Our team of professionals has researched and evaluated the leading FX brokers in the market today. This comprehensive guide summarises the findings and provides suggestions for the top FX trading platforms.
We have economists and currency traders on staff who have devoted decades to mastering the forex market. We have evaluated and ranked every major forex broker based on their features and ease of use as part of our evaluation process.
Each professional rated the platforms based on their overall impression of the broker’s service and how well they completed a series of simple tasks. We averaged the results of these evaluations to arrive at an overall grade. Find out which brokers fared the best in our analysis.
Top 20 Forex Brokers We Recommend
- eToro 🥇 Best for trading cryptocurrency
- Capital.com 🥈 Best Forex Broker for Beginners
- Alvexo 🥉 Best Trading platform for day traders
- Skilling 📱 Best Forex Trading App
- XTB 📈 Best Forex Broker Overall
- IG 🇺🇸 Best for US Traders 🇺🇸
- Plus500 – Best for Trading Forex CFDs
- Forex.com – Best Customer Service
- Interactive Brokers: Best Charting And Graph Tools
- CMC Markets: Best for Forex Spread betting
- Saxo Bank: Best FX pairs
- Naga Markets
- Trading 212
- FP Markets
- IC Markets
The Importance Of Forex Brokers – How & Why
A foreign exchange broker is a corporation authorised by a government regulatory authority to facilitate the purchase and sale of foreign currencies via the use of electronic trading platforms or voice broking.
Depending on the regulations in your country, your forex broker may provide you with the underlying currency, a non-deliverable spot contract, or a derivative such as a contract for difference (CFD).
If you want to lower your chances of being ripped off, you should only work with brokers who are licenced by the appropriate authorities.
How to Search for the Best Forex Broker?
When looking for a broker, it is important to consider the following factors:
- Account Types and Costs
- Leverage & Trading Features
- Broker Assistance, Training, and Education
- Broker Security Features
Account Types and Costs
When looking for a broker, it is important to consider the minimum deposit requirement. Most brokers have different requirements, so it is important to find a broker that matches your investment amount.
Definitions of Different Account
Our recommended brokers provide a variety of account kinds to their clients. Demo accounts are available for testing using this option. Almost all reputable foreign exchange (FX) brokers provide this kind of account, which allows you to trade in real time and in a risk-free environment that mirrors that of actual trading as closely as possible.
Beginners may benefit greatly from the reduced risk inherent with cent accounts and micro accounts, which may be available via your online broker.
A cent account and micro account are a type of forex account in which the trader can trade in fractional lots. A fractional lot is a trade size that is less than the standard lot size of 100,000 units.
In retail FX trading, cent accounts are trading accounts where the balance is denominated in cents rather than US dollars. Transactions in cents are processed in the same manner as those in dollars, the only variation being the nominal amounts involved.
In the realm of foreign exchange (forex) trading, a micro account is aimed squarely at the retail investor who wants a taste of the action but can’t afford to put up a sizable sum of money. The minimum contract size for a micro account is one thousand micro lots.
You should also know that because of regulatory constraints, no currency broker will provide you with a bonus to create an account if you are located in the European Union.
Most brokers have different requirements, so it is important to find a broker that matches your investment amount. The minimum deposit requirement is the amount of money that you must deposit into your account in order to start trading. This amount can vary depending on the broker, which typically averages 200 GBP.
Most brokers also offer a variety of account types, so it is important to find an account that fits your needs. Brokers typically offer demo accounts, which allow traders to practice trading without risking any money.
When deciding on an online trading broker and setting up your first account, you may have to pay a few fees. Most of the best forex brokers need a preliminary deposit before you can begin trading with a live account. However, there are numerous very competitive options available from online brokers with far lower minimum deposits.
Deposit and withdrawal fees are another potential expense at your broker, but many of the top-rated ones do not. Different base currencies are also supported by brokers. Here, it’s best to choose the one that corresponds to the currency of your actual bank account, to prevent incurring any unnecessary costs due to currency conversion.
If you are not actively trading, inactivity fees may apply after a certain period of time.
The Price of Trade
Regardless of how reputable an FX broker may be, all trades will have some kind of fee. Variable spreads are the norm, however, fixed spreads are sometimes available. There are accounts where commissions are assessed for each lot as well. Most reputable brokers provide spreads of 1 pip or less on key currency pairs like the EUR/USD, while other low-spread forex brokers go as low as 0 pips.
