10 Best ECN Forex Brokers

 

The Electronic Communication Network (ECN) is designed to provide traders and investors with direct automated access to a platform where trading orders are sent between clients and liquidity providers.

 

Here is a comprehensive list of the top ECN Forex Brokers regulated by FCA. 

 

In this in-depth guide you’ll learn:

• List of Best ECN Brokers
• Meaning of ECN Forex Broker
• 10 best FCA-regulated ECN forex brokers
• What is an ECN forex broker?
• Why do many traders not use ECN accounts to trade Forex?
• Pros and Cons of an ECN account
• ECN vs STP

And lots more…

Let’s dive right in…

 

10 Best ECN Forex Brokers  – A Comparison

 

🌐 𝗕𝗿𝗼𝗸𝗲𝗿	📉 𝗢𝗽𝗲𝗻 𝗮𝗻 𝗮𝗰𝗰𝗼𝘂𝗻𝘁	⚖️ 𝗠𝗶𝗻𝗶𝗺𝘂𝗺 𝗗𝗲𝗽𝗼𝘀𝗶𝘁
ActivTrades	👉Click Here	$100 USD
Infinox	👉Click Here	$1 USD
Capital.com	👉Click Here	$20 USD
FXGiants	👉Click Here	$100 USD
FXOpen	👉Click Here	$10 USD
HF Markets (Formally HotForex)	👉Click Here	$0 USD
IronFX	👉Click Here	$100 USD
USG UK	👉Click Here	$500 USD
Pepperstone	👉Click Here	$10 USD
IC Markets	👉Click Here	$200 USD

 

Definition of ECN Forex Brokers

 

Leverage in Forex Trading ECN brokers are popular with traders and investors who are interested in making larger transactions. It allows traders to trade outside of traditional trading hours and is a useful platform for traders who aren’t full-time traders and can’t actively trade when financial markets are open. ECN require higher initial deposits but they provide greater transparency, and a level of anonymity, and have lower commissions and fees with direct access to liquidity providers.

 

10 Best ECN Forex Brokers (2023)

 

1. ✅ ActivTrades – Overall, best ECN Forex Broker
2. ✅ Infinox – Offer competitive spreads as ECN Broker
3. ✅ Capital.com – Provides Demo account for ECN trading practice
4. ✅ FXGiants – Low Forex ECN Fees
5. FXOpen – Offers social trading services
6. HF Markets (Formally HotForex) – Best Online Trading Experience
7. IronFX – Best for Scalping
8. USG UK  – Best MT4 ECN Broker
9. Pepperstone  – Top ECN Broker for Beginners
10. IC Markets –  Ultra-low spreads across Crypto derivatives

 

 

ActivTrades

 

 

ActivTrades is renowned for its dedication to honesty and integrity in the financial markets. As an ECN (Electronic Communication Network) Forex broker, ActivTrades works according to a model that links customers to a global network of liquidity sources, such as banks, businesses, and other traders.

 

 

With this strategy, there are often few conflicts of interest between the broker and its clients, competitive spreads, and quick execution. Customers can execute their trades under fair market conditions thanks to ActivTrades’ chance to access deep liquidity and trade FX currency pairs transparently. ActivTrades has established a solid reputation as a trustworthy option for forex traders looking for a dependable ECN broker because to its commitment to customer education and strong regulatory presence.

 

ActivTrades Overview

 

𝗕𝗿𝗼𝗸𝗲𝗿	𝗔𝗰𝘁𝗶𝘃𝗧𝗿𝗮𝗱𝗲𝘀
📜 Headquartered	London
📅 Year Founded	2001
🚀 Regulating Authorities	CSSF, FCA, SCB, BACEN & CVM, CMVM
🎁 Sign Up Bonus	No
🥇 Demo Account	Yes
📈 Maximum Leverage	1:400
💰 Minimum Deposit	$100 USD
☪️ Islamic account (swap-free)	Yes
🚀 Open an Account	👉Click Here

 

 

ActivTrades Pros and Cons

 

✅ Pros	❎Cons
Client funds are segregated from the company's operating funds, providing an extra layer of security in case of financial difficulties.	Primarily targets European and UK clients
Offers a wide range of trading instruments, including forex, indices, commodities, and shares	Charges inactivity fees if an account remains dormant for an extended period
Provides a variety of educational resources, including webinars, video tutorials, and market analysis	Does not accept clients from the United States
Regulated by the Financial Conduct Authority (FCA) in the United Kingdom, which is one of the most reputable financial regulatory bodies globally.	Subject to leverage restrictions
Offers the popular MetaTrader 4 (MT4) and MetaTrader 5 (MT5) trading platforms

 

 

Infinox

 

 

 

Infinox is a respected ECN (Electronic Communication Network) Forex broker with a strong reputation for transparency and integrity in the financial markets. Established in 2009, Infinox has its headquarters in London, United Kingdom.

