Here is the 5 best raw spread forex brokers, each with distinct features and advantages so you can choose the cheapest trading solution that best suits your needs.
Spread is one of the costs that traders had to pay to trade forex. Reduced spread means narrower differences between the bid and ask price for currency pairs. It generally increases potential revenue gained from each price movement. However, which broker has the smallest spread?
Most forex brokers apply mark-up in the spreads. The original rates they received from liquidity providers were added with a certain percentage of profit, then the marked-up prices were displayed on the trader's feed.
Raw spread forex brokers try to stay away from such practices by presenting spreads as they are. They harvest profits from commission fees per lot traded instead of spread. Hence, most experienced forex traders would confess that the smallest spread is provided by raw spread forex brokers.
We have collected for you the 5 best raw spread forex brokers, each with distinct features and advantages so you can choose the cheapest trading solution that best suits your needs.
Australian-licensed Pepperstone connects with liquidity providers from Tier 1 Banks and institutions. This allows them to offer raw spread and fast execution to all clients through Razor account with starting deposit as low as USD200.
Trading by telephone
Islamic accounts available
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.
The average spread on Pepperstone's own Razor account is just 0.09 pip for EUR/USD. Average spreads for other currency pairs are similarly economical, each at 0.28 for GBP/USD, 0.14 for USD/JPY, and 1.0 for EUR/GBP. Or, are you interested in crypto? Spread for Litecoin is just around 3.0 pips, Ethereum 8.0 pips, and Bitcoin 40.0 pips. Read more on Pepperstone review .
2. IC Markets
A close rival of Pepperstone from the same country of origin, IC Markets offers raw spreads starting from 0.0 pips. Average spreads on IC Markets' Raw Spread account are 0.02 pip for EUR/USD, 0.23 for GBP/USD, and 0.14 for USD/JPY. Spreads for crypto pairs are also equally low, 1.5 for LTC/USD, 11.6 for ETH/USD, and 42.0 for BTC/USD.
ASIC, ACN 123 289 109
Interest rate on funds
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.
Raw Spread account registration can be done quickly through IC Markets' official site. The minimum starting deposit is just USD200 with a maximum leverage option as high as 1:500. Read more on IC Markets review .
Cyprus-based XM is more well-known as a dealing-desk broker rather than a raw spread provider, but their newly launched XM Zero account actually features raw spread as low as zero pips. The average spread is 0.1 for EUR/USD and USD/JPY, also 0.6 and 0.4 respectively for EUR/JPY and GBP/USD.
Interest rate on funds
Trading by telephone
Islamic accounts available
Requires sending documents via postal mail
Established in 2009, XM is a member of an online brokerage company called Trading Point of Financial Instruments Ltd. In providing clients on a global scale, the company has branched into XM Australia and XM Global, and XM Cyprus. Each member has different headquarters and licenses, with XM Australia registered under the Australian Securities and Investment Commission (reference number: 443670), XM Global under the IFSC (60/354/TS/19), and XM Cyprus under the Cyprus Securities and Exchange Commission (reference number: 120/10).
XM is one of the more experienced brokers in the world of online forex trading today. Since its founding, the broker has experienced a lot of changes, including the addition of the Ultra-Low Account and Webinar feature that is accommodated in 19 different languages with 35 native instructors for each language.
In terms of trading instruments, XM is a well-known diverse class assets provider, varying from Forex, Commodities, Equity Indices in CFDs, Precious Metals, Energies, to Shares. XM prides itself to be the ideal broker in trading execution, offering a stat of 99.35% orders to be executed in less than 1 second. Trading in XM would be also provided with a strict no requotes policy, no virtual dealer plug-in, no rejection of orders, real-time market execution, and the choice for traders to place orders online or by phone.
Spreads on all majors can reach as low as 0.6 pips in Ultra-Low Account, while spreads on other accounts usually start from 1 pip. Instead of providing maximum leverage on the scale of 1:500 or 1:1000 (round numbers), XM chooses to limit their leverage on a 1:888 scale, a unique number that is now widely recognized as XM's trademark.
