5 Best STP Forex Brokers for 2024

List of Top STP Forex Brokers and Accounts

Understanding STP Accounts in Forex Trading

STP, short for Straight-Through Processing, is an electronic order execution method in securities trading. For retail traders, using an STP account means automatic order execution without a dealing desk’s involvement. The main advantage of No-Dealing-Desk (NDD) brokers, including STP, is faster order execution, with a higher chance of orders being filled at or near the requested price, thereby reducing the risk of negative slippage.

In terms of pricing, STP accounts differ from ECN accounts. While ECN accounts typically have a fixed commission and raw spreads starting from 0.0 pips, STP accounts offer commission-free trading with floating spreads. Psychologically, STP’s single-cost structure might seem more appealing, though it’s not always the most cost-effective choice.

How Did FX Empire Choose the Best STP Forex Brokers?

• Regulation. We only considered brokers that are regulated by top-tier financial institutions and adhere to the strictest financial requirements ensuring maximum protection.
• Best execution policy. We prefer brokers that have a ‘best execution policy’, ensuring only the most favorable price quotes are fed to their clients at all times.
• STP accounts. STP accounts usually offer a combination of commission-free trading and floating spreads. We only looked for brokers that provide the most favorable combinations.
• Speed performance. We only considered brokers that can ensure fast and precise order execution, with an average execution speed no higher than 100 milliseconds. Additionally, at least two-thirds of all orders have to be executed at the requested price or with positive slippage.
• Trading software. We selected brokers offering user-friendly platforms with easy learning curves, such as MetaTrader 4&5, which are quite popular among newbies, and lean, sophisticated, and cutting-edge platforms catering to experienced professionals. We also looked for brokers that support the best third-party tools in the industry.
• Available instruments. We preferred brokers that offer a sufficient amount of tradable instruments from different asset classes to allow traders to exploit different opportunities.
• Supporting content. We evaluated brokers’ research and educational offerings for comprehensive insights into market trends as well as the scope and applicability of the available content for learning.

Our team of experts has identified brokers’ strengths and weaknesses using FX Empire’s comprehensive methodology. Here’s how we test.

Now let’s dive into the selected brokers.

How to Choose the Best STP Account?

Now it is time to identify the specific factors traders need to consider when searching for the most suitable broker offering an STP account.

How to find a safe broker?

To make sure you are dealing with a trustworthy partner, you need to make sure that the broker entity you choose is tightly regulated and complies with all industry safety requirements.

I have broken down the most important safety mechanisms to look for in a broker below:

• Segregation of client funds. Brokers must keep their clients’ funds in separate bank accounts from the ones used for their corporate capital. This is crucial for mitigating the risk of accounting errors.
• Negative balance protection. Negative balance protection means that a trader’s losses cannot exceed their account balance. This protection is indispensable when trading high-risk instruments, such as Contracts for Difference (CFDs).
• Capped leverage. Beginners are especially susceptible to the risk of adverse price fluctuations, which is why the maximum leverage allowed for retail traders is set at 1:30. Anything beyond that can be too risky for inexperienced traders.
• Compensation scheme. Depending on the jurisdiction where a broker is situated, a compensation scheme may also protect its clients against the company’s credit risk and liabilities. For instance, brokers regulated by the CySEC participate in the Investor Compensation Fund (ICF), and in the case of a company’s insolvency, traders can be compensated by up to 20,000 EUR. The Financial Services Compensation Scheme (FSCS) under FCA UK protects traders by up to 85,000 GBP.

Read more about Best regulated forex brokers.

How to evaluate if the pricing is competitive?

The biggest difference between STP and ECN accounts, apart from the execution model, is the pricing mechanism. Usually, STP accounts afford commission-free trading and floating spreads, whereas ECN accounts have fixed commissions and raw spreads (typically starting from 0.1 pips). At first glance, the former sounds more favorable because you only have to pay one cost – the spread – rather than two.

Many brokers recognize the psychological significance of this sort of thinking and seek to exploit it by raising the spreads on their STP accounts to the point where they are no longer the more competitive option. I will now demonstrate how to do a quick test for yourself to evaluate the competitiveness of a broker’s ECN and STP accounts.

Read more about Best STP forex brokers and Best ECN forex brokers.

