Differences between NDD, STP and ECN executions - FXPro Trading Platforms
FXPro is a NDD broker
FXPro provides online Forex and CFD trading service as a NDD broker.
Thus all trading orders are executed anonymously with No Dealing Desk Intervention.
But why FXPro choose to be a NDD broker when there are many online brokers who are known as STP and ECN brokers?
FXPro explains the reasons why.
Why FxPro is not an STP Broker?
STP (Straight-Through-Processing) is one of the most commonly misinterpreted terms in the trading industry.
Although it is often considered to relate to the execution that a client receives from their broker, STP is in fact a post-execution, post-trade communication process between executing counter-parties with minimal impact on the speed or price of execution that a retail trader is offered.
Though FxPro does use STP technologies, they classify themselves as NDD in accordance to their method of order execution.
Why FxPro is not an ECN Broker?
ECN stands for Electronic Communication Network and is frequently confused with NDD execution.
However, ECN refers to the anonymous communication between executing counter-parties which may, in fact, result in no guaranteed fills and worse pricing for the retail trader.
FxPro is a true No Dealing Desk Execution broker, meaning that they execute client orders with no dealing desk intervention.
For information about FXPro’s trading conditions, visit the official website from below.
Who is FXPro?
FXPro is a Mega Forex broker in Europe, with many industry awards and accreditation within retail Forex market.
Since the foundation in 2006, the broker has been licensed by multiple regulatory authorities including CySEC, UK FCA,
FSCA, Dubai FSA and Bahamas SCB.
FXPro strives to offer complete NDD (Non-Dealing Desk) execution environment since 2012.
The broker offers very “fair” trading conditions through 3 most popular trading platforms MT4, MT5 and cTrader.
FXPro is believed to be the most “Trusted” Forex broker for retail investors.
What you can invest in with FXPro?
FXPro’s competitive trading condition is as below.
FXPro offers over 300 financial instruments including Forex, Stocks, Indices, Commodities, Metals and Energies through 3 of the most popular trading platforms which are MT4, MT5 and cTrader.
Maximum leverage is up to 1:500 and both Floating & Fixed spreads are available from 0.7 pip of minimum spread. (you can find the actual spread of FXPro from here.)
With 100% NDD environment, all kinds of trading styles are allowed on FXPro’s platforms, except arbitrage.
For the information of available Deposit and Withdrawals methods, please visit the page here.
Execution Rules of FXPro
As a leading forex broker, FXPro strives to provide the clients with superior order execution.
As a regulated, MiFID-compliant European broker, it is FXPro’s responsibility and priority to treat all of the clients on an equal and fair basis.
The general rules below apply when you open a Trading Account with FXPro.
1. Type of Orders
As our client, you are given the option to place the following orders for execution:
“Market Order” is an order instantly executed.
You may attach to a market order a Stop Loss and/or Take Profit.
Stop Loss is an order to limit your loss on a trade, whereas Take Profit is an order to capture your profit.
“Pending Order” is an order to be executed at a later time at a price that you specify.
The following types of pending orders are available: Buy Limit, Buy Stop, Sell Limit, Sell Stop and Trailing Stops.
You may attach to any pending order a Stop Loss and/or Take Profit to any pending order.
You may modify an order before it is executed, but cannot change or remove Stop Loss, Take Profit or Pending Orders if the price has reached the level of the order execution.
2. Trading Hours and 24/5 Service
FxPro’s operation time: round-the-clock (24 hours) from 23.00.01 P.M. (CET) Sunday through 23.00.00 P.M. (CET) Friday, which is from 00.00.01 A.M. (Cyprus Time) Monday through 24.00.00 P.M. (Cyprus Time) Friday.
Cyprus Time is indicated as the Server time in the market watch window of the trading terminal.
Holidays are announced through the internal mail of the MT4 trading terminal.
During the above listed time FXPro operates multilingual Customer Support (Help Desk), available 24/5, should you require any further clarification of holidays.
FXPro will not quote any price outside the operations time, therefore no orders can be placed by the client during that time.
3. Best Execution on FXPro’s trading platforms
FXPro takes all necessary steps to obtain the best possible result for the clients when executing their trading orders:
- Price
For all instruments, FXPro quotes two prices: The higher price (ASK) at which the client can buy (go long) for that instrument, and the lower price (BID) at which the client can sell (go short) for that instrument.- Spread: The difference between the lower and the higher price of any given instrument. FXPro offers competitive spreads starting from just 0.5 pips.
