Question: How to confirm the STP/ECN Forex trading environment or the execution model?
STP stands for Straight Through Processing.
Meaning that all traders’ orders will be directly sent to Forex markets without any interference from brokers.
There are mainly two ways to confirm if your broker is really offering the STP trading environment.
Execution Statement issued by their Liquidity Provider
If your orders are really sent to Forex markets, your orders must have been counter-ordered by one of broker’s liquidity providers.
In case the broker offers 100% STP trading environment, then you may be able to get the confirmation statement issued with some costs.
In case your broker is a Market Maker or half Market Maker and half STP, then your broker needs to refuse providing the statement because it may be not possible to issue one.
Trading Restrictions
Some brokers actually refuse to offer the statement because they have never done that before even the broker is really offering STP environment.
Then you may want to see if there is any unauthorized trading activities on their trading platforms.
If your broker is not interfering to clients’ trades, then there shouldn’t be a conflict of interest at all.
So the broker shouldn’t restrict any trading activities on its trading platform because they don’t need to.
You may just ask your broker, if the broker may restrict some trading activities on its trading platform, then it is highly possible that the broker is interfering clients’ trades.
