Forex traders can pick from thousands of online brokers and trading platforms, each offering a range of transaction types, spreads, analysis tools and interfaces.
Choosing the right trading partner depends on your expectations and requirements in terms of:
- Investment style
- Risk management approach
- Forex trading experience
- Minimum spend
- Necessary account features
- Anticipated trading volumes
These six forex brokers are considered among the best, but the choice depends on your trading style and expectations.
They range from sites designed specifically for advanced institutional investors to those catering to novice forex traders looking for low costs and account balance thresholds.
CMC Markets launched in 1989 and is one of the most popular forex platforms, with no minimum account balance and a range of products and services.
The UK-based forex broker is listed as CMCX on the London Stock Exchange and does not cater to US traders. However, it is FCA-regulated, ensuring consumer deposit protection for British traders under the Financial Services Compensation Scheme (FSCS) up to £85,000.
Trading fees on CMC Markets are relatively low, and the broker won the Investopedia award for Best Overall Forex Broker in 2020.
Forex traders can access a number of products and available trades, including those outside of the forex market, including:
- Spread betting and CFDs
- 14 cryptocurrencies
- Commodities, shares and indices
- Government bonds
Spreads on CMC are competitive and adjust according to the size of the trade. Client accounts are protected from heading into the red.
London Capital Group (LCG)
LCG is one of the biggest forex brokers in the UK, with FCA regulatory authorisation and client account protection to prevent users from turning negative.
The platform provides guaranteed stop losses for an additional fee on LCG Trader accounts, which protects from market gap risks.
There are four primary forex order types, and traders can opt to add a stop loss or take-profit order and decide whether the stop loss should execute at the bid or ask rate.
Financial instruments are available on LCG across a number of asset classes, such as:
- Individual stocks
- Options and ETFs
- Commodities and bonds
- Indexes and forex
- Metals at spot rates
One of the pitfalls is that you need to choose between the LCG Trader platform and MT4, but prices vary between the two. Users do not need to deposit a minimum amount to open a trading account. Still, traders without any activity in six months are charged £15 per month.
LCG is a good forex broker for beginners, with basic performance metrics to track trades and profits or losses. More advanced tools in the Active Market Panel show real-time margins, trade and pip values.
Saxo Capital Markets
Saxo Capital Markets was founded in 1992 and is part of the Danish Saxo Bank Group, a specialist in fintech investments and wholesale client trading services.
The broker offers a downloadable platform called SaxoTraderPRO, aimed at advanced traders. Newer forex investors can use the SaxoTraderGO desktop platform with trading features, an optional mobile app and access to third-party tools.
Products available include bonds, options, futures, commodities, forex, shares, indices and bonds, alongside forward contracts. The difference from most other brokers is that Saxo only offers spread betting to professional account holders.
Forex spreads are competitive, although they vary between accounts, categorised as Classic, Platinum or VIP.
Saxo is FCA regulated, provides client account protection, and has a good user interface. However, the fee structures can be complex. The minimum account balances on the Classic account are £500.
XTB Online Trading
XTB was the first forex broker service in Poland, launched in 2002 originally as X-Trade. It then transitioned to X-Trade Brokers before becoming XTB Online Trading in 2009 when the platform went public on the Warsaw Stock Exchange.
The forex brokerage carries some of the lowest spreads and fees and has a maximum leverage of 30:1 on UK accounts.
There is no minimum account fee, and client account funds are protected under FCA regulations, but users do not have a guaranteed stop loss and cannot automate FX trades through an Expert Adviser.
XTB offers a Standard account with a minimum 0.5 spread, and 0.1 on a Pro account, although all trades on a Pro account are charged a commission of $3.50 (£3.16) per lot.
Other charges include:
- €10 (£8.77) inactivity fee for making no trades within 365 days or no cash deposits within 90 days.
- Fee for withdrawals under a specified limit from the client’s cash account.
- Percentage fees for credit card withdrawals.
Traders on XTB can use the MT4 platform, with three basic order types; market, limit and stop. Users can attach a take-profit or stop-loss order to each trade.
The xStation 5 mobile version has most of the same features as the desktop site, although traders cannot set automated price alerts. Other functionalities such as charting, trading instruments and complex orders are all supported by the app on either iPhone or Android.
IG Group (IG)
IG has a minimum account deposit of $250 (£226) to start trading. It was founded in 1974 as part of IG Group Holdings. Unlike many of the other best-known UK forex brokers, IG accepts US traders and is regulated by both the FCA and the Commodity Futures Trading Commission (CFTC) and National Futures Association (NFA) in the states.
The broker has account protection for traders in the UK and EU and provides plenty of educational resources and trading types but has limited safeguards for US users, without account protection or guaranteed stop losses.
Spread costs are low, and there are multiple asset classes available in addition to forex, including:
Minimum spreads on all major currency pairs vary between the UK and US. They are usually from around 0.8 pips, with swap fees on overnight positions and currency conversion charges for trades outside the base currency.
Inactivity fees also apply at $12 (£10.84) per month if an account hasn’t been used for two years, and a bank withdrawal fee of $15 (£13.55).
Pepperstone is an Australian forex broker that has traded since 2010. Minimum account balances start at 200 units of whichever base currency the trader uses, and the platform features metals, shares, commodities, crypto, and forex.
The interface is relatively easy to use. Pepperstone is a fit for forex traders looking for low-cost investments, multiple account types and a responsive customer support service.
As an FCA-authorised broker, Pepperstone is regulated in the UK and accepts EU clients with limited customer account protection. It is not open to US traders, and there are no guaranteed stop losses.
Standard accounts are subject to minimum spreads starting from one pip but do not pay commission. Alternatively, traders can open a Razor account, which has no spread, but commissions instead, making it a competitively priced platform.
Users can choose between cTrader and MT4 or MT5, although the former tends to be preferred due to direct pricing from the liquidity provider and technical tools such as backtesting and detachable charts.
Forex Brokers – Picking A Trading Partner FAQ
Forex trading is complex and high-risk. Retail investors trying forex trading for the first time should prioritise platforms and brokerage services with demo accounts and educational resources.
Examples include IG and CMC Markets, both of which provide customer service support and materials to help novice traders learn more about the forex market.
Most brokerage services have a minimum trade value or deposit, although you can find platforms with minimal or zero deposits to get started – although you will probably need to pay more funds into your account to make the first trade.
XTB Online Trading is one of the better options for traders in terms of transactional costs, and you can open an account without any deposit at all.
The majority of forex brokers have a mobile app where you can log into your trading account, although you may have limited access to more advanced features such as technical analysis charts.
London Capital Group has an Android app available on Google Play, which has been downloaded over 10,000 times and is rated 3.5 stars after 487 reviews.
Most forex platforms have different account tiers, depending on your average monthly trading volume and experience. You can often apply for an upgraded account with more technical tools if you are a regular, high-spend trader.
Benefits include more complex order types and analytical charting tools, which you can find on Saxo Capital Markets, designed primarily for institutional investors and professional forex traders.
It is highly advisable to only trade forex on a brokerage platform registered with and regulated by the FCA in the UK. Regulated brokers abide by mis-selling laws and offer account protection – although this may not apply if you are a non-UK resident or trade from overseas.
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