A-Book vs B-Book: What Every Retail Trader Needs to KnowMost retail CFD traders have never even heard the terms “A-Book” and “B-Book,” yet almost all of them are directly affected by how these models work. Your broker’s choice between the two can change the prices you see, how your orders are filled, and even whether your stop loss gets hit. Let’s break it down so you know exactly what’s going on behind the scenes.
█ What is A-Book?
An A-Book broker routes your orders straight to external liquidity providers, such as banks, market makers, or directly to an exchange in the case of futures or spot markets. Your broker is essentially the middleman, passing your trade along and matching it with a real counterparty.
⚪ How they make money:
Spreads (the difference between the bid and ask prices).
Commissions on each trade.
Occasionally a small markup on the feed.
Because they don’t profit when you lose, an A-Book broker’s ideal client is a trader who trades frequently and consistently, your activity is their revenue stream.
█ What is B-Book?
A B-Book broker keeps your trades “in-house,” meaning they take the other side of your position. If you buy, they sell; if you sell, they buy, but all within their own system. Your trades don’t reach the real market at all.
⚪ How they make money:
Your losses are their profits.
They may still earn on spreads and commissions, but the main income is the net loss of their client base.
