What is Difference Between ECN and DD Commodities Trading Account in Commodities?
ECN Commodities Trading Account vs DD Commodities Trading Account
ECN Commodities Trading Accounts
ECN Commodities Account stands for Electronic Communication Net-work, these ECN Commodities Trading Account commodity brokers are connected to the inter-bank network directly through an electronic communication network and the commodity orders from the ECN Commodities Trading Account are placed straight to the electronic network.
The ECN Commodities Account will display different orders from different banks. The commodity quote placed by these ECNs net-work of banks are direct from them to the inter bank network and orders are executed directly to the interbank market once a trader trading with this ECN account places an order with their commodity broker.
These ECNs trading account will charge commissions + spreads for every commodity trade. For these ECN Commodities Account execution technique every trade is matched to another in real time over the inter-bank network - ECN Network.
DD Commodities Trading Accounts
DD stands for dealing desk, these DD account commodity brokers have a dealing-desk where they can match orders & execute commodity order in the online interbank commodities market.
The commodity trader trading with a DD account will get a lot of re-quotes.
Dealing Desks will issue commodity traders with a lot of order re quotes, meaning commodities trading prices of orders are not real-time & commodity broker can requote a commodity trader's order if the commodities trading price of the commodity market changes quickly enough before broker's dealing desk places the trading order online or before they match the order in the online interbank commodities market.
Dealing Desk accounts therefore means that order execution of commodity orders is not instant and therefore this execution model might mean that orders executed using a DD Commodities Account aren't executed as quickly as when compared to an ECN trading account or an STP account.
