Agency Model
a.k.a. Agency execution, Pass-through model
A broker setup where your orders are passed on to outside liquidity providers, so the broker earns fees rather than betting against you.
Under the agency model, your broker acts as a messenger. It takes your order and routes it to banks or other liquidity providers, earning money from a commission or a small markup on the spread.
The appeal is fewer conflicts of interest: the broker does not win when you lose. The opposite approach is a market maker (dealing desk), which takes the other side of your trade itself. Many brokers mix both, so read how yours actually works.
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