Connecting MetaTrader 4 to an ECN Broker

Posted on April 23, 2008

mt4.jpg

Let’s face it, the majority if not all forex brokers that support the MetaTrader 4 platform are pure bucketshops. I have yet to find ONE MT4 broker which offers a true non-dealing desk trading environment. A lot of them claim this, but it is all pure bullshit, if you’ll pardon my french. If they have fixed spreads they CANNOT be a non-dealing desk broker! Any broker that offers fixed spreads by definition can’t be offering a no dealing desk trading platform. Just be aware that when there is a trading desk involved (be it human or computer operated) you are not trading in a true market environment but instead are in a “sandbox” type of trading environment where the broker has full control over your position. So how do you get around this? The solution is simple, use ECN brokers.

The thing is that some of us are somewhat attached to the MetaTrader 4 platform. I personally think it is a pretty neat and functional trading platform. The scripting abilities are excellent, and there are just so many free indicators and expert advisors available for this platform that it has become wildly popular with retail traders. However, most ECN brokers do NOT support the MT4 platform. One of the main reasons is that MT4 server/client software was never meant to operate in an ECN trading environment. Many brokers have tried to adapt it to an pure ECN trading environment and failed. So can we have our cake and eat it too? Yes, you can, but it involves a bit more work.

I’m going to tell you about some possible solutions which you can use to get MT4 to work more or less reasonably well with some ECN brokers. By the use of a specialized API (programming interface) it is possible to setup a virtual bridge between MT4 and the ECN platform. This will give you a more accurate, reliable, and less “doctored” price feed along with SPT (straight pass through) execution so your trades get routed directly into the interbank environment.

So far I know of 3 ways you can get this done:

1 – Some ECN providers offer their own custom API you can use. I only of one ECN broker that offers this solution and they’re called HotspotFX. For more details check out this link:

http://eu.hotspotfx.com/trading-software/connectivity/api-for-metatrader/

2 – You can use commercial software. I scoured the net and forex forums and there just isn’t that much relevant software out there. One that I did come across is called TradeBullet. See their homepage for more details.

http://www.tradebullet.com/

3 – The free route – always my favorite. However the disadvantage to this solution is that it may not have all the capabilities or bells and whistles of commercial alternatives. The only free solution that I’ve found is called TWSLink. This solution is free, so no hand holding for you! You’re just going to have to figure out things for yourself using the documentation available. Visit this website for more details:

http://www.trade-commander.org/twslink/twslink.htm

If anyone else knows other solutions please feel free to contact me and I will gladly add it to this article with links to your site(s) and everything.

Until next time, many pips to you all!

Alan

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82 thoughts on “Connecting MetaTrader 4 to an ECN Broker”

  2. 1) No it is not very likely that they’ll have the same spread. You know to be honest I haven’t looked too deeply into the spread. All ECN brokers have spreads that vary quite wildly so it’s quite tedious to analyze them over long periods of time.

    2) I’d say either MB Trading or Dukascopy is your best bet. But for such large account perhaps Dukascopy may be your best bet due to the incredible level of liquidity they can provide. For accounts over 250,000 your account will be held in a secure Swiss bank. Commission is 10-18 per mio.

    http://www.dukascopy.com/swiss/english/forex/forex_trading_accounts/?ibref=415

    see the above link for the VIP interbank account or to open a demo account this link:

    http://www.dukascopy.com/ibentry.php?ibref=415

    Make sure you go for the Swiss bank custodian program as it allows you to park the money in a safe and reputable Swiss bank while still trading with Dukascopy, thus eliminating your exposure to broker failure/bankruptcy or something of that sort.

    See this link for details:

    http://www.dukascopy.com/swiss/english/forex/custodian/?ibref=415

    4) I’m not sure about that, I’d have to look into it some more. Honestly I don’t think Canada has too many popular forex brokers. I heard of Questrade and some other ones, but haven’t done much research into this matter. I typically stick to US, UK, and Swiss brokers only.

    5) Typically it sits in the BROKERS bank account unless of course the broker offer segregated accounts. If you’re paranoid about account safety I would highly recommend the Swiss Bank Custodian Program that Dukascopy offers…wish I had the cash to get in on this..maybe someday..lol

    Once again see this link:

    http://www.dukascopy.com/swiss/english/forex/custodian/?ibref=415

    In the end I think you’ve got to choose between MB Trading and Dukascopy. MB Trading is more expensive than Dukascopy from what I know ($10 per 10,000 traded), so because of that reason and because Dukascopy offers segregated accounts (with a swiss bank) I’d recommend them over MB Trading in your case.