 

 

Infinox is considered a low-risk, reliable broker with a wide range of trading instruments and an economical social trading environment. Infinox is regulated by the top tiers SCB, FSC & FSCA and has low spreads and competitive trading fees against major currency pairs

 

Infinox Overview

 

𝗕𝗿𝗼𝗸𝗲𝗿	𝗜𝗻𝗳𝗶𝗻𝗼𝘅
📜 Headquartered	Mauritius
📅 Year Founded	2009
🚀 Regulating Authorities	FSC, SCB
🎁 Sign Up Bonus	No
🥇 Demo Account	Yes
📈 Maximum Leverage	1:1000
💰 Minimum Deposit	$1 USD
☪️ Islamic account (swap-free)	Yes
🚀 Open an Account	👉Click Here

 

Infinox Pros and Cons 

 

✅ Pros	❎Cons
Offers a wide range of trading instruments, including forex pairs, commodities, indices, and cryptocurrencies	Limited cryptocurrencies
Offers the popular MetaTrader 4 (MT4) trading platform, known for its user-friendly interface and extensive analytical tools.	Lack of Negative Balance Protection
Provides educational resources, such as webinars, tutorials, and market analysis	Charge inactivity fees
Offer customer support services,	Limited Account Types
Competitive Spreads	Limited Regulatory

 

 

Capital.com

 

 

 

Capital.com Overview 

 

𝗕𝗿𝗼𝗸𝗲𝗿	𝗖𝗮𝗽𝗶𝘁𝗮𝗹.𝗰𝗼𝗺
📜 Headquartered	Cyprus
📅 Year Founded	2016
🚀 Regulating Authorities	CySEC, FCA, NBRB, ASIC
🎁 Sign Up Bonus	No
🥇 Demo Account	Yes
📈 Maximum Leverage	1:500
💰 Minimum Deposit	$20 USD
☪️ Islamic account (swap-free)	Yes
🚀 Open an Account	👉Click Here

 

 

Capital.com Pros and Cons 

 

✅ Pros	❎Cons
user-friendly trading platform	Limited Geographic Availability
Offers a wide range of assets for trading	Limited Payment Options
Regulated by several financial authorities, such as the FCA in the UK and CySEC	Charge inactivity fees
offers leverage, which can amplify potential profits
Users can practice trading with a demo account

 

 

FXGiants

 

According to research in South Africa, FXGiants is a company founded in 2015 with headquarters in London, United Kingdom. It also has offices in Australia and Bermuda.

 

 

FXGiants Overview

 

𝗕𝗿𝗼𝗸𝗲𝗿	𝗙𝗫𝗚𝗶𝗮𝗻𝘁𝘀
📜 Headquartered	Bermuda
📅 Year Founded	2015
🚀 Regulating Authorities	FCA and ASIC
🎁 Sign Up Bonus	Yes
🥇 Demo Account	Yes
📈 Maximum Leverage	1:1000
💰 Minimum Deposit	$100 USD
☪️ Islamic account (swap-free)	Yes
🚀 Open an Account	👉Click Here

 

 

FXGiants Pros and Cons 

 

✅ Pros	❎Cons
Regulated by multiple financial authorities	Limited cryptocurrency trading
Offers a wide range of trading instruments	Charges withdrawal fees
Provides access to competitive leverage options	Not available to traders from all countries
Offers different account types	Inactivity fees for dormant accounts
Offer customer support services

 

 

FXOpen

 

 

Overall,FXOpen was the first broker to offer ECN and STP trading via MetaTrader 4 (MT4), an award-winning platform that boasts instant trade execution at competitive prices.

