The post Best Zero-Spread Forex Brokers by Chika Uchendu appeared first on Benzinga. Visit Benzinga to get more great content like this.
Benzinga readers love FOREX.com or IG Markets as the best zero spread forex brokers.
Suppose you’re a novice or expert forex trader seeking a cost-effective, transparent and seamless trading experience. In that case, you should consider zero-spread forex brokers. These brokers offer trading opportunities where the spread, which is the difference between the bid and ask price, is set at zero or extremely tight. This means you can enter and exit positions at the exact market price without incurring additional costs, thereby maximizing profit.
Zero-spread forex brokers streamline market access for undercapitalized traders by minimizing trading costs. However, while zero-spread forex brokers seem attractive, most platforms try to recoup the cost via hidden fees like commission and overnight charges, so read the terms to understand the pricing before opening accounts.
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6 Best Zero-Spread Forex Brokers
Benzinga’s six best zero-spread brokers comprise well-regulated and reputed forex brokerages that blend fast trade execution with other exceptional features. These brokers offer diverse tradable instruments, cutting-edge trading tools, excellent educational resources and competitive pricing. They are:
- Best Overall: FOREX.com
- Best for CFD Trading: IG Markets
- Best for Expert Traders: Interactive Brokers
- Best for Web Trading: CMC Markets
- Best for Beginners: Pepperstone
- Best for Scalping and High-Frequency Trading (HFT): Tickmill
1. Best Overall: FOREX.com
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securely through FOREX.com’s
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FOREX.com is a one-stop shop for forex traders. With a massive range of tradable currencies, low account minimums and an impressive trading platform, FOREX.com is an excellent choice for brokers searching for a home base for their currency trading. New traders and seasoned veterans alike will love FOREX.com’s extensive education and research center that provides free, informative forex trading courses at multiple skill levels. While FOREX.com is impressive, remember that it isn’t a standard broker.
Best For
- MetaTrader 4 users
- Beginner forex traders
- Active forex traders
- Impressive, easy-to-navigate platform
- Wide range of education and research tools
- Access to over 80 currencies to buy and sell
- Leverage available up to 50:1
- Cannot buy and sell other securities (like stocks and bonds)
FOREX.com is Benzinga’s pick for the best zero-spread broker thanks to its competitive spreads, flexible leverage options, multiple account types and user-friendly trading platforms. Over 80 currency pairs are available, providing traders with an excellent opportunity to explore various forex markets. You can set up your account and start trading with a minimum deposit of $100. However, the brokerage recommends a $2,500 deposit for flexibility and efficient risk management. FOREX.com provides three primary account options: Standard, Raw pricing and direct market access (STP Pro) accounts.
The Standard account features variable spreads as low as 1.0 with no trade commission. In contrast, the Raw pricing account offers ultra-raw spreads as low as 0.0 for major pairs and a commission of $7 per USD traded. The STP Pro account is commission-free and has a similar spread to the Raw pricing account. The default leverage is 200:1. However, you can request it to be changed to a maximum of 400:1 for the Standard account or 100:1 — 50:1 for other account options. The brokers support multiple trading platforms, including MT4, TradingView and NinjaTrade, available on web, desktop and mobile devices for on-the-go access. FOREX.com offers robust educational and research resources.
Pros
- Ultra-tight spreads
- Lightning-fast trade execution
- Over 80 currency or forex pairs
- Competitive leverage of up to 1:50
- Advanced trading tools and software
- Excellent educational and research resources
Cons
- Relatively high CFD fees
- MT5 account unavailable in the U.S.
2. Best for CFD Trading: IG Markets
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securely through IG Markets’s
website
IG is a comprehensive forex broker that offers full access to the currency market and support for over 80 currency pairs. The broker only offers forex trading to its U.S.-based customers, the brokerage does it spectacularly well. Novice traders will love IG’s intuitive mobile and desktop platforms, while advanced traders will revel in the platform’s selection of indicators and charting tools. Though IG could work on its customer service and fees, the broker is an asset to new forex traders and those who prefer a more streamlined interface.
