I'm relatively new to Forex and have so far experiences with 3 brokers. One is a major worldwide player (can name it, if doing this is appropriate) that has been discussed in great detail here on this forum as well. Both are small regional ones in an East European country and are providing local support only.
During explosive times, the two local ones have given better execution, which I find difficult to believe actually. What I mean is this type of scenario:
Several times I'd positions in major currency pairs that I was holding at times of major economic announcements. Say I have a buy in EUR USD, I bought in at 1.23050 and also the most recent trade is 1.23220. I've a profit and I don't wish to lose it all if the prices plummet, so I set a stop loss at, say, 1.23120.
In the above described situation, in a regional little broker, if the prices plummet, dropping just like 150 points in half a second, I'd the halt loss get executed very near my stop loss amount. But in the large, global broker I can escape my place at a much worse price only, say at 1.2350 or worse... How come?
I was told this is because the huge broker won't book the transactions but matches/routes these (I've a True ECN account) while the small brokers will book the transactions and consequently will execute better under the above described circumstances, that never made sense to me. Of course under normal trading conditions the worldwide broker offers much better terms; trading prices (disperse commission) are far less in the worldwide broker. But in volatile times, it's the regional men (I tried two and both beat the worldwide participant ) that execute much better. Can anyone clarify the dynamics here?