No Dealing Desk (NDD) Connectivity
NDD execution routes client orders directly to external liquidity providers without broker intervention. Understanding how NDD connectivity works is essential for evaluating broker execution quality.
What Is NDD?
No Dealing Desk (NDD) means the broker does not take the other side of client trades. Instead, orders are passed through to external liquidity providers -- banks, non-bank market makers, and ECNs. The broker earns revenue from spreads or commissions rather than from trading against clients.
STP vs. ECN Models
Within NDD, there are two primary models. Straight-Through Processing (STP) routes orders to one or more LPs based on best price. ECN models place client orders directly into a central limit order book where they interact with orders from other participants. Both eliminate dealing desk intervention but differ in execution mechanics.
Connectivity Infrastructure
NDD brokers typically connect to LPs via FIX protocol through technology providers like Integral or oneZero. The broker's pricing engine aggregates streams from multiple LPs, applies markup, and presents a composite price to clients. When a client trades, the order is routed back to the LP with the best price for STP execution.