Forex glossary
Dealing desk
A dealing desk is a team or dealing model through which a provider manages quotes, execution and exposure. It may internalize client trades or hedge them externally. The DD label alone does not determine spread type, hedging policy or execution quality.
Illustrative example
How does it work in practice?
In a hypothetical dealing-desk model, the provider quotes EUR/USD with a two-pip spread, then four pips. It hedges part of its exposure with a bank; the label determines neither spread nor hedging share.
A case to work through
A label and two documents
Model: an offer is labeled DD; execution policy describes principal trading, while risk policy permits hedging.
- Principal status identifies the client transaction’s counterparty role.
- Hedging permission separately describes exposure management.
What follows? Read the two descriptions independently.
Example boundary: A policy declares rules but does not itself measure actual execution quality.
A useful distinction
Dealing desk / STP broker
STP describes automated processing; dealing desk describes a quote and risk-management function.
Check your understanding
Evaluate stated policies rather than infer behavior from a label.
Show the answer and explanation
It cannot determine the hedging policy
A specific risk policy is needed.
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Read the fuller explanation
Related terms
Sources and documentation
- FCA — CP16/40, Chapter 2: CFD provider business models
Historical consultation, sections 2.2 and 2.9: the CFD counterparty and external hedging are separate matters. This is not evidence of current leverage limits.
Document read:
The example illustrates the mechanism. Check current account conditions and instrument specifications with the provider.