A Forex (Foreign Exchange) market maker broker is a type of brokerage firm that act as a counterparty to traders’ orders rather than as an intermediary between the traders and the liquidity providers.
Market maker brokers are sometimes also called Dealing desk broker (DD) or dealer.
Forex market maker brokerages function differently from ECN (Electronic Communication Network) or STP (Straight Through Processing) brokerages, which primarily act as intermediaries, facilitating trades between market participants. Market maker forex brokers, on the other hand, enhance market fluidity by actively participating in trades. This often involves taking the counter position to a client’s trade to ensure uninterrupted and seamless market operations.
Market maker forex brokers offer almost immediate order execution and flexibility on their trading platforms, due to their role as counterparties—buying when clients sell, and selling when clients buy—giving them near-unlimited and instant internal liquidity. This also allows them the possibility to offer fixed spreads. However, they often have stricter Terms & Conditions, possibly prohibiting trading practices like scalping, algorithmic trading, or hedging.
While market makers sometimes trade against traders, it’s to protect their business rather than make traders lose. They earn when a trader loses, but also lose when a trader wins. To mitigate this, market makers often hedge trades to balance potential losses. For instance, if a trader buys a forex pair, the market maker may hedge by buying the same amount from the market, offsetting any losses if the trader’s trade is profitable.
The InvestinGoal team has prepared this top ten featuring some of the best forex market maker brokers. You will find the following features explained for each broker:
- Regulation
- Assets features
- Spreads on forex
- Techniques allowed
What are the best market maker forex brokers?
Here below you can find the best forex market maker broker list.
Warning
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you can afford to take the high risk of losing your money.
AvaTrade
best for fixed spread trading
AvaTrade acts as a market maker. AvaTrade offers 200+ assets and fixed spreads from 0.9 pips. AvaTrade allows hedging, scalping, and EAs.
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Regulations:
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Avg. EUR/USD Spread:
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About AvaTrade
AvaTrade is a global forex and CFD broker founded in 2006 and headquartered in Dublin, Ireland. AvaTrade offers trading on currencies, commodities, indices, stocks, bonds, ETFs, and cryptocurrencies. AvaTrade provides proprietary platforms alongside MetaTrader 4 and 5. AvaTrade is regulated by multiple authorities including CySEC, ASIC, and FSA. AvaTrade serves over 300,000 clients worldwide. AvaTrade is known for competitive spreads and extensive educational resources. The AvaTrade CEO is David Dryzin since 2016.
AvaTrade Features
The features of AvaTrade are listed below.
- AvaTrade is regulated by the BVI, CIRO (former IIROC), ASIC, FSRA, CBI, FFAJ, and FSA
- AvaTrade offers 200+ assets, including 60 forex pairs, commodities, indices, stocks, ETFs, bonds, and forex options.
- Clients find fixed spreads from 0.9 pips on forex.
- Hedging, Scalping, and EAs allowed for AvaTrade traders. Also, Spread betting is available for UK clients.
AvaTrade Pros and Cons
Advantages of AvaTrade
The advantages of AvaTrade are listed below.
- Tight fixed spreads from 0.6 pips (0.9 pips for retail traders)
- The mobile apps are well designed
- Can be connected to ZuluTrade and Duplitrade
Disadvantages of AvaTrade
The disadvantages of AvaTrade are listed below.
- High inactivity fees
- The demo account is limited to 30 days
IG Markets
wide range of tradable assets
IG Markets functions as a market maker. IG Markets provides access to 17,000 CFD assets and offers forex spreads from 0.6 pips.
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About IG Markets
IG Markets is a global online trading provider founded in 1974, offering access to over 17,000 financial markets including forex, stocks, indices, commodities, and cryptocurrencies. IG Markets provides proprietary trading platforms alongside MetaTrader 4 and ProRealTime. IG Markets is regulated by multiple top-tier authorities worldwide, including the FCA and ASIC. IG Markets is known for competitive spreads, extensive educational resources, and innovative features like weekend trading. The IG Markets’ parent company “IG Group” CEO is Breon Corcoran.
IG Markets Features
The features of IG Markets are listed below.
- IG Markets is a market-maker broker regulated by the FCA, ASIC, FMA, FSCA, NFA, MAS, DFSA, JFSA, FINMA, and BMA.
- Clients have access to 17,000 CFD assets, including 80 currency pairs, commodities, indices, stocks, bonds, interest rates, ETFs, sectors, options, turbo warrants, and digital100.