Best For
- New forex traders who are still learning the ropes
- Traders who prefer a simple, clean interface
- Forex traders who trade primarily on a tablet
- Easy-to-navigate platform is easy for beginners to master
- Mobile and tablet platforms offer full functionality of the desktop version
- Margin rates are easy to understand and affordable
- Access to over 80 currency pairs
- U.S. traders can currently only trade forex
- Customer service options are lacking
- No 2-factor authentication on mobile
IG Market is a London-based forex contract for difference (CFD) broker that provides a comprehensive trading package, including multiple-robust trading platforms, flexible strategies and exceptional educational and research tools. It is considered one of the best CFD brokers, with over 18,000 CFD instruments across multiple asset classes, including stocks, indices, commodities and cryptocurrencies. IG Markets supports ProRealTime for the web, MT4 and L2 Dealer — its direct market access (DMA) platform and MT4.
You can seamlessly trade 80+ forex pairs on these platforms using your favorite strategies, including algorithmic trading. You can set up an account and start trading with a $250 minimum. For major pairs, spreads start as low as 0.8 (with zero commission). Per CFTC regulations, you can access up to 50:1. If you meet a certain volume threshold, you qualify for a rebate. The mobile app is equipped with essential tools such as advanced charts, risk management features and customizable trading options and makes for excellent ease of usage.
Pros
- Solid reputation across the board
- High emphasis on education and research
- Robust and user-friendly platform
- Fast trade execution
- Offers support for API and algo trading
- Extensive range of instruments
- Regulated by FCA (UK), NFA & CTFC (U.S.)
Cons
- Allows only forex for U.S. clients
- Overnight and inactivity fees
- No account protection and guaranteed stop loss for U.S. clients
3. Best for Expert Traders: Interactive Brokers
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securely through Interactive Broker Primary’s
website
Interactive Brokers is a comprehensive trading platform that gives you access to a massive range of securities at affordable prices. You can buy assets from all around the world from the comfort of your home or office with access to over 150 global markets, allowing you to access the forex market with ease. Options, futures and fund trading are also available, and most traders won’t pay a commission on any purchase or sale.
IBKR is geared primarily toward experienced traders and investors but now with the availability of free trades with IBKR Lite, casual traders can also acclimate to IBKR’s offerings.
Best For
- Access to foreign markets
- Detailed mobile app that makes trading simpler
- Massive range of accounts and assets
- Quality desktop platform
- Mobile app mirrors the desktop platform
- Low margin rates
- The scope of this platform may intimidate some traders
Interactive Brokers (IBKR) prides itself as the gateway to the global financial market for expert traders and is rightfully so, given its expansive offering. You can explore over 150 global markets and trade your favorite assets, including stocks, options, bonds, funds and forex. IBKR offers over 100 currency pairs on 24 global currencies with a tight spread as narrow as 0.1 pips and a commission as low as 0.08, depending on your monthly trading volume. There’s no account minimum, inactivity fees, hidden spread or markup. IBKR’s transparent and low prices prevent conflicts of interest often associated with brokers who trade for their own accounts.
Moreover, its deep liquidity and real-time quotes from 17 of the largest global FX dealers facilitate fast trade execution and informed decision-making based on up-to-date market information. IBKR is available in about 200 countries and accommodates traders of different levels with various account types, including Individual, Joint and Corporate accounts, allowing for diverse trading needs. Multiple trading platforms are available, including the web client portal, IBKR mobile for on-the-go access and the powerful Trader Workstation (TWS) for the desktop, the most robust platform for expert traders. IBKR’s professional FX trading tool — FXTrader — provides an optimized trading interface tailored for the currency market and is easily accessible on the TWS.