 

 

FXOpen Overview

 

𝗕𝗿𝗼𝗸𝗲𝗿	𝗙𝗫𝗚𝗶𝗮𝗻𝘁𝘀
📜 Headquartered	Charlestown, Nevis
📅 Year Founded	2005
🚀 Regulating Authorities	FCA
🎁 Sign Up Bonus	No
🥇 Demo Account	Yes
📈 Maximum Leverage	1:500
💰 Minimum Deposit	$1 USD
☪️ Islamic account (swap-free)	Yes
🚀 Open an Account	👉Click Here

 

 

FXOpen Pros and Cons

 

✅ Pros	❎Cons
Offers social trading services	Not be available to traders from all countries
Supports the popular MetaTrader 4 (MT4) and MetaTrader 5 (MT5) trading platforms	Offers cryptocurrency trading, the selection may not be as extensive
Provides access to leverage	Inactivity fees for dormant accounts
Offering competitive spreads	Have fewer research tools and market analysis resources
Offers a wide range of trading instruments

 

 

HF Markets (Formally HotForex)

 

 

Overall, HotForex can be summarised as a trustworthy and safe broker with 24/5 educational support. Hotforex is regulated by Tier 1 and Tier 2 Trading Bodies. . Hotforex has a high trust score of 90 out 99.

 

 

HF Markets Overview

 

𝗕𝗿𝗼𝗸𝗲𝗿	𝗛𝗙 𝗠𝗮𝗿𝗸𝗲𝘁𝘀
📜 Headquartered	Cyprus
📅 Year Founded	2010
🚀 Regulating Authorities	FSCA, CySEC, DFSA, FSA, FCA, FSC, CMA
🎁 Sign Up Bonus	Yes
🥇 Demo Account	Yes
📈 Maximum Leverage	1:2000
💰 Minimum Deposit	$100 Pro account
☪️ Islamic account (swap-free)	Yes
🚀 Open an Account	👉Click Here

 

 

HF Markets Pros and Cons 

 

✅ Pros	❎Cons
Provides customer support services, including live chat, email, and phone support, to assist traders with their inquiries and issues	HF Markets (Formally HotForex) may be restricted in some countries due to regulatory restrictions
Supports the MetaTrader 4 (MT4) and MetaTrader 5 (MT5) trading platforms	Limited Cryptocurrency Options
Provides access to competitive leverage options	There are inactivity fees for dormant accounts
Offers various account types	Offers competitive spreads on many instruments, spreads can vary depending on the account type and market conditions. Traders should be aware of the cost of trading.
Offers a wide range of trading instruments, including Forex currency pairs, commodities, indices, cryptocurrencies, and more, allowing traders to diversify their portfolios.

 

 

 

IronFX

 

 

Overall, IronFX can be summarised as a reliable and credible broker that is very competitive in terms of its trading fees, (against major currency pairs). The spread is also very low and is considered low-risk.

 

 

IronFX Overview

 

𝗕𝗿𝗼𝗸𝗲𝗿	𝗜𝗿𝗼𝗻𝗙𝗫
📜 Headquartered	Bermuda
📅 Year Founded	2010
🚀 Regulating Authorities	CySEC, ASIC, FCA
🎁 Sign Up Bonus	Yes
🥇 Demo Account	Yes
📈 Maximum Leverage	1:1000
💰 Minimum Deposit	$100 USD
☪️ Islamic account (swap-free)	Yes
🚀 Open an Account	👉Click Here

 

 

IronFX Pros and Cons 

 

✅ Pros	❎Cons
Regulated by several financial authorities, including CySEC (Cyprus) and the FCA (UK),	Limited Research Tools
Access to a broad spectrum of trading instruments, including numerous currency pairs, commodities, indices, and cryptocurrencies,	Withdrawal Delays
Offers various account types	High Spreads
Offers the popular MetaTrader 4 (MT4) and MetaTrader 5 (MT5) platforms,
Offers customer support through various channels, including live chat, email, and phone,

 

 

USG UK

 

 

Overall, it seems that USGFX is a decent choice for traders outside of the US who are interested in trading Forex or CFDs, though we think there may be better options that can give traders more peace of mind without the high minimum deposit requirement.

 

 

USG UK Overview

 

𝗕𝗿𝗼𝗸𝗲𝗿	𝗨𝗦𝗚 𝗨𝗞
📜 Headquartered	London
🚀 Regulating Authorities	FCA
🎁 Sign Up Bonus	No
🥇 Demo Account	No
📈 Maximum Leverage	400:1
💰 Minimum Deposit	$600 USD
☪️ Islamic account (swap-free)	No
🚀 Open an Account	👉Click Here

 

 

USG UK Pros and Cons 

 

✅ Pros	❎Cons
Segregated trust accounts vir Barclays Group	Restrictions on trading companies
Regulated by the Financial Conduct Authority (FCA).	Withdrawals can be approved within 48 hrs
multi-asset global FX & CFD broker
margin based FX and CFD broker
fast execution of orders with one-click trading

 

Pepperstone

 

 

Overall, Pepperstone can be summarised as a credible and trustworthy broker. Pepperstone is considered low-risk to medium-risk. Pepperstone offers competitive trading fees and pip spreads which gives it an overall trust score of 92 out of 99.

