What is a B-Book Forex Broker and is it Bad?


Tadenex Limited is registered in Kenya with registration number PVT-LRUDJJB and is regulated by the Capital Markets Authority in Kenya as a Non-dealing Online Foreign Exchange Broker under license number 162. The registered office of Tadenex Limited is at the Courtyard, 2nd Floor, General Mathenge Road, Westlands, Nairobi. Or the existence of any material interest in a transaction, without prior reference to the Client”. This leads me to infer that some trades may be B booked, while others A Booked.

The more participants, the more liquidity and the narrower is the spread. Each participant tries to offer the best price, and all traders get the best current Bid/Ask price. At the moments of theEURUSD highest liquidity, the spread could be around zero level, however, there can’t be literally zero spread. The trader, of course, blames the broker for everything. Therefore, the broker is forced to use software to track such tricks of the provider.

A-Book vs. B-Book Brokers

For better understanding, we will be explaining both comprehensively. Here’s the difference – When placing a trade via a https://xcritical.com/blog/a-book-vs-b-book-brokers-in-forex-trading/, they fill your trade internally. So, a B book forex broker can be best described as a market maker that is responsible for always providing execution and paying the differences to their clients. OANDA is renowned for its advanced trading technology and transparent pricing. The platform offers access to a wide range of markets, including forex, indices, commodities, and bonds.

For other trading platforms, you have to take your brokers word for it. While these quotes come from an actual Liquidity Provider, your broker can make the decision to not send orders to them. This means the broker accepts your order and fills it based on the price from the LP but doesn’t send the same order to the Liquidity Provider.

Brokers that are pure A book

Brokers use dedicated software to successfully divide traders and implement the hybrid model in their orders. This tool allows them to track the amount of a trader’s deposit, the leverage used, the risk taken with each transaction, the use or non-use of protective stops, etc. On this basis, it is decided whether a trader’s transaction will be executed in the A-Book or B-Book model. First of all, many traders value the A-Book model for the lack of conflict between the broker and the investor.

  • This is the reason why most brokers use a combination of B-Book and A-Book execution, also known as a “hybrid model”.
  • 76% of retail investor accounts lose money when trading CFDs with this provider.
  • Nearly all, if not all forex brokers operate both models.
  • But, during off-market hours such as the early Asian trading session, you can see the spreads widen.
  • So – whereas the A book operator has a cleaner business model, it’s the b book operator that can offer a cheaper service.
  • ECN/STP brokers all use an A Book, they are intermediaries that send their clients’ trading orders directly to liquidity providers or multilateral trading facilities .

If a B-book broker offers high leverage, it’s usually because they want you to blow your account – because they want your money. You can see here how the misalignment of incentives can be a problem. But I don’t believe high leverage itself is responsible for most retail trader implosions. Rather it is the lack of understanding of how dangerous leverage can be. Many retail traders, especially those new to trading, typically have no idea what good “risk management” looks like.

A-book Forex Brokers NDD for 2023

If you are trading through a B-book trader and your account goes into the negative, it really means nothing. The broker hasn’t lost any money, because they never sent your trades to a third-party. They can simply reset your account balance to zero if they want to, and because they don’t owe anyone any money on your behalf, it’s basically a fake debt. Whereas an A-book broker is a business that offers their services to professional traders. Sound risk and money management are vital to financial market navigation with A-Book Versus B-Book Brokers. However, selecting the best broker to access the markets is a critical step that traders should not overlook as they embark on trading live financial markets with A-Book Versus B-Book Brokers.

b book broker

It’s important to ensure your B-Book Forex Brokers DD provide complimentary resources such as analysis, education, and risk management tools. The best rated B-Book Forex DD broker IC Marketsoffers competitive offers for Forex, CFDs, Spread Betting, Share dealing, Cryptocurrencies. Considering certain basic factors becomes necessary while choosing a broker. The market is flooded with a number of brokers and the first step is to do a simple Google search. The next step is to check whether the brokers are regulated and licensed by a regulatory authority like FDA.

Reputable A-book Forex Brokers NDD Checklist

B book forex brokers typically charge a fixed spread which you pay for every time you open or close a position. For one, having fixed spreads makes it easier for you to trade when there are market shocks. Between 74-89% of retail investor accounts lose money when trading CFDs. It is risky when dealing with a B-book Forex brokers as they can view the account balances, stop-loss levels, orders and other information of their clients. Moreover, the broker can manipulate the spreads at anytime, can refuse to fill orders and send requotes or slow the speed of order execution in order to sway trades in their favour.

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With advanced charting capabilities and a variety of order types, traders can execute their strategies with precision. Additionally, AvaTrade provides access to educational resources and a demo account for beginners to practice their trading skills. Their strong reputation and commitment to transparency make them a preferred choice for many traders.

A-book Forex Brokers NDD Verdict

The platform showcased on this website serves demonstration purpose only. Thank you very much for the quick feedback, appreciated much! I’ve learn a lot here, I guess I would take the A book brokers for peace https://xcritical.com/ of mind like you mentioned. With IC providing slightly more flexible leverage, probably just go with them at the moment, although I still feel slightly strange why they were calling me from Cyprus.

b book broker

This is the thing that caused FXCM to be kicked out of the USA. I am unable to find the stock brokers who provides “Guarantee StopLoss” with low stop distance like less than 5%. Rakuten should be B book, because they offer fixed spreads.