Forex broker with the lowest spread and commission is the first factor when many newcomers to reputable forex brokers are often interested. But how to accurately assess these two criteria and choose Forex brokers with the smallest spread is not known to everyone. With our experience, we will help you summarize the top Forex brokers with the lowest spread through the following article.
Learn more about Spread
The first thing to start trading is to choose a reputable Forex broker. You should only trade with a licensed and trusted Forex broker. So we're concerned about transaction costs and other costs.
- Transaction costs: The cost each trader has to spend on each trade, including what the spread cost, commission and swap fee is
- Other costs: Deposit, withdrawal, account management and recovery.
Spread is the difference between the Bid and Ask prices, also known as Ask and Bid, of a currency pair, stock, index or any other asset being traded on the Exchange market. Transaction costs will be high when spreads are high. That's why most traders want to trade with the lowest spread forex broker. In Forex, the unit of spread is pips and is usually converted to USD to calculate the profit or loss amount.
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Criteria for choosing the Forex broker with the lowest spread
Currently, the market has hundreds of forex brokers where there is no shortage of brokers with low fees. However, in addition to the low costs, when choosing a reputable forex broker to trade with, you should also pay attention to the following other criteria.
- Prestigious legal records: licensed by reputed management agency world leaders like ASIC, FCA, CySEC, etc. This proves the exchange's reliability to secure your investment.
- Low total cost: Spread and commission are the two main sources of income for a Forex broker, so they will always have a policy to balance these two fees. Sometimes a low spread does not mean the total cost you will pay to the lowest broker. There are 4 types of brokers in the market, including low spread + low commission, low spread + high commission, high spread + low commission and high spread + high commission. So if one lowest fee forex broker, but high deposit and withdrawal fees you should also consider.
- There is a convenient and diverse payment system.
- Good trading conditions and platforms: The exchange's trading conditions and platform must be of good quality and suited to the traders' capital and needs. Other factors are trading software and slippage. The software should support analysis and order placement well with less slippage to help you invest better.
View more: Know what is forex? Basic knowledge of forex trading
Summary of Forex brokers with the lowest spreads
Each broker will provide different types of accounts for traders, the spread between these accounts will be different. Among them, the two most popular account types are the Standard account and the ECN account. The Standard account has no commission but offers higher exchange spreads. ECN accounts are subject to a commission and have low spreads.
Next, we will introduce you to the most reputable and low spread forex brokers on the market today
1. Exness
With minimum spreads of 0.3 pips, average of 1.0 pips on EUR/USD and no commissions for Standard accounts, Exness is also a favorite among traders.
The Raw Spread (ECN) account has a rate considered very competitive in the market with only 7 USD per lot. Zero Spread accounts at Exness have transaction costs as low as 0.1 and commission of 3.5 USD per lot as long as you have a minimum deposit of 200 USD and always keep a margin on the account.
Furthermore, this exchange is ranked #1 in the market in terms of withdrawal processing time.
Register now at Exness
To learn more about Exness, you can check out the articles below.
2. IC Markets
With pairs like EUR/USD, USD/JPY also having an almost zero spread, ICMarket is considered one of the brokers with the lowest spread. The commission per lot is also very nice at just 7 USD. This is a great option for traders who like the scalping style. IC Markets offers 4 account types and supports MT4, MT5 platforms, so this is the best option on the market. The only hurdle for new investors is the very high margin rates.
Register for IC Markets
You can consult more articles related to ICMarket:
3. XM
Thanks to its stable and quite low spread rates, this is also an investment platform of choice for many people. The average spread is around 1. Also, XM broker does not apply commissions for account types. If you sign up for an XM Ultra Low account with a deposit of 50 USD, the spread will be reduced to 0.6 pips from the minimum deposit of 5 USD. If you are used to using the MT4, MT5 platform, the XM broker is a completely viable option.
Sign up for XM
4. Mill
One of Tickmill's strengths is its tight spreads. Pro accounts only have an average rate of 0.1 to 0.3 pips. The commission per lot is also very competitive, from 3.5 to 5 USD. With over 1 million visits per month, Tickmill has an extremely fast development speed despite being established later than other exchanges. Being one of the lowest fee brokers in the industry is Tickmill's main goal.
Register for Tickmill exchange
5. HotForex
For traders, the name HotForex floor is no longer strange. The spread applicable to this forex broker is only 1.0 pips. Except for HotForex PAMM account (10 USD/lot) and Zero Account (8-12 USD/lot), most HotForex accounts are commission free. However, due to the provision of up to 8 types of accounts, choosing the right account on the trading floor for investors is quite time-consuming. Another point to note is that if you choose the navigation style, Hotforex will not be a suitable choice as the spread rate is still better than the above brokers.
Register for HotForex exchange
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6. FXTM
The spread on FXTM is also quite low, averaging just 0.8 pips. When compared to other exchanges, this fee is also much lower. For ECN accounts, the commission is only 4 USD per lot. FXTM is quite popular among traders despite being recently established. One disadvantage of FXTM is that when the market is highly volatile, the spread can widen.
Register for FXTM
7. FBS
FBS is currently one of the exchanges that most interest Vietnamese traders as of 2018, with numerous promotional policies. Also, the ECN account commission rate is very attractive with 6 USD per lot and the spread is almost zero. This is a reputable broker licensed by CySEC, FCA and convenient for traders. Vietnam in depositing and withdrawing money.
Subscribe to FBS
Who is the low spread suitable for?
Low spreads are often the first concern for two types of traders: long-term investors and scalpers. Long-term investors usually open orders for more than 1 month. On the other hand, scalpers will open orders in less than 1 month and close many orders continuously in short time.
money changer
They prefer to choose forex brokers with low spreads and low commissions, in exchange, they make profit based on the frequency of opening and closing orders continuously in a short period of time. As its main transaction costs are low commissions and low spreads but with a large number of orders.
long term investor
Each position held longer they can make hundreds of pips so they usually don't care about the spread. As they hold the position for many months, their transaction fee will be a swap fee to hold the order overnight. Sometimes their swap fees represent 90% of profit, so your first priority is forex brokers with low swap fees.
Conclusion
I hope the summary of spread rates and Forex brokers with the lowest spreads in the article can help you to consult, evaluate in detail and choose the most suitable trading platform for your capital, investment strategy and investment strategy. Choosing a broker with a high reputation, trading conditions and market-leading quality of service is also the most important step in your journey to get rich with Forex. Another issue that many traders are concerned about is the legality of Forex in Brazil, to help you better understand this information, we will update the details in the next article. Also, you can update more information about Forex Signals to increase the probability of winning.
See also: Top 5 Legal Forex Brokers in Brazil You Shouldn't Ignore in 2022