Picking a forex broker is one of the most important choices you’ll make as a new trader.
That’s why it’s essential to do your homework—always perform due diligence and DYOR (Do Your Own Research).
You’ve probably seen terms like:
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Dealing Desk (DD)
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No Dealing Desk (NDD)
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Market Maker (MM)
…and then a flood of other acronyms: STP, ECN, DMA, OTC, LP, and more.
Welcome to the alphabet soup of forex lingo.
And your reaction? Probably something like: WTF? OMG!
If you haven’t seen these yet—don’t worry, you will. They’re all over the internet. You can’t avoid them.
But here’s the thing…
A lot of what’s out there is overly technical, outdated, or just plain wrong.
For instance, you may have read that retail forex brokers fall into two categories:
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The shady kind
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And the not-so-shady kind
(Just kidding… kind of 😆)
Let’s be serious now.
You’ll often see brokers labeled as either:
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Dealing Desk (DD) brokers
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No Dealing Desk (NDD) brokers
And that’s just the start.
The industry has layered even more acronyms on top to sound more sophisticated and "professional":
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Under DD brokers, you get Market Makers (MM)
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Under NDD brokers, you get:
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Straight-Through Processing (STP)
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ECN/STP (Electronic Communication Network + STP)
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DMA/STP (Direct Market Access + STP)
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It all looks very official in broker marketing materials—complete with charts and fancy names.
But here’s the catch…
It’s not accurate.
The way brokers are marketed doesn't reflect how they actually operate.
In reality, there’s only one true type of forex broker available to retail traders.
And here’s the kicker:
Most of these so-called “brokers” aren’t even real brokers. 😱
Ever noticed how many of their websites don’t actually use the word “broker”?
(And if they do, it’s usually just for SEO—to rank better on Google.)
That’s because, from a technical standpoint, they’re not brokers at all.
The term “forex broker” is actually a misnomer—a label that’s inaccurate or misleading.
So if they’re not real brokers… what are they?
Well, the answer is a bit like that vague Facebook relationship status:
It’s complicated.
But don’t worry—we’re here to break it all down and help you understand what forex brokers really are and how they work.
And to do that, let’s begin… with a story.