If you don’t day trade but instead leave your positions open for many days, you may incur additional expenses such as the rollover fee. While this has no bearing on your Islamic trading account, certain web-based brokers may charge you an additional fee to cover their costs.
Leverage & Trading Features
Most brokers offer very high leverage, and while this can lead to large profits, it can also magnify losses. With a standard account, you may be able to trade with a 50:1 or 100:1 margin, but with an Islamic account, your broker must provide you with a No Riba account which does not allow for any overnight swaps
In order to trade larger volumes without risking a large portion of your own funds, you may take use of leverage. A reliable forex broker and there are none better than the greatest in the world, will exceed the leverage limits imposed by government agencies.
The Australian Securities and Investments Commission (ASIC) and the European Union (EU) and the United Kingdom (UK) place a maximum leverage of 30:1 on retail forex investors, while professional traders may use up to 400:1.
If you’re located outside of these regions, the maximum leverage per trader is normally approximately 400:1, but it may go much higher, to as high as 3,000:1, depending on the broker. You should verify their legitimacy as regulated forex brokers before placing any trades with them.
Essential Trading Tools & Product Offerings
As was noted before, top-tier brokers often provide cutting-edge trading tools. Some of their own trading platforms join the likes of MetaTrader 4, MetaTrader 5, and cTrader here. Options for trading on desktop platforms, the web, and mobile applications are common.
In addition to a variety of order types and trading tools, the top trading platforms will also provide access to technical indicators for doing technical analysis. Online trading firms may also provide access to premium sophisticated charting tools for clients who either make larger initial deposits or who use the service often.
All of these resources are here to help you meet your many trading requirements and increase your odds of success.
The vast majority of retail forex brokers use the agency model for order execution. With this type of trading, your broker is simply filling orders based on your instructions. You’re not actually buying or selling the underlying currency itself but rather a contract that will track its price movements.
In an agency model, the company you are working with is not taking the opposite side of your trade. Instead, they are charged a commission for each transaction. The main benefit of this is that it creates a conflict-free environment since the broker’s interests are not directly aligned with yours.
ECN and STP brokers may also use the agency model but typically only do so with larger accounts. For smaller accounts, they will likely use the dealing desk model which we will discuss next.
Dealing Desk Model
The dealing desk model is quite different from the agency model and is commonly used by brokers who are less reputable. In this type of trading, your broker is taking the other side of each trade that you make. This means that they profit when you lose and vice versa.
Because of this, there is a clear conflict of interest between the broker and their clients. It also creates significant risks since the broker may manipulate prices or refuse to fill trades in order to generate profits for themselves.
If you are using a dealing desk broker, it is important to be aware of these risks and to trade with caution. You should also be sure to only work with brokers who are properly regulated in order to protect yourself from fraud or other unethical behaviour.
ECN and STP Brokers
ECN and STP brokers are similar in that they both use the agency model for order execution. The main difference between the two is that ECN brokers provide their clients with direct access to the interbank market while STP brokers route orders through a dealing desk.
ECN brokers typically charge a commission for each trade while STP brokers make money by adding a small markup to the spread. Both types of brokers can provide their clients with access to the best available prices and execution.
ECN brokers are the preferred choice for most serious traders since they provide the best possible trading conditions. STP brokers may be a good choice for beginner traders or those who trade with very small accounts.
When choosing a forex broker, it is important to understand how they make their money.
Broker Assistance, Training, and Education
One important thing to look for when choosing a forex broker is their level of customer service. Excellent customer service should be one of your top priorities, as you’ll undoubtedly have questions at some point. 24/7 support is essential, and you should also make sure that the broker has a good reputation for resolving any disputes quickly and fairly.
In addition to providing excellent customer service, a good forex broker will also offer extensive educational resources. These can include webinars, video tutorials, e-books, and more. The best brokers also have trading experts on staff who can provide one-on-one mentoring and assistance.
It’s important to receive proper training before starting to trade with real money. Not only will this help reduce the risk of incurring losses, but it will also give you a better understanding of how the forex market works. By using the educational resources offered by your broker, you can become a successful trader in no time.
