10 Best Market Maker Forex Brokers in 2022

In the global foreign exchange market, Market Maker Forex Brokers fulfil a useful role. They create liquidity and contribute to market efficiency.

Choose your quick section of our best Market Maker Forex Brokers below

Our 10 Best Handpicked Market Maker Forex Brokers Revealed:

There are many unscrupulous Market Makers and scam forex brokers who give this type of broker a bad reputation. Here is our list of reputable Market Makers that we can recommend.

AvaTrade

Founded                              2006

Regulated                           ASIC, BVI, CBI, CySEC, FSA(JP), FSC, FSCA

Headquarters                    Ireland

Tradeable assets               Currencies, commodities, indices, stocks, bonds, crypto, futures

Trading platform              AvaOptions, AvaSocial, AvaTradeGo, MT4, MT5

Trading desk                      Market Maker

Minimum deposit            $100

CMC Markets

Founded                              1989

Regulated                           ASIC, FCA

Headquarters                    United Kingdom

Tradeable assets               Currencies, commodities, indices, stocks, bonds, crypto, futures

Trading platform              CMC Web Platform

Trading desk                      Dealing Desk, Market Maker

Minimum deposit            $0

eToro

Founded                              2007

Regulated                           ASIC, CySEC, FCA, MiFID

Headquarters                    Cyprus

Tradeable assets              Currencies, commodities, indices, stocks, crypto

Trading platform              eToro platform

Trading desk                      STP, Market Maker, NDD

Minimum deposit            $200

Exness

Founded                              2008

Regulated                           CySEC, FCA, FSA(SC), FSCA

Headquarters                    Cyprus

Tradeable assets               Currencies, commodities, indices, stocks, crypto

Trading platform              MT$, MT%

Trading desk                      Market Maker, NDD

Minimum deposit            $10

FXCM

Founded                              1999

Regulated                           ASIC, FCA, FSP

Headquarters                    United Kingdom

Tradeable assets               Currencies, commodities, indices, stocks, crypto

Trading platform              MT4, NinjaTrader, Trading Station, Zulutrade

Trading desk                      DD, Market Maker

Minimum deposit            $300

FXTM

Founded                              2011

Regulated                           FCA, CySEC, FSCA, FSC (Mauritius)

Headquarters                    Cyprus

Tradeable assets               Currencies, commodities, spot metals, stocks, indices, crypto

Trading platform              MT4, MT5

Trading desk                      Market Maker

Minimum deposit            $10

FXVC

Founded                              2011

Regulated                           CySEC, FINMA, FSCA, IFSC

Headquarters                    Cyprus

Tradeable assets               Currencies, commodities, indices, stocks, crypto

Trading platform              Proprietary

Trading desk                      Market Maker, NDD, STP

Minimum deposit            $250

HYCM

Founded                              1977

Regulated                           CIMA, CySEC, FCA, SVGFSA

Headquarters                    United Kingdom

Tradeable assets               Currencies, Commodities, Indices, Stocks, Crypto, Futures

Trading platform              MT$, MT%

Trading desk                      DD, Market Maker

Minimum deposit            $100

JustForex

Founded                              2012      

Regulated                           Pending

Headquarters                    Belize

Tradeable assets               Currencies, commodities, indices, stocks, crypto, futures

Trading platform              MT4

Trading desk                      ECN, NDD, STP

Minimum deposit            $1

 

XTB

Founded                              2002      

Regulated                           CNMV in Spain, CySEC, FCA, IFSC, KNF    

Headquarters                    Poland

Tradeable assets               Currencies, commodities, indices, stocks, bonds, crypto, futures

Trading platform              MT4, xStation 5

Trading desk                      MM, STP

Minimum deposit            $0

What is a Market Maker forex broker?

A Market Maker is an individual, brokerage or institution that buys and sells large amounts of a particular asset on the financial markets. This is done by continuously quoting bid and ask prices that are available to other traders on a trading platform such as MetaTrader 4.

Market Makers are also known as liquidity providers because they keep financial markets liquid. Basically, Market Makers ensure the financial markets run smoothly with high liquidity and they make profits from the bid/ask spread.

A large majority of registered forex brokers are Market Makers. They display a buy and sell quote and execute trades at those prices rapidly which provides retail forex traders with a straightforward and simple way to trade currencies and other financial assets.

How do Market Makers make money?

Market Makers carry the risk of buying a financial asset that may devalue. To compensate for this risk, Market Makers maintain a spread on the assets that they enable retail traders to trade.   

