A-book and B-book brokers differ in the way they process orders, but both act as intermediaries between traders and market makers. Most brokers use a hybrid model rather than strictly following one type.

A-book brokers primarily make money from commissions by passing orders to a prime broker or market maker. They operate as direct market access (DMA) brokers, allowing traders to enter the market without having to own the order books. Since they do not act as counterparties to traders, A-book brokers provide a certain level of fairness.

B-book brokers make the bulk of their profits from client losses by acting as counterparties to their orders. They provide liquidity and match orders internally, but may hedge large trades with market makers to reduce risk. This model can create a potential conflict of interest, as brokers benefit when their clients suffer losses. However, attractive tight spreads and favorable trading conditions often attract less risky traders. 

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