STP Forex brokers

(No Dealing Desk + STP)

STP Forex brokers is the most diverse group when it comes to trading conditions.

Ranging from STP brokers who act almost like a Market maker, to STPs who offer advanced DMA trading.

While all STP brokers offer No Dealing desk (NDD) trading and Straight Thought Processing (STP), which eliminates conflict of interests, there are 3 factors that stand them apart:

  • Order execution type
  • Number of liquidity providers
  • spreads

 

STP brokerOrder execution:Spreads:STP available on accounts:Number of Liquidity providers:
Forex Time (FXTM) Instant & Market executionvariableAll accounts
1BillionForexInstant & Market executionfixed & variableAll accountsover 30
24FXInstant & Market executionfixedAll accounts2
AAAFxMarket executionvariableAll accounts3
AAFX TradingMarket executionfixed & variableAll accounts10
Abshire-SmithInstant & Market executionfixed & variableAll accounts12
AccentForexInstant & Market executionfixed & variableSTP accounts - Market execution5+
ACM GoldInstant executionfixedAll accounts1
Admiral MarketsMarket executionvariableAll accountsover 12
ADS Securities LondonMarket executionvariableAll accountsover 30
ActivTradesMarket executionvariableInterbank accounts2 (Citi, Deutsche Bank)
Advanced MarketsMarket executionvariableAll accounts11 (Macquarie Bank, Bank of America, Barclays Capital, Citi, Commerzbank, BNP Paribas, Deutsche Bank, J.P. Morgan, Morgan Stanley, Nomura, UBS)
AFX CapitalMarket executionvariableAFX Classic accounts5
AGM MarketsMarket executionvariableAll accounts2
Alfa FinancialInstant & Market executionfixedAll accounts5
Alpha Capital MarketsInstant executionfixed & variableAll accountsover 14
AmigaFXInstant executionfixedAll accounts2
AssetsFXInstant & Market executionvariableAll accounts1 (LMAX)
ATC BrokersInstant & Market executionvariableAll accounts1 (FXCM)
Atom8Instant & Market executionvariableAll accounts1
AxioryMarket executionvariableAll accounts8 banks
AxiTraderMarket executionvariableAll accounts14
BCapitalsFXMarket executionvariableAll accounts25
BelforFxInstant & Market executionvariableAll accounts2
Blackwell GlobalInstant & Market executionfixed & variableAll accounts12 (BOA, Barclays, Citi, Credit Suisse, HSBC, JP Morgan, Standard Chartered, BNP Paribus, Deutsche Bank, RBS, USB, and Morgan Stanley)
BlackBull MarketsMarket executionvariableAll accounts22+ Top Tier 1 banks
BTFXMarket executionvariableAll accounts1
BulbrokersInstant & Market executionfixed & variableAll accounts10
Caesar TradeInstant & Market executionvariableAll accounts?
CAPPROFXInstant & Market executionvariableAll accounts5
CFD1000Instant & Market executionfixed & variableAll accounts10
CFH ClearingInstant & Market executionvariableAll accountsall top tier 1 banks
CFI MarketsInstant & Market executionfixed & variableAll accounts
CM TradingMarket executionvariableAll accounts70
Core Liquidity MarketsMarket executionvariableAll accountsover 15
ContinentalFXInstant & Market executionfixed & variableAll accountsover 10
DarwinexMarket executionvariableAll accounts1 (LMAX)
Direct FXMarket executionvariableAll accounts17 (tier 1 banks)
Divisa CapitalMarket executionvariableAll accounts12
EightCapMarket executionvariableAll accounts10
eToroInstant executionfixedAll accounts1 (RetailFX)
Euro Pacific BankMarket executionvariableAll accounts5
FBSInstant & Market executionfixed & variableAll accounts10+
IV BrokersInstant & Market executionfixed & variableAll accounts15+
FeelTradeInstant executionfixed & variableAll accountsover 30
FidelisMarket executionvariableAll accounts10+
Finpro TradingMarket executionvariableAll accounts16
FIPFX GLOBALInstant & Market executionvariableAll accounts10
FirewoodFXInstant executionfixedAll accounts2
Forex Broker IncInstant & Market executionfixed & variableAll accounts3
Forex ClubInstant executionfixed & variableActTrader platform7-10
Forex FSInstant & Market executionvariableAll accounts4 (banks)
Forex4youInstant & Market executionfixed & variableAll accounts2 (primary; + few reserve)
Forex.eeMarket executionvariableAll accounts6+
RallyTradeInstant & Market executionfixed & variableAll accounts1
