Lowest Spread Forex Broker Comparison

With the high influx of Forex brokers online, choosing the best broker to trade with can be difficult. Trading with the best forex broker provides good execution for your trades. A good broker with a low spread offers a lower cost of a trade. Trading with a good broker is essential because it provides the trading platform used in the execution of trades. As an amateur trader, the ability to compare the best forex brokers can be hard. There are many good brokers you can trade with online. However, there are a lot of basic forex brokers that camouflage to be one of the best when they’re not.

BrokerRegulationsMinimum DepositTrading PlatformDescriptionVisit Broker
ICmarkets Forex broker CySEC, ASIC, FSA$200/£200MetaTrader 4, cTraderOffer CFDs on Forex, stocks and cryptocurrencies,
established 2007

XM Forex broker CySec, FCA, ASIC, IFSC$5/£5MetaTrader 4, MetaTrader 5, Web PlatformOffer CFDs on Forex trading, stocks and cryptocurrencies,
established 2008



Admiral Markets Forex broker CySEC, FCA, ASIC, FSCS$100/£50MetaTrader 4, MetaTrader 5, Web PlatformOffer Forex trading, stocks and funds via CFDs, cryptocurrencies,
established 2001



TickMill Forex broker CySEC, FCA, FSA$100/£25MetaTrader 4, MetaTrader 5, Web PlatformOffer CFDs Forex trading
established 2014



IG Forex broker CySEC, FCA, ASIC, CFTC, NFA$300/£250MetaTrader 4, WebTraderOffer CFD, Forex trading and cryptocurrencies,
established 1974



Pepperstone Forex broker FCA, ASIC, DFSA$1/£1MetaTrader 4, MetaTrader 5, cTraderOffer CFD, Forex trading, stocks and cryptocurrencies,
established 2010



 In this article, we will focus on the things to look out for when choosing a forex broker. Those are the components that make up a good Forex broker. But before we delve into that let’s explain what a Forex broker is.

WHAT IS A FOREX BROKER

 A forex broker is a financial firm that allows traders to buy and sell foreign currencies. A Forex market transaction is done in pairs, between two different currencies. The job of the Forex broker is to provide currencies the traders speculate on. These currencies include the US dollar (USD), the pound sterling (GBP), the Euro (EUR), the Australian dollar (AUD), the Japanese yen (JYP), the New Zealand dollar (NZD), the Swiss franc (CHF), and the Canadian dollar. Some brokers provide traders with other currencies to trade with.

 A trader uses a Forex broker to buy a currency pair and also sell the currency pair. For instance, a trader will exchange euros for USD by buying EUR/USD pair. The trader closes the trade by selling the currency pair. Profit is recorded if the exchange rate is high. However, if the exchange rate is low, a loss is recorded.

LOWEST SPREAD FOREX BROKER COMPARISON

 To perform the lowest spread forex broker comparison, knowing the services it provides is important. The more service it provides the better the broker.

 Look for features that provide learning materials for the basic Forex trading without any additional cost. Also, choose a broker that provides updated trade analysis, provides consultancy, and notifies of impending risks. These features not only help you succeed but also attract traders to the broker giving additional success factors.

 Reliable brokers are mostly companies that are formed from large banks or divisions. When comparing forex brokers, make sure to check for this feature, it gives traders a high level of reliability. These brokers are strict with deposits, but the peace and minimum risk that comes with it is worth it.

 There are several online Forex brokers a trader can choose from, the lists are endless. However, picking one of the best forex brokers is a trader’s ultimate goal. Some criteria make up a good broker. These criteria must be met by any broker a trader signs up with. These criteria include the regulation of a broker, the withdrawal and deposit method, etc. This criterion is used to compare the best forex brokers.

COMPANY’S YEAR OF ESTABLISHMENT

 When the organization was established is an important feature to note. The level of experience helps in ensuring the safety of your trading account. Any Forex broker that lacks experience in the Forex market is not a good choice. Pick brokers that have stood the test of time. And also ensure the broker is partnering with a strong company.

 Scam brokers do not have a long life span; traders quickly notice that they are fraudulent. Also, the state authorities when alerted will shut down the company. Traders will also leave bad reviews on the sites alerting other traders not to use them. Any broker that has been in existence for 10 years should be trusted.

HEADQUARTERS LOCATED IN YOUR CITY

 It is important to trade with a broker that has a headquarters or branch office in your geopolitical zone. It is not very important, but it won’t be a bad idea for easy access when the need arises.

Furthermore, brokers with lots of branches all over the world are more reliable.

WITHDRAWAL METHOD

 A withdrawal method is the means to transfer your profits from your Forex account to a local bank account. Most brokers provide different ways that can be used for withdrawal like, through E-wallets(Paypal, Skrill, etc), credit or debit cards, checks or money orders, bank transfers, and sometimes Bitcoin or a different cryptocurrency.

 The one thing to look out for is the withdrawal fees. Some brokers charge high withdrawal fees while some charge little or nothing. Before signing up, also make sure the withdrawal conditions meet your requirements. Some brokers allow withdrawals on certain days while some have flexible withdrawal days.

DEPOSIT

 A deposit method is a procedure used in paying money into a Forex account to commence trading. Just like withdrawal methods, it is carried out via different payment methods. These payment methods include Bank transfers, credit and debit cards, cryptocurrency, etc.

 Most brokers list their minimum deposits, some charge as low as $1 while others charge as high as $500. Don’t be tempted by low deposit Forex brokers, because most times there is always a hidden charge. Make sure they are reputable and trustworthy before signing up. Some brokers offer low minimum deposits to draw in traders but have low trade execution performance.

