What's Difference Between STP and DD Commodities Trading Account in Commodities?

STP Commodities Trading Account vs DD Commodities Trading Account

STP Commodities Trading Accounts

STP Commodities Trading Account stands for Straight Through Processing, STP Commodities Trading Account commodity brokers will send client orders direct to their Commodities Liquidity Provider, the Commodities Liquidity Provider is a large bank with deep liquidity to trade on the interbank net-work.

An STP Commodities Trading Account provided by an STP commodity broker can either have one Commodities Liquidity Provider or many liquidity providers.

The best thing about STP Commodities Trading Accounts is that commodities traders can place their commodities trades immediately with instant market execution because they have access to the inter-bank market via their STP commodity broker.

STP Commodities Trading Accounts will not charge commissions, but will charge spread on commodities trades. Because Commodities traders have access to inter bank market execution, there is no re-quotes on the commodity trading orders neither any order waiting for execution, order execution is instant.

DD Commodities Trading Accounts

DD stands for dealing desk, these DD account commodity brokers have a dealing desk where they can match orders and execute commodity order in the online interbank commodities market.

The commodity trader trading with a DD account will get a lot of requotes.

Dealing Desks will issue commodity traders with a lot of order requotes, meaning commodities prices of orders are not real-time and commodity broker can requote a commodity trader's order if the commodities price of the commodity market changes quickly enough before the broker's dealing desk places the order online or before they match the order in online inter-bank 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 are not executed as quickly as when compared to an ECN trading account or an STP account.