- IG spreads on forex from 0.6 pips.
- Hedging, scalping and EAs are all accepted as trading techniques by IG Markets.
- Spread Betting is also permitted for UK clients.
IG Markets Pros and Cons
Advantages of IG Markets
The advantages of IG Markets are listed below.
- Low spreads from 0.6 pips on Forex
- Wide range of financial instruments
- 40 years of experience in the Forex industry
Disadvantages of IG Markets
The disadvantages of IG Markets are listed below.
- No copy trading features
- No social trading features
EasyMarkets
best customer service
EasyMarkets operates as a market maker. EasyMarkets offers fixed spreads starting from 0.3 pips and allows techniques like hedging and scalping.
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Regulations:
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About EasyMarkets
EasyMarkets is a global forex and CFD broker founded in 2001, offering trading on currencies, commodities, indices, cryptocurrencies, and stocks. EasyMarkets provides proprietary web and mobile platforms alongside MetaTrader 4 and 5. EasyMarkets is regulated by multiple authorities including CySEC and ASIC. EasyMarkets is known for innovative features like dealCancellation and fixed spreads. EasyMarkets serves clients worldwide and has received numerous industry awards. The EasyMarkets CEO is Nikos Antoniades.
EasyMarkets Features
The features of EasyMarkets are listed below.
- easyMarkets is regulated by the BVI, FSA, ASIC and CySEC.
- Clients find 200+ easyMarkets assets, including 60+ forex pairs, crypto, commodities, shares, and indices.
- The easyMarkets spreads charged by the market-maker broker start from 0.3 pips.
- Techniques such as hedging, scalping and EAs are allowed by easyMarkets.
EasyMarkets Pros and Cons
Advantages of EasyMarkets
The advantages of EasyMarkets are listed below.
- Innovative Risk Management Tools
- User-Friendly Platform
- Regulatory Trust
Disadvantages of EasyMarkets
The disadvantages of EasyMarkets are listed below.
- Limited Tradeable Symbols
- Higher Spreads on Some Accounts
- Outdated User Experience
XTB
for educational resources
XTB acts as a market maker. XTB offers 5400+ assets, with spreads starting from 0.3 pips. XTB accepts hedging and scalping.
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Regulations:
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About XTB
XTB is a global forex and CFD broker founded in 2002 and headquartered in Poland. XTB offers trading on over 2,000 instruments including currencies, stocks, indices, commodities, and cryptocurrencies. XTB provides the proprietary xStation platform and is regulated by multiple authorities including FCA, CySEC, and KNF. XTB is listed on the Warsaw Stock Exchange and serves over 897,500 clients worldwide. The XTB CEO is Omar Arnaout since March 2017.
XTB Features
The features of XTB are listed below.
- XTB is a DMA/Market-maker broker and is regulated by FCA, CySEC, KNF, IFSC, FSCA, and the DFSA.
- 5400+ XTB assets are available for clients, including 48 forex pairs, indices, commodities, crypto, ETFs, and shares.
- Spreads on XTB currency pairs start from 0.3 pips.
- Hedging, Scalping and EAs are all techniques accepted by XTB.
XTB Pros and Cons
Advantages of XTB
The advantages of XTB are listed below.
- No minimum deposit
- Wide selection of assets
- Competitive trading costs
Disadvantages of XTB
The disadvantages of XTB are listed below.
- Small withdrawal fee
- No social or copy trading
- XTB demo account is limited to 30 days
Forex.com
best for high-volume traders
Forex.com serves as a hybrid STP/market maker broker. Forex.com offers 2000+ assets with spreads starting from 0.5 pips.
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About Forex.com
FOREX.com is a global forex and CFD broker founded in 2001, offering trading on currencies, commodities, indices, stocks, and cryptocurrencies. FOREX.com provides proprietary platforms alongside MetaTrader 4 and 5. FOREX.com is regulated by multiple top-tier authorities including FCA, ASIC, and CFTC. FOREX.com is known for competitive spreads, fast execution, and extensive educational resources. FOREX.com serves over 450,000 clients worldwide. The FOREX.com’s parent company “StoneX Group Inc.” CEO is Sean O’Connor.
Forex.com Features
The features of Forex.com are listed below.