Pros
- Flexible investment options
- Impressive educational and research resources
- Cutting-edge and customizable trading tools
- User-friendly mobile app
- Superior order execution
Cons
- Beginner traders may find the platforms intimidating
- MetaTrader unavailable as an alternative platform
4. Best for Web Trading: CMC Markets
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securely through CMC Markets’s
website
CMC Markets (LSE: CMCX) was founded in 1989 as a spread betting broker and operates under the UK Financial Conduct Authority (FCA) regulatory oversight. Although it does not accept U.S. clients, CMC Markets currently offers spread betting in the UK that can have tax advantages, as well as a global trading service in contracts for difference (CFDs). Available asset classes include forex, cryptocurrencies, indices, commodities, shares, exchange-traded funds (ETFs) and government securities.
Best For
- Active CFD traders
- UK-based spread bettors
- Beginning traders
- Wide range of tradable assets
- Supports MetaTrader 4 (MT4)
- Excellent education and research resources
- Does not accept U.S. clients
- Only CFD trading
- No social trading
- Spread betting only for UK residents
CMC Markets is a U.K.-based brokerage offering spread betting and CFD trading on 12,000+ instruments across global markets. CMC Markets facilitates zero-spread forex trading across multiple currency pairs on its FX Active account. This enables you to trade on pure price action with lightning-fast execution (0.003 seconds), benefiting from spreads as low as 0.0 pips on six major forex pairs while enjoying a fixed low commission rate of 0.0025% per transaction. You also get a 25% spread discount on all other forex pairs. Leverage ranges between 20:1 to 30:1 depending on the specific currency pairs, and there’s no minimum deposit.
Additional fees include guaranteed stops, inactivity fees, overnight charges and rollover charges. CMC’s proprietary web trading platform, Next Generation, combines cutting-edge features and advanced security measures, ensuring lightning-fast execution and providing best-in-class insights and analysis for traders. While Next Generation seems highly intuitive and powerful, the broker also offers MT4 for MetaTrader lovers. You can access both platforms on the highly intuitive mobile app. MT4 is also available on the web. CMC Markets offers about 330 forex pairs, including over 175 on MT4.
Pros
- Extensive range of tradable instruments
- Excellent proprietary trading platform
- Offers client account protection
- Well-regulated by FCA (U.K.)
Cons
- No backtesting capabilities
- Doesn’t accept U.S. clients
- High CFD spread for specific indices
5. Best for Beginners: Pepperstone
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Pepperstone is an Australian broker focused on providing international forex, CFD and cryptocurrency trading. Though U.S. traders currently cannot open an account with Pepperstone, the broker remains an affordable and comprehensive option for international traders.
Pepperstone offers traders access to over 61 forex markets, over 60 CFDs for index funds and stocks and 5 cryptocurrencies. Leverage options with Pepperstone are extensive; you may qualify for up to 500:1 leverage when trading currencies and up to 5:1 leverage when trading cryptocurrencies, for example.
There are a few areas where Pepperstone can afford to improve. We’d love to see Pepperstone add its own trading platform in the future instead of relying entirely on 3rd-party platforms. We’d also love to see direct stock and fund purchase options in the future. Despite these flaws, Pepperstone remains a very strong choice for international traders.
Best For
- International traders interested in trading CFDs from foreign markets and currencies
- Traders who are already familiar with the MetaTrader or cTrader platforms
- Traders who are looking for leverage when trading cryptocurrencies
- Access to over 61 forex pairs and over 60 stock CFDs
- Leverage available for both forex and cryptocurrency trading
- Wide range of educational tools and courses that both beginners and experts can use
- 24/7 customer service
- Not currently available to U.S. traders
- No option to purchase stocks, bonds or mutual funds directly; only CFDs are available
Pepperstone provides traders with an expanding selection of tradable instruments, quality educational resources and support for various social copy trading platforms. You can access over 1,200 instruments, including 60+ forex, indices, equities, energy and commodities. Pepperstone uses multiple liquidity providers from Tier 1 Banks and financial institutions to provide competitive quotes with low spreads and deep liquidity on diverse instruments, ensuring razor-sharp pricing and fast execution.
