STP Broker

STP describes what the broker does with your order *after* it accepts it. That is a much narrower claim than most people hear when they read it. In retail forex the firm is still your counterparty on paper. In the US, the CFTC's final retail forex rules require these counterparties to register as futures commission merchants or retail foreign exchange dealers ([CFTC release 5883-10](https://www.cftc.gov/PressRoom/PressReleases/5883-10)). What STP promises is that no human dealer sits between you and the price, and that the firm passes the risk out to a liquidity provider instead of warehousing it against you. It is a statement about **how the firm hedges**, not about who you signed a contract with. The money comes from a markup added to the raw price the firm receives. That is the business. Typically no commission line on your statement, a slightly wider quote instead. The cost did not vanish, it stopped being itemised, which is exactly why it feels cheaper than it is. When the FCA reviewed CFD providers' pricing it noted they "have many opportunities to decide the overall price paid by retail clients" and found significant variation between firms, particularly in charges for maintaining overnight positions ([FCA multi-firm review](https://www.fca.org.uk/publications/multi-firm-reviews/contracts-difference-providers-provision-price-and-value)). So the advertised spread is the least useful thing on the page. Compare instead: - the average spread on the pair you actually trade, not the "from" number in the ad - the overnight financing or swap rate, where firms differ most - how the quote behaves during news, when a variable markup can widen sharply Why it earns the label *honest default*: nothing to dispute with a dealing desk, no per-lot commission to track, and if you hold for hours or days, a fraction of a pip of markup is not what decides the outcome. The traders it quietly taxes are the ones clicking many times a day, where that invisible markup compounds trade after trade and never shows up as a line item they can see.