DMA Spread Betting Firms

Direct Market Access (DMA) Spread Betting Platforms 2017

Find the Best Direct Market Access (DMA) and Non-Dealing Desk (NDD) Spread Betting Firms

This table lists a current director of Direct Market Access (DMA) and Non-Dealing Desk (NDD) that offer spread betting in the UK.

The different between DMA/NDD spread betting providers and Market Makers is that you’ll receive more competitive spreads when trading the markets. This is because DMA brokers earn their commission by charging a small fee per trade as opposed to manipulating market prices and the spread.

[dv_custom_company_data_spread regulated2=”Direct Market Access (DMA)” hide_tabs=”2,3,4,5,6″]

What is the Difference between DMA/NDD vs. Market Maker Broker?

In retail Forex trading, there are two different types of brokers that you can trade on:

A Market-Maker broker, such as Capital Spreads and City Index, trades against you and generates losses from your winning trades. Market-Makers manipulate the quoted prices in the market and generate a profit by manipulating the spread (different between bid-offer prices). As such, Market Makers tend to offer higher spreads for traders.

In contract, Non-Dealing Desk (NDD) and Direct-Market Access (DMA) brokers allow you to trade directly on the Inter Bank market. This allows you to trade real-time prices that are not manipulated by the broker in any shape or form. Your orders are placed directly on to the market via ECN/STP processing, with no dealer intervention or re-quotes. These types of brokers earn commission by charging a small fee per trade.

Which is Better for you?

The main advantage of a non-dealing desk broker is that you’ll receive tighter spread prices and no slippage or re-quotes in volatile markets. Your orders are processed straight away through ECN/STP processing.

The downside to DMA brokers is that the spreads will be variable. This means spread sizes can vary wildly in volatile market conditions and during major economic news releases. Furthermore, you’ll be charged a fixed fee per trade and DMA brokers usually require larger trade sizes and starting capital.

Market Makers, on the other hand are better for beginners because they offer lower trade sizes, fixed spreads and greater leverage. The downside is that because Market Maker brokers have to accept each of your traders, you can be liable to slippage and re-quotes.

As you increase your stake sizes, platforms such as Capital Spreads may take 5s-40s to accept your trades. Some of the risks around slippage can be avoided with limited risk accounts and guarantee stops, however you also end up paying a premium in the form of higher spreads. Thus as you develop your trading and increase your trade sizes, it may be worth moving to a DMA broker such as FXCM.

Finally, it’s worth remembering that in the case of Market Makers, they make some of their money from losing traders. This can create a conflict of interest between the trade and the broker.

Review the full list of Spread Betting Companies we recommend.

Adam

More About

Adam is an experienced financial trader who writes about Forex trading, binary options, technical analysis and more.

View Posts - Visit Website

Leave a Reply