Pick an instrument, say, the EUR/USD. Suppose also that the spread on the pair is 0.9 pips on a broker’s STP account and 0.1 pips on its ECN account. There is also a $6 commission for trading a 1 lot (100,000 units) contract. If the EUR/USD pip value is $10, you can do a simple calculation to determine the value of a hypothetical position on the EUR/USD executed on both account types. The formula is the value of a trade = spread x pip value + commission. When we pop in the above values, this is what we discover about our hypothetical broker:

This is just a hypothetical example, but hopefully, it illustrates how more can be less in trading. So it’s worthwhile evaluating the costs of a broker you consider opening an account with for yourself before doing so. And if you are still uncertain, you can always check out our database of reviews to sort out the most competitive brokers.

Check out our guide on Best lowest spread forex brokers.

Why liquidity matters?

The deeper the liquidity pool that a broker has access to, the better the order execution conditions it can serve its clients. That is why traders (especially professionals) should always check the speed and quality of order execution. The easiest way to do that is to see whether the broker has a ‘best execution policy.’ It means that the company is committed to providing the best price quotes, given the underlying market conditions, when an order is placed.

Precision and speed of order execution are also likely to be enhanced when a broker provides Virtual Private Server (VPS) hosting. As a rule of thumb, look for brokers that can accommodate ultra-fast order execution speeds of no more than 100 milliseconds.

Read more about Best brokers with VPS hosting.

You can confirm a broker’s performance by going to the Legal Documents section of its website and opening its latest execution statement/review. Keep in mind that not all brokers are mandated by their regulators to post such reviews yearly. However, the ones that do are more likely to afford you precise order execution and diminished risk of negative slippage.

How to choose a trading platform?

A trading platform is your window into the market. It allows you to observe price action behavior and study potential opportunities for placing orders. Technical traders use a platform’s array of indicators, drawing tools, and other features to examine various price patterns, changes in volatility, liquidity, and so on to gauge the most favorable times to enter or exit the market.

The best platforms are also the most versatile ones. They include a wide spectrum of technical indicators, such as Fibonacci retracement levels, oscillators, trend-based and range-based indicators, and others, as well as drawing tools, such as trend lines, channels, wedges, etc. They are also the ones that allow you to easily scale price action up and down.

In addition to these components, when looking for a suitable platform, you must also look for efficiency. Ask yourself: Does the platform facilitate easy and rapid order placement through one-click trading? Does it support algorithmic trading via Expert Advisors (EAs)? Can it handle market, limit, and stop orders? These factors, and more, contribute to a platform’s overall effectiveness.

The most popular retail platforms in the industry are MetaTrader 4 and MetaTrader 5. Over the years, the two have become the benchmark for simplicity and reliability. The two entries in the popular franchise have a decent range of technical indicators and drawing tools and afford multi-timeframe analysis.

Check out our dedicated guides on best MT4 brokers and best MT5 brokers.

However, despite MetaTrader’s easy learning curve, its rugged design becomes apparent when contrasted against newer and sleeker platforms. In my estimation, MetaTrader is a good choice for newbies wanting to learn the ropes, but to take your trading to take it to the next level, you may need something more sophisticated.

The answer of some brokers is to develop their proprietary platforms. The advantage of most such platforms is their convenience. The ability to search for instruments by asset class, scale price action up and down with ease, or execute complex box orders are benefits you cannot find in MetaTrader. To summarise, the question of choosing the best platform for you is one of simplicity vs practicality.

Here are our picks of Best forex trading platforms.

What is the difference between ECN, STP, and Dealing Desk brokers?

Dealing Desk (DD), Straight Through Processing (STP), and Electronic Communication Network (ECN) refer to different types of brokers in the forex trading industry. The main differences among these types of brokers lie in how they execute trades, how they make money, and the potential for conflict of interest. Here’s a simple breakdown of each:

• Dealing Desk (DD) brokers, also known as Market Makers, provide liquidity for their clients by taking the opposite side of their trades. They create an internal market for their clients and set both the bid and the ask prices. Some traders may be wary of potential conflicts of interest with DD brokers, as they may stand to profit from their clients’ losses.
• Straight Through Processing (STP) brokers send their clients’ orders directly to the interbank market, where they are matched with the best available bid and ask prices. STP brokers make money by adding a markup to the spread obtained from their liquidity providers. They do not take the other side of their client’s trades, which reduces the potential for conflict of interest.
• Electronic Communication Network (ECN) brokers provide a transparent trading environment by linking traders with various liquidity providers, such as banks, hedge funds, and other traders. Orders are matched on a network with the best available prices. ECN brokers charge a fixed commission for each trade rather than a spread markup. Read more about best ECN forex brokers.

What to Avoid When Choosing an STP Account?