 

 

Pepperstone Overview 

 

𝗕𝗿𝗼𝗸𝗲𝗿	𝗣𝗲𝗽𝗽𝗲𝗿𝘀𝘁𝗼𝗻𝗲
📜 Headquartered	Australia
📅 Year Founded	2010
🚀 Regulating Authorities	ASIC, FCA, CMA
🎁 Sign Up Bonus	No
🥇 Demo Account	Yes
📈 Maximum Leverage	1:400
💰 Minimum Deposit	$10 USD
☪️ Islamic account (swap-free)	Yes
🚀 Open an Account	👉Click Here

 

 

Pepperstone Pros and Cons 

 

✅ Pros	❎Cons
Regulated by reputable financial authorities, including ASIC (Australia) and the FCA (UK),	Some withdrawal methods may incur fees
Wide Range of Instruments	U.S. Clients Not Accepted
Competitive spreads	Charge an inactivity fee
MetaTrader 4 (MT4) and MetaTrader 5 (MT5) trading platforms
Provides customer support 24/5

 

 

IC Markets

 

 

 

IC Markets Overview 

 

𝗕𝗿𝗼𝗸𝗲𝗿	𝗜𝗖 𝗠𝗮𝗿𝗸𝗲𝘁𝘀
📜 Headquartered	Australia
📅 Year Founded	2007
🚀 Regulating Authorities	FSA
🎁 Sign Up Bonus	No
🥇 Demo Account	Yes
📈 Maximum Leverage	1:1000
💰 Minimum Deposit	$200 USD
☪️ Islamic account (swap-free)	Yes
🚀 Open an Account	👉Click Here

 

 

IC Markets Pros and Cons

 

✅ Pros	❎Cons
Regulated by reputable financial authorities, including ASIC (Australia) and CySEC (Cyprus),	Inactivity fees for dormant accounts
Well-known for its tight spreads	No U.S. Clients
Wide Range of Instruments
MetaTrader 4 (MT4), MetaTrader 5 (MT5), and cTrader trading platforms
Offers ECN and True ECN accounts

 

 

ECN vs STP

 

🥇𝗙𝗲𝗮𝘁𝘂𝗿𝗲𝘀	💻𝗘𝗖𝗡	💻𝗦𝗧𝗣
📌Execution Method	Direct access to interbank liquidity, offers market depth information.	Routes orders to liquidity providers without intervention.
📌Spreads	Typically variable and competitive, close to interbank rates.	Variable spreads, generally tighter than Market Maker accounts.
📌Commission	Charged per trade, may be higher than spreads in other account types.	No commission, broker profits from the spread markup.
📌Order Execution	Faster execution with potential for slippage during high volatility.	Execution speed depends on broker's liquidity providers.
📌Minimum Deposit Requirement	Often requires a larger minimum deposit.	Minimum deposit requirements vary by broker.
📌Suitable for Scalping	Suitable for scalping due to low spreads and fast execution.	Can be suitable for scalping, but execution speed varies.
📌Availability	Available with specific ECN brokers.	Offered by a wider range of brokers.

 

Pros and Cons of ECN Trading

 

✅ Pros	❎Cons
ECN accounts offer competitive, variable spreads, often close to the interbank rates.	raders pay a commission fee per trade, which can be higher than spreads in other account types.
Traders can access market depth information, allowing for better transparency in price movements.	ECN brokers may require larger minimum deposits,
ECN accounts provide direct access to interbank liquidity, potentially leading to faster execution and fewer requotes.	Traders may experience slippage, resulting in worse execution prices during fast market movements.
ECN brokers do not trade against clients, eliminating conflicts of interest.	ECN trading can be more complex, requiring a deeper understanding of order types and market dynamics.
Low spreads and fast execution make ECN accounts suitable for scalping strategies.

 

What is an ECN forex broker?

 

ECN forex brokers use the Electronic Communication Network which provides traders with direct access to liquidity providers via interbank trading prices. Liquidity providers include banks, large brokerages, hedge funds, and investment corporations. 

 

The ECN platform issues orders entered by Market Makers directly to third parties and individual traders. It effectively cuts out the traditional ‘dealer middleman’ in the over-the-counter forex market.

 

Traders with an ECN account benefit from the best pricing because they get different prices from a variety of market participants. This is because as the integration of orders increases, so does the overall pool of orders in the network.

