Finding a good broker with a competitive spread is crucial as it may impact your profitability. What are the best low spread brokers in Australia?
Forex trading in Australia is very popular among the residents. Normally, they are looking for Australian-based brokers or international brokers that accept Australian traders. Among the many options, brokers with low spreads remain the most popular to choose. But, where can you find the best low spread brokers in Australia? Before exploring the options, let's understand more about the low spread and why it greatly matters for many traders.
In the forex market, a spread refers to the difference between the bid and ask price of an asset. A spread is the easiest way for many brokers to get their profit for each transaction in their trading platform. For example, a EUR/USD is priced at 1.1450, but the broker will offer it at 1.1452 for buy and 1.1448 for sell price. In this case, the spread of EUR/USD is 2 pips, and that is where the broker's income comes from.
Spread usually varies from broker to broker. However, there are brokers that use the ECN system which allows them to charge super tight spread. In exchange, they usually charge commission for every transaction executed. Most traders prefer a broker with a low spread because it reduces the trading cost they have to pay.
Scalper and day traders can benefit from using low spread brokers. They open and close positions multiple times within the same trading day, thus, they are more likely to be subjected to higher trading costs from the spread.
Finding Low Spread Brokers in Australia
There are a lot of brokerages in Australia, but finding the best one with the best low spread account can be challenging. The key is to find a low spread broker that has been regulated by ASIC or has headquarters in Australia. Here are some recommendations for you to consider:
1. IC Markets
IC Markets is one of the best low spread brokers in Australia that aims to provide solutions for all types of traders, including scalpers and day traders. Their lowest spread account starts from 0.0 pips, which makes them one of the lowest among other brokers in the country. They make sure to provide their clients with low latency connectivity for better transactions speed to ensure no slippage is happening. IC Markets is also regulated by ASIC so there's no problem in terms of legality.
When it comes to trading platforms, IC Markets trusts the popular MetaTrader 4 and 5. They also provide cTrader for those who like to trade with advanced charting. All of their platforms are available for PC as well as mobile display.
There is a reason why IC Markets is considered one of the best Australian brokerages. For a start, this broker was incorporated by a team of professionals in financial services. Their exponential growth over the years makes them one of the largest regulated CFD providers. IC Markets understands that clients' safety comes first, they make sure to maintain and monitors the transfer of confidential and sensitive client information within and outside the company on a need-to-know basis.
IC Markets is an online forex broker operating under the company of International Capital Markets Pty Ltd. Traders under the Australian jurisdiction are provided with the trading service of IC Markets AU that is headquartered in Australia and licensed by the Australian Securities and Investments Commission (ASIC).
On the other hand, non-Australian traders who open an account in this broker are registered under IC Markets SEY that is based in Seychelles, and regulated under the Seychelles Financial Services Authority (SFSA). The dual operation is a result of the relatively new rules from ASIC that prohibit their regulated broker to offer trading services outside Australia.
Classified as an ECN broker, IC Markets provide clients with MetaTrader 4, MetaTrader 5, cTrader as platform trading options. This broker also follows market trends to include Cryptocurrencies as one of its products, enriching its already wide selection of trading assets that include Currencies, Indices, Metals, Energies, Softs, Stocks, as well as Bonds.
The minimum deposit in IC Markets is in the middle range compared to other ASIC-regulated brokers, as it reaches $200 for every client. Market analysis materials are also prepared regularly for trading insights on IC Markets's official website, proving their competence to serve their traders with important contents created by market experts that work specifically for them.
For payment methods, IC Markets allows funding and withdrawal via wire transfer, credit card, PayPal, Skrill, Neteller, FasaPay, UnionPay, as well as Bitcoin via BitPay. The more interesting aspect from this broker is its multi-base currencies that include USD, AUD, EUR, GBP, SGD, NZD, JPY, CHF, HKD, and CAD.
As the trading technology in IC Markets is highly equipped with co-located servers and extremely low latency (especially on cTrader), the broker is widely known for its capability in hosting traders with the special needs for high-frequency trading as well as scalping.
To sum up, IC Markets is a fitting destination for active traders looking for a well-regulated broker. IC Markets is also flexible in terms of base currency and payment methods, signaling their commitment to welcome traders beyond their home country. As of late 2019, IC Markets provided their website in 18 international languages including English, Korean, Indonesian, French, Spanish, Italian, Malay, German, and Chinese.
This is a brokerage that was founded in 2010 and has been regulated by ASIC. Pepperstone's lowest spread starts from 0 pips, which makes it one of the best low spread brokers in Australia. To make sure there is no slippage, Pepperstone claims to execute orders less than 30ms, which is ideal for scalpers or expert advisor users.
