NDD (no dealing center)

NDD (no dealing center)

NDD (no dealing center)

Trading on the Forex market is half dependent on the professional skills of the trader, and the second half is the quality of service provided by the broker. The main components of a high-quality trading process are minimization of spreads, high speed of order execution, as well as prompt deposits and withdrawals. This is why truly professional Forex brokers systematically improve the technology of the trading process.

Among high-tech services, the NDD system has recently gained popularity. Traders open thousands of NDD accounts every day. In this article, we will look at why it is so popular among Forex market participants.
What is the NDD system?

A broker's non – Dealing Desk system (NDD) is trading without a broker's participation. This trading technology means that client orders are automatically placed on the open market. They are also executed there, directly at the liquidity provider, and not inside a dealing center (Forex broker).
Thus, the trader can control the broker's participation in trading. If the client wants to open an NDD trading account, they can trade all currency pairs and even Bank metals (gold, silver, platinum).

If we talk about the trading platform, an NDD account can be opened within the framework of the well-known MT4 platform. All transactions are processed using the end-to-end method (STP). In other words, the submitted applications are sent directly to the banks that have signed a contract with the brokerage house. The more banks are partners of the broker, the more profitable the terms of execution of transactions will be due to market competition. The best price is automatically determined. What benefits does a Forex broker get? For each transaction, he receives a Commission.

To open an NDD account, a trader just needs to Deposit $500. However, there are many NDD brokers that have a higher entry threshold.
About NDD features

Exclude mediation, NDD technology reduces the execution time of any orders by an order of magnitude. They are executed in less than a second.
Trading within the No Dealing Desk can often narrow spreads, sometimes their value fluctuates to zero. This can be tracked through reporting systems that provide detailed reports on spread formation.

The main advantage of NDD is that Deposit replenishment is carried out instantly, profit is withdrawn automatically without delay.

To perform automatic trading, you need to eliminate requotes (repeated requests when the market is experiencing a lightning change in quotes). Therefore, when processing trading orders on the No Dealing Desk, Market Execution Is used exclusively at the current price. This ignores any change in the processing of the trading order.

On the one hand, this is good, but if you look at this advantage from a different angle, it is not entirely profitable, since the transaction price may be less profitable in the application. But if we draw a comparative parallel with slower trading (a regular trading account), this probability is small. Price slippage also plays a role in profitable trading. When market participants show high activity, NDD brokers level these slippages to very small values.
Who provides liquidity for Forex?

For the Forex market, the main liquidity providers are ten global market-making banks. Among them (HSBC, Barclays, Bank of America, Deutsche Bank, Citi, UBS, etc.).
Due to the presence of large liquidity providers that compete with each other, as well as automation of trading allows transactions to:

Direct access to the interbank market.
Maintain high speed of execution of trading orders even in conditions of high volumes.
Make completely anonymous requests when sending market price providers.
To reduce the spreads.
Expand the capabilities of a particular trading strategy.

Important: by providing the opportunity to trade on an NDD account, exchanges earn income on large volumes and high frequency of opening trading orders. Therefore, the system itself is interested in ensuring that its participants receive, and not lose, profits.

Over time, the NDD technology in Forex will not be an advantage, but the norm. By the way, managed accounts work within NDD. This only adds to the attractiveness of this type of account.

If You are interested in reducing the spread, fast execution of trading orders with minimal price slippage, as well as high-quality liquidity providers, then choose brokers that provide the opportunity to open an NDD account.

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