 

ECN forex brokers charge a small fixed commission on every trade, regardless of the size of the trade. They don’t make profit on the spread difference. Instead, ECN traders are shown the best bid and ask price on the ECN platform and the matching and execution of orders takes place automatically. ECN account holders can always be sure that the forex broker never trades against them.

 

Reasons to trade with an ECN forex broker

 

➡️️​ Best bid and ask prices available

 Traders using an ECN trading account receive the best bid and ask prices available. This is because a variety of market participants are involved in the trade. Prices are instantly consolidated and the execution of trades is seamless.

 

➡️️​ Very low/tighter bid-ask spreads

A major benefit of an ECN trading account is the spreads are very low during times of high market volatility. This is because the ECN provides deep liquidity from multiple providers and merely act as hubs for various players in the forex market.

 

Due to the fact there are so many participants in the ECN hub, it’s expected that there will be both higher and lower bid-ask prices. There will always be liquidity providers who have a lower bid price and higher ask prices which results in large spreads; and there will always be those who have higher bid and lower ask prices which results in tighter spreads.

 

The good thing about the ECN system is you can buy currency pairs from one liquidity provider at a lower price and sell to another provider at a higher price. This is what makes the ECN so popular among traders and investors who prefer to trade large amounts of capital.

 

➡️️​ ECN brokers don’t trade against their client

An ECN broker can only match trades between its clients and other market participants. It cannot trade against the client. As a result, ECN spreads are often narrower than those used by Market Maker brokers and ECN brokers make money by charging clients a fixed commission per transaction.

 

➡️️​ Transparency

ECN accounts offer full transparency because the ECN platform connects orders directly to other market participants. This limits price manipulation because all ECN brokers have access to the same feed and a certain amount of the price history is readily available to all parties. No ECN trader has a particular advantage over other ECN traders because everyone has equal access to the information.

 

➡️️​ No Dealing Desk (NDD)

The ECN system does away with the dealing desk. The benefit of this is there are no re-quotes which can negatively impact your trading performance and increase costs. You deal directly with the interbank market without any dealer intervention.

 

➡️️​ Trade outside of traditional trading hours

Trading with an ECN account means you can trade outside of normal market hours.

 

 

Why many traders don’t use ECN accounts to trade Forex

 

For as much as there are numerous benefits to using an ECN account through an ECN forex broker, there are a few disadvantages that put many beginner and intermediate traders off using them. Higher service prices and higher initial deposits are the two main reasons why many traders opt for other types of trading accounts.

 

➡️️​ Higher deposit requirements

ECN accounts require higher initial deposits. This makes an ECN account less suitable for beginner traders who should not be trading with large amounts of capital. The trade-off to higher deposit requirements is ECN account holders benefit from tighter spreads.

 

➡️️​ Very high commission

ECN forex brokers charge a commission on each trade and it is higher than the commission charged by STP brokers. The per-trade-based commissions on ECN accounts can be costly and can affect a trader’s bottom line and profitability.

 

➡️️​ No micro lots

ECN account holders are subject to minimum requirements from liquidity providers and typically have to take a minimum position of 0.1 lot (10 000 currency units). ECN traders cannot open positions for 0.01 lot (1 000 currency units) which is available to traders using Market Maker forex brokers.

 

Conclusion

 

In conclusion, ActivTrades, Infinox, Capital.com, FXGiants, FXOpen, HF Markets (Formally HotForex), IronFX, USG UK, Pepperstone, IC Markets are respected ECN brokers regulated by FCA. ECN Forex trading offers transparency, competitive spreads, and direct market access, making it a preferred choice for many experienced traders, but it may not be suitable for everyone due to commission costs and complexity.

 

Disclaimer

 

Forex is a complex instrument and trading forex involves a high risk of losing money rapidly due to leverage. You need to understand how forex trading works and decide whether you can afford to take the risk of losing money on trade orders that do not go your way.

Forex Trading Africa annually reviews brokers regarded as the best in the world and provides information on the products, fee structure, market analysis and service they offer. We aim to provide important information for you to base your decisions on when choosing the right forex broker for your needs.

 

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Frequently Asked Questions

 

What is the meaning of ECN Forex Broker? 

The Electronic Communication Network (ECN) is designed to provide traders and investors with direct automated access to a platform where trading orders are sent between clients and liquidity providers. The idea is to limit the number of intermediaries between two market players.

 

Why do many traders not use ECN accounts to trade Forex?

Due to the commission fees and preference for fixed spreads in other account types, many traders avoid using ECN accounts for forex trading.