Fortress CapitalInstant executionfixed & variableAll accountsover 30
FreshForexInstant & Market executionfixed & variableAll accounts4
FW MarketsMarket executionvariableAll accounts3
FXCHInstant executionfixedAll accounts8
Fort Financial ServicesInstant & Market executionfixed & variableAll accounts8 (Deutsche Bank, Barclays, Goldman Sachs, Morgan Stanley, Nomura, UBS, Merrill Lynch, Credit Suisee)
FX-EDGEMarket executionvariableAll accounts5-7
FXCM - Forex Capital MarketsMarket executionvariableAll accounts10+
FXFairMarket executionvariableAll accounts25
FxGloryInstant & Market executionfixedAll accounts5
FXGMInstant executionfixedAll accountsbroker refused to provide information
FxNetMarket executionvariableAll accounts2
FXOpen UKMarket executionvariableAll accountsover 15
FXOptimaxInstant & Market executionfixed & variableAll accounts>5
FxPlayerMarket executionvariableAll accounts20
FXPRIMUSInstant executionfixed & variableAll accounts5-10
GDA FincorpInstant & Market executionvariableAll accounts4
GAINSYMarket executionvariableSTP accounts20
Gallant Capital MarketsMarket executionvariableMicro & Standard accounts15
GCI FinancialInstant executionfixedAll accounts10
GDMFXInstant & Market executionfixed & variableAll accounts15
GKFXPRIMEInstant & Market executionfixed & variableAll accounts5
Global Prime ForexMarket executionvariableAll accountsover 15
Golden TangentMarket executionvariableAll accounts3
Grand CapitalInstant & Market executionvariableAll accounts3
Grinta InvestMarket executionvariableAll accounts14+
HeartForexMarket executionvariableAll accounts4
Hirose Financial UKInstant & Market executionfixedAll accounts10
HiWayFXMarket executionvariableAll accounts2
HotForexMarket executionvariableAll accounts6
IamFXMarket executionvariableAll accounts2 (IB for GCMFX)
IC MarketsMarket executionvariableSTP accounts2
IFC MarketsInstant executionfixedAll accounts5
IKON GroupInstant & Market executionfixed & variableAll accountsover 30
IMMFXMarket executionvariableAll accounts12
Indigo DMAMarket executionvariableAll accounts10
INTFXMarket executionvariableAll accounts5
InstaForexInstant executionfixedAll accountsbroker refused to provide information
InvastMarket executionvariableAll accountsover 30
InvestorseuropeMarket executionvariableAll accounts15 banks
IronFXInstant executionvariableAll accounts2
IsikFXInstant executionfixedAll accounts10
Juno MarketsMarket executionvariableAll accounts10-12
JustForexInstant & Market executionfixed & variableall accounts1 (Sucden Financial, through 18 banks)
KAWASEMarket executionvariableAll accountsover 15
Key To MarketsMarket executionvariableAll accounts20
KGI Ong CapitalMarket executionvariableAll accounts10
KRCNZMarket executionvariableAll accounts3
LAND-FXInstant & Market executionvariableAll accounts5+
Lider ForexInstant executionvariableAll accounts1 (FXCM broker)
LiteForexInstant & Market executionfixed & variableAll accounts21
LMAXMarket executionvariableAll accounts4 (LCH.Clearnet (central LP), Goldman Sachs, JPMorgan, Optiver)
LMFXInstant & Market executionfixed & variableAll accounts2
LCG (London Capital Group)Market executionvariableAll accountsover 10
Lucror FXInstant executionvariableAll accountsbroker refused to provide information
MaxFXInstant executionvariableAll accounts1
MEX EXCHANGEInstant & Market executionvariableAll accounts3+
MTI MarketsInstant & Market executionvariableAll accounts16
MTradingInstant & Market executionfixed & variableAll accounts5+
NAS BrokerInstant & Market executionfixed & variableAll accounts2
NoaFXInstant & Market executionfixed & variableAll accounts16
Nord FXInstant & Market executionfixed & variableStandard accounts18+ (via Currenex and Integral to: Bank of America, Barclays, BNP Paribas, Citibank, Commerz Bank, Credit Suisse, Deutsche bank, Goldman Sachs, HSBC, J.P.Morgan, Morgan Stanley, MUFG, Natixis, Nomura, RBS, SEB, SMBC, UBS))
NSFXInstant & Market executionfixed & variableAll accounts2
OctaFXMarket executionvariableAll accounts10
One Financial MarketsInstant & Market executionfixed & variableAll accounts8
OloFxMarket executionvariableAll accounts10