There are two discernable characteristics of an STP account you must consider – the execution model and the pricing mechanism. I have summed up what to avoid below:

• Brokers that do not monitor their execution performance regularly. Execution quality summaries are important because they ensure the broker stays committed to meeting certain performance standards. In these reports that can be found in the legal docs section of a broker’s website, you can read about the broker’s execution venues, the average speed of execution, and more. Accordingly, the risk of poorer performance and even price manipulation is greater with a broker whose regulator does not mandate to carry out such tests regularly.
• Brokers that do not have a ‘best execution policy’. Best execution is a legal mandate compelling brokers to provide their clients with the best possible price feeds under prevailing market conditions. It could be that a broker is capable of even delivering ultra-fast execution speeds of under 40 milliseconds. Still, without such a policy in place, there are no legal repercussions for them if they choose not to go above and beyond. Like the case with execution quality summaries, the best execution policy ensures just that – execution quality.
• Brokers that take longer than 100 milliseconds on average to execute an order. Since STP brokers operate without a dealing desk, the risk of negative price requotes is somewhat diminished. However, the longer it takes for a broker to fill your order, the likelier it is for the spot price of the underlying to change. This could result in negative slippage, which is why a proven track record of a broker averaging execution speeds of less than 100 milliseconds is so vital.
• STP accounts with floating spreads starting from 1.2 pips or higher. As I argued above, there is a peculiar psychological oddity when thinking about the total costs of your typical ECN account and the costs of a typical STP account. It is easy to assume that STP accounts have a more competitive offering because they lack a fixed commission. However, their competitiveness could be decreased if the floating spreads are too high. That is why, as a rule of thumb, you should avoid STP accounts that have floating spreads starting from 1.4 pips.

How to Avoid Forex and CFD Scams?

Scammers rely on the gullibility of traders. A common tactic fraudsters employ is to promise quick and easy profits at no risk to the trader. Often scammers would use labels that closely resemble the brands of real and legitimate companies. That is why regulators like the FCA have registers where traders can read about such fraudulent companies pretending to be others. The best and easiest way to protect yourself is to make sure you work with a trustworthy and transparent broker.

Check out our guide on Best FCA-regulated forex brokers.

Another important consideration is online safety. Be cautious about where you leave your personal information. Registering your details on suspicious pop-ups that promise enormous profits, could lead to your contact information landing on a scammer’s dialing list. Remember, no licensed broker would make unsolicited cold calls.

The next time you get contacted out of the blue with promises of becoming the next Warren Buffet, you must remember that you are most likely speaking to a scammer. In my opinion, nowhere is the “if something sounds too good to be true…” saying more accurate than in the world of trading. That is why you should do your due diligence before opening an account with any broker.

Our Methodology

Here at FX Empire, we have pioneered a unique methodology for evaluating Over-the-counter (OTC) derivatives brokers worldwide. Our goal is to provide a comprehensive picture of a broker’s pros and cons so that our readers can make informed decisions. We understand their need to choose the best partner for their particular goals and needs.

Our team of dedicated professionals is working continuously to improve our system and keep it up-to-date with current market trends. We test each broker systematically by employing over 250 variables across nine categories:

• Trust
• Fees
• Account Types
• Tradable Instruments
• Platforms and Tools
• Deposits and Withdrawals
• Customer Support
• Research
• Education

We strive to be as objective as possible, which is why our rigorous examinations are devoid of any personal bias as much as possible. We review the licenses of all the subsidiaries of a broker and check the fine print in the Client Agreement. The reliability of a broker is further determined based on the regulation, fees, and general transparency of the website.

We collect essential information by opening a live account with a broker entity and testing its services in real time. We measure the spreads, swaps, and commissions on its most popular account type and compare our findings to the industry average.

We also test the functionality of the available platforms, the number and types of tradable instruments, the reliability of customer support, and the quality of the research and educational materials.

For this guide, we only considered brokers regulated by top-tier regulatory bodies and complied with most safety requirements. Due to the nature of STP accounts, we selected brokers that support fast and precise order execution and have competitive pricing mechanisms.

We evaluated the competitiveness of the prices by calculating the value of trade of a hypothetical 1 lot (100,000 units) position on the EUR/USD pair for each account, where the pip value is $10 (spread x pip value + commission = trade).

We abide by our strict guidelines for editorial integrity based on the objective standards we have set for our reviews. You can read more about our review process here.

Meet Our Writers

The team of forex and CFD analysts and editors at FXEmpire is composed of trading industry professionals and seasoned financial journalists. Our experts have been published on leading financial websites such as Investopedia and Forbes. In addition, they all have extensive trading experience.

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