The minimum spread ranges from 0.0 for the Razor account to 1.00 for the Standard account. Commissions are charged only for the Razor accounts. There’s no minimum deposit requirement, and leverages range between 30:1 to 500:1 depending on regulatory jurisdiction — FCA (U.K.), ASIC (Australia), CySEC (Cyprus) and others. Although the broker doesn’t have its own trading platforms, it provides nearly all industry-leading third-party platforms, including TradingView, MT4, MT5 and cTrader. These platforms are available on PC, web and mobile devices, allowing for convenient market analysis, trade execution, strategy development, and risk management.
You can seamlessly perform technical analysis on the PC and web versions using its robust Smart Trader Tools and trade on the go with the mobile versions. Pepperstone provides the cAlgo platform for algorithmic trading, allowing traders to automate their strategies. Additionally, for social copy trading, Pepperstone offers DupliTrade for cTrader and myFxbook for MetaTrader, enabling beginners to connect with and follow successful traders.
Pros
- High-quality educational and research resources
- Multiple third-party trading platforms, including MT4/5
- Support algorithmic and social copy traders
- Raw tight spread
- Regulated by FCA (UK)
- Account protection for UK clients
Cons
- Unavailable for U.S. traders
- Overnight trading fee is applicable
- No guaranteed stop loss
6. Best for Scalpers and High-Frequency Traders (HFT): Tickmill
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securely through Tickmill’s
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Tickmill is an award-winning, multi-regulated investment firm offering trading in a plethora of asset classes including, CFDs in forex, precious metals, indices, stocks, commodities, cryptocurrencies and bonds.
Apart from offering various platforms, Tickmill caters to traders of all levels by providing competitive pricing, leverage up to 1:500 depending on the entity and client classification, dedicated support, exclusive market analysis and a wide array of trading tools and education. This low-spread broker offers fast execution, several payment methods and no restrictions on trading strategies such as hedging or scalping.
Futures and Options are offered with Direct Market Access across multiple globally regulated Futures exchanges including CME, CBOT, NYMEX, COMEX, EUREX, ICE Futures Europe and more. Real Futures include Stocks, Indices, Forex, Metals, Cryptos and Energies like the Micro E-Mini S&P 500, Micro E-Mini Nasdaq 100 and Micro Bitcoin Futures.
Future and Options are offered with probably the lowest fees and transparent commission structures in the industry, ultra-low latency, and seamless trading solutions for high volume trading with reliable, flawless order routing underpinned by advanced technologies.
Tickmill has become a trusted market-leading broker because of its commitment to seeking regulations in several jurisdictions. Traders have access to forex, stocks, commodities, cryptocurrency and bond markets as well as Futures and Options.
Free educational content and advanced tools are available for novice and experienced traders to help them enhance their trading strategies and achieve their trading goals.
The 20+ awards received are a testament to Tickmill’s commitment to providing optimal trading conditions for retail and institutional clients. Besides offering low spreads and fast execution, Tickmill ensures no trading restrictions, access to CFDs and occasionally runs campaigns (under Tickmill Ltd) to reward traders for their loyalty and activities.
Best For
- Forex, stocks, commodities, precious metals, bonds and crypto with competitive conditions
- Futures & Options trading with probably the lowest fees in the industry
- Retail and institutional clients
- Traders seeking various platforms and accounts
- Beginners wanting free trading tools and educational material
- Traders incorporating advanced tools and algorithm systems
- Strongly regulated broker
- Swap-free accounts available
- Enables access to various markets and asset classes
- Fast execution speed in milliseconds
- Crypto trading available 24/7 with 0 Commissions, 0 Swaps
- Deposits and withdrawals in BTC, ETH and USDT
- Free educational content
- Negative balance protection
- Mobile app available for account management
- User-friendly client area
- Free demo accounts
- Live chat is unavailable on weekends
From low trading costs to high leverages, Tickmill provides highly competitive trading conditions for high-frequency, high-volume traders and scalpers. You can access over 60 forex pairs across the global market. The spread varies according to account type, starting as low as 0.0 for the Pro and VIP account and 1.6 for the Classic account. The maximum leverage is 1:30, and the minimum deposit is $100. There is no commission on the Classic account; for the Pro and VIP account, there is a commission of two units of the base currency per side per lot and 1 unit of the base currency per side per lot, respectively.
