Electronic Communication Network (ECN) is a trading technology that allows price makers to make an executable bid and ask prices available to the market and to build a central limit order book(CLOB) similar to that of a stock market, and a system that automatically aggregates, matches and executes buyer and seller orders.
ECN Platform Model
The ECN platform is an e-trading platform that brokers of stocks, forex, etc., build for their clients, the Institutional solution manager comments. The Fortex XForce platform is this exact ECN model, on which there are market participants such as banks, brokers, and hedge funds. They send their respective competitive bid or ask prices to the ECN system and trade with each other.
The ECN platform chooses the best bid-best offer prices between the various banks and trading platforms to execute the deal for the client’s trade request, and a broker earns an appropriately low percentage of the commission.
History of ECN
ECNs rose to prominence during the 20th century when the U.S. stock market was at an all-time high. The first ECN, Instinet, was created in December 1969 and provided an early application of computing advances.
In 1975, the SEC passed the Securities Act Amendments, which encouraged the rise of ECNs by connecting all qualified securities markets through communications and data processing facilities.
In the U.S. OTC (Over The Counter) market, ECNs have been recognized as a trading system that supplements the exchange aggregation function.
Fortex ECN
Today, the ECN model has evolved from the earliest days of offering only forex and stock trading assets to a multi-asset trading platform that can also trade futures, crude oil, and other asset classes.
Fortex provides multi-asset e-trading solutions on the ECN model that provides traders services with low spreads, deep liquidity, trade transparancy, low slippage and low latency, addressing the most pressing needs of institutional clients.
Fortex XForce multi-asset trading platform packs liquidity aggregation, order and risk management, MT4/5 Bridges, FIX API, hosting, and multiple trading GUI in one valued SaaS offering.
Fortex XForce ECN e-trading platform brings together over 500 global financial industry giants with access to 10,000 stocks, futures, forex, and more. With Fortex XForce, institutional clients have access to high-quality liquidity and depth, and build an order book of all quotes, offering the best bid and asking prices to their own clients to enhance competitiveness.
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About Fortex
Founded in 1997, Fortex Technologies aims to revolutionize trading with its powerful, neutral, multi-asset trading platform focused on the FX, and equities markets. Fortex’s XForce solution, ECN, MT4/5 bridges, infrastructure hosting and more are used by regional banks, hedge funds, asset managers, broker dealers and professional traders around the world to enhance liquidity access, improve execution workflows and support sophisticated trading strategies.