A Forex spread is a the difference between the bid and ask value of a Forex pair. Spreads vary at and between brokers, but some brokers aim to provide low spreads, however there are various factors to be considered when factoring spreads into a broker choice. This page provides a top 10 list focused on brokers which offer low spreads for trading styles such as automated trading and scalping.
A Forex pair has a value when bought and when sold. The difference between these is the spread and is one of the ways brokers receive compensation. Traders may be interested in the lowest spread, as this may be seen as reducing their trading cost.
The spread becomes more significant with the volume of trades made and the increasing duration of the trade. For example, a trader making a few trades in a day on a longer term time frame may be less concerned with spreads than one who makes a larger number of traders on a shorter time frame.
Scalping is making rapid trades at frequency and these costs can add up. Such trades can be made by a human or a computer program (robots). So some traders may look for brokers offering low spreads. However brokers which offer the lowest spreads, tend to charge a commission. This is added to the spread.
Such brokers may have relatively low commission charges (or volume based reductions), making them attractive to automated and higher frequency traders, especially if there are low average spreads. Low average spreads tend to be offered at brokers focusing on scalpers and automated traders, and can accompany the use of a pool of liquidity providers and rapid, non dealing desk execution.
Headline Forex spreads are typically for the most liquid Forex pairs, which tends to be EUR/USD and other major pairs, as other pairs may have higher minimum spreads, whether fixed or variable.
This is another issue in spreads, that is whether they are fixed or variable. Variable spreads change in accordance with a range of factors, including liquidity (for example they can widen during volatile market conditions). Fixed spreads however tend to stay fixed. Fixed spreads tend to be higher than variable spreads (that is the low or average of variable spreads). This said some brokers can offer tight, fixed spreads.
The upshot of this, is that traders may wish to focus on features such as trading platforms, rather than spreads, though they can be a significant though not necessarily straightforward factor in some types of trading.
1 ThinkMarkets
- Minimum deposit: None
- Online trading platforms: MT4, MT5, ThinkTrader
- Variable spreads from 0.4 without a commission charge
- Variable spreads from 0 plus a commission charge
ThinkMarkets manages to offer tight Forex spreads without a commission charge and spreads from 0, plus a commission charge ($3.5 per lot per side). The spreads from 0 have an average of 0.1 on the ThinkZero account and 1.2 on the Standard account.
Forex spreads with a commission charge are offered on the ThinkZero account, while Forex spreads without a commission charge are available on the Standard account. The Standard account has no minimum deposit requirement, while the ThinkZero account has a $500 minimum deposit.
These account differences reflect the different uses these account may be put to, i.e. the Standard for traders who plan an execute their own trades, with the ThinkZero for automated trading. To some extent this may be a difference in experience, as automated trading can be seen as a more advanced strategy and also one which can cause drawdown in the account (i.e. accumulated losses as a strategy operates). Traders placing their own trades can manage risk with stop-losses and take-profits, as well as the option to end or adjust a trade as they see fit.
Traders who want to trade on a user friendly platform can find ThinkTrader, which is on the Standard account. MT4 and MT5 are on both accounts.
2 Pepperstone
- Minimum deposit: $200
- Online trading platforms: MT4, MT5, cTrader, TradingView
- Variable spreads from 0.6 without a commission charge
- Variable Forex spreads from 0 plus commission
Pepperstone offers spreads from 0 on its Razor account, plus a commission charge of $3.5 per lot per side for MT4 and MT5 and $3 per lot per side for cTrader and TradingView. On its Standard account it offers Forex sprerads from 0.6 pips, without a commmission charge.
Average spreads for EUR/USD are 0.17 pips on the Razor account (with a commission charge) and 0.77 on the Standard account (without a commission charge) - figures for spreads from June 2022. Pepperstone says its Standard account is for new traders and its Razor account for algorithmic traders and scalpers.
3 easyMarkets
- Minimum deposit: $25
- Online trading platforms: MT4, MT5, Web Trader, Trading View
- Fixed spreads from 0.7 without a commission charge
- Variable spreads from 0.5 without a commission charge
easyMarkets provides mostly fixed spreads, from 0.7 pips on MT4, without a commission charge. However on MT5, it provides Forex spreads from a tight 0.5 pips, without a commission charge. easyMarkets allows automated trading with MetaTrader EA robots and has a low minimum deposit (in some regions) of $25.
