What is Direct Market Access?
Direct Market Access (DMA), is the electronic facility that allows for CFD prices and liquidity to be identical to the underlying stock markets. Investors enter into CFDs at the underlying market price. This means that all orders are executed in real time and the investors can be assured of true market prices.
DMA also has the added benefit of offering the ability to participate in the pre-opening and pre-closing phase of the market, which is often the most liquid and volatile period of the trading day. CGS-CIMB Securities adopts the Direct Market Access model for Contracts for Difference as it offers one of the most transparent pricing structures to investors.
With the DMA CFD provider model, the investor experiences/ allows :
- No additional spreads
- Straight through processing
- Potential to be a price taker or maker, and;
- Participate in pre-opening and pre-closing phase.
In comparison, the Market Maker (MM) CFD model :
- May not always have the same prices as the exchange
- There is potential for additional spreads and potential requotes
- Market makers are price takers only, generally there is no participation in pre-opening and pre-closing phase.