NDD vs Market Maker: Two Broker Models Compared
Macro Glossary, Broker and Prop
By Ken Chigbo, macro trader and founder of KenMacro, 18+ years in markets.
Updated 2026-05-20
The desk’s answer
NDD (No Dealing Desk) brokers route client orders to external liquidity providers for execution, taking no market risk on the trade. They earn from spread markup or per-lot commission. Market maker (dealing-desk) brokers take the other side of client orders themselves, profiting from the spread and from net client losses. NDD execution is structurally cleaner because the broker has no conflict of interest with the client. Market-maker execution is structurally conflicted but is the dominant model for small retail accounts because per-account revenue is too low to make external hedging economical.
Defined term, NDD vs market maker broker model
An NDD (No Dealing Desk) broker routes client orders to external liquidity providers for execution, taking no market risk on the trade and earning from spread markup or per-lot commission. A market maker (dealing-desk) broker takes the other side of client orders itself, profiting from the bid-ask spread and from net client losses. The two models produce very different execution behaviour, particularly around high-impact news.
The two models compared
NDD brokers operate in two main subtypes: STP (Straight Through Processing, where orders route to a single or small number of LPs) and ECN (Electronic Communications Network, where orders route into an aggregated competitive LP pool). Both are A-book: the broker hedges the client’s position externally and is indifferent to whether the client wins or loses. Market maker brokers operate a dealing desk that internalises client orders, taking the other side. They are B-book: the broker profits from client losses. Most retail brokers actually run hybrid models, A-booking profitable accounts and B-booking smaller or net-losing ones.
Where the execution difference shows up
Three places. First, around high-impact news (NFP, CPI, FOMC), NDD execution prints whatever the LPs return, which can be wide gaps and visible slippage but with no broker filtering. Market makers can widen spreads, requote, or reject orders during news to protect their book. Second, around consistent winning by a single client: NDD execution remains constant because the broker has no exposure to the client’s performance. Market makers may introduce slippage and requotes when a B-booked client wins persistently, to discourage further winning or to push them to a different broker. Third, at order fill speed: NDD fills routinely under 100 milliseconds, market makers can delay fills to protect the dealing desk’s position.
Which model to use
Three factors. First, account size: small accounts (under 5,000 dollars) often have no realistic NDD option because per-account revenue is too low; market maker is the default. Second, trading style: scalping and news trading on tight spreads strongly favour NDD because of the execution behaviour around volatility; swing and position trading on wide stops are less sensitive to the model. Third, regulatory tier: a properly regulated market maker (FCA, ASIC) operating under best-execution rules is often a perfectly acceptable choice for a retail account, while a poorly regulated offshore NDD broker is not. Regulator quality is the dominant variable; the NDD vs MM distinction matters within a given regulatory tier.
Frequently asked
What does NDD mean in forex?
No Dealing Desk, a broker model where client orders are routed to external liquidity providers for execution. The broker earns from spread markup or per-lot commission and takes no market risk on the trade. NDD includes both STP and ECN execution subtypes.
Is NDD better than market maker?
Structurally cleaner because the broker has no conflict of interest. But within a properly regulated framework (FCA, ASIC), a competent market maker under best-execution rules can deliver perfectly acceptable execution for retail. The dominant variable is regulator quality, not the broker model label.
Which model do most retail brokers run?
Hybrid. Profitable, high-volume or larger accounts are routed to A-book (NDD-style hedged execution). Small or net-losing accounts are routed to B-book (market-maker internalised execution). The classification is internal and not disclosed to clients, but FCA and ASIC best-execution rules constrain abusive B-book behaviour.
What this means at the desk
Regulator quality outranks the NDD vs MM label. Both can be acceptable inside Tier-1; neither is inside offshore.
Read next from the desk
Educational glossary entry only,
From the desk
Knowing the term is step one. The next question is always which broker actually serves you well. The desk audits eight brokers on regulation by entity, true cost, and honest fit, with the regulatory caveats the comparison sites bury.
not financial advice and not a trade signal. The desk teaches a reading framework, never entries, targets or recommendations. Trading forex, indices and leveraged products carries significant risk and may not be suitable for all traders. Some broker links on this site are commercial partnerships and KenMacro may receive compensation, which does not change the editorial view. Only trade with capital you can afford to lose.
From the desk, free
Get the macro framework the desk actually trades
The same regime-first framework behind every call on this site, plus the weekly macro brief. Free. No spam, unsubscribe anytime.
Continue reading