To protect the client's fund in the event of extreme volatility, XM presents each account type with Negative Balance Protection. The deposit starts from $5 in Micro and Standard Account, while Ultra-Low Account requires a minimum deposit of $50. Traders who open accounts in XM are enabled a condition similar to a Cent Account environment in the Micro Account, in which the Contract Size for every lot is only 1,000 units. If it is applied with the smallest lot size in the MetaTrader platform which amounts to 0.01, it means that traders can go as small as 10 units per trade.
For the deposit, XM applies zero-fee deposits in most of its available payment methods. Traders can choose to fund or withdraw their accounts via wire transfer, credit card, as well as the most favorable e-payment choices like Skrill, Neteller, and FasaPay.
XM also provides an Islamic Account for Muslim Traders obligated to Sharia Law that prohibits the use of interest generated by overnight swaps for each currency pairs. To give their clients the best experiment in trading, XM has given access to both MT4 and MT5 platforms, each is available for more than 6 display formats (PC, Mac, Multiterminal, WebTrader, iPad, iPhone, Android, and Android Tablet).
All in all, there is no doubt that XM has gone global with its deep commitment to providing trading services in more than 15 languages around the world. Aside from easing traders' experience with mainstream trading platforms and high-quality trading execution, XM is open to various types of traders, from small capital traders to the more experienced ones with big deposits at the ready. Traders are even provided with a Cent Trading environment should they choose to register under Micro Account.
You can open an XM Zero account with starting deposit of USD100 to enjoy maximum leverage of 1:30. XM has not yet added crypto among its extensive market offering, so an XM Zero account may be more suitable for expert traders specializing in forex, indices, and commodity CFD. Read more on XM review .
4. Vantage FX
As UK and Australia dual license holder, Vantage FX provides Raw ECN account with a minimum USD200 initial deposit and leverage up to 1:500. There is no information regarding average spread, but the lowest spread is undoubtedly 0.0 pip for all major pairs.
Fixed and Variable
ASIC, #ACN 140 903 886
Interest rate on funds
Trading by telephone
Islamic accounts available
Vantage FX was founded in 2009 in Australia. It is the brand name of the Vantage International Group which is regulated by the Cayman Islands Monetary Authority (CIMA). Before it is known as Vantage FX as today, they used to be MXT Global in 2009 and Vantage FX Pty LTD in 2015. The Vantage Group also operates other companies such as Vantage Global Prime, which is regulated by the Australian Securities and Investments Commission (ASIC) and the Financial Conduct Authority (FCA).
According to the broker’s website, Vantage FX adds further protection to clients by segregating client funds and holding their funds with Australia’s National Australia Bank (NAB). NAB is one of the 4 largest financial institutions in Australia as well as the Top 20 safest banks in the world. Thus, clients don't need to worry about saving their funds at Vantage FX.
With Vantage FX, traders will experience super-fast trade execution, as well as interbank grade and RAW ECN spreads. When combined, these elements offer clients a true institutional trading experience, across a wide range of trading instruments. They also offer services designed for both beginners and professionals with access to Forex ECN trading, as well as CFD trading on Indices, Commodities, and U.S & Hong Kong Shares. Those instruments are available to trade on MetaTrader 4 and MetaTrader 5, either for Mac, PC, iOS, or Android. There are also social trading platforms such as MyFXbook and Zulutrade.
By registering in Vantage FX, traders will have access to an impressive range of educational materials and research tools including MT4 SmartTrader Tools, a wide variety of promotional trading offers and rebate programs, as well as access to accounts with up to 500:1 leverage. Vantage FX provides research in the form of technical and fundamental analysis on its blog from in-house staff as well as guest writers. There is also an economic calendar powered by MQL5 from MetaQuotes. For clients who deposit at least $1,000, Vantage FX offers a suite of plugins for MT4 branded as MT4 SmartTrader Tools, developed by FX Blue LLP.
As an authorized representative of Vantage Global Prime, the broker caters to retail traders under the Vantage FX brand and offers access to the following instruments:
- 40 currency pairs, which are the most liquid global forex market currencies.
- 50 highly liquid US Share CFDs in some of America’s largest companies such as Apple, Google, Coca-Cola, and more.
