Every regulated broker must publish an order execution policy, usually buried in the legal documents. It is dull to read, and extremely informative.
Questions it should answer
- Does the broker route orders to external liquidity providers or act as the counterparty?
- How is the price for execution selected?
- When is a requote, rejection or partial fill possible?
- How is slippage treated, in both directions?
Red flags
Vague language, no mention of slippage, or sweeping rights to reject orders. A good policy is specific about venues, timing and what happens in fast markets.
Quick test
Place a handful of small live orders in different conditions and compare the fills with the market feed. Execution quality is something you can measure, not only read about.
Risk warning: Trading forex and CFDs involves a high level of risk and may not be suitable for all investors. You may lose more than your initial investment.
Topicsexecutionslippagebest-execution