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Dealing Desk

Discussion in 'Hello and Welcome' started by willymac73, Sep 15, 2008.

  1. willymac73

    willymac73 Recruit

    Sep 14, 2008
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    Hello, I am newer to forex. I love the leverage. It is fantastic.

    I am in Seattle.

    Can someone either paste a link or briefly explain the difference between dealing desk and non-dealing desk? I read a post from Felix on the subject a while back, but I can not find it right now.

    The reason I am asking is, I was looking at a broker that I like but they are a dealing desk, and I thought we were supposed to steer clear of that type.
  2. Pharaoh

    Pharaoh Colonel

    Oct 3, 2007
    Likes Received:
    Unfortunately, it's not quite so clear cut. Some dealing desks are automated, so don't cause too many problems. Some allegedly ECN brokers trade against you and have a manual dealing desk.

    True ECN brokers vary. If I understand correctly, MB Trading matches orders between customers and then passes unmatched orders via ECN directly to the interbank market. Like any "normal" brokerage, spreads widen and slippage (or no fills) can happen during volatile market conditions. If you want a broker with a true interbank platform, there are some, but they have pretty hefty minimum account balances.

    Typical market makers have some sort of dealing desk (even when they claim not to). As mentioned, if it's automated, this isn't too bad. If it's a manual dealing desk, that means that a human gets orders and passes them onto the market (HUGE slippage and/or lots of no fills). A frequent complaint of traders is that after they become profitable, the broker puts them onto the manual dealing desk. In some cases this is a valid complaint. In others, it's just Murphy's Law at work.

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