Commission, swaps, ECN account, how to wrap your head around it all?
Both new and current Purple Trading clients now have the opportunity to trade crude oil (WTI) with zero commission. However, this tempting offer applies only to ECN accounts. So how does one opens an ECN account and what exactly is the commission on oil? Exactly these types of questions will be answered in this short article
What is an ECN account?
ECN account is one of the two account types we offer (the other being STP account). ECN account differs from the STP one by lower spreads (starting on 0.1 pip) and fixed commission (10 USD/ 1 traded lot). Whereas on STP account you have higher spreads but no commission.
The commission is not a Swap
Whereas setting the price of a commission fee is the domain of the broker who can treat is as he wishes swap price is set by the liquidity provider. To put it simply, a commission is our income from your oil trading and swap is our expense for being able to provide you with WTI oil symbol that we pay to our liquidity provider.