ECN, STP and Market Makers: How Your Broker Actually Fills Your Trades
A-book and B-book in plain terms. How ECN differs from STP, why a market maker is not automatically the enemy, and how to tell where your orders go.
Between your buy button and the global currency market sits a broker. What it does with the order determines both your trading costs and the potential conflict of interest.
Three models
Market maker (B-book). The broker is the counterparty. Your loss is its profit and vice versa. In exchange you get tight fixed spreads, instant execution and a low entry barrier.
STP. The order is routed straight to a liquidity provider. The broker earns from a spread markup and has no stake in your results.
ECN. Your order enters a shared pool where banks, funds and other clients meet. Depth of market is visible, spreads can collapse to zero, and the broker charges commission per lot.
Why every large broker is hybrid
Routing every 0.01-lot trade to the external market makes no economic sense — the cost exceeds the revenue. So small, statistically losing flow usually stays internal (B-book) while large, profitable flow is passed out (A-book). This is standard industry practice, not evidence of fraud.
The question is not whether a B-book exists but whether execution is fair: is slippage symmetrical, are requotes one-directional, are stops honoured.
What to check in practice
- Execution type in the account specification.
- Whether Depth of Market appears in the terminal.
- Your own fills: requested price versus executed price.
- The published order execution policy — regulated brokers must disclose it.
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Frequently asked questions
What are A-book and B-book?
A-book means the broker passes your trade to the external market and earns commission. B-book means it keeps the trade and becomes your counterparty. Most large brokers run both at once.
Does a market maker always trade against clients?
No. It matches opposing client orders internally and hedges the residual. The conflict of interest is real, but regulated brokers are required to execute on the best available terms.
How do I know whether my account is really ECN?
By indirect signs: raw spreads from 0.0, a separate per-lot commission, Market Execution, and depth of market in the terminal. The word ECN in the account name guarantees nothing.
- Min. deposit
- $50
- Spread
- from 1.0 pip (Standard STP)
- Commission
- $3 per lot per side (Raw ECN)
CFDs are complex instruments with a high risk of losing money