ECM Trader Review
ECM Trader Review
ECM Trader is a forex and spot metals broker. While the leverage offering varies, base on the size of your account, there are no clear account types (requiring a different deposit and providing different spreads).
The Company. Security of Funds
Company Country Regulation
ECM Group Limited Vanuatu VFSC
ECM Trader is owned by ECM Group Limited, which is a company based and regulated in Vanuatu. We rarely, if ever, recommend trusting your trading funds with off-shore companies.
This is due to the simple reason, many of these destinations do not provide a stringent legal framework for forex brokers. Vanuatu, in particular, is known for its minimal capital requirement – you can register a “dealer in securities” after proving your company has $2,000 in capital. Of course this attracts a lot of dishonest pseudo-broker. On the other hand, regulators, like the UK’s Financial Conduct Authority or FCA, impose much higher entry levels to ensure a company has long term ambitions. In the FCA’s case the cqpital holdings requirement is €730,000.
Furthermore the British watchdog enforces multiple rules upon companies, registered with it. Two are the most important from a trader’s point of view – segregated accounts and the compensation scheme. While the first of them implies a broker can not put your funds in the same bank account it uses for operational purpose, the second one is a bit more interesting. The Financial Services Compensation Scheme, acts as an insurance company, which protects clients against broker bankruptcy. If you trade with an FCA-regulated forex broker, which happens to go insolvent, your account will be compensated up to £50,000.
ECM Trader has a strategic liquidity partnership with VIBHS, a Dubai-based broker and liquidity provider, which also has an FCA license. The brings a bit of credibility when it comes to the execution, one should expect at ECM Trader.
Minimum Initial Deposit
ECM-Trader has set the deposit minimum at $100. This is similar to what most brokers demand nowadays. That being said, some companies have set even lower entry points, while aiming to attract more clients, like FXCM who only require $50.
This may be an important factor for new traders, who are willing to delve into trading with a small account. More experienced ones will tell you, this shouldn’t be a big factor when comparing brokers.
Average spreads & Commissions
Spreads at ECM-Trader are fixed and start from 3 pips on EUR/USD. This is a high level, when compared to offers by other brokers. For instance FxPro offers fixed spreads, starting from 1.6 pips, alongside their even better floating sprad offering.
This leads us to the fact next point, while fixed spreads offer a level of predictability, variable ones are usually tighter. How much tighter, you may ask? Feel free to check our real-time comparisons of the spreads provided by some of the industry leading brokers at topforexbrokers.com website.
ECM Trader offers a maximum of 1:500 in leverage. Although this is a very high level, there are many brokers, providing similar ratios. If you have a bigger account your leverage ratio will be reduced, which makes sense from a risk management perspective. Here is a breakdown of the different leverage levels at ECM Trader, taken from their website:
Remember, misuse of high leverage can lead to big losses. In fact ECM Trader has put a very nice example of how this works on their website.
ECM Treader offers its services via MetaTrader 4 (MT4). This is by far the most popular forex trading platform in the world. It has acquired a massive fan base over the years due to the ease with which it handles multiple instruments and the excellent charting package it provides. The amount of traders using it and the relatively easy to learn programming language have led to a vast number of new tools being developed and sold at the MetaTrader’s MQL marketplace. The most popular ones are technical indicators and automated trading systems, known as Expert Advisors.
One of the key downsides of MT is that by default there is no partial position closing, although some brokers have added this functionality via proprietary software. That being said, we couldn’t test ECM Trader’s offering, as the account creation page had technical issues at the time of writing of this review. There is no way to be certain if this is a temporary difficulty or an indication of a more serious problem.
Methods of Payment
Currently ECM trade only accepts payments via Bank Transfer and Credit/Debit card. Users of on-line payment systems, such as PayPal, may feel left out.
ECM Trader Review Conclusion
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