At the very least, you should expect to find a detailed economic calendar alongside some updated news, market analysis, and maybe a few other basic features with any legitimate trading broker. The best brokers will also offer advanced research tools and allow you to connect your account with third-party tools.
Broker Security Features
When looking for a forex broker, it is important to consider the security features that they offer. Some of the most important security features include:
- Password protection: This ensures that only authorized users can access your account.
- Two-factor authentication: This adds an extra layer of security by requiring a second form of identification, such as a code sent to your phone, in order to log in.
- Fraud monitoring: Brokers often have teams of fraud analysts who monitor activity on accounts and identify any suspicious behaviour.
- SSL encryption: This encrypts your communications with the broker, ensuring that your data is safe and secure.
These are just some of the security features to look for when choosing a forex broker. By ensuring that your broker offers these features, you can trade with confidence knowing that your account is safe and secure.
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In this in-depth article, we’ve guided you to leverage the power of the human brain with neuroscience sales tips. Whether you’re selling a digital product online or you run a brick-and-mortar business, these behavioural neuroscience principles will work for you. They’ll help you drive more visitors into your marketing funnel and convert casual visits into sales.
How to choose a Forex broker?
When choosing a forex broker, it is important to consider the following factors:
– Reputation: The broker should have a good reputation and be regulated by a reputable authority.
– Fees: The broker should have low fees and no hidden costs.
– Trading Platform: The broker’s trading platform should be user-friendly and reliable.
– Customer Support: The broker should offer good customer support with fast response times.
How to place a trade?
To place a trade, the following steps need to be followed:
– Choose a currency pair: The first step is to choose a currency pair. The most popular currency pairs are known as majors, and they include EUR/USD, USD/JPY, GBP/USD, and USD/CHF.
– Decide on the trade size: The next step is to decide on the trade size. This is the amount of money that you are willing to invest in the trade.
– Choose a direction: You then need to choose whether you think the price of the currency pair will go up or down.
– Place the trade: Once you have chosen all of the above factors, you can then place the trade by clicking on the “buy” or “sell” button.
What are the different types of orders?
There are four different types of orders:
– Market order: A market order is an order to buy or sell a currency pair at the current market price.
– Limit order: A limit order is an order to buy or sell a currency pair at a specific price.
– Stop order: A stop order is an order to buy or sell a currency pair when the price reaches a certain level.
– Trailing stop order: A trailing stop order is an order to buy or sell a currency pair when the price moves in a certain direction.
What are the different trading strategies?
There are four different trading strategies:
1. Day trading: Day trading is a strategy where you open and close trades within the same day.
2. Swing trading: Swing trading is a strategy where you hold trades for longer than one day.
3. Position trading: Position trading is a strategy where you hold trades for weeks or months.
4. Scalping: Scalping is a strategy where you take small profits on each trade.
What are the different kinds of analysis?
There are four different kinds of analysis:
1. Technical analysis: Technical analysis is the study of price charts in order to identify trends and market reversals.
2. Fundamental analysis: Fundamental analysis is the study of economic indicators in order to identify trends in the forex market.
3. Sentiment analysis: Sentiment analysis is the study of investor sentiment in order to identify market trends.
4. Behavioral analysis: Behavioral analysis is the study of investor behaviour in order to identify market trends.
What are the risks involved in forex trading?
There are four different risks involved in forex trading:
– Market risk: Market risk is the risk that the price of a currency pair will move in an unexpected direction.
– Credit risk: Credit risk is the risk that a counterparty will default on a trade.
– Liquidity risk: Liquidity risk is the risk that a currency pair will be difficult to trade.
– Volatility risk: Volatility risk is the risk that the price of a currency pair will move violently.
How to read a Forex quote?
Forex quotes are quoted in pairs. The first currency is called the base currency, and the second currency is called the quote currency. For example, in the EUR/USD pair, EUR is the base currency and USD is the quote currency. The base currency is always equal to one unit, and the quote currency is the amount of the quote currency that is needed to buy one unit of the base currency.
What is the spread in Forex trading?
The spread is the difference between the bid and ask price of a currency pair. The bid price is the price at which you can buy a currency pair, and the ask price is the price at which you can sell a currency pair. The spread is typically expressed in pips.
What is a pip?
A pip is the smallest unit of price movement in the forex market. A pip is equal to 0.0001 for most currency pairs, with the exception of the Japanese yen, which is equal to 0.01.