ECN brokers fees explain
ECN (Electronic Communications Network) brokers are Forex brokers that connect traders to a network of liquidity providers through an electronic platform. These brokers typically offer lower spreads and faster execution speeds than traditional market makers but charge a commission fee on each trade. This article will explain the different fees charged by ECN brokers, and recommend the three best ECN brokers according to the Traders Union.In the following table you can find typical fees and spreads of the best ECN brokers
Typical ECN fees are:
| ECN fee per lot | EURUSD everage spread | |
|---|---|---|
RoboForex |
$2 |
0.3-0.5 pips |
IC Markets |
$3-$3.5 |
0.1-0.2 pips |
Exness |
$3.5 |
0.1-0.2 pips |
How do ECN brokers make money?
ECN brokers make money by charging a fee on each trade that is executed through their network. This commission fee is typically ranging from $2 to $4 per executed standard lot.
ECN brokers also make money by charging an additional fee for access to their advanced trading platforms, or for providing other services. They can also charge monthly or annual subscription fees from traders to access their network.
How much are ECN fees?
In the following table you can find typical fees and spreads of the best ECN brokers
| ECN fee per lot | EURUSD everage spread | |
|---|---|---|
RoboForex |
$2 |
0.3-0.5 pips |
IC Markets |
$3-$3.5 |
0.1-0.2 pips |
Exness |
$3.5 |
0.1-0.2 pips |
Are ECN brokers cheap?
ECN (Electronic Communications Network) brokers typically offer lower spreads than traditional market makers, which can make them cheaper for traders who make a high volume of trades or trade large positions.
However, ECN brokers may charge commission fees, which can add to the cost of trading. It's important to compare the fees and spreads of different brokers to determine which one is the cheapest for your trading style.
For example, EURUSD ECN costs 2 to 3.5 dollars per lot and has a spread of 0.1 pip which makes the cost of the transaction between 3 and 4.5 dollars. However, the cost of spread on a standard account is between 7 and 20 dollars, depending on different brokers.
What is the minimum deposit for an ECN account?
The minimum deposit amount varies from one ECN account to another. RoboForex charges $10 as an ECN account minimum deposit, Exness charges $200, IC Markets charges $200, and so on.
Top 3 Forex ECN accounts
TU has listed the top three Forex ECN accounts, which are:
RoboForex ECN Account
Exness Group ECN Account
IC Markets ECN Account
RoboForex ECN account
Top Forex and CFD broker RoboForex provide a variety of ways to make money. Novice traders can automatically imitate the indications of experienced traders. The broker lets people trade on the Forex, stock, and cryptocurrency markets on their own. Experienced traders can also use a Forex bot builder.
Forex, stock, and cryptocurrency trading are supported by RoboForex. There are 8,700 different trading assets available through the broker.
In the CFD market, RoboForex earns through spreads. The commission on the Forex market is determined by the selected account. The typical spread ranges from 0.3 pip to $1–$2 per lot when trading on an ECN account.
For European clients, the maximum leverage is 1:30 however, for international traders the leverage is up to 1:500 for all types of platforms (MT4, MT5, and rTrader). However, for cTrader the leverage is 1:300. The broker also makes bonuses when accounts are opened.
Exness group ECN account
Since 2008, Exness Trading Company has been operating in the forex market. The broker now maintains the top spot in the forex ratings. The total monthly trading volume for the corporation is $325.8 billion USD. The broker currently offers CFDs on stocks, energy, metals, more than 120 currency pairs, cryptocurrencies, and stocks.
Exness's service gives traders good working conditions, such as low commissions, immediate order execution, and easy access to their money. Traders have different options for opening an account, depending on what they want to do. It is possible to open a demo account, which serves as both a training tool and a demo account for experienced traders.
Exness has currency, stock market, commodities market assets, and cryptocurrencies as trading instruments. In a standard account, the EURUSD average spread is 1 pip. The account fee for ECN/STP is $3.5 per lot.
IC Markets ECN account
IC Markets is a popular ECN (Electronic Communications Network) broker that offers trading in a wide range of financial instruments, including Forex, indices, commodities, and cryptocurrencies. One of their main selling points is the low spreads and fast execution speeds that they offer on their ECN accounts.
IC Markets' ECN account offers very competitive spreads, which are some of the lowest in the industry, especially for major currency pairs. This makes it a great choice for traders who prefer to trade with low spreads. They also offer a wide range of trading platforms, including cTrader, MT4, and MT5.
Another benefit of the IC Markets ECN account is the high leverage of up to 1:500. This can be useful for traders who want to make large trades but have a small account balance. However, it's important to remember that high leverage can also increase the risk of losing money.
IC markets also offer negative balance protection, which makes sure that traders can't lose more than the amount of money in their accounts. This feature provides an additional level of security for traders.
IC Markets also provides excellent customer support with multiple languages and 24/5 availability. There is no commission on standard accounts in IC Markets. For EURUSD, the spread is 0.8 pips. The spread for a raw account is 0.1 pip and has a fee of 3.5 per lot.
FAQ
Which is better, ECN or standard?
ECN is cheaper than a standard account because it only charges a commission on the trade execution and not a premium on the spread. A standard account, on the other hand, charges a premium on the spread to make money from the trade, which makes the cost higher.
What does ECN mean in Forex?
ECN stands for "Electronic Communications Network" in Forex trading. An ECN Forex broker connects traders to the interbank market, where banks and other financial institutions trade with each other. Rather than just the broker, traders can now access the best bid and ask prices from a pool of liquidity providers.
Can ECN fees be avoided?
Some ECN fees are avoidable, but not all of them. Some ECN brokers charge a commission on each trade; it can be avoided by choosing an ECN broker that offers commission-free trading, but these accounts can have other costs, such as the wider bid-ask spread.
Do all brokers charge ECN fees?
Not all brokers charge ECN or commission fees. Some brokers, such as market-maker brokers, make money by setting the bid-ask spread.
Glossary for novice traders
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1
Broker
A broker is a legal entity or individual that performs as an intermediary when making trades in the financial markets. Private investors cannot trade without a broker, since only brokers can execute trades on the exchanges.
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2
ECN
An ECN, or Electronic Communication Network, is a technology that connects traders directly to market participants, facilitating transparent and direct access to financial markets.
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3
Trading
Trading involves the act of buying and selling financial assets like stocks, currencies, or commodities with the intention of profiting from market price fluctuations. Traders employ various strategies, analysis techniques, and risk management practices to make informed decisions and optimize their chances of success in the financial markets.
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4
CFD
CFD is a contract between an investor/trader and seller that demonstrates that the trader will need to pay the price difference between the current value of the asset and its value at the time of contract to the seller.
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5
Leverage
Forex leverage is a tool enabling traders to control larger positions with a relatively small amount of capital, amplifying potential profits and losses based on the chosen leverage ratio.
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Team that worked on the article
Alamin Morshed is a contributor at Traders Union. He specializes in writing articles for businesses who want to improve their Google search rankings to compete with their competition.
Dr. BJ Johnson is a PhD in English Language and an editor with over 15 years of experience. He earned his degree in English Language in the U.S and the UK. In 2020, Dr. Johnson joined the Traders Union team. Since then, he has created over 100 exclusive articles and edited over 300 articles of other authors.
Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO).