Market Execution
In this type of execution, orders are filled at the next available market price without any requotes. Most of the ECN /STP brokers offer market execution for clients to ensure a dynamic trading environment. Many brokers offer the market execution model to their customers to ensure a trading environment without requotes.
Instant Execution
When orders are processed by the broker's price feed, it is known as instant execution. This type of execution is often offered by market-maker brokers, and requotes are commonplace. This means that if the desired price level is not available at the time of trade execution, then the broker will requote with the newly available price level.
Market Execution vs. Instant Execution
Both of these models are very popular amongst the retail traders, but there are pros and cons for the two systems. The market execution model gives clients a more fluid price, and the order is guaranteed to be filled at the best available market price at the time of execution.
Most brokers charge a small commission and/or offer a variable spread trading account for this model. However, because prices are subject to continual fluctuations, this means that the order may not be filled at the price the client had initially requested, and significant slippage can be experienced at the entry and exit points. Sometimes the slippage might go in a trader's favour, however negative slippage can jeopardise an entire trading plan.
Compared to market execution, the instant execution model can be much slower. Typically, it can take 1-3 seconds or more to confirm orders. During high levels of market volatility, the trader will receive repeated requotes to approve before the order can be placed, making it extremely difficult for a trade to be opened at the desired price. In many cases, the instant execution model is offered for fixed spread trading accounts. Wide spreads are an indicator of large broker fees, and there is no assurance that a trader will have access to the best available price feeds in the market.
Pros and Cons of Market Execution
Pros
- Usually orders will be filled within a fraction of a second.
- No requotes, even during highly volatile market conditions.
- Guarantee that orders will be filled at best available market price.
- Positive slippage – the chance of getting a better price for the executed order than the price expected.
- A trading account which offers market execution typically comes with variable spreads and low commission.
-
Cons
- Slippage is common in market execution and this can often be negative.
- Sometimes there will be a significant deviation from the desired entry level due to high market volatility.
- Stop loss and take profit levels need to be set after the execution of the trade.
Pros and Cons of Instant Execution
Pros
- Trading costs are fixed as a fixed spread trading account is usually offered.
- Predefined stop loss and take profit levels can be set during trade execution.
- Orders can be cancelled when faced with disagreeable requotes.
Cons
- Orders are filled with a significant delay.
- There is no guarantee that orders will be executed in the market, at best market price.
- Usually, the spreads are a little bit higher in this type of model.
Regulated Brokers Offering the Market Execution Model
After weighing up the pros and cons, retail traders may decide that the market execution model is best for trading live assets. It is essential when choosing a broker to select a regulated broker with a good reputation.
AvaTrade offers advanced order types based on the market execution model. They acknowledge that slippage may occur, but assure best execution at all times, and provide a fully transparent order execution policy which is available to download from their website. Alternatively, Â City Index offers a one click trading model based on the same principle of market execution.
Importance of Choosing a Regulated Broker
Trading with a regulated broker is crucial in order to ensure that deposits are safe and protected. Most regulated brokers also now offer negative balance protection to clients and work hard to develop their trading environments to ensure their client's satisfaction. Above all, regulated brokers are accountable to their financial regulatory bodies for any problems with their services.
Conclusion
Before selecting a broker, traders should ensure that they provide a transparent execution policy, and select one that most suits their trading style.
BrokerNotes.co 2023 Overall Rankings
To recap, here are our top forex brokers for 2023, sorted by Overall ranking.
Popular Guides
Popular Forex Reviews
Methodology
At BrokerNotes.co, our data-driven reviews of online brokers are based on our own extensive testing of each broker's products and services as well as the qualified observations of our expert editorial team. In conjunction with our sister site, ForexBrokers.com, we’ve published well over 100,000 words of research and collected thousands of data points across hundreds of variables. Our in-depth trading guides are created with the same rigorous, data-driven approach.
Our proprietary Trust Score rating system tracks data from over 100 regulatory jurisdictions to help forex traders understand the regulatory status of their forex broker and choose a broker that they can trust.
Our editorial team is led by Steven Hatzakis, an industry veteran with decades of experience and a deep understanding of the forex market. Our team conducts thorough testing on a wide range of brokers, platforms, products, technologies, third-party trading tools, and mobile apps. We also test for the availability of high-quality educational content, actionable market research resources, and the accessibility and capabilities of mobile platforms. All of our ratings and rankings are based on the collection and validation of thousands of data points and our in-depth product testing.
Part of our testing process involves in-depth research into commissions and fees. We dive into each broker’s trading costs, such as VIP rebates, inactivity fees, custody fees, bid/ask spreads (we always strive to determine the average spreads for each broker to better serve our readers), and a variety of other fee-based data points.
All websites and web-based platforms are tested using the latest version of the Google Chrome browser. Our Desktop PCs run Windows 11, and we use MacBook Pro laptops running the latest version of macOS to test trading on the go.
When testing mobile apps or mobile products, we test on both Apple and Android devices. For Apple, we test with the iPhone XS running iOS 16, and for Android we use the Samsung Galaxy S9+ and Samsung Galaxy S20 Ultra devices running Android OS 13.
All of the content on BrokerNotes.co is researched, fact-checked, and edited by members of our editorial team. Our ratings and rankings are driven by our independent data collection. We may use generative AI tools to assist in some of the rote aspects of our content production processes, but the substance of our content, as well as our opinions and evaluations are based on our extensive research and product testing. Read our Generative AI policy to learn more.
Our rigorous data validation process provides our readers with quality data they can trust. Click here to learn more about how we test.
Forex Risk Disclaimer
There is a very high degree of risk involved in trading securities. With respect to margin-based foreign exchange trading, off-exchange derivatives, and cryptocurrencies, there is considerable exposure to risk, including but not limited to, leverage, creditworthiness, limited regulatory protection and market volatility that may substantially affect the price, or liquidity of a currency or related instrument. It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable, or that they will not result in losses. Learn more about foreign exchange risk.
About the Editorial Team
BrokerNotes.co
BrokerNotes is powered by a dynamic team of writers, researchers, content strategists, data analysts, editors, traders, and investors. We are obsessed with creating the best finance content on the internet, and we are dedicated to helping our readers make great choices for their money.
IG
Saxo Bank
Interactive Brokers
CMC Markets
TD Ameritrade
FOREX.com
City Index
XTB
eToro
Swissquote
AvaTrade
FXCM
Plus500
Capital.com
XM Group
Pepperstone
OANDA
Admiral Markets
FP Markets
IC Markets
Markets.com
FxPro
Tickmill
Fineco Bank
BlackBull Markets
DooPrime
Vantage
BDSwiss
HFM
FlowBank
HYCM (Henyep Capital Markets)
Trading 212
ThinkMarkets
Eightcap
Trade Nation
Moneta Markets
VT Markets
TMGM
ACY Securities
easyMarkets
RoboForex (RoboMarkets)
IronFX
Exness
Spreadex
IFC Markets
Trade360
Axi
GKFX
Vestle
Octa
FXOpen
TeleTrade
FXPrimus
Forex4you
GBE brokers
Alpari
TopFX
Libertex (Forex Club)
LegacyFX
FXGT.com
ATFX
Xtrade
UFX