ECN or Electronic Communications Network brokers are those who match your trades with other traders by passing your orders on to liquidity providers like banks or other financial institutions. On the other hand, the market makers act as middle-men who continuously buy and sell a currency at an openly quoted price in the OTC market.

This is an important decision because the type of broker you choose can directly impact the quality of service you receive, as well as your transaction fees and dealing spreads. Choosing the right ones among the sea of brokers can be tough as some of them are legitimate while others are illegal and deceptive.

Stories of traders falling victims to scams by illegal forex traders are not unheard of. This usually happens when new or aspiring forex traders enter the market and make decisions that are impulsive and unwise. This can be voided by studying the market, types of brokers, as well as doing a comparative analysis.