Pepperstone supports social trading and copy trading using third-party services. They partnered with a wide range of social trading platforms to help their clients access the best strategies from the world's best traders. Some platform they use is Myfxbook, MetaTrader Signals, and DupliTrade.
Pepperstone was founded in 2010 by a team of experienced traders with a shared commitment to improve the world of online trading. Based in Melbourne, Australia, they grew to become one of the largest forex brokers in the world. If traders want to find a broker that provides low spreads, fast execution, and award-winning support, then the answer is Pepperstone.
Pepperstone has a strong legality guarantee because it has been licensed by the Australian regulator ASIC and FCA. Traders' funds can be deposited in segregated accounts at top Australian banks, one of which is the National Australia Bank (NAB). Therefore, the safety of funds is not a concern if a trader chooses to open an account in Pepperstone .
They succeeded in collaborating with 23 top banks to bring Bid to investors instantly via optical fiber. This allows all orders to be executed 100 percent automatically with low latency up to 0.05 milliseconds, without dealing desk intervention and requotes, as well as with super low trading costs.
Trusted by over 73,000 traders around the world, Pepperstone processes an average of USD12.55 billion of trading volumes every day. Because of that, they have many awards such as:
- The Best Global Forex ECN Broker 2019 and Best Forex Trading Support-Europe
- Best Australian Broker and Best Trading Platform 2018 by Compareforexbrokers.com
- Best Forex ECN Broker, Best Forex Trading Support, and Best Forex Trading Conditions by UK Forex Awards 2018
With the many rewards gained, Pepperstone hopes to attract more and more traders from all over the world. The rising performance of Pepperstone is not only due to the super-tight spreads and fast execution that it provides, but also because many traders are interested in trading with deposits in currencies other than US Dollars.
For this reason, Pepperstone is one of the most market-responsive brokers because it is willing to accept deposits in 10 currencies, which include AUD, USD, EUR, CAD, GBP, CHF, JPY, NZD, SGD, and HKD.
Trading in Pepperstone would allow traders to choose between 11 trading platforms: MT4 for desktop, MT4 Mac, MT4 iPhone, MT4 Android, MT4 iPad/Tablet, MT5, WebTrader, cTrader WebTrader, cTrader cAlgo, and cTrader Mobile. The choice of trading platforms may seem confusing to novice traders, but actually, it is very useful because it has fast execution.
When trading forex, traders can enjoy raw spreads from 0.0 pips on Razor accounts, over 61 currency pairs, and commission-free account funding on a wide range of deposit options. In addition to currency pairs, Pepperstone provides many types of trading instruments, including CFDs for indices and shares, commodities, and cryptocurrencies.
Instruments in commodity trading are pretty much diversified. Not only metal, gold, and silver, but traders can also trade with soft commodities such as cotton, sugar, coffee, cocoa, and orange juice. Pepperstone also provides trading on energy (oil and gas).
There are two types of accounts provided by Pepperstone, namely Razor accounts, and Standard accounts. If you area beginner, it is recommended to choose a Standard account with an average EUR/USD spread of 1.0-1.3 pips and free commission.
Those with particular trading styles such as scalpers and algorithmic traders may enjoy the lower cost setup traditionally seen in a Razor account, with a commission from AUD7 round turn of 100k traded. The initial deposit starts at USD200 with a minimum lot of 0.01 (micro) and 1:500 leverage.
As a Pepperstone client, a trader can fund and withdraw with alternative methods including Visa, Mastercard, POLi internet banking, bank transfer, BPay, PayPal, Neteller, Skrill, and Union Pay.
If you are new to trading or looking to practice your trading strategies in a risk-free environment, you can create Demo Account in Pepperstone. But if you are an experienced trader or prefer to learn by doing, Pepperstone provides a Live Account that allows you to trade with live executions and pricing.
Traders can also follow and copy strategies from popular traders using third-party services while learning how to improve their trading abilities. Pepperstone has partnered with a range of social trading platforms that traders can choose from, such as Myfxbook, ZuluTrade, Mirror Trader, MetaTrader signals, and Duplitrade.
3. FP Markets
FP Markets low spread account starts from 0.0 pips. It's applicable to over 10,000 tradeable CFD products provided by the broker. The transparent pricing and commissions make FP Markets earn its place among the best low spread brokers in Australia. They also try to minimize slippage by offering low latency order executions using the best in class technology.
