ECN vs STP Brokers: What's the Difference?
Both route your trade to the market, but how they price it changes your real cost. Here is the practical difference.
How each executes
ECN (Electronic Communication Network) matches you against multiple liquidity providers with raw prices and charges a commission. STP (Straight-Through Processing) sends your order to a provider, often with a spread markup built in.
Pricing models
ECN shows interbank spreads (sometimes near zero) plus a fixed commission per lot. STP shows a wider spread but usually no separate commission. Compute all-in cost to compare fairly.
Which is cheaper for you
For high volume, ECN usually wins on all-in cost. For small or occasional traders, a no-commission STP account can be simpler and cheaper after factoring lot sizes.
Related glossary terms
New to the jargon here? These plain-English definitions will help.