Country of Origin: Switzerland
Regulated: Switzerland, European Union (Latvia)
Accepts US Traders: No
Business Model: ECN
Minimum Trade Size: 1 Micro Lot (1000 units)
Trading Software Platforms: JForex (OS-independent Java based)
Commissions/Spread Cost: Starting at $3.50 per Standard Lot ($35 per million) with tiered discounts for high volume traders
Best Suited For: Frequent traders and scalpers, non-Americans
Official website: dukascopy.com
Dukascopy is a unique ECN Forex broker structured as a Swiss bank. They initially jumped on the bandwagon of the No Dealing Desk/ECN/STP backlash against the pioneering generation of dealing desk bucket shops and focused marketing efforts on its ECN business model, which they like to call their "Swiss Marketplace" or SWFX.
Putting the hype aside, they undeniably offer some of the smoothest execution in the retail space as one of the few places where currency traders can actually add liquidity (post your own bids and asks in the form of limit orders that actually get filled between the spread rather than constantly paying spread cost.)
After the initial ECN wave came and went, Dukascopy remains one of the most reputable execution venues for retail Forex traders. They don't currently offer MetaTrader 4 but their company was actually founded as a technology company that designed their own trading software from the ground up, so it's no surprise that they've stuck to their guns and maintained their own JForex platform. In fact, JForex offers potential advantages for traders that MetaTrader lacks: real historical tick data from their own servers and, being a Java-based trading platform, it also comes with the added freedom of running just as well on Mac OS and Linux operating systems as it does on Microsoft Windows. And, to some pro traders, its best feature: It's not MetaTrader.
Among its competitors in the retail ECN Forex broker category, Dukascopy's commission rates are acceptable at only $3.50 per Standard Lot (100,000 units) to start. Higher volume traders will appreciate discounts on that rate. From the top down, they were structured to cater to professional level traders but they've made an effort to become more accessible to beginners in recent years at the same pricing standards and professional trading conditions.
For years, Dukascopy's biggest drawback to beginners was their overly cumbersome account opening procedure. (Their traditional account application procedure involved a strict requirement for physical certified copies of ID and proof of address documents, no doubt as a side effect of their Swiss regulatory environment.) So, in 2011, they opened a European Union subsidiary to offer higher leverage, lower initial deposit minimums, and a streamlined account opening process for relatively smaller accounts.
It's a major step toward opening their doors for beginners to experience their rare premium level trading conditions.
Overall, our international staff member reported excellent fills and overall experience with the company but their overall credible image has also come with the fact that they don't accept Americans in light of their lack of regulation from the NFA/CFTC.
For the rest of the world, we highly recommend Dukascopy for intermediate and pro traders. Or, if you're willing to open an account with their Latvia-based EU branch rather than their Swiss Bank unit, it'd be fair to expand that recommendation to: traders of all levels. It's hard to go wrong with Dukascopy for non-US traders.