PaxForexInstant executionvariableAll accounts5
PepperstoneMarket executionvariableAll accounts22 (banks and ECNs)
Pacific Financial Derivatives (PFD-NZ)Instant & Market executionfixed & variableAll accounts12
PhillipCapitalMarket executionvariableAll accounts18
PhillipCapital UKMarket executionvariableAll accounts5+
ProfiforexInstant & Market executionfixed & variableAll accounts3
Real-ForexMarket executionvariableAll accounts10 (Bank of America, Citibank, Deutsche Bank, Goldman Sachs, J.P.Morgan, Morgan Stanley, UBS)
Renesource CapitalMarket executionvariableFX Calssic accounts26 (ADM, Deutsche Bank, MAREX, GFT, JSC IBC Finasta, JSC Citadele Banka, JSC Latvijas Krajbanka, KIT Finance, MF Glbal, ODL Securities, Penson Financial, Pinnacle Capital Markets, Saxo Bank, Swedbank, Commerzbank and other )
Royal Forex TradingInstant & Market executionfixed & variableAll accounts15
RoboForexInstant & Market executionfixed & variablePro accounts16 (through Integral: Citibank, Deutsche Bank, Bank of America, UBS, HSBC, NOMURA, RBS, BNP Paribas, Credit Suisse, COMMERZBANK, SEB, SMBC, Morgan Stanley, Goldman Sachs, JPMorganChase, NATIXIS
Rubix FXMarket executionvariableAll accounts15
SaudiQuoteInstant & Market executionvariableAll accounts9
Sterling Gent TradingMarket executionvariableAll accounts30+
SolforexMarket executionvariableAll accounts10
Sun Hung Kai ForexMarket executionvariableAll accountsbroker refused to provide information
StoxMarketInstant executionfixed & variableAll accounts2 to 10
Sucden FinancialInstant & Market executionvariableAll accounts15 banks
SunbirdMarket executionvariableAll accounts5
SVSFXMarket executionvariableAll accounts?
TFX MarketsMarket executionvariableAll accounts15
TeleTradeMarket executionfixedAll accounts10
ThinkMarketsMarket executionvariableAll accounts70 (banks via Currenex)
TifiaMarket executionvariableAll accounts3
Titan FXMarket executionvariableAll accountsover 20
TopFXMarket executionvariableAll accounts11
Trade12Instant executionvariableAll accounts6
TradeFxPMarket executionvariableAll accounts4
TradenextMarket executionvariableAll accounts2
TraderNovoInstant & Market executionfixed & variableAll accounts10
Trader's WayInstant executionvariableSTP accounts18
Traders TrustMarket executionvariableSTP accounts4 (Barclays, Deutsche Bank and Citybank)
TradersChoiceFXInstant & Market executionfixed & variableSTP accounts1 (one of: GAIN Capital, FXDD and FXCM brokers)
Tradestation SecuritiesMarket executionvariableAll accounts23 (numerous market centers such as NYSE, Nasdaq, ATD, CME, CBOT)
TradeviewMarket executionvariableAll accounts10
TradeWiseFXInstant & Market executionvariableAll accounts10
Trading 212Instant & Market executionfixed & variableAll accounts5
TradingBanksInstant executionfixed & variableAll accounts
TradizeInstant executionfixed & variableAll accounts3
TrioMarketsMarket executionvariableAll accounts20
Trust CapitalInstant executionfixedAll accounts3
UFXInstant executionfixedAll accounts1 (broker)
Uniglobe MarketsMarket executionvariableAll accounts5
UpFXInstant & Market executionvariableAll accounts10 banks and 4 private hedge fund/brokers
USGFXInstant & Market executionvariableAll accounts2
Valbury CapitalMarket executionvariableAll accountsa basket of banks
ValutradesInstant executionfixed & variableAll accounts11 (banks)
Vantage FXInstant & Market executionvariableAll accounts70
Velocity TradeMarket executionvariableAll accounts8
Vinson FinancialsInstant & Market executionfixed & variableAll accountsover 5
Wenn MarketsInstant & Market executionvariableAll accounts2
WH SelfInvestMarket executionvariableAll accounts15 (banks: J.P.Morgan, Citibank, Deutsche Bank, Barclays ...)
Windsor BrokersInstant & Market executionvariableDynamic STP accountsbroker refused to provide information
xCFDMarket executionvariableAll accounts5
XGLOBAL MarketsMarket executionvariableAll accountsover 30
XTB UKInstant & Market executionfixed & variableAll accounts1
YadixMarket executionvariableAll accounts15
YouTradeFXInstant executionfixedAll accounts60
ZAR FXInstant & Market executionvariableAll accounts5+

