Best Lowest Spread Forex Brokers

Low spreads can significantly affect your bottom line in the dynamic world of forex trading. Choosing a broker with minimal spreads, although not the only factor, ensures you keep more of your gains. This article unveils the best low spread forex brokers to help you make informed choices in your trading journey.

AvaTrade stands out prominently with consistently low spreads across major currency pairs. Offering just 0.6 for EUR/USD and not exceeding 1.1 for GBP/USD, it presents the most competitive rates, ensuring traders maximize their potential returns.

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In a Rush? Here Are the Best Lowest Spread Brokers

AvaTrade: Robust offerings, multiple platforms, global presence.

 eToro: User-friendly, innovative platform with social trading features.

easyMarkets: Straightforward trading, fixed spreads, intuitive platforms, customer-centric approach.

FXCM: Trusted globally, offers comprehensive research, versatile platforms.

XM.com: Wide asset offerings, higher spreads, user-centric tools, trusted globally.

CMTrading: Innovative platforms, broad instruments, client-focused, secure trading.

[Table with spreads comparison, first column broker, 2^nd eur/usd spread, 3^rd gbp/usd, 4^th usd/jpy, 5^th aud/usd]

*Spreads available only through the MT5 platform

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Best Lowest Spread Brokers – Full Analysis (Updated in 2023)

AvaTrade

• Minimum Deposit: $100
• Our Score: 79.5%
• Tradeable Symbols: 250+
• Maximum Leverage: 1:30 – 1:400 for professional accounts

AvaTrade stands as a pillar in the Forex community, balancing user-centric offerings with a rich trading environment. While not the tightest, its spreads remain very competitive, especially for diversifying their portfolio across various currency pairs.

Beyond spreads, what captures our attention is their robust educational platform, catering to both novice and veteran traders. Together with a user-friendly interface, trading becomes less daunting and more strategic.

However, their commitment to transparency and robust customer support truly elevates the AvaTrade experience. For traders eager to harness the full potential of this platform and gain deeper insights, our exhaustive AvaTrade review is a must-read.

Pros:

• Diverse Portfolio Opportunities: AvaTrade offers a wide range of instruments, allowing traders to diversify their investment strategies seamlessly.
• Robust Educational Platform: Comprehensive resources are provided, ensuring traders of all levels can refine their skills and knowledge.
• Top-Notch Customer Support: Their dedicated team ensures swift responses and effective solutions, enhancing the trading experience.

Cons:

• Inactivity Fees: Traders can incur costs if their account remains inactive for a specific period, affecting infrequent users.
• Withdrawal Delays: Some users have reported occasional delays in withdrawal processing, which might pose an inconvenience for those needing quick access to funds.

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eToro

• Minimum Deposit: $50
• Our Score: 98%
• Tradeable Symbols: 3,000+
• Maximum Leverage: 1:30 – 1:400 for professional accounts

eToro is globally recognized for its social trading platform and also commands attention for its spread structure. Its spreads, as evidenced by a 1.0 on EUR/USD and AUD/USD, reflect a balanced approach, neither being the tightest nor the widest in the industry. While its 2.0 on GBP/USD is slightly on the higher side.

eToro compensates with the unique advantage of a unified spread across pairs like USD/JPY and AUD/USD. This consistency can benefit traders who prefer predictability in their cost structures.

However, the real allure remains their innovative platform features, which present a compelling package when combined with these spreads. To thoroughly explore eToro’s offerings, check our complete review here.

Pros:

• Consistent Spread Structure: eToro’s spreads offer traders predictable cost foundations, especially for pairs like USD/JPY and AUD/USD.
• Innovative Social Trading: Pioneers in social trading allowing users to mimic successful traders, boosting potential profitability.
• User-Centric Interface: The platform is designed for intuitive navigation, enhancing the trading experience for all skill levels.

Cons:

• Limited Customization: The platform, while user-friendly, lacks deeper customization options for advanced traders’ specific needs.
• Fee Structure: Beyond spreads, certain fees like overnight and inactivity charges may catch novice traders off guard.

