What is the Difference Between Electronic Communication Network and Dealing Desk Account in Indices Trading?

ECN Indices Trading Account vs DD Indices Trading Account

ECN Indices Trading Accounts

ECN Indices Trading Account stands for Electronic Communication Network, these ECN Indices Trading Account brokers are connected to the interbank network directly through an electronic communication network and the indices orders from the ECN Indices Trading Account are placed straight to the electronic network.

The ECN Indices Trading Account will display different orders from different banks. The indices trading quote placed by these ECNs network of banks are direct from the to the interbank network and orders are executed directly to the interbank market once a indices trader trading with this ECN account places an order with their stock indices trading broker.

These ECNs account will charge commissions + spread for every indices trade. For these ECN Indices Trading Account execution method every trade is matched to another in real time over the interbank network - ECN Network.

DD Indices Trading Accounts

DD stands for dealing desk, these DD account indices brokers have a dealing desk where they can match orders and execute indices order in the online stock indices market.

The indices trader trading with a DD account will get a lot of requotes.

Dealing Desks will issue indices traders with a lot of order requotes, meaning indices prices of orders are not real time and the stock indices trading broker can requote a indices trader's order if the stock indices price of the stock indices trading market changes quick enough before the broker's dealing desk places the order online or before they match the order in the online stock indices market.

Dealing Desk accounts therefore means that order execution of stock indices orders is not instant and therefore this execution model may mean that trading orders executed using a DD Indices Trading Account are not executed as quickly as when compared to an ECN account or an STP account.