Looking for a recommended worldwide non market maker forex broker for low deposit account
- Thread starter ya12
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These are all dealing desk brokers, some to more degree than others. Since Forex itself, is traded only OTC and never on central exchanges, there is NO non dealing desk brokers. Whenever you are trading forex, you will ALWAYS be trading against a dealer ie, a MM, even forex brokers themselves, they trade with market makers, usually referred to as liquidity brokers, basically bigger market makers for forex brokers. The whole entire forex industry is basically one big food chain with retail traders like us at the very bottom of the food chain.
So if you want to trade, I would recommend you to trade instruments that trade on central exchanges. As far as I know, only futures and bonds are instruments that trade purely on central exchanges and with no market makers. Even stocks and options are trading more or less on a dealing desk model with payment for orderflow.
Oh, there are market makers in the CME. You just need to know where to look. They like to remain hidden, but can be found.
Here's the March MYM right before today's close...
There they are, at 35547 and 35495. Now that the market is closed, they are nowhere to be found. *poof* they are gone.
CME is still a spoof-fest. It's insane.
sure there are Market makers on main exchanges, you and me can be a market maker in that sense! but I think what the OP meant was a "no conflict of interest" broker.... such as all FCM or stock brokers who simply take your order to a regulated true exchange so in case of CME they novate the trade and make sure buyer and seller honor the commitment thus eliminating your counter party risk
Where as on an OTC broker the broker themselves could be your counterpart!
yes some claim ECN but as JSOP mentioned they even might be acting as Exchange and have no conflict of interest with you as a retail trader as they in turn either match the orders internally or farm it to "liquidity providers" but at the end of the day read fie print are they really not the counterpart?
+ the entire FX OTC is not regulated or thinly regulated ( UK and USA has better rules) and domiciled in very dodgy jurisdictions
Would anybody trade their stocks on a tin pot island based "Exchange" NO
Look at even the regulated OTC fx "brokers" like FXCM USA!
when was the last time CME/ NYSe, LME, LSe, SGX, ASX went out of business! or not honor the trade!
Yeah but there is no payment for order flow in futures and bonds. It's no problem that that there are market makers. It's when they take on the opposite side of your trade and trade against you that's the problem. With forex, everything is OTC so you have no choice but to trade against market makers. In stocks and options, you are supposed to have everything traded on central exchanges but with payment for orderflow, you end up trading against market makers also.
Yes I agree with you Exchange traded is better as there is no conflict of interest as comapred to OTC .. but how many people understand this difference! as soon as they see the word Broker many think oh must be OK .. FXCM USA is a good example of things going bad.. having said that in USA even an FCM can go out of business and there is no SIPC protection but any way that is a slightly diff subject matter.
Now a days OTC CFd have started offering OTC Option CFds! LOL
SIPC protection has nothing to do with trading with non dealing desk brokers. Those are totally different concepts. SIPC protection deals with default risk or going concern of the brokers that you have money with. Trading with non dealing desk brokers have to do with conflict of interest. Bankruptcy can happen with any broker. Bear & Stern and Lehman Brothers, two of the most prestigious and capital intensive brokers still went bankrupt during the 2008 financial crisis. This has nothing to do with whether it's a non dealing desk broker or not. Non dealing desk brokers have to do with fair dealing and not trading against clients to profit at the clients' expense.
OTC Option CFD's? Are those binary options?
I only mentioned SIPC becasue we are talking about WHICH broker which goes hand in hand with "Which Exchange or OTC" and client money protection. etc.. any way back to OTC FX Best transparency would be either FX futures or if SIPC protection sought that FX ETF list woudl be OTC FX even if it is in good jurisdiction like UK
OTC Option CFD's? = E toro I think ( base sin Cyprus!)
SIPC protectio is irrelevant imo. Any broker can go broke at any time. As long as you are trading instruments that are protected under the SIPC and with a broker that's a member of SIPC you are fine. But trading with brokers that do not trade against clients, that's a different story. That is something that impacts your profitability/losses every single time when you trade. You can be trading with a broker that's under the SIPC protection but if it trades against you, you will not make any money or be constantly losing money.