- 50 biggest companies listed on the Hong Kong Stock Exchange to trade on.
- 15 most liquid Indices from across the globe, including the S&P 500, DAX, FTSE, DJ30, and more.
- 17 commodities, either soft commodities or precious metals.
Clients can open accounts in VantageFX and deposit funds in 8 base currencies: AUD, USD, EUR, GBP, NZD, SGD, JPY, and CAD. They also provide clients with convenient deposit and withdrawal methods through local and international bank transfers, credit/debit cards, and e-payment.
Overall, Vantage FX is valued to be proper for retail traders with small deposits who like the max leverage thresholds. In terms of pricing, the broker's commission-based Raw ECN account is the clear choice for cost-sensitive traders as it features a lower all-in cost compared to its Standard account offering.
Vantage FX also maintains live connections with two top social trading platforms, ZuluTrade and MyFXBook Autotrade. It means you can use Raw ECN account while following trade signals from professional traders; or if you think you are good enough, you could provide signals for others to earn certain commissions. Read more on Vantage FX review .
Australian-licensed ThinkMarkets recently introduced ThinkZero account that enables traders to access raw spreads as low as zero pips, tight commission fee, fast order execution, and up to 1:500 leverage. All of the conveniences with a minimum initial deposit of just USD500.
Trading by telephone
Islamic accounts available
As a multi-asset online brokerage, ThinkMarkets present a wide range of trading assets starting from Forex to Precious Metals, Commodities, Indices, Shares, and Cryptocurrencies. The Australian-based broker is established in 2010 and has since opened additional headquarters in London and throughout Asia-Pacific, Middle East, North Africa, Europe, and South America.
Average FX spreads for traders opening an account in ThinkMarkets start from 1.2 pips for the standard account, while ThinkZero provides the best trading experience with 0.1 pips spread. Still, traders may need to consider that ThinkZero applies commission from $3.5 per side for every 1000,000 trading volumes.
As a global online brokerage, ThinkMarkets operates under various financial regulatory institutions. For example, ThinkMarkets Australia is managed by TF Global Markets (Aust) Limited and is licensed by the Australian Financial Services as well as the Australian Securities and Investment Commission (ASIC) with ABN: 69158361561. On the other hand, ThinkMarkets UK is registered under the Financial Conduct Authority (FCA) by the company name of TF Global Markets (UK) Limited (number: 09042646).
ThinkMarkets consistently try to improve their trading environments with various advanced products. Automatic trading fans are provided with free VPS Hosting, while passionate traders who'd like to experience beyond MetaQuote platforms can try ThinkMarkets' proprietary platform called ThinkTrader.
The trading platform is available on 3 different interfaces specifically designed for Desktop, Tablet, and Mobile displays. Furthermore, customized tools such as 80+ drawing tools and indicators for technical analysis accessible even through Mobile screens would certainly provide a brand new trading on-the-go experience.
As far as market updates go, trading in ThinkMarkets would be accompanied with news from FX Wire Pro that is known for its strict policy toward upholding objective journalism and delivering critical, trusted information in real-time. Information segments covered by FX Wire Pro include Economic Commentary, Technical-level Reports, Currency and Commodities, Central Bank Bulletins, Energies and metals, together with Event-driven Flashes.
For payment methods, ThinkMarkets offer the gateway via bank transfer, credit card (Visa and MasterCard), Skrill, Neteller, POLi internet banking, BPay, and Bitcoin wallet.
All in all, it is safe to say that for a company that started business since 2010, ThinkMarkets is an accomplished broker in terms of legal standing and innovation in trading technology. As an additional safety assurance for traders, this broker underlines its commitment to provide a $1 million insurance protection program which is made possible by ThinkMarkets' insurance policy with Lloyd’s of London that protects clients' funds for up to $1 million in the unlikely event of insolvency.
Typical spread on ThinkZero account has been reduced up to 0.0 for EUR/USD and USD/JPY, or up to 0.3 for GBP/USD and EUR/GBP. This shows how many advantages that traders get through direct access to institutional pricing without any added mark-up by the broker. Read more on ThinkMarkets review .