The Academy of Financial Trading What are the different types of Brokerages? www.academyft.com [email protected]
Aug 07, 2015
The Academy of Financial Trading
What are the different types of Brokerages?
Stop losses explained
Any Advice or information provided by the Academy of Financial Trading is General Advice Only - It
does not take into account your personal circumstances, please do not trade or invest based solely
on this information. By viewing any material provided by the Academy of Financial Trading or using
any information or tools you agree that this is general educational material and you will not hold any
person or entity responsible for loss or damages resulting from the content or general advice provided
here by The Academy of Financial Trading, its employees, directors or fellow members. Futures,
Contracts for Difference (CFDs), Options, and spot currency trading have large potential rewards, but
also large potential risks. You must be aware of the risks and be willing to accept them in order to
invest in CFDs and leveraged forex markets. Don't trade with money you can't afford to lose. No
representation is being made that any account will or is likely to achieve profits or losses similar to
those discussed in any material provided by the Academy of Financial Trading. The past performance
of any trading system or methodology is not necessarily indicative of future results.
Risk Warning
Why do we need a brokerage?
A brokerage is a medium between us and the market. It is the middle man!
Brokerages explained
Different types of brokerages
They are responsible for placing our orders for us.
There are certain ways a brokerage can operate.
What is most favourable to the trader?
Different types of brokerages
Different types of brokerages
What are the two most common?
There are two main types of brokerages.
Let’s start of by assuming that we want a direct feed to the market and that our brokerage cannot manipulate this – there is no conflict of interest!
This would mean we want to find what is called an STP brokerage – a Straight Through Processor!
Is this best for us?
What about the other?
Stop losses explained
The second main type of brokerage is a Market Making Brokerage.
This is a brokerage that has the power to literally make a market!
It means they have the capacity and interest to adjust market prices, delay orders and essentially make decisions to gain from a clients loss!
Different types of brokerages
Stop losses explained
Different types of brokerages
The Favourable Choice
What is it that is of most interest to us?
Well we as traders want to gain as much from a movement as possible
If a market has a huge movement we want to make all possible profits available to us within that movement
In other words we want to actually capitalise on the true market move, not a partial reflection!
We do not want to have potential total profits skimmed from the top!
www.academyft.com
Contact us anytime on
Ire: +353 (0) 1 553 0174UK: +44 (0) 207 760 1614
USA: +1 347 627 0001
Keep Learning!
academyft.com