- Forex.com is a hybrid STP/ Market-Maker broker and it is regulated by the FCA, CySEC, CIRO (former IIROC), ASIC, CIMA, FSA, MAS, and SFC.
- Forex.com clients will find 2,000+ assets, including 80 fx pairs, indices, shares, commodities and crypto.
- Forex.com spreads can be found from 0.5 pips on forex.
- Scalping, Hedging and EAs are all accepted by Forex.com.
Forex.com Pros and Cons
Advantages of Forex.com
The advantages of Forex.com are listed below.
- Regulatory Assurance
- Low Forex Fees
- Comprehensive Educational Resources
Disadvantages of Forex.com
The disadvantages of Forex.com are listed below.
- Limited Product Portfolio
- Higher Spreads on Standard Accounts
- No Guaranteed Stop-Loss Orders for U.S. Clients
Plus500
one of the best for CFD trading
Plus500 functions as a market maker. Plus500 provides a wide range of 2000+ assets and offers variable forex spreads.
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Avg. EUR/USD Spread:
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About Plus500
Plus500 is a global fintech company founded in 2008, offering online Futures trading services in different markets such as Agriculture, Cryptocurrencies, Metals, Commodities, Forex, Interest Rates, Energy and Equity Indices. Plus500 provides proprietary web and mobile trading platforms. Plus500 is regulated by multiple top-tier authorities including FCA, ASIC, and CySEC. Plus500 is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index. The Plus500 CEO is David Zruia since April 2020.
Plus500 Features
The features of Plus500 are listed below.
- Plus500 is a market-maker CFD provider regulated by CySEC, ASIC, MAS, FSCA, and the SFSA.
- The range of assets provided are 2000+, including 60+ forex pairs, indices, commodities, crypto, ETFs, options, and shares.
- Plus500 spreads on forex are variable.
Plus500 Pros and Cons
Advantages of Plus500
The advantages of Plus500 are listed below.
- Well-regulated CFD provider
- Over 2000 tradable CFDs
- Unlimited demo account offered
Disadvantages of Plus500
The disadvantages of Plus500 are listed below.
- Limited Regulatory Protections for Professionals
- Inactivity fees
- Limited deposit methods
Saxo
best for professional forex traders
Saxo operates as a market maker. Saxo offers 40,000 assets, with spreads starting from 0.4 pips. Saxo restricts techniques like scalping and hedging.
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Avg. EUR/USD Spread:
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About Saxo
Saxo is a Danish investment bank and online trading platform founded in 1992. Saxo offers trading in forex, stocks, CFDs, futures, options, and other financial instruments across global markets. Saxo provides proprietary trading platforms and white-label solutions for institutional clients. Saxo is regulated by multiple authorities including the Danish FSA and UK FCA. Saxo serves retail and institutional clients in over 170 countries. The Saxo CEO and co-founder is Kim Fournais.
Saxo Features
The features of Saxo are listed below.
- Saxo is a market-maker broker regulated by FCA, ASIC, MAS, UAE Central Bank, FINMA, FSA, and SFC HK.
- Saxo offers 40,000 assets, including forex, shares, bonds, ETF, CFDs, options, and futures.
- Spreads charged by Saxo on forex pairs start from 0.4 pips.
- Scalping and hedging are not allowed by Saxo.
Saxo Pros and Cons
Advantages of Saxo
The advantages of Saxo are listed below.
- Regulation and Trust
- Extensive Product Range
- Advanced Trading Platform
Disadvantages of Saxo
The disadvantages of Saxo are listed below.
- High Minimum Deposits for Premium Accounts
- Lack of Spread Betting Options
- Custody Fees in Certain Regions
Roboforex
best for algo traders
Roboforex acts as a market maker. Roboforex offers ECN accounts with spreads starting from 0 pips and allows hedging and scalping.
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Regulations:
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Avg. EUR/USD Spread:
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Platforms:
About Roboforex
RoboForex is a global forex and CFD broker founded in 2009, offering trading on currencies, stocks, indices, commodities, and cryptocurrencies. RoboForex provides MetaTrader 4, MetaTrader 5, and proprietary platforms. RoboForex is regulated by the Financial Services Commission (FSC) of Belize. RoboForex is known for competitive spreads, extensive educational resources, and multiple account types. RoboForex serves over 4.5 million clients worldwide. The RoboForex CEO is Andrei Dziarnovich.
Roboforex Features
The features of Roboforex are listed below.
