Real work on MT5 NDD - page 11
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I think I'll finish with the primer. The interest here is almost entirely theoretical, not practical.
To be interested in this not out of academic curiosity, you have to have actively traded a lot. This is not a lecture, there is simply no other way.
What did I say wrong? For example, I have encountered this definition:
STP is Straight Through Processing. With STP, clients' trades are sent directly to liquidity providers - banks or other brokers. STP systems can be connected to one or more liquidity providers. The more liquidity providers, the more liquidity in the system and therefore the better execution for clients.
ECN - Electronic Communications Network. ECN forex brokers, in addition to STP, allow client orders to communicate with each other. An ECN is a marketplace where all participants (banks, merchant brokers and individual traders) trade against each other. Participants of interaction within the system receive the best offers for their trades at a certain point of time. All trades are executed between counterparties in real time.
I do not understand why ECN/STP is better than ECN, there is very little good information on the subject. As for the interest, it is more for self-development, you can also trade in the kitchen.
As for the interest, it is more for self-development, you can also trade in the kitchen.
Why? Now there are sites (real, mt5) where ECN starts from $200
Why? Now there are sites (real, mt5) where ECN starts from $200
If they write MT5 ECN, then after a closer look you find NDD))
1. Because all liquidity providers must become clients of your ECN system. There is such a broker - LMAX. It is practically a pure ECN (MTF exchange), in it liquidity providers are clients of the created system. I.e. there are some kind of agreements signed with some banks that they accept such terms. I mentioned LastLook above, besides that there are other reasons why many banks do not go for such terms.
2. a huge difference, a market order will be executed with slippage in both directions, a limit order only in the positive direction, or is delayed. Setting a pending order in advance (at least one second beforehand) allows us to avoid dependence on the terminal<->trading platform server<->aggregator, respectively reduce time costs for execution and thus improve the execution itself.1. Why should the liquidity provider become the aggregator's client? It should be logically vice versa - the aggregator should be a client so that it can send its pending orders and market orders to the provider for execution in its market space. The aggregator only has to have the provider's market data like any other trader, i.e. become a client of the external provider which does not require any special agreements.
2. In MT4 for example you can set slippage for a market order, if it is zero then there should be a redirect.
NDD - Says that the other side of the transaction is not a broker, it is only an intermediary. This is not inconsistent with ECN. Contrast this with DD - the second side of the transaction is a broker (DC).