 

No Dealing Desk means STP

Any Forex broker that doesn’t run a dealing desk nowadays is called an “STP broker”.

But STP brokers can be different:

Broker A – a no dealing desk IB (introducing broker) who simply passes all client orders to the Prime broker – calls it “STP”
Broker B – a no dealing desk broker, who fills client orders himself using Instant execution, and then immediately (and automatically, without human intervention) offsets 100% of those orders with own liquidity providers – calls it “STP”
Broker C – a no dealing desk broker, who passes all client orders directly to the liquidity providers using Market execution – calls it “STP”

What kind of STP is each one of these brokers?

QUICK BASICS

STP – Straight Though Processing – means that there is no dealing desk involved in quoting & controlling market prices (no market making), but instead all orders are passed through to Liquidity Providers (other brokers and banks), where they are executed at the bid/ask rate given by those Liquidity Providers.

So, an STP broker with no dealing desk will direct all orders to Liquidity Provider(s). What happens next?

A Liquidity Provider (LP) always acts as a Principal and a Conterparty to your trade. An LP takes the other side of your position, while looking to make profits by closing this position later in a trade with another party.
(Same as with ECN brokers, who pass your trades to an ECN pool, where other liquidity providers – banks, hedge funds, brokers, investors – become a counterparty to your trade).

Thus, in the end your order always meets a Liquidity Provider, who is a final Counterparty to your trade.

3 ESSENTIAL COMPONENTS of an STP

There are 3 essential components that will help you to learn more about any STP broker:

1. Depth of the liquidity pool (number of liquidity providers)
2. Type of the spread (fixed or variable)
3. Type of execution (instant or market)

1. Liquidity providers and Depth of the liquidity pool. Why it matters?

Unlike ECN brokers who send orders to ECN liquidity pools with a large number of liquidity providers trading on the Interbank, an STP broker has it’s own “internal liquidity pool”, which consists of a smaller predetermined number of liquidity providers – only those with whom an STP broker has signed a business contract. Those Liquidity providers will then compete for providing the best bid/ask rates for orders coming from an STP broker.

The more there are liquidity providers in the system – the deeper is the liquidity pool.

It’s worth mentioning that if an STP broker has only one Liquidity Provider (LP), there will be no price competition among LPs, and therefore it’ll be equal to just adding yet another “middleman” into the trading. These days Forex brokers try to have more than one liquidity provider to be able to offer deeper liquidity, better bid/ask quotes and, as a result, lower spreads.

2. STP spreads: fixed vs variable?

STP brokers nowadays are known to offer both types of spreads: fixed and variable.

An STP broker with variable spreads works in a way similar to ECN model (but inside its own internal liquidity pool): while liquidity providers compete to offer the best bid/ask prices, an STP broker will pick the best Bid price from one liquidity provider and the best Ask price from another liquidity provider and deliver the best current spread to own clients (+ own small mark-up, which allows an STP broker to earn its profit).

An STP broker with fixed spreads won’t adjust spreads for the clients based on the lowest bid/ask prices offered by Liquidity providers. The spreads will remain fixed all the time.
If an STP broker has only 1 liquidity provider, this Liquidity Provider will act as a single counterparty to all client trades. In this case traders are at the mercy of the liquidity provider, who decides which prices to quote and when.

If there are several liquidity providers, but the spreads remain fixed, this means that an STP broker uses its own back-office price matching engine, which ensures that a broker is able to make profits on spread difference. To do that, a client is charged a fixed spread, which is higher than the best available rate a broker can get from the LP(s). A broker then earns on the spread difference while immediately hedging this trade with an LP at a better rate.

3. Instant vs Market execution?

As practice shows, when it comes to reading about trading advantages on brokers’ sites, the term “Instant execution” can be used differently:

Version 1: “Instant execution” in reference to the speed of order execution: fast, instantaneous order processing.
Version 2: “Instant execution” in reference to the method of order execution: an execution technology used on the trading platform. (Traders can find it in the order window when they open/close positions).

We’re interested in the second definition – “Instant execution as the method of platform order execution”.

Instant execution means that the order won’t go to the market (it’ll be instantly filled by your broker).
Market execution means the order will go to the market (where it’ll be filled based on available quotes from the liquidity providers).

STP brokers who offer Market execution provide true Direct Market Access (DMA) trading to their clients.

Summary

 

A summary – conditions comparison – for all STP brokers:
Fixed spreads Spreads quotes come from the broker, or from just 1 liquidity provider Variable spreads Quotes come from several liquidity providers, with spreads generated based on the best bid/ask quotes from liquidity providers
Instant execution Client orders are filled by the broker, who then may (or may not) offset own risks with liquidity providers – therefore it’s a less transparent model Market execution Client orders go to the market, where they are filled by liquidity providers – more transparent model
One liquidity provider No price competition, one liquidity provider controls the width of the spreads Several liquidity providers Liquidity providers create price competition, which results in better spreads for the clients.

 

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Note: We recommend not to use more than 5% of your equity in open trades at one time. Risk management is very important to minimize losses and maximize profits.
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