A-Book

The so-called A-Book refers tobrokerThrow the customer's order to the bank or liquidity provider, etc. Then make a profit by charging spreads or commissions. The order models such as STP/ECN/DMA models we usually talk about belong to the category of A-Book.

For brokers, the A-Book method transfers trading risks, and brokers can obtain stable profits solely by relying on trading volume; however, at the same time, it also means that traders give up the opportunity for huge profits. Why do you say that? Everyone has heardforeign exchange marketThe "20-80 rule" means that 80% of people are losing money. For the huge number of users of the broker, most users lose money when they withdraw money. For a simple example, join a person to deposit $10,000, and only $100 is left when they finally withdraw money. In the process, the broker may only earn $100 in fees, and if the platform eats this part of the loss, the profit will be very different.

For users, the broker who executes the A-Book model has no conflict of interest with themselves. On the contrary, if the trading volume increases, the other party can get more commissions, so there is no need to worry about the broker preventing themselves from making profits. This is also why the broker of the A-Book model has always been very popular in China. However, A-Book also has its own shortcomings. The liquidity of A-Book depends on the upstream liquidity provider. It is inevitable that there will be problems such as delay, inability to execute and slippage of orders. The order turnover rate is low, which will also affect the user experience.