Broker
Market Structure & Participants
A broker is the firm that gives traders access to the markets, providing a platform, pricing, and execution in exchange for spreads or commissions.
What is a broker?
A broker is the company that gives individual traders access to financial markets. Rather than connecting directly to a bank or exchange yourself, you open an account with a broker, deposit funds, and the broker provides the trading platform, live pricing, and order execution needed to buy and sell instruments like currency pairs, CFDs, indices, or commodities.
In exchange for this access, brokers earn revenue mainly through the spread (the gap between buy and sell prices), a per-trade commission, or both, depending on the account type.
What a broker actually does
A broker’s core job spans several functions:
- Market access — connecting client orders either internally (as a market maker) or out to external liquidity providers via ECN/STP routing.
- Platform provision — offering software such as MetaTrader 4/5 or a proprietary web/mobile app.
- Account infrastructure — deposits, withdrawals, demo accounts, customer support, and reporting.
- Compliance — running KYC checks and operating within the rules of its financial regulator.
Types of brokers
Brokers are commonly grouped by their execution model: dealing-desk (market-making) brokers versus No Dealing Desk brokers running ECN or STP models. They also vary in the range of instruments offered, account minimums, leverage, and the regulatory licenses they hold — a broker might be regulated by a strict tier-1 regulator such as the FCA or ASIC, by an EU authority such as CySEC, or operate as an offshore broker under lighter oversight.
Why choosing a broker carefully matters
Because a broker holds client deposits and controls order execution, its regulatory status, segregated funds practices, and pricing transparency are central to trading safely. A well-regulated broker is required to meet capital, conduct, and client-money rules that materially reduce the risk of losing access to your own funds. Comparing brokers on regulation, real (not just advertised) spreads, platform quality, and withdrawal reliability — not marketing claims alone — is the starting point for any trader opening a live account. See FinPip’s broker reviews for verified comparisons across these factors.