Execution and liquidity decide the prices your clients see and how their orders are filled. Here is how STP and ECN execution work, and what to look for when connecting liquidity providers.
What STP and ECN mean
With straight-through processing (STP), client orders pass directly to liquidity providers instead of being taken by a dealing desk. ECN execution adds aggregated depth: prices from several providers are combined into one book, so clients trade at the best available price.
In both models the broker’s revenue comes from a commission per lot on raw spreads, a markup on the spread, or a mix of the two.
Types of liquidity provider
- Prime of prime: access to bank liquidity for brokers without a direct prime relationship.
- Banks and ECNs: deeper liquidity and aggregated depth.
- Crypto exchanges: spot and perpetual venues for crypto instruments.
- Your own LP: if your group already runs a liquidity business.
Bridges and why they matter
On many platforms, connecting to a liquidity provider requires a third-party bridge: another licence, another server and another supplier to manage. Altus Trader connects to providers natively from the platform, so there is no bridge to license, host or maintain.
Routing per client group
Different clients may need different execution. With per-group routing, each client group can use its own providers and pricing, so professional and retail clients can be served differently from one platform.
Protecting clients from bad prices
Feeds fail, and frozen prices can cause bad fills. Altus Trader’s Quote Server supports several feeds per symbol with failover and detects stale prices, and administrators can halt trading in one click.
Read more on the STP / ECN execution page, or book a demo.