Broker Reviews – User Ratings & Reviews

What is DMA/STP?
The contractual partner (broker) forwards all positions of the customer directly and transparently to the stock exchanges or liquidity providers and earns primarily on the commissions. The spread here will usually be smaller than with normal account models, but the commissions usually make the position similarly expensive. The advantage for the customer is that the broker has no advantage of working against the trader through poorer prices or price manipulations (spikes or spread widening). The broker has an interest in the success of the trader, since he earns money through volume – i.e. trading. The broker earns a share of every lot that the customer receives, so a successful trader would be lucrative for the broker. A DMA/STP agency model without a dealing desk is important here. The pure agency model with 100% DMA/STP execution, in which the brokers merely act as intermediaries and forward all orders to the interbank and currency markets. The problem is that some brokers claim this but do not (e.g. FXCM USA, whose license has been revoked). Authentic post-trade transparency should therefore be available at all times. If a broker can provide these details to his traders, one can be sure that the ethical business principles are correct and the client’s interests are protected.