What an ECN is, what brokers mean by an ECN account, how a raw spread plus commission compares with an all-in spread, and the terms of the NAMH Global ECN account.
ECN stands for electronic communications network. In the wider market, an ECN is a system that matches orders between many participants, such as banks and other dealers, and shows the prices they are willing to trade at.
In retail forex and CFD trading, "ECN account" is also the usual name for an account type that charges a narrow raw spread plus a separate commission per lot. The name tells you how the account is priced. It does not, on its own, tell you how a broker executes the orders on it. That is set out in the broker's client agreement, and it is worth reading before you choose an account.
This guide explains the ECN model in general, then compares the two ways brokers charge for a trade, with the arithmetic.
How an ECN works
On an electronic communications network, several participants post the prices at which they will buy and sell. The network shows the best bid and the best offer and matches orders against them.
A broker that offers ECN-style execution passes its clients' orders on to an external network or to a group of price providers. It earns its fee through a commission rather than by widening the spread. A broker that deals on its own account takes the other side of client trades and quotes its own prices. Many brokers use a mix of the two.
From the outside you usually cannot tell which model a broker uses. The account name, the spread and the commission are not proof either way. Ask the broker, and check the client agreement.
Two ways to pay for a trade
On a standard account, the broker quotes one price for buying and one for selling. The gap between them, the spread, is the whole cost of the trade. There is no commission.
On an ECN-style account, the spread is narrower, and you pay a commission per lot as well. The commission shows on each trade in MT5.
On both, positions held past the daily rollover pay or earn swap. That cost is separate from the spread and commission.
Neither way is cheaper in itself. What decides it is the spread on each account at the moment you trade, plus the commission.
Worked cost comparison on EUR/USD
On EUR/USD, one pip on one standard lot (100,000 euros) is worth $10. The NAMH Global ECN account charges $5 per standard lot, round turn, which is the same as half a pip. Pro and Standard accounts charge no commission.
Here is the cost of one lot, opened and closed, at the lowest spread we quote on each account:
Account | Lowest EUR/USD spread we quote | Commission per standard lot, round turn | Cost per lot at that spread |
|---|---|---|---|
ECN | 0.0 pips | $5 | $5 |
Pro | 0.7 pips | None | $7 |
Standard | 1.2 pips | None | $12 |
These are minimums, not averages. Spreads on every account widen in quiet hours, at the daily rollover and around major news, so most trades cost more than this.
The rule that holds at any spread: ECN costs less per lot whenever its spread is more than half a pip narrower than the other account's spread at the same moment. Against a 1.2-pip Standard spread, that means an ECN spread below 0.7 pips. Against a 0.7-pip Pro spread, it means an ECN spread below 0.2 pips.
The number of lots you trade does not change which account is cheaper per lot, because both the commission and the spread are charged per lot. Volume changes how much the difference adds up to. At the lowest quoted spreads, 100 lots cost $500 on ECN, $700 on Pro and $1,200 on Standard.
Depth of Market
MetaTrader 5 has a Depth of Market window. It shows the prices and volumes the broker streams for a symbol, at several levels above and below the current price. It can help you judge how much is available near the price before a large order. What it shows depends on the symbol and the broker's price feed.
What you get and what you give up
The main advantage of an ECN-style account is a lower cost per lot when its spread is tight. The commission is shown on every trade, so you can check what each trade cost.
The costs are the commission on every lot, which you pay even on a trade that closes at a loss, and on NAMH Global a $10,000 minimum deposit. Like every spread, the raw spread varies, and it can widen a long way around major news.
On any account type, a market order fills at the next available price, which can differ from the price on your screen. A stop-loss can fill well past its level if the price gaps.
Who an ECN account suits
Traders who place many trades, or large ones, feel the cost per lot most. That includes scalpers and many automated systems, so they are the traders who tend to look at ECN-style pricing.
If you trade a few lots a month, the per-lot saving is small in dollars. The deposit is then the bigger question.
If you are new to trading, a smaller deposit on a Standard or Cent account lets you learn with less money at stake. Both open from $100 and charge no commission. The Pro account opens from $5,000, with spreads from 0.7 pips and no commission.
The NAMH Global ECN account
These are the published terms of the ECN account:
Term | ECN account |
|---|---|
Minimum deposit | $10,000 |
EUR/USD spreads | From 0.0 pips |
Commission | $5 per standard lot, round turn |
Maximum leverage | 1:500 |
Platform | MetaTrader 5: desktop, WebTrader and mobile app |
The name follows the industry use described above: a raw spread plus a commission. Under our Terms, retail accounts have negative balance protection: if your balance goes below zero, we reset it to zero. You can still lose all of the money you deposit.
NAMH Global Ltd is a company registered in Saint Lucia (No. 2024-00372). It is not licensed by a securities regulator. More detail is on the Trust & Safety page.
You choose the ECN account type when you open an account, and you can deposit once your identity is verified. Support is open 24/7 if you have questions.
CFDs use leverage. You can lose money quickly, and you can lose all of the money you deposit. Only trade with money you can afford to lose.
ECN account questions
What does ECN mean in forex?
ECN stands for electronic communications network: a system that matches orders between many market participants and shows the prices they are willing to trade at. Brokers also use "ECN account" as the name for an account with raw spreads and a separate commission per lot. The name alone does not tell you how a broker executes orders on that account.
What is the difference between an ECN account and a standard account?
The difference is how you pay. An ECN account charges a narrow raw spread plus a commission per lot, and a standard account charges one wider spread with no commission. On NAMH Global, the commission on the ECN account is $5 per standard lot, round turn, which is worth half a pip on EUR/USD. So ECN costs less per lot whenever its spread is more than half a pip narrower than the other account's spread at the same moment.
Is an ECN account suitable for beginners?
Usually not as a first account, mainly because of the deposit. The NAMH Global ECN account needs $10,000 to open, and the commission is charged on every lot. Standard and Cent accounts open from $100 and have no commission. Whichever account you use, CFDs are leveraged and you can lose all of the money you deposit.
How are spreads set on an ECN account?
An ECN-style spread moves with the bid and ask prices quoted to the broker, so it changes all the time. It is usually narrowest on the major pairs while London and New York are both open. It widens in quiet hours, at the daily rollover, around major news and at the weekly open.
What commission does NAMH Global charge on ECN accounts?
The ECN account commission is $5 per standard lot, round turn. That covers opening and closing one lot of 100,000 units. On a smaller trade it is charged in proportion, so 0.1 lot costs $0.50 for the round turn.