperienced traders wipe out faster. This is legitimate — the data shows, the majority of retail accounts lose money. The counterpoint is a key point: traders who know what they're doing never actually deploy full leverage. They use the availability high leverage to minimise the margin tied up in any single trade — freeing up margin to deploy elsewhere.
Obviously it carries risk. Nobody disputes that. But that's a risk management problem, not a leverage problem. When a strategy benefits from lower margin requirements, access to 500:1 lets you deploy capital more efficiently — most experienced traders use it that way.
Choosing a broker outside FCA and ASIC jurisdiction
Broker regulation in forex operates across different levels. The strictest tier is FCA (UK) and ASIC (Australia). Leverage is capped at 30:1, enforce client fund segregation, and put guardrails on the trading conditions available to retail accounts. Further down you've got the VFSC in Vanuatu and similar offshore regulators. Fewer requirements, but that also means better trading conditions for the trader.
The trade-off is not subtle: tier-3 regulation means higher leverage, lower trading limitations, and usually more competitive pricing. The flip side is, you get less regulatory protection if the broker fails. You don't get a investor guarantee fund paying out up to GBP85k.
For traders who understand this trade-off and pick execution quality and flexibility, tier-3 platforms are a valid choice. What matters is doing your due diligence rather than just checking if they're regulated somewhere. An offshore broker with a decade of operating history under tier-3 regulation is often a safer bet in practice than a newly licensed FCA-regulated startup.
What scalpers should look for in a broker
For scalping strategies is the style where broker choice matters most. Targeting 1-5 pip moves and keeping positions for seconds to minutes. At that level, even small gaps in fill quality become profit or loss.
The checklist comes down to a few things: raw spreads from 0.0 pips, execution under 50 milliseconds, guaranteed no requotes, and explicit permission for scalping strategies. Certain platforms say they support scalping but add latency to execution when they detect scalping patterns. Look at the execution policy before depositing.
Brokers that actually want scalpers tend to put their execution specs front and centre. You'll see their speed stats disclosed publicly, and they'll typically offer VPS hosting for automated strategies. If the broker you're looking at avoids discussing their execution speed anywhere on their marketing, take it as a signal.
Social trading in forex: practical expectations
Social trading has become popular over the past few years. The concept is simple: identify someone with a good track record, copy their trades without doing your own analysis, benefit from their skill. In practice is less straightforward than the advertisements suggest.
The main problem is time lag. When the lead trader executes, your mirrored order executes after a delay — and in fast markets, that lag can turn a profitable trade into a bad one. The tighter the profit margins, the bigger the lag hurts.
That said, some copy trading setups deliver value for those who can't develop their own strategies. The key is finding platforms that show real performance history over at least several months of live trading, not just backtested curves. Looking at drawdown and consistency matter more than headline profit percentages.
A few platforms offer in-house social platforms alongside their regular trading platform. This can minimise the execution lag compared to external copy trading providers that bolt onto the trading platform. Check how the copy system integrates before trusting that the lead trader's performance can be replicated with the same precision.