TRANSACTION COSTS/SPREAD

 Brokers charge transaction costs or spread for every trade placed by a trader. A spread is the price difference between the cost price and the selling price of a forex pair. There are two types of Spread, they are fixed spread and Variable spread.

 Just like the name implies, a fixed spread is a spread fixed to a particular amount and cannot be changed. While a variable spread is inconsistent, changes as the buy price and sell price change. Most brokers prefer to charge a spread for each trade other than a commission for each trade. Spread is incorporated into the buy and sell price. Traders prefer to sign up with the cheapest spreads rates. However, make sure they are highly secured and regulated.

LEVERAGE

 Simply put, leverage is the act of buying trades on credit. Forex traders place trades 1000 higher than their equity with the help of leverage. They are granted access to higher amounts of trades than previously expected.

For instance, 

 A trader has equity worth $1,000 in his/her trading account. A standard lot size is $100,000. This trader will only make a profit of 2% if they open a trade without leverage. But with leverage, the same trader using a 1:500 will generate 5 times their profit. Opening trade with an equivalent of $500,000, their profit will be maximized.

 However, apply caution while trading with leverage; it maximizes both profits and losses. Ensure to use a broker that offers reasonable leverage which fits your trading strategy.

TRADE EXECUTION

 Trade execution rate is the time taken by the trading platform to place your trades. This is the most crucial criteria used for the lowest spread forex broker comparison. A Forex broker might be good in most cases but lack good trade execution speed. Normally, this procedure takes milliseconds to complete. In some cases, it could take up to 10- 20 seconds. And this is dangerous because the Forex market is a volatile trade that requires instant trade execution to avoid price change. The market volatility and lack of liquidity in the market could affect your trade execution rate.

 This is most important for scalpers. When comparing the best forex brokers these criteria should be top of your list. As this could either positively or negatively affect your trades. Remember to check with your provider to see if they allow scalping.

AVAILABLE TRADING INSTRUMENTS

 Forex brokers give access to Forex and Stock markets and also several other financial instruments. Financial instruments such as Indices, and commodities like precious metals(gold sliver platinum), energy carriers (crude oil).

 The type of trade you specialize in determines the type of Broker you sign up with. some brokers only trade two or three assets. Ensure to pick the one that tallies with your trade strategy.

SUPPORT

 Brokers provide different customer care support. Choose a broker that supports 24/7 customer care service. Some brokers provide an email, telephone, and a 24/7 live chat. And also ensure they respond quickly and are helpful. Some brokers offer all these but their customer agents are not friendly and helpful. Make your findings and inquiries before signing up.

REGULATIONS/SECURITY

 The number one characteristic a good broker must possess is a premium level of security. It is the most sort after component used for the lowest spread forex broker comparison. Make sure you check the reputation of the broker to avoid risk and loss of deposited funds. There are many regulatory firms in the world used to regulate and oversee trading markets In different countries. These regulatory bodies ensure the safety of traders’ funds and protect the trader’s interest.

Listed below are some countries with governing bodies:

  • Australia: Trading brokers are governed by the (ASIC) Australian Securities and Investment Commission.
  • Canada: Forex brokers are governed by the Investment Information Regulatory Organization of Canada (IIROC).
  • Switzerland: Brokers are regulated by the Swiss Federal Banking Commission (SFBC).
  • United States: Trading brokers are regulated by the National Futures Association (NFA) and Commodity Futures Trading Commission (CFTC).
  • Germany: Brokers are governed by the BundesanstaltfürFinanzdienstleistungsaufsicht (BaFIN).
  • United Kingdom: Forex brokers are regulated by the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA)
  • France: Trading brokers are regulated by Autorité des Marchés Financiers (AMF).

TRADING PLATFORM

 The online world is taking over now. Every trader is now moving to the online trading world. Forex brokers provide a trading platform for their traders that allows them to open and close trades at will. There are several trading platforms available, but the most popular is the MetaTrader platform. The trading software was established in 2005. There are two main types of MetaTrader offered by the MetaQoutes industry, the MetaTrader 4 and MetaTrader5. The MetaTrader 4 trading platform favors Forex traders more, while the MT5 gives traders access to other financial instruments.

 For amateur traders, picking a Forex broker with the MT4 trading platform is the best choice. MT4 is easy to navigate; it provides good trade results with the help of inbuilt components to make trading easy.

AMOUNT OF REGISTERED USERS

 This is the easiest factor to check out when a trader wants to compare the best Forex brokers. The more users a broker has the more credible it is. Because brokers with poor performance and ineffective customer support do not have a large number of users.

PROVIDING NECESSARY MARKET ANALYSIS

 A good Forex broker provides its traders with top-notch market analysis and market signals. This feature makes a trader know the right market to trade in. It tells the trader when it’s safe to enter and leave the market. This feature is very important because it helps maximize profits by making good trade decisions.

PROTECTION OF TRADER’S DATA

 Pick a broker that ensures the safety of your data, like bank details, house address, and phone number. If your data is not secured it could fall into the wrong hands like hackers or thieves.

FOREX TRADING EDUCATION

 A good broker provides limited educational materials for its traders at no additional cost. Any broker without the educational sector is a red flag. They should provide materials to help traders grow their trading experience.

CONCLUSION

Lowest Spread Forex Broker Comparison hint

 The lowest spread forex broker comparison is not always easy because there are so many of them. However, picking a good broker is the beginning of your trade journey. So picking the best Forex broker that complements your Trading strategy is the ultimate goal. There are a lot of good brokers to choose from. This article should help you pick the best brokers by looking at the characteristics stated above. Also, a good forex broker doesn’t guarantee a profitable trade. You must be experienced in the trading sector to successfully open and close trades. That shouldn’t be difficult as there are several free Forex educational materials easily gotten online.

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