    I hope I have answered your questions, and I thank you for visiting my blog and I’m glad you like it. I wish you the best and if you have any other questions feel free to contact me here:

    alan at alansforexblog.com

  3. Alan,
    What a great blog, thanks! I’ve been reading through this thread, and, based on what was available when the thread started and what is available now, what do you see as the best/truest and safest MT4 with real ECN for modest (10K) live accounts? Thanks for your input.

  4. Glad you like my blog :)…

    In that case I’d say MB Trading. They have a very high (I think 4 star our of 5 or something like that) rating from Barron’s Magazine.

  7. Good blog, with very helpful info on brokers and where the land mines are buried.. nice work. when I have something to contribute, I’ll certainly come back.
    Tz

  8. I already have this bridge to mt4 and I am now offering it to brokers and bank. If you are either a broker of bank please contact me.

  11. Yeah I know about that. But I’m not sure if they’re accepting live clients on the mt4 platform..I’ll checkout their site since I haven’t done so in a while…

  12. Thanks for all the help here. I have been struggling for days reading reviews, etc. trying to find a FX Broker that will not rob you blind. I came to the conclusion that MB Trading (2k account) would be best before finding your blog. I’m now confident to trade with them.

  14. Thanks for the information. I never really thought about the part about fixed spreads. I agree though. If a broker offers fixed spreads then they cannot be a non-dealing desk broker. I trade with IBFX and they advertise as having no dealing desk. They also do not have fixed spreads. I have never had any problems with them yet as far as trading goes. Anyone else have any experience with them?

  15. Martin, I have an IBFX account but I no longer actively trade on it. However when I did actively trade on this account I haven’t had any broker related issues at all. When I lost trades it was entirely my fault. The only thing is that while I haven’t caught IBFX messing about with my account/positions I still do not believe the claim that they have no dealing desk. I’ve read somewhere on the net that they outsource their dealing desk to a third party and thus they can legally claim to have “no dealing desk” of their own.

  16. Hi Alan very insightful blog. I am pretty new to forex trading and have been using a Market maker; needless to say i have my fair share of frustrations.

    Could you point me to a few reputable DMA or ECN brokers with low commission charges? I don’t need them to have MT4 i am fine using their platform.

    thanks in advance!

  21. is the data feed you use for MT4 going to play a role in getting the right signals that gets transferred to Dukascopy.

    I mean how would you make sure the price data on MT4 and Dukascopy are the same.

    euro/usd 1.4652 on MT4 = euro/usd 1.4652 on Dukascopy when the signals are generated on MT4.

  24. Sweet stuff…this is what I’ve been waiting for umm for a LONG time..:))

    Now I must quickly open a live account and also get the word out.

  26. I use the bridge Metatrader to Dukascopy and is also working fine. But i really wait till they will have real Metatrader, i hope they will get it fast, will make it little more easy. At least they have Metatrader demoaccount, so i have about the same prices like dukascopy real account to copy trades. Against MB i like Dukascopy more, because you have often bether spreads and less commission. Ofcourse opening an account with Dukascopy is very usefull with an Introducing Agent (for example “Molecule6.com” thats paying back 45 % of Commission payment) to get a big part of your commission back and get many helping hints. Thats a lot of money you save every month.

  28. Since the last post related above, I was wondering if anybody foud a RELIABLE way to convert MQL indicators into Java language to use them on the Dukascopy platform. It’s really needed because Duakscopy has just informed me they didn’t plan to set up their MT4 platform live in a near future (too many technical problems and too many complaints from beta users).
    I know Dukascopy provides on their website a list of programmers supposed to be able to complete the job but Dukascopy does not endorse that list. So I thought maybe somebody here could recommend a programmer in particular or any other cost-efficient way around…? Thank you.

  29. To follow up with yesterday’s post, I contacted programmers listed on the Dukascopy website. In my particular case, I have 5 indicators to be converted. Quotes I got from those programmers range from 200 euros up to US$ 1,000 to complete the same job!!! Who’s fooling me here?

  31. Great post Alan.. Interesting that I applied EAs to brokers like FXCM, CMS and Gomarkets and they perform dismally in fact totally differently where the EAs rarely trade. Begs the question, me thinks theres some filtration of data going on to avoid being labelled as a broker that constantly requotes. Ive been in a situation where i cant get out of trades manually bc requotes. The thing also is the bridge has to be reasonably fast .. ive had situations where there are substantial delays so when the profitable position is closed ..the resultant trade ended up in loss!

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