Market Makers make money by charging higher ask prices (selling price) than bid prices (buying price). The difference is the spread which compensates Market Makers for the risk involved in such trades. The risk is the price movement against the Market Makers on trading positions.

Example

A Market Maker may offer to purchase 200 equities from you at $10 each (the ask price). The broker than offers to sell the equity to a buyer at $10.02 (the bid price).

The $0.02 difference is very small per trade but in high-volume trading, the Market Makers profits rack up to large amount.

What is a bid/ask spread?

The bid/ask spread is the difference between what the buyer’s price and the seller’s price. In other words, what the buyer is willing to pay for a financial asset and what a seller is willing to accept to sell it.

The bid price represents demand and the ask price represent supply for an asset.

What is the difference between Market Makers and ECN/STP brokers?

The difference is Market Makers don’t cover positions on liquidity providers and is obliged to pay for clients’ beneficial trades with its own money. So, a Market Makers earnings are a clients losses.

With the ECN/STP trading model, the brokerage sends all orders directly to the liquidity providers and doesn’t bear the risks of clients’ trading. ECN/STP forex brokers don’t intervene with the order execution process. They merely makes money on trade turnover and it’s in their best interest that clients don’t lose their money and trade more.

The majority of forex brokers mix these models and pass only part of their clients’ orders to liquidity providers. Some brokers pass orders to the liquidity pool themselves as Market Makers and also offer separate ECN/STP trading accounts with a guaranteed transmission of orders to the interbank market. This approach combines an A-book execution and a B-book execution which spreads the risk for forex brokers.

4 reasons to use Market Maker Forex Brokers

There is room in the financial markets for the two main business modes used by forex brokers, namely the Straight Through Processing (STP) and Market Making (MM) models.

STP forex brokers transfer all their orders directly to a pool of liquidity providers and take a small cut on every trade. Market Maker brokers cover the orders internally with their own liquidity and only cover high risk orders with external liquidity providers. By using their own liquidity, Market Makers profit when clients lose money and lose money when clients profit.

  • Market Makers have more flexibility

The benefit of using a Market Maker forex broker is if there is mispricing or a technical error executing an order, the broker can rectify the situation whereas an ECN/STP broker doesn’t have that flexibility. This is because Market Makers use internal liquidity.

  • Market Makers provide full recourse

There is no middleman involved in the Market Making model; you trade directly through the brokerages using sophisticated platforms like MetaTrader 4 and MetaTrader 5. If anything goes wrong, your MM forex broker can provide you full recourse.

  • Market Makers direct liquidity to their clients

ECN/STP brokers transfer orders directly to liquidity providers who act as Market Makers. MM brokers execute orders for their clients via an electronic trading platform which means MM brokers bring direct liquidity to their clients.

  • Market Makers build relationships

Market Maker forex brokers tend to market themselves to beginner and intermediate traders who need time to gain experience and develop a disciplined trading strategy. You’ll find MM forex brokers offer welcome bonuses, training courses and a wealth of educational content on their site to help new traders hone their trading skills. MM forex brokers provide their clients with a valuable experience that goes beyond executing orders.

What you should know about Market Maker Forex Brokers

The main issue that Market Maker brokers are criticised for relates to conflict of interest exists.  This is because MM brokers profit from their client’s losses. There are many dishonest MM brokers offering their services to retail brokers and lots of broker scams. For this reason, it’s extremely important that you ONLY trade currencies through a forex broker that is regulated by a top-tier authority.

MM forex brokers are often accused of price manipulation, disconnecting the price feeds, increasing the spreads, filling orders at unfavourable price levels and even resorting to changing client orders without their consent. It is also common to experience a significant number of re-quotes and large slippages from MM brokers during times of low liquidity in the forex market.

Yes that happens, but those are unscrupulous retail brokers who give forex trading a bad reputation. Reputable forex brokers who are regulated by top-tier authorities never go out of their way to make you lose money. It’s not in their interests to have clients money and cancelling their accounts.

Rather, reputable and trustworthy Market Maker brokers should provide their clients with the best possible prices, ensure fast execution, honour all pending and market orders and pay profits when clients withdraw from their accounts.

Conclusion

They also make the process of matching individuals traders to buy and sell currencies seamless with sophisticated trading platforms. A large portion of retail forex brokers are Market Markets but many of the reputable brokerages also offer their clients an ECN account.

It’s crucial that you only trade with a Market Maker broker that is licensed and regulated by a top-tier authority and is regarded as honest, transparent and safe to use.

Forex Trading Africa Disclaimer

Forex is a complex instruments 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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