What are the types of forex brokers?
The most essential element in the forex market today is forex brokers. Because they play an important role by providing individuals access to the currency market. These individuals may be traders who lack the financial resources to finance their trade and participate in the interbank market.
The value of small trade in the banking market is estimated at $ 1,000, which can only be shared by high-value traders. Otherwise, you can start participating in the Forex market with a $ 50 mark as an example, and you can easily make profits in the market by helping forex brokers. But first you must know the different types of forex brokers before entering the market.
There are two types of FX brokers in the FX market, namely "Market Makers" and "ECN Brokers".
ECN Brokers (ECN): The ECN broker acts as a regulator or a spokesperson by matching buyers and sellers. It does this by placing commands using its own communications network. ECN broker does not provide financial liquidity. It plays no role in manipulating market prices and provides only a means for buyers and sellers to communicate with one another.
Market Maker: These brokers provide liquidity to aspiring traders by taking positions on their positions. For example, when a trader buys a stake from GBP: CHF, in order to do this, another party will sell a lot of that stake. Market makers play the role of the other. They are standing on the opposite side of the deals. In this way, forex trading is a bargain for a deal, there is a party that loses money and the other collects profits.
Therefore, when an individual chooses the type of intermediaries market makers, this means that his loss is a gain for the brokers and vice versa. However, market makers do not admit this to forex traders. It is in their interest that traders lose money. It is not impossible for traders to make money when dealing with market intermediaries. When traders make high profits, these brokers have no excuses not to give their money. At this point it is best to move to another forex broker.