For those who are somewhat uneasy about the future, let's focus on Forex investment. If you are planning to start Forex from now on, you might also want to look at overseas Forex account. Unlike domestic Forex, overseas Forex accounts can expect much higher leverage.
The Gain Capital, which operates FOREX.com UK, since its establishment in 1999, it has been backed by the world as a leading online Forex company. FOREX.com UK has a standard account and FOREX.com UK mini.
GEMFOREX which can utilize the maximum leverage 1000 times also has good reputation to Japanese individual investors now. GEMFOREX has two accounts, an all-in-one account and a no-spread account. In GEMFOREX, both all-in-one account and no spread account are ECN method.
What I'd like to talk about this time is not the all-in-one account / no spread account. For these accounts, please visit the official website https://gforex.asia/en/tradeaccount/fx/accounttypes.php This time I will talk about comparing ordering methods.
What is DD system ......
First of all, those who are turning their attention to Forex in Japan may perceive the DD (Dealing Desk) method as a matter of course, but it is an ordering method where it is possible to conduct illegal trading. The individual accounts of profitable individual investors may be transferred to a DD system server and may be subjected to various harassments by the dealer.
Most of the domestic companies adopt this DD method, which means that all Forex companies in Japan can say that they are all "bucketing Forex traders." However, Just because the spread is narrow, the style that depends on such a Forex company is not correct at all, it is important to consider hidden cost. But, if all domestic Forex companies are motivated like this, individual investors may not be able to choose. In order to improve the level of Forex in Japan, domestic Forex companies seem to need to reform the fundamental ordering method.
The way the Forex company (dealer) intervenes between the trader and the interbank is the DD method, not the order directly to the interbank, the Forex company settles all orders. So, even though you can pass orders or not, the dealer's discretion in the Forex company will intervene. Whether individual investors' orders pass or not, DD method is in the dark. In the DD system, if the customer loses, a Forex company makes a profit, and if the customer makes a profit, the Forex company loses it.
In the DD system, most low spread is realized. The dealer is profitable as far as the spread closes to zero ....? But the DD method is surprisingly profitable because it has the advantage of a cash point in trading with customers. With a 10% stability that winning traders take, but since there are statistics that 90% of market participants lose, it is impossible to win in total if you put reverse trading on losing traders.
And in the DD method, if the risk is high, the order is flipped and reqoute. Individual investors will not feel good if they hear that DD brokers are profitable from customer loses.
Let's take a look at the NDD ordering method which is adopted in many of the overseas Forex accounts. In contrast to the DD method, it refers to the ordering method where orders are processed without going through a dealer. In the NDD method, you can expect a method to solve problems such as "stop hunting", "disadvantageous slippage", "intentional requote", "intentional system down", "intentional rate change", which will occur in the DD method. Since it is a no dealing desk method and there’s absolutely no involvement in any trader’s transaction on the Forex company side, the only income source is the fee from the spread. It is a very clean trading environment because the interests of customers and Forex companies do not conflict.
In the case of the NDD method, there is a mechanism that the commission enters into profit to the extent that individual investors do a lot of trading. However, it is said that the spread is higher than the DD method. The fact that the Forex company operates only with the spread earnings may be unavoidable in some ways, although it is said that the NDD method is adopted, there are things that Forex companies are cutting to the limit.
What is STP system ......
There is also a method called the STP method for the NDD method. The NDD method is said to be more transparent than the DD method, but if you dare analyze the STP method, although it is said that transparency is high, a dealer is attached, and the same method as DD method, it adopts a method that digitizes customer's order within broker and then processes it.
Strictly speaking, the STP method may not be called an NDD method. If so, the ECN method adopted by GEMFOREX may be the only NDD method. The STP method can sufficiently guess the possibility that the broker is bucketing if it cannot place an order to the cover destination. In the STP method, it seems we cannot enter into the internal circumstances because the cover destination not publicized. Is it true that an ordering method is truly reliable if it is highly transparent?
In the STP method, referring to the rate of the covering financial institution, the spread is added to the rate and presented to the customer, and the order obtained from the customer is delivered to the covering financial institution. The difference in the presentation rate to the customer is the profit of the broker, and the brokers with many covers can advantageously trade-deliver and benefit traders as well.
What is ECN method ......
Speaking of the real NDD method, it’s the ECN method after all, which is the ordering method adopted by GEMFOREX. The ECN method is a method referring to e-commerce. Since the transaction is established by matching the order received from the customer with the order of another customer at the e-commerce shop, indeed, it’s a 'no dealing desk', and there is no broker involved. The existence of a broker in the ECN method, think of it as just an intermediary for accessing e-commerce.
Furthermore, with the ECN method, you can see the board information of the e-commerce office, so you can experience overseas Forex account in a truly vitreous environment.
However, in the case of the ECN method, the customer needs to pay a fee to the broker. In the ECN method, the lowest spread can be realized because the most favorable rate from the cover point is presented directly to the customer.
Although GEMFOREX is ECN method, the trading fee is free. In fact GEMFOREX all - in - one account is from 1.5 pips, although the spread is average, the free trading fee is not very common when compared with other dealers, GEMFOREX should be an ordering method that makes a lot of merit if you think about plus payment including fee.
And at GEMFOREX the minimum deposit amount is from 100 yen ($ 1), the (FOREX.com UK standard real account has a minimum deposit of $ 2,500 and mini real account of $ 250).
For individual investors who want to actively trade, FOREX.com UK has a charm to consider transitioning. But don’t you think GEMFOREX is more superior GEMFOREX?