4. Vantage FX
Vantage FX is an ECN broker with a spread as low as 0.0 spread. This is one of the best low spread brokers in Australia. Established in 2009. the company has earned the reputation of being transparent with their clients. For the trading platform, Vantage FX uses good-old MetaTrader 4 and 5. However, they also provide the Vantage FX app to support trading on the go. This app is very easy to use and allows users to access hundreds of FX pairs, Commodities, Indices, Share CFDs, and more.
5. CMC Markets
CMC Markets' lowest spread is not as low compared to other brokers, but they can still provide spreads as tight as 0.7 pips, so they still deserve to be one of the best low spread brokers in Australia. In addition, their trading fees only start from 0.1%. Their award-winning trading platform is equipped with technical indicators, drawing tools, and price projection tools. Clients can access this platform from PC, as well as mobile devices like iPhone, iPad, and Android.
This ASIC-regulated broker was founded in 2006 and has built a solid reputation for itself. Right now their lowest spread is 0.5 pips, a little bit higher than most brokers in this list, but is still considerably tight. Other than being one of the best low spread brokers in Australia, Avatrade also facilitates their clients with AvaTradeGo as a mobile app. It provides intuitive management tools, clear charts, zoom for details, and other unique features for trading.
Avatrade can be called one of the most well-rounded brokers that support almost all trading styles. Not only allowing hedging, scalping, and expert advisor (EA), Avatrade also completes their service with One-cancels-the-other order (OCO) and AutoTrading in many variants of automated trading systems.
AvaTrade was founded in 2006, with the primary mission to empower people to trade with confidence. If traders are still confused about what is the best broker for supporting trader's trading, AvaTrade perchance option of traders, because it has been evaluated and honored for some of the industry's most remarkable financial and technological achievements that it provided to clients.
In 2019, the Dublin-based broker got achievement from Daytrading.com as The Best Forex Broker 2019. Besides, the company is honored as Best Forex Broker, Best Bitcoin CFD Trading Provider of the year, and Best Affiliation Programme in the European area.
Furthermore, for traders who have high mobility, AvaTrade provides many platforms that allow traders to trade using laptops and mobile phones. The availability of the free Autochartist tool in the platforms is the best support for both novice and experienced traders because it makes it easier for them to find trading opportunities without the need to glance at charts all day.
The Autochartist free signal is provided in Gold Account, Platinum Account, and AVA Select. By opening an account in AvaTrade, traders don't have to pay for getting a full Autochartist service. Autochartist itself is a market scanner tool that can detect trading signals from various technical perspectives.
Traders can access AvaTrade in many variants of platforms, such as AvaTradeGO, MetaTrader 4, MetaTrader 5, Automated Trading, Mac Trading, Web Trading, Mobile Trading, and AvaOptions.
In terms of regulation, AvaTrade is regarded as a superior broker because it has a lot of credible licenses. That way, even with deposits of up to ten thousand dollars, security can be guaranteed. Applying the Segregated Account system, AvaTrade is regulated by the Central Bank of Ireland (No.C53877), ASIC Australia (No.406684), JFSA Japan (No.1662), and South Africa (FSP 45984).
Can traders lose more than their deposit abruptly in the event of high volatility? AvaTrade explicitly answers no, as traders have negative balance protection.
With a minimum deposit of USD100, AvaTrade offers various leverage depending on the trading instruments; whether it is forex (starts from 30:1), indices (starts from 20:1), commodities (starts from 5:1), ETFs (starts from 5:1), or cryptocurrencies (starts from 2:1).
AvaTrade has committed to a set of values in relation to customers. Therefore, the company provides the best trading experience, offering multilingual customer service and the most sophisticated and user-friendly trading platform.
New traders can also learn forex trading in the Education tab on AvaTrade's official website. Traders will find a wide collection of articles, video tutorials, and more tools that will assist them every step of the way. It is an important requirement as the forex market might be a bit overwhelming and even scary at times, so traders need to make sure that they are fully prepared to begin trading in the real account.
There are many types of account types provided by AvaTrade. There is also an Islamic Trading Account, which is uniquely provided for Muslim Traders. Islamic account type is similar to a regular one with one key difference; it is not subject to any special fees or interests (swap-free), which sits well with the finance principles of Sharia Law.
If traders have felt confident for forex trading, traders can choose AvaTrade as an ideal choice. The minimum deposit and various platforms offered to make it a suitable destination for even beginners who would like to try forex trading for the first time.
