What is the A Book and B Book that forex brokers use? Forex trading is different from investing in shares or futures, trade forex non dealing desk a broker can choose to trade against his clients. This system used by “Dealing Desk” Market Maker brokers is known as “B booking”.
STP brokers send all of their clients’ trades to the real market or to liquidity providers. They therefore use the “A booking” system. However, many forex brokers use a hybrid model which uses a B Book for clients who lose money and an A Book for the profitable clients. In the regulated futures contract and stock markets, all transactions are sent to an exchange that confronts buyers’ and sellers’ orders by sorting them according to price and time of arrival. These forex brokers make money by increasing the spread or by charging commissions on the volume of orders. Therefore, there are no conflicts of interest, these brokers earn the same amount of money with both winning and losing traders. This type of forex broker is becoming increasingly popular because forex traders are reassured by the absence of this conflict of interest, as well as the fact that these brokers have an incentive to have profitable traders since they will increase their trading volumes and therefore the brokers’ profits.