Tickmill allows all trading strategies, including algorithmic, automated and social trading. The forex trading platform includes the MT4/5 platform. The MT4 offers advanced charting and analytical tools and sophisticated order management and is available on desktop and mobile devices (mobile app). The MT5 is more advanced, highly customizable and ideal for expert traders. Available tools include autochartist, Tickmill VPS, earning calendar, forex calculator and signal center. Additionally, Tickmill offers impressive learning resources, including video tutorials, webinars, podcasts and a forex glossary. Tickmill also provides specialized futures and options trading platforms, such as CQG, AgenaTrader and TradingView.
Pros
- Robust trading platforms MT4/MT5
- Negative account protection
- Quality research and educational material
- Offers Islamic account
- Fast and hassle-free account opening
- Multiple and top-tier regulations, including FCA (U.K.)
Cons
- Unavailable for U.S. clients
- No guaranteed stop loss
What is a Zero-Spread Forex Broker?
A zero-spread forex broker is a type of brokerage firm that offers forex trading with no spread or markup on the bid-ask prices. This means that traders can buy at the ask price and sell at the bid price without incurring additional costs. Instead of earning from the spread, these brokers typically charge a fixed commission per trade. Zero-spread brokers provide a transparent pricing structure that allows traders to see the true interbank market prices and enjoy tighter bid-ask spreads.
This can particularly benefit day traders, scalpers and high-frequency traders who execute numerous trades in a short timeframe (aiming to profit from small price movements) and so need to keep transactions low. However, it’s important to note that zero-spread brokers may have other fees or limitations. Hence, it’s crucial that you carefully consider all aspects before choosing a broker.
Advantages of Zero-Spread Forex Brokers
Zero-spread forex trading offers various advantages, including:
- Cost savings: Zero-spread forex brokers offer tighter bid-ask spreads than standard brokers, enabling you to enter and exit trades at more favorable prices, thereby saving trading costs and enhancing profitability.
- Transparent pricing: Zero-spread brokers provide transparent pricing as they eliminate the spread markup. Traders can see the actual interbank market prices without hidden costs, ensuring fair and transparent execution.
- High liquidity and lightning-fast execution: Zero-spread forex brokers can enhance liquidity by passing on the cost savings from lower spreads to traders via improved pricing and faster trade execution. Scalpers and HFTs rely on fast and rapid trade execution to implement risk management strategies and deliver profitable trade.
- Fixed commissions: Zero-spread brokers typically charge a fixed commission per trade instead of earning from the spread. This fee structure gives traders a clear understanding of their trading costs, making calculating and managing their overall expenses easier. There’s no need for requotes, as you can seamlessly access large liquidity pools and efficiently execute trades.
Disadvantages of Zero-Spread Forex Brokers
Despite the potential advantages, zero-spread forex brokers have some disadvantages. A few of these include:
- Hidden fees: While zero-spread brokers eliminate the spread markup, they may charge various hidden fees, including swap, inactivity and platform fees, along with fixed commission per trade. These fees can significantly add up, affecting your overall trading cost, especially if you’re a high-volume trader.
- Restrictive trading requirements: Some zero-spread brokers may require a higher minimum deposit or specific trading volume criteria to qualify for their services. This can be disadvantageous if you’ve limited capital or prefer smaller trading volumes.