7. Saxo Markets Australia
Saxo Markets Australia is a part of the Saxo Group. This brokerage offers a low spread account starting from 0.1 pips. Saxo Group had launched its online trading platform and continues to serve traders with premium service. Their award-winning platform, SaxoTraderGo, gives a smooth trading experience for mobile traders. There are a lot of features traders can enjoy, including technical and fundamental analysis tools, a set of extensive charting, news and expert research, and many more.
Saxobank was founded in 1992 in Denmark, which began as a brokerage business. At present, they have penetrated the online banking and forex trading business internationally. The company is known as one of the best in the industry.
Their innovative platforms have been used by Microsoft's global institutions, Barclays Stockbrokers Ltd, and TD Waterhouse. The platforms include SaxoTraderGO, an award-winning trading platforms and is offered as Saxobank's flagship. Two other platforms are SaxoTraderPRO and SaxoInvestors. Each platform has advantages and functions.
SaxoTraderPRO is suitable for use by advanced traders and institutional clients, which trade faster via quick-close all features and view exchange order books and execution reports in real-time. On the other hand, Saxo TraderGO is a platform for retail traders. This type of platform offers easy portfolio management from a single account. For example, traders can get live and historic reports of net holdings.
As for Saxo Investors which is a user-friendly case-product platform tailored to retail investors, there are several advantages including browsing curated themes and pre-made screenings. Also, clients can choose between diversified investment portfolios. It is a responsive platform accessible from any device.
The Saxobank website accommodates the needs of international clients, with dozens of languages available on the Saxobank website. Besides English, there are also Japanese, Mandarin, French, Italian, Indonesian, and many more.
When clients choose Saxo, clients are choosing to trade with a fully regulated industry leader, who adheres to strict regulatory requirements in 15 financial centers around the world, including the UK, Singapore, Hong Kong, and Denmark.
Another advantage is traders have so many choices of instruments that can be traded on Saxo, covering 40,000 instruments across 184 forex pairs, 9,000 CFDs, 19,000 shares, 200 Stock options, 2,500 ETFs, Futures, Gold, Silver, and many more.
Since the company also serves as a bank, the speed of execution at Saxo can be guaranteed. However, some traders may feel that Saxobank is not suitable for individual trading, as the minimum capital is too large and the spreads and commissions are considered burdensome for so many clients. The spread which is charged by Saxobank for each pair is quite large, so it is not suitable for scalpers. Meanwhile, the commission that must be paid by traders to this broker starts from USD1.
Furthermore, Saxobank often stops trading for a few seconds before the release of important news and only activates it again after the news is released. This makes news traders do not have the best opportunity to act on Saxobank.
Actually, The deposit value can be adjusted according to the level of account chosen by the clients. There are three levels in Saxo Accounts, including Classic (minimum funding is 500 Pounds), Platinum (minimum funding is 50,000 Pounds), and VIP (minimum funding is 1,000,000 Pounds). Clients can use leverage 1:200 and a minimum lot of 0.05.
Traders are spoiled with various kinds of facilities provided by Saxobank. Each aaccount level has its own facilities offering that can be adjusted to the needs of traders. The higher the level, the more complete the facilities provided.
For example, traders who have VIP accounts will get personal relationship managers, and direct access to trading experts 24 hours. These facilities are not found when traders choose Classic and Platinum accounts.
For Corporate Clients, Saxobank provides 40,000 instruments, with 1: 1 support from expert account managers and the security that comes from their 25+ year experience.
If clients meet professional criteria, they can join Professional Accounts at Saxobank. The criteria in question include having a financial portfolio that exceeds around 500,000 Euros, having placed at least 20 relevant trades in significant sizes over the last four quarters, and having worked in the financial sector for at least one year.
Moreover, Saxobank provides more than 100 institutional specialists operating from offices in key financial centers, including Denmark, London, Singapore, Shanghai, Hong Kong, Switzerland, and Dubai. The client can choose the location closest to their area. With this kind of support, Saxobank is optimistic for delivering the right solution for the business of clients.
From the explanation above, it can be concluded that Saxo is more suitable for deep-pocket forex traders who are interested in forex trading as an investment portfolio. The broker's business focus is also more towards institutional clients rather than retail clients.
Spreads can influence how much profit and loss one might get. It's best if you choose the best broker with a low spread account. However, you need to be careful when you choose. A bad broker might manipulate their spreads unbeknownst to their clients. This is not the same as floating spreads where it changes in accordance with the market volatility.
To avoid broker cheats, make sure you choose reputable brokers that have been regulated by a governing body in the area. If you are an Australian-based trader, you can consider choosing one of the brokers mentioned above.