4 Dukascopy Bank
- Minimum deposit: $1000
- Online trading platforms: MT4, JForex
- Variable Forex spreads from 0.1 plus commission
Dukascopy Bank allows all trading styles, and offers platforms for styles such as scalping and automated trading. Spreads are from 0.1 on both MT4 and JForex. Commissions are volume dependant, starting from $3.5 per lot per side for JForex, and $4 per lot per side for MT4, and reducing in stages with increasing volume.
Traders who execute their own trades can also use JForex, in fact it has a user friendly interface and a relatively large number of inbuilt technical indicators, as well as MT4. There is also the facility to buy more indicators and robots from the JStore (some are free while some are not). The Visual JForex tool lets traders build robots without needing to code.
5 FXCC
- Minimum deposit: None
- Online trading platform: MT4
- Variable spreads from 0 without a commission charge
FXCC has the distinction of offering an account (its ECN XL account) which can provide spreads from 0, plus a commission charge and allows automated trading and scalping. There is also no minimum deposit requirement. FXCC only offers MT4, however this is a major, long standing trading platform for Forex traders.
6 FXTM
- Minimum deposit: $10
- Online trading platforms: MT4, MT5
- Variable spreads from 0.1 plus commission
FXTM offers Forex spreads from 0, with a floating commission charge depending on equity and trading volume for MT4 from $2 per lot per side. The commission charge is fixed at $4 per lot per side for MT5 (MT5 is not available in some regions).
These spreads are available on the Advantage account, which has a minimum deposit of $500. The MT4 Cent account (the Micro account) has a spreads from 1.5, without a commission charge. However the Micro account offers very small trade sizes and a low minimum deposit.
7 IC Markets
- Minimum deposit: $200
- Online trading platforms: MT4, MT5, cTrader
- Variable Forex spreads from 0.6 without a commission charge
- Variable Forex spreads from 0 plus commission
IC Markets offers services for scalpers, high frequency traders and automated traders, as well as traders who trade on their own behalf on a longer term. On the Raw Spread account, Forex spreads are available from 0, plus a commission charge of $3.5 per lot per side for MT4 and MT5 and $3 per lot per side for cTrader. On the Standard account, Forex spreads are offered from a tight 0.6 without a commission charge.
8 XM
- Minimum deposit: $5
- Online trading platforms: MT4, MT5
- Variable Forex spreads from 0 plus commission
- Variable spreads from 1 without a commission charge
XM can offer spreads from 0 plus a commission charge of $3.5 per lot per side on the XM Zero account. However it can also provides spreads from 1, without a commission charge on its Micro account. The Micro account is a Cent type account, offering small trade sizes.
9 FXPRIMUS
- Minimum deposit: $15
- Online trading platforms: MT4, MT5, cTrader
- Variable spreads from 1.5 without a commission charge
- Variable spreads from 0 plus commission
FXPRIMUS can offer Forex spreads from 0, plus a commission charge of $5 per lot per side on its PrimusZERO account, which has a minimum deposit of $1000. However the PrimusCLASSIC account can offer Forex spreads from around 1.5, without a commission charge and a low minimum deposit. There is also a PrimusPRO account which can provide spreads from 0.3 for a higher commisison charge than the PrimusZERO account, but with a $500 minimum deposit.
10 Titan FX
- Minimum deposit: $200
- Online trading platforms: MT4, MT5
- Variable Forex spreads from 0 pips plus commission
Titan FX provides tight spreads with no dealing desk execution for automated traders, scalpers and high freqency traders. Titan FX has spreads from 0, plus a commission charge of $3.5 per lot per side on its Zero Blade account, with average spreads from 0.2. The Zero Standard account has spreads from 1.2, without a commission charge. The accounts are prefixed 'Zero', alluding to the Zero Point Technology used by Titan FX, which is a trading infrastructure including data centers, low latency interconnects, Dynamic Liquidity Aggregation and rapid order processing.
Online trading platforms which can offer low Forex spreads (plus a commission charge) include MT4, MT5, JForex and cTrader. Traders can find Forex spreads which can be tight on platforms such as user friendly platforms, typically without a commission charge. Such brokers may not have a headline Forex figure, perhaps because the brokers which do, tend to have a focus or the capacity for automated trading, where low spreads can be more significant.