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easyMarkets

• Minimum Deposit: $100
• Our Score: 63.75%
• Tradeable Symbols: 199
• Maximum Leverage: 1:30 – 1:400 for professional accounts

EasyMarkets offers a compelling juxtaposition in the forex space, where the devil truly is in the details. At its best, the broker flaunts very competitive spreads, but there’s a catch: these optimal rates are exclusively available through the MT5 platform.

Users of their proprietary app might find themselves navigating less competitive spreads, such as a 1.5 for AUD/USD. This distinction underlines the importance of platform choice when trading with easyMarkets.

On the upside, their overall service package is fortified by solid customer support and innovative trading tools. To understand the intricacies of easyMarkets and the spread disparity across platforms, read our in-depth review here.

Pros:

• MT5 Platform Advantages: Through MT5, traders access some of the most competitive spreads available, optimizing their trading strategy.
• Strong Customer Support: easyMarkets’ dedicated team ensures queries and concerns are addressed promptly and efficiently.
• Innovative Trading Tools: The broker offers advanced tools that enhance trading decisions, giving users a strategic edge.

Cons:

• Proprietary App Disparity: Their in-house app presents less competitive spreads compared to the MT5, affecting cost efficiency.
• Platform Transition Challenges: Traders may face a learning curve when switching between their proprietary platform and MT5.

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FXCM

• Minimum Deposit: $50
• Our Score: TBA
• Tradeable Symbols: 2,800+
• Maximum Leverage: 1:30 – 1:300 for professional accounts

FXCM, a veteran in the Forex arena, offers a spread structure that reveals a keen understanding of trader preferences. Their 0.8 on EUR/USD and 0.85 on AUD/USD indicate a competitive edge in the market, appealing to those dealing with these major pairs.

A slightly higher 1.35 on GBP/USD may raise eyebrows, but it’s counterbalanced by a decent 1.09 on USD/JPY. The real strength of FXCM lies not just in their spreads but also in their legacy, platform stability, and vast resources.

For a deep dive into FXCM’s complete offerings and how they stack up in today’s market, our detailed review awaits you here.

Pros

• Competitive Major Pair Spreads: With 0.8 on EUR/USD and 0.85 on AUD/USD, FXCM offers traders cost-effective opportunities.
• Established Legacy: FXCM’s long-standing reputation in Forex brings trustworthiness and credibility to its user base.

• Variety of Platform Choices: FXCM offers multiple platforms, including the popular TradingView and MT4, catering to diverse trader preferences.

Cons:

• Slightly Elevated GBP/USD Spread: The 1.35 spread can impact frequent GBP/USD traders, potentially reducing their profit margins.
• Promotions Limitations: FXCM’s promotional offers might come with specific terms, potentially limiting accessibility for some traders.

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XM.com

• Minimum Deposit: $5
• Our Score: 67%
• Tradeable Symbols: 1,400+
• Maximum Leverage: 1:30 – 1:400 for professional accounts

Although XM.com has slightly higher-than-average spreads, the broker also has a broader range of benefits when looked at closely. At the forefront is their commission account, which offers the allure of spreads dipping to an astonishing zero.

This allows cost-conscious traders to determine which type of account may benefit their trading best. But spreads alone don’t define XM.com. Its robust platform, diverse trading tools, and exemplary customer support echo its commitment to providing a comprehensive trading experience.

The broker also has extensive educational resources, a boon for neophytes and seasoned traders. If you’re weighing the balance between spreads and overall service quality, our in-depth XM.com review will shed light on the bigger picture.

Pros:

• Zero Spread Commission Account: XM.com offers an account type with spreads reaching an impressive zero, allowing users of high-frequency trading strategies to maximize profits.
• Extensive Educational Resources: A wide range of tools and materials cater to traders of all levels, fostering continuous learning.
• Exemplary Customer Support: With responsive assistance and expert guidance, XM.com ensures a seamless trading