Glossary / Liquidity Provider (LP)

Liquidity Provider (LP)

Liquidity provider (LP) is the institution or network a broker or prop firm routes trades to for pricing and execution, particularly relevant on live funded accounts rather than simulated ones.

Most challenge and simulated funded accounts never actually touch an LP at all; where a firm does route trades live, its LP relationships affect execution quality and, indirectly, how tight it can afford to make its spreads.