ECN stands for Electronic Communication Network or ECN broker which are Forex financial experts. They use electronic communication networks to allow clients to directly access other participants in the currency market. ECN is traded by a non-dealing desk platform. In other words, it means brokers will not forward orders to the liquidity provider.
Advantages of ECN trading
● Able to trade outside market hours
Even though you are busy with work during working hours, investment is not exempt because you can trade even outside market hours. Therefore, it is an advantage for traders who are unable to trade during normal business hours. Moreover, you can choose to trade at any convenient time or trade independently, which is a highly flexible trade.
● Suitable for one who has high privacy
For ECN trading, traders do not have to disclose their information. Therefore, this is good for investors who want to keep their private information confidential or do not want to disclose personal information in public. This is another advantage that greatly attracts investors.
● Transparent price
Transparent price is considered to be the most beneficial to traders because all ECN brokers can access and trade at the same price. The amount of historical price data can always be checked, which helps investors to prevent price fraud. Therefore, traders can check the historical data of both past and present prices for use in future calculations.
● All traders are equal
ECN trading will not allow one trader to gain benefits from the other. All traders can have equal access to the data. Therefore, you do not need to worry about inequality during trades.
Disadvantages of ECN trading
● Trading fee
Although there are many advantages of ECN trading, there are definite inevitable disadvantages. There are higher charging fees and commissions on general trading than ECN trading. The trader should cogitate to reconsider the profits they received in each trade.
Investing your fund with ECN brokers is another alternative to facilitate traders more efficiently. This will help traders to conveniently trade currencies through brokers. Also, traders can choose to trade at any convenient time and not limited to trading only during business hours and the price is transparent, which they can check the history and prices. Anyone can trade and receive equal rights in trading.