- ASK Price: Buy Limit, Buy Stop, Stop Loss and Take Profit for opened short position are executed at the ASK price.
- BID Price: Sell Limit, Sell Stop, Stop Loss and Take Profit for opened long position are executed at the BID price.
- Execution Price Orders: Stop Loss, Take Profit, Buy Limit, Buy Stop, Sell Limit and Sell Stop are executed at the requested price. Under certain trading conditions it may be impossible to execute the above at the requested price and FxPro has the right to execute them at the first available price.
- Costs
For opening a position in some types of financial instruments, the following fees may occur:- Commissions: May be charged either in the form of a percentage of the overall value of the trade or as a fixed amount. Currently this applies only to derivatives with an underlying financial instrument of shares and futures.
- Financing Fees: The value of opened positions in some types of financial instruments is increased or reduced by a daily financing fee “swap.” Financing fees are based on prevailing market interest rates, which may vary over time.
- Speed of Execution
FxPro places a great importance on speed when executing clients orders and strives to offer high speed of execution. - Likelihood of Execution
Although FXPro aims to execute all orders placed by the clients, should there be any reason we are unable to do so at that specific time, FXPro reserves the right to decline an order and to offer a new price in the form of a “Market Order.” In this case, you can either accept or refuse the new price. - Size of Order
The minimum size of an order is 0.1 lots (one tenth of a lot). A lot is a unit measuring the transaction amount and it is different for each type of financial instrument. - Leverage/Margin
Required margin is the amount needed to be in the Trading Account in order for a position to be opened. This is related to the leverage of the account, which can be chosen to be up to 1:500.
4. Execution Venues of FXPro
Execution venues are the entities within which the orders are placed or to which FxPro transmits orders for execution.
For the purposes of orders for the financial instrument provided by FxPro, they act as principal and not as agent on the client’s behalf; therefore FxPro is the sole execution venue for the execution of the client’s orders.
FxPro does not transmit the client order in the external market if the order is for the financial instrument provided by FxPro.
5. Bid Prices on Charts
Charts in the terminal are built and shown only for Bid prices.
However, for opening of long positions and closing of short ones, Ask price is always used.
But it is not shown in the chart in any way and it cannot be sent.
More scrutiny and review can be accessed by enabling the “Show Ask line” parameter.
After this command has been executed, an additional horizontal line corresponding with current Ask price of the last bar will appear in the chart.
6. Expert Advisor And Trailing Stops
Expert Advisors (EA) are programmes in the terminal that have been developed in MetaQuotes Language 4 (MQL 4) and used for automation of analytical and trading processes.
EAs enable the performance of prompt technical analysis of price data and manage trading activities on basis of signals received.
The entire routine work of technical analysis and trading can be given to EA.
An EA can perform analytical and trading operations for any symbols or periods independent of whether the corresponding chart was opened or not.
Stop Loss is intended for the reduction of losses where the symbol price moves in an unprofitable direction.
If the position becomes profitable, Stop Loss can be manually shifted to a break-even level.
To automate this process, Trailing Stop was created.
This tool is especially useful when price changes strongly in the same direction or when it is impossible to watch the market continuously for some reason.
Bear in mind that EA and Trailing Stops operate in the client terminal, not in the server (as with Stop Loss or Take Profit). This is why they will not work, unlike the above orders, if the terminal is off.
7. Margin Level Required To Open Lock Or Hedge Positions
A lock or hedge position appears when a client opens a trade for the same volume in the countrary direction of one already open.
This is not the same as closing the initial trade, since the lock position requires that both remain open.
When you open a lock position (the contrary position) you will not be asked for additional margin as long as your Margin Level is higher than 100% on your Trading Account.
Since the Margin level ratio expresses the relation between the Equity and the Used Margin (Margin Level = [Equity / Used Margin] * 100) you can conclude that as long as you have a positive Free Margin (Margin Level > 100%) you will be able to open lock positions without additional margin.
In the other case you won’t be able to open any new position including lock.
You can check your Equity, Used Margin, Free Margin and Margin Level at the status line of your Trading Account.
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