A forex broker identifies an agent who acts as the link between the client and the vendor in the forex market. Most brokers in the forex market have large banks which provide them with the marketplace prices of numerous currencies which are then relocated to the traders as the ask or bid price go markets. To know and identify the very best forex broker, it is good to know first the many kinds of brokers in the market. It are often important that you hire or consult a well established forex company to guide you in trading. In the wake of rising technology, online forex trading is extremely common and you possibly can make or lose profit trading online and worst of all you may be scammed so be cautious. Make certain that first of all you cope with a legit well established forex company. The are four well established kinds of brokers are market makers (DD), the Straight Through Processing (STP) brokers, No Dealing Desk (NDD) brokers and the Electric Communications Network (ECN) brokers.

Market makers have what is known in forex markets as the Dealing Desks and that's why they're abbreviated as DD. Most traders hold the view that these brokers do not have their interests at heart because as the name suggests, they (these brokers) just make the marketplace for the forex traders. For traders who would like to sell, the DD brokers buy from their store; for traders who would like to buy, these brokers sell to them. These brokers earn money through by not trading in support of its clients and through spreads. They're never at the same sides of trade with the brokers because their main aim of brokerage is creating the marketplace for the forex traders. In this case, the trader is not able to see the real market price quotes and the DD brokers can manipulate the quotes (the ask or bid price) in away in which they make huge profits. Most forex trading experts discourage traders from trading with the DD brokers because it is only the brokers who benefit from the trade typically and not the trader.

The NDD are those brokers which cope with the provision of interbank market access without orders passing via the Dealing Desk. These orders pass the marketplace quotes since they are to the traders and do not have any major intentions of making major profits by manipulating the bid or the ask price. These brokers make profits by charging a trading commission or by increasing the spread thereby making the forex trading free of any commission. Most NDD brokers are either a mix of ECN and STP brokerage or just as the STP brokers.

STP brokers send client's orders straight to the providers of liquidity which usually are banks which take part in the interbank trading. STP brokers may at some times and instances have only one provider for liquidity while in other times, they could have several. A rise in the number of banks and liquidity in the machine means better and more profitable trade for the brokers. The traders can indeed access the marketplace and trade without these brokers. These brokers are preferred by most forex traders for their transparency and honest in trade.

The ECN brokers are regarded by most forex traders and other online forex trading professionals for their transparency. These brokers allow all of the forex trade participants to trade freely by sending competitive offers and bids to the market. There's free interaction and no interruption or linking of just one participant with another. ECN brokers charge just a small fee because of their services.