ECN vs dealing desk: understanding what you're trading through
Most retail brokers fall into two execution models: market makers or ECN brokers. The distinction matters. A dealing desk broker acts as the one taking the opposite position. ECN execution routes your order straight to liquidity providers — you get fills from actual buy and sell interest.
Day to day, the difference shows up in three places: whether spreads blow out at the wrong moment, execution speed, and requotes. Genuine ECN execution generally offer raw spreads from 0.0 pips but apply a commission per lot. DD brokers pad the spread instead. There's no universally better option — it comes down to what you need.
If you scalp or trade high frequency, ECN execution is generally the right choice. The raw pricing compensates for paying commission on most pairs.
Why execution speed is more than a marketing number
You'll see brokers advertise fill times. Figures like sub-50 milliseconds make for nice headlines, but what does it actually mean when you're actually placing trades? More than you'd think.
A trader who executing a handful of trades per month, a 20-millisecond difference won't move the needle. But for scalpers trading tight ranges, execution lag can equal worse fill prices. A broker averaging under 40ms with zero requotes offers noticeably better entries versus slower execution environments.
A few brokers have invested proprietary execution technology to address this. One example is Titan FX's Zero Point technology designed to route orders straight to LPs without dealing desk intervention — they report averages of under 37 milliseconds. There's a thorough analysis in this Titan FX broker review.
Blade vs standard accounts: where the breakeven actually is
This ends up being the most common question when picking an account type: do I pay commission plus tight spreads or markup spreads with no fee per lot? The answer depends on your monthly lot count.
Let's run the numbers. A standard account might show EUR/USD at around 1.2 pips. A commission-based account shows 0.1-0.3 pips but charges around $3.50-4.00 per standard lot round trip. With the wider spread, the broker takes their cut via the markup. Once you're trading moderate volume, ECN pricing saves you money mathematically.
A lot of platforms offer both as options so you can see the difference for yourself. Make sure you calculate based on your actual trading volume rather than going off the broker's examples — broker examples tend to favour whichever account the read this broker wants to push.
500:1 leverage: the argument traders keep having
The leverage conversation polarises forex traders more than almost anything else. Regulators limit leverage to 30:1 or 50:1 depending on the asset class. Platforms in places like Vanuatu or the Bahamas can still offer ratios of 500:1 and above.
The usual case against 500:1 is simple: retail traders can't handle it. That's true — the numbers support this, traders using maximum leverage end up negative. But the argument misses something important: professional retail traders never actually deploy full leverage. They use the availability more leverage to reduce the money sitting as margin in open trades — freeing up funds to deploy elsewhere.
Obviously it carries risk. That part is true. But that's a risk management problem, not a leverage problem. When a strategy needs reduced margin commitment, having 500:1 available means less money locked up as margin — most experienced traders use it that way.
VFSC, FSA, and tier-3 regulation: the trade-off explained
Broker regulation in forex exists on different levels. Tier-1 is FCA, ASIC, CySEC. They cap leverage at 30:1, mandate investor compensation schemes, and put guardrails on the trading conditions available to retail accounts. On the other end you've got jurisdictions like Vanuatu and Mauritius and Mauritius FSA. Fewer requirements, but that also means higher leverage and fewer restrictions.
The compromise is straightforward: offshore brokers means higher leverage, less trading limitations, and typically cheaper trading costs. In return, you get less regulatory protection if there's a dispute. No regulatory bailout paying out up to GBP85k.
For traders who understand this trade-off and prefer performance over protection, offshore brokers work well. The key is looking at operating history, fund segregation, and reputation rather than just reading the licence number. A platform with a long track record and no withdrawal issues under tier-3 regulation is often more trustworthy in practice than a freshly regulated tier-1 broker.
What scalpers should look for in a broker
Scalping is where broker choice matters most. You're working 1-5 pip moves and staying in positions for seconds to minutes. In that environment, tiny gaps in fill quality equal profit or loss.
Non-negotiables for scalpers isn't long: 0.0 pip raw pricing from 0.0 pips, order execution under 50 milliseconds, a no-requote policy, and the broker allowing scalping strategies. Some brokers technically allow scalping but add latency to orders for high-frequency traders. Read the terms before funding your account.
Platforms built for scalping will put their execution specs front and centre. Look for their speed stats disclosed publicly, and usually offer VPS hosting for automated strategies. If the broker you're looking at is vague about their execution speed anywhere on their marketing, that's probably not a good sign for scalpers.
Copy trading and social platforms: what works and what doesn't
The idea of copying other traders took off over the past decade. The appeal is simple: identify profitable traders, mirror their activity in your own account, and profit alongside them. How it actually works is more complicated than the advertisements make it sound.
The main problem is execution delay. When the lead trader opens a position, your copy goes through milliseconds to seconds later — during volatile conditions, the delay transforms a profitable trade into a worse entry. The tighter the average trade size in pips, the more the lag hurts.
Despite this, a few social trading platforms are worth exploring for those who don't want to trade actively. The key is finding transparency around audited track records over a minimum of a year, not just demo account performance. Looking at drawdown and consistency are more useful than headline profit percentages.
Some brokers build their own social trading alongside their regular trading platform. This can minimise the delay problem compared to external copy trading providers that sit on top of MT4 or MT5. Look at whether the social trading is native before trusting that the results will translate in your experience.