What is the Difference Between Electronic Communication Network and Straight Through Processing Account in Indices Trading?

ECN Indices Trading Account vs 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.

STP Indices Trading Accounts

STP Indices Trading Account stands for Straight Through Processing, the STP Indices Trading Account brokers will send client orders direct to their Indices Trading Liquidity Provider, the Indices Trading Liquidity Provider is a big bank with deep liquidity to trade on the interbank network.

An STP Indices Trading Account provided by an STP stock indices trading broker can either have one Indices Trading Liquidity Provider or many liquidity providers.

The best thing about STP Indices Trading Accounts is that stock indices traders can place their stock indices trades immediately with instant execution because they have access to the interbank market via their STP stock indices trading broker.

STP Indices Trading Accounts will not charge commissions, but will charge spreads on stock indices trades. Because Indices traders have access to the interbank market execution, there is no requotes on the indices orders neither any order waiting for execution, the execution is instant.