Raw spreads and fast execution: what traders need to know in 2026

The difference between ECN and market maker execution

A lot of the brokers you'll come across fall into two execution models: dealing desk or ECN. The difference is more than semantics. A dealing desk broker is essentially your counterparty. ECN execution routes your order directly to liquidity providers — your orders match with actual buy and sell interest.

For most retail traders, the difference matters most in a few ways: how tight and stable your spreads are, fill speed, and order rejection rates. ECN brokers will typically offer raw spreads from 0.0 pips but apply a commission per lot. Dealing desk brokers pad the spread instead. Neither model is inherently bad — it comes down to how you trade.

For scalpers and day traders, ECN execution is generally worth the commission. The raw pricing makes up for paying commission on high-volume currency pairs.

Why execution speed is more than a marketing number

Brokers love quoting fill times. Numbers like under 40ms fills sound impressive, but what does it actually mean for your trading? Quite a lot, depending on your strategy.

A trader who making two or three swing trades a week, shaving off a few milliseconds won't move the needle. But for scalpers trading quick entries and exits, every millisecond of delay means money left on the table. If your broker fills at under 40ms with no requotes gives you an actual advantage versus slower execution environments.

Certain platforms have invested proprietary execution technology to address this. Titan FX developed a Zero Point technology which sends orders directly to LPs without dealing desk intervention — their published average is under 37 milliseconds. You can read a detailed breakdown in this Titan FX review.

Raw spread accounts vs standard: doing the maths

This ends up being something nearly every trader asks when picking an account type: is it better to have a commission on raw spreads or zero commission but wider spreads? The answer depends on volume.

Take a typical example. A spread-only account might have EUR/USD at 1.0-1.5 pips. A commission-based account offers true market pricing but charges roughly $3-4 per standard lot round trip. For the standard account, you're paying through the spread on each position. At moderate volume, the raw spread account works out cheaper.

Many ECN brokers offer more articles both account types so you can compare directly. What matters is to do the maths with your own numbers rather than going off the broker's examples — they often make the case for one account type over the other.

500:1 leverage: the argument traders keep having

The leverage conversation splits retail traders more than almost anything else. Tier-1 regulators like ASIC and FCA have capped leverage to 30:1 or 50:1 depending on the asset class. Platforms in places like Vanuatu or the Bahamas still provide 500:1 or higher.

The usual case against 500:1 is simple: it blows accounts. That's true — statistically, traders using maximum leverage end up negative. The counterpoint is a key point: professional retail traders don't use the maximum ratio. What they do is use the availability more leverage to reduce the margin sitting as margin in any single trade — which frees capital for other opportunities.

Yes, 500:1 can blow an account. Nobody disputes that. But that's a risk management problem, not a leverage problem. If your strategy needs reduced margin commitment, access to 500:1 means less money locked up as margin — which is the whole point for anyone who knows what they're doing.

Offshore regulation: what traders actually need to understand

The regulatory landscape in forex exists on different levels. Tier-1 is regulators like the FCA and ASIC. They cap leverage at 30:1, mandate investor compensation schemes, and limit how aggressively brokers can operate. Further down you've got jurisdictions like Vanuatu and Mauritius and Mauritius (FSA). Fewer requirements, but that also means higher leverage and fewer restrictions.

The trade-off is not subtle: tier-3 regulation means higher leverage, lower account restrictions, and typically cheaper trading costs. But, you sacrifice some safety net if the broker fails. There's no compensation scheme like the FCA's FSCS.

If you're comfortable with the risk and choose performance over protection, tier-3 platforms work well. What matters is checking the broker's track record rather than only trusting a licence badge on a website. A platform with a long track record and no withdrawal issues under VFSC oversight can be more trustworthy in practice than a brand-new tier-1 broker.

What scalpers should look for in a broker

If you scalp is one area where broker choice has the biggest impact. When you're trading tiny price movements and keeping for less than a few minutes at a time. At that level, seemingly minor variations in fill quality translate directly to real money.

What to look for is short: raw spreads at actual market rates, execution in the sub-50ms range, a no-requote policy, and no restrictions on holding times under one minute. Some brokers say they support scalping but throttle execution if you trade too frequently. Check the fine print before committing capital.

ECN brokers that chase this type of trader usually say so loudly. You'll see average fill times on the website, and usually offer VPS hosting for running bots 24/5. If the broker you're looking at doesn't mention execution specifications anywhere on the website, that's probably not a good sign for scalpers.

Following other traders — the reality of copy trading platforms

Social trading has become popular over the past several years. The concept is obvious: identify profitable traders, replicate their positions in your own account, and profit alongside them. In reality is more complicated than the advertisements imply.

The main problem is the gap between signal and fill. When a signal provider opens a position, the replicated trade goes through with some lag — when prices are moving quickly, that lag can turn a profitable trade into a bad one. The more narrow the strategy's edge, the bigger the lag hurts.

Despite this, a few copy trading setups deliver value for traders who don't want to develop their own strategies. The key is finding platforms that show verified performance history over a minimum of 12 months, rather than demo account performance. Risk-adjusted metrics matter more than raw return figures.

Certain brokers offer their own social trading integrated with their main offering. Integration helps lower latency issues compared to external copy trading providers that sit on top of the trading platform. Research the technical setup before assuming the lead trader's performance will carry over to your account.