ECN

An ECN (Electronic Communication Network) is a type of trading system that connects traders directly to liquidity providers, such as banks, hedge funds, and other market participants. This is done without the need for a traditional broker or dealing desk. ECN brokers facilitate transparent and fast trade execution by matching buy and sell orders in real time. This ensures competitive bid and ask prices. This system is commonly used in the Forex market. It is favored by traders who seek direct market access and tighter spreads.

One of the main advantages of ECN trading is lower spreads, especially during high liquidity periods. Prices are sourced from multiple participants. Additionally, since ECN brokers do not take the opposite side of trades, they eliminate the conflict of interest that can exist with market makers. ECN are popular among professional traders and scalpers due to their speed, transparency, and access to deep liquidity. Scandinavian Markets is a STP-ECN broker, learn more and start trading with a trustworthy broker.

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