- Limited availability: Most zero-spread brokers are only available in specific jurisdictions or regions. Traders residing in certain countries may have limited access to these brokers, restricting their options. For instance, most of the zero-spread brokers in Benzinga’s list are unavailable for US clients.
- Limited product range: Some zero-spread brokers often focus on forex trading and may have a limited range of other financial instruments. Suppose you’re interested in diversifying your portfolios with a broader range of assets. In that case, you may need to consider additional brokers or platforms. With limited options for adjusting spreads and leverage, these brokers may offer less customizable trading conditions.
How to Choose the Best Zero-Spread Forex Broker
When selecting the best zero-spread forex broker, consider the following factors to make an informed decision.
Spreads
The spread directly impacts your trading costs. Tighter spreads result in better pricing, enhancing profitability and reducing overall trading expenses. While zero-spread brokers eliminate the spread markup, it’s essential to ensure that the broker consistently offers competitive bid-ask spreads not just for a few currency pairs but across multiple currency pairs and financial instruments.
Execution Speed
Fast and reliable execution ensures you can enter and exit positions promptly, taking advantage of market opportunities without delays. A zero-spread broker with efficient execution speed can help you achieve optimal trade entry and exit points, enhancing your trading experience and improving overall results. Therefore, you must consider the execution speed of your chosen zero-spread forex brokerage before opening an account.
Trading Platform
The trading platform is the interface for executing trades and accessing market data. A reliable and user-friendly trading platform can enhance your trading experience, providing intuitive navigation, advanced charting tools and order execution capabilities. Choosing a zero-spread broker with a robust and efficient trading platform is essential to ensure seamless and convenient trading operations.
Trading Instruments
Considering the range of trading instruments is essential when choosing a zero-spread forex broker, as it determines the variety of markets you can trade. While forex is the primary focus, having access to additional instruments like stocks, indices, commodities or cryptocurrencies can offer diversification opportunities. A broker with a broader range of trading instruments allows you to explore different markets and potentially capitalize on various trading opportunities.
Tools and Resources
Besides trading platforms, you must also consider the available tools and resources when opening a zero-spread forex brokerage account, as they can enhance your trading analysis and decision-making process. Advanced charting tools, technical indicators, economic calendars and educational resources can provide valuable insights and help you stay informed about market developments. A broker that offers comprehensive tools and resources can support your trading strategies and contribute to your overall trading success.
Regulation
Well-regulated brokers operate within established guidelines, providing security and protection for traders. They are subject to regulatory oversight, which promotes transparency, fair trading practices and client fund protection. So consider brokers regulated by reputable financial authorities like FCA (U.K.), CTFC and NFA (U.S.), as they mitigate risks and instill confidence in the integrity of the trading environment.
Maximize Profitability and Save Cost By Choosing Zero-Spread Forex Brokerage
Choosing a zero-spread forex brokerage can significantly impact your trading profitability by minimizing costs and maximizing potential gains. These brokers provide transparent and fair pricing by eliminating the spread markup, ensuring you get the best possible rates. This cost-saving advantage is particularly beneficial for scalpers, high-frequency traders and those who engage in frequent trading activities. Selecting a reputable zero-spread forex broker allows you to optimize your trading strategy while minimizing expenses, ultimately helping you achieve greater profitability in the forex market.
Frequently Asked Questions
What does zero spread mean in forex?
Zero spread in forex refers to the absence of a bid-ask spread, where the buying and selling prices for a currency pair are the same.
Answer Link
Which forex broker has the lowest spread?
The forex broker with the lowest spread can vary depending on market conditions and currency pairs, but some popular brokers known for competitive spreads include FOREX.com, CMC Markets, Pepperstone and Tickmill.
Answer Link
Is it good to trade on a zero-spread account?
Trading on a zero-spread account can be beneficial due to the absence of spread costs, potentially improving trading profitability.
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The post Best Zero-Spread Forex Brokers by Chika Uchendu appeared first on Benzinga. Visit Benzinga to get more great content like this.