The difference between ECN and market maker execution
The majority of forex brokers fall into two execution models: dealing desk or ECN. The distinction matters. A dealing desk broker is essentially the one taking the opposite position. An ECN broker routes your order directly to banks and institutional LPs — you're trading against genuine liquidity.
In practice, the difference shows up in a few ways: whether spreads blow out at the wrong moment, execution speed, and order rejection rates. A proper ECN broker generally give you tighter spreads but charge a commission per lot. Dealing desk brokers pad the spread instead. Neither model is inherently bad — it comes down to what you need.
If you scalp or trade high frequency, a proper ECN broker is typically worth the commission. Tighter spreads compensates for the commission cost on the major pairs.
Execution speed: what 37 milliseconds actually means for your trades
Every broker's website mentions fill times. Numbers like "lightning-fast execution" make for nice headlines, but how much does it matter for your trading? Quite a lot, depending on your strategy.
For someone executing longer-term positions, a 20-millisecond difference doesn't matter. For high-frequency strategies targeting tight ranges, execution lag can equal slippage. If your broker fills at under 40ms with a no-requote policy offers an actual advantage compared to platforms with 150-200ms fills.
Some brokers put real money into proprietary execution technology to address this. Titan FX developed a proprietary system called Zero Point which sends orders directly to LPs without dealing desk intervention — the documented execution speed is under 37 milliseconds. You can read a detailed breakdown in this review of Titan FX.
Raw spread accounts vs standard: doing the maths
This is a question that comes up constantly when picking a broker account: do I pay the raw spread with commission or markup spreads with no fee per lot? The maths comes down to your monthly lot count.
Let's run the numbers. A standard account might offer EUR/USD at around 1.2 pips. A commission-based account shows 0.1-0.3 pips but charges a commission of about $7 per lot round-turn. With the wider spread, you're paying through every trade. If you're doing 3-4+ lots per month, the raw spread account is almost always cheaper.
A lot of platforms offer both account types so you can see the difference for yourself. Make sure you do the maths with your own numbers rather than going off hypothetical comparisons — broker examples often make the case for one account type over the other.
500:1 leverage: the argument traders keep having
Leverage splits retail traders more than any other topic. The major regulatory bodies have capped leverage to relatively low ratios for retail accounts. Offshore brokers continue to offer 500:1 or higher.
The standard argument against is simple: it blows accounts. Fair enough — statistically, most retail traders lose money. But the argument misses a key point: professional retail traders rarely trade at 500:1 on every trade. What they do is use the availability more leverage to lower the margin tied up in any single trade — freeing up capital for additional positions.
Obviously it carries risk. That part is true. But blaming the leverage is like blaming the car for a speeding ticket. When a strategy requires lower margin requirements, the option of higher leverage frees up margin for other positions — which is the whole point for anyone who knows what they're doing.
VFSC, FSA, and tier-3 regulation: the trade-off explained
The regulatory landscape in forex exists on a spectrum. At the top is FCA, ASIC, CySEC. Leverage is capped 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 places like Vanuatu (VFSC) and Mauritius (FSA). Less oversight, but the flip side is better trading conditions for the trader.
The trade-off is real and worth understanding: tier-3 regulation gives you more aggressive trading conditions, less trading limitations, and often more competitive pricing. But, you sacrifice some investor protection if the broker fails. No compensation scheme paying out up to GBP85k.
For traders who understand this trade-off and choose execution quality and flexibility, offshore brokers are a valid choice. What matters is looking at operating history, fund segregation, and reputation rather than just trusting a licence badge on a website. A platform with a long track record and no withdrawal issues under VFSC oversight can be a safer bet in practice than a brand-new broker that got its licence last year.
Scalping execution: separating good brokers from usable ones
If you scalp is the style where broker choice matters most. You're working 1-5 pip moves and holding trades open for very short periods. In that environment, seemingly minor differences in execution speed equal the difference between a winning and losing month.
The checklist comes down to a few things: 0.0 pip raw pricing from 0.0 pips, execution in the sub-50ms range, guaranteed no requotes, and no restrictions on holding times under one minute. Certain platforms technically allow scalping but slow down orders if you trade too frequently. Check the fine print before depositing.
Platforms built for scalping will put their execution specs front and centre. Look for their speed stats disclosed publicly, and often include virtual private servers for automated strategies. If a broker avoids discussing fill times anywhere on their marketing, take it extra resources as a signal.
Social trading in forex: practical expectations
Copy trading took off over the past several years. The concept is straightforward: identify traders who are making money, replicate their positions automatically, collect the profits. In practice is less straightforward than the advertisements make it sound.
The main problem is time lag. When the lead trader enters a trade, your mirrored order fills with some lag — when prices are moving quickly, the delay transforms a profitable trade into a losing one. The smaller the strategy's edge, the bigger this problem becomes.
That said, a few copy trading setups are worth exploring for people who can't monitor charts all day. Look for access to verified trading results over no less than several months of live trading, not just backtested curves. Risk-adjusted metrics tell you more than the total return number.
A few platforms offer in-house social platforms within their standard execution. This can minimise latency issues compared to third-party copy services that bolt onto the broker's platform. Research the technical setup before trusting that historical returns can be replicated to your account.