- Roboforex is a market-maker which also offers ECN accounts and it is regulated by IFSC and CySEC.
- Roboforex provides 130,000+ assets, including forex, commodities, index, stocks, ETFs, crypto, and Russian GDRs.
- Spreads on ECN accounts start from 0 pips with Roboforex.
- Hedging and scalping are allowed by Roboforex.
Roboforex Pros and Cons
Advantages of Roboforex
The advantages of Roboforex are listed below.
- Diverse Trading Platforms
- Wide Range of Instruments
- Low Minimum Deposit
Disadvantages of Roboforex
The disadvantages of Roboforex are listed below.
- Limited Educational Resources
- Higher Spreads on Some Accounts
- Regulatory Concerns
City Index
best for trading tools
City Index acts as a market maker. City Index provides access to 4600+ assets and offers forex spreads starting from 0.5 pips. City Index allows hedging and scalping.
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Regulations:
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Avg. EUR/USD Spread:
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Platforms:
About City Index
City Index is a global forex and CFD broker founded in 1983, offering trading on currencies, indices, commodities, cryptocurrencies, and stocks. City Index provides proprietary platforms alongside MetaTrader 4. City Index is regulated by multiple top-tier authorities including FCA, ASIC, and MAS. City Index is known for competitive spreads, extensive research tools, and educational resources. City Index is part of the NASDAQ-listed StoneX Group. The City Index’s parent company “StoneX Group Inc.” CEO is Sean O’Connor.
City Index Features
The features of City Index are listed below.
- City Index is a market-maker regulated by FCA, ASIC, MAS, and UAE Central Bank.
- 4600+ assets are provided for City Index clients, including 84 fx pairs, commodities, indices, crypto, stocks, bonds, interest rates, and options.
- City Index spreads on forex start from 0.5 pips.
- City Index clients can benefit from Scalping, Hedging, and EAs techniques. Moreover, spread betting is in place for UK traders.
City Index Pros and Cons
Advantages of City Index
The advantages of City Index are listed below.
- Regulatory Trust
- Advanced Trading Tools
- Diverse Market Access
Disadvantages of City Index
The disadvantages of City Index are listed below.
- Limited MetaTrader Options
- Educational Content Gaps
- Customer Support Issues
Oanda
best for beginners
Oanda functions as a market maker. Oanda offers 120+ assets with spreads starting from 0.8 pips and allows hedging and scalping.
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Regulations:
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Avg. EUR/USD Spread:
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About Oanda
OANDA is a global multi-asset broker founded in 1996, offering trading on forex, CFDs, commodities, indices, and cryptocurrencies. OANDA provides proprietary platforms and API solutions. OANDA is regulated by multiple authorities including FCA, ASIC, and MAS. OANDA is known for competitive spreads, fast execution, and currency data services. OANDA serves both retail and institutional clients worldwide. The Oanda Chief Executive Officer is Gavin Bambury since August 2019.
Oanda Features
The features of Oanda are listed below.
- Oanda is a market-maker broker regulated by ASIC, CIRO (former IIROC), MAS, FSA, NFA, and the FCA.
- Oanda offers 120+ assets, including 70 forex currency pairs, indices, commodities, bonds, and crypto.
- Spreads start from 0.8 pips on Oanda forex.
- Oanda allows hedging, scalping and EAs, as well as Spread betting under the FCA entity.
Oanda Pros and Cons
Advantages of Oanda
The advantages of Oanda are listed below.
- Comprehensive Platforms
- Robust Education
- Highly Regulatory Trust
Disadvantages of Oanda
The disadvantages of Oanda are listed below.
- Higher Spreads
- Proprietary Platform Limitations
- Inactivity Fees
How does a forex market maker broker work?
A Forex market maker brokerage operates by providing liquidity to the market through maintaining a firm bid and ask price for a specific currency pair. In essence, they ‘make the market’ by being always ready to buy or sell at publicly quoted prices.
A market maker forex broker sets autonomously the bid and ask prices for the currency pairs they cover.
By constantly offering to buy or sell a currency pair, the market maker adds liquidity to the market. This is crucial for the smooth operation of the Forex market, as it ensures traders can always execute their trades, even if there aren’t other traders looking to take the opposite position at that moment.
When a trader places a trade through a market maker brokerage, the brokerage often takes the other side of the trade. For example, if a trader wants to buy a specific currency, the market maker sells it to them, and vice versa. This is different from other types of brokers, such as ECN or STP brokers, who merely pass the orders onto liquidity providers.
Market maker forex brokers hold a stockpile of various currencies in their inventory, similar to how a traditional store holds a variety of goods. They are always ready to buy or sell from this inventory to maintain an active and liquid market for traders. This is an ongoing balancing act, in fact they need to constantly adjust their inventory levels to respond to market conditions. For example, if there are more buyers than sellers for a particular currency pair, the market maker will sell from its own inventory, thereby providing the needed liquidity. On the other hand, if there are more sellers, the market maker will buy the currency pair, adding it to their inventory. They adjust the bid and ask prices they offer to attract more buyers or sellers, helping them balance their holdings and manage their inventory.
Of course, there is risk involved in being a market maker forex broker, as they may end up holding a large amount of a currency if the market moves against them. They manage this risk through various strategies, including diversifying their currency holdings and using complex risk management and hedging strategies when dealing with the traders’ operations.
How to choose a market maker broker
- Opt for a Regulated Market Maker Broker: Market makers always act as a counterparty in both sell and buy orders. If the market maker isn’t honest, they may manipulate buy and sell prices, causing you to lose money. Therefore, it’s best to select a regulated broker for forex trading.
- Verify the Foundation Year: While choosing a regulated broker is crucial, it’s equally vital to ascertain how long the broker has been operational in the market. “Regulated” does not necessarily equate to “100 percent safe,” so verifying the duration a market maker brokerage firm has been active is essential information to consider.
- Select a Market Maker Broker with Low Spreads: Generally, market makers brokers charge a markup to the trading spread. In other words, they slightly increase the spread between the actual Bid and Ask values, and that is their gain. Market makers often charge spreads as low as 1 pip, but you can find some with spreads as low as 0.6 pips.
What is it like to trade with a market maker broker?
Market maker forex brokers generally offer almost instantaneous order execution and a very flexible trading environment.
However, one should also be aware that market makers have the power to manipulate the prices of the assets they offer and that they have more stringent T&Cs compared to other forex brokers.
Ultra-fast execution comes from the fact that market makers act as a counterparty, that is, they buy what you sell, and they sell what you buy. This gives market makers almost unlimited and instant internal liquidity compared to NDD (non dealing desk) forex brokers which instead match your orders with those of other players in the market and are dependent on external liquidity providers.
In addition, being able to create an internal market makes market makers extremely flexible, especially in terms of costs. So much so that they are the only types of forex brokers that can offer fixed spreads to their clients.
However, on the downside, there is always a risk of manipulation when trading with a market maker. Additionally, if you are looking for a broker to engage in scalping, algorithmic trading, or hedging, you may be disappointed to find that most market makers prohibit this type of trading, unlike NDD forex brokers.
Market maker brokers (DD) vs ECN-STP brokers (NDD)
The main difference between market makers (or DD which stands for Dealing Desk), and an ECN-STP (or NDD which stands for Non Dealing Desk) broker, is that market maker brokers acts as a counterparty to all of its clients’ orders, while ECN-STP brokers act as a bridge between the trader and the international markets without interfering in execution.
This is the main reason why many retail traders prefer ECN-STP brokers over market makers: without the interference in execution, ECN-STP brokers are able to offer very low spreads and overhead costs because they do not have to protect themselves from the risk of acting as a counterparty.
In addition, ECN-STP forex brokers (with the same regulations) are generally seen as more transparent than market makers, precisely because there is no conflict of interest in their order management.
Do market maker brokers trade against the traders?
Sometimes the market makers trade against the traders. However, their goal is not making the trader lose money, but rather to protect their own business.
In fact, if the market maker acts as a counterparty between clients’ orders, it means that it makes money when the trader loses, but it also means that it loses money when the trader takes a winning trade.
So, what happens is that market makers generally hedge the trades in order to compensate for any losses they may incur.
For example, if the trader opens a long position on the EUR/USD forex pair, the broker is actually “selling” USD to the trader. So the market maker, in order to protect itself, might hedge this order by buying from the market the same amount of USD.
In this way if the trader gains $100 from the trade, the market maker will gain as much, thus offsetting the loss.
Market maker brokers pros and cons
Pros
- Extremely fast order execution
- Flexible trading environment
Cons
- There is a conflict of interest between market makers and traders
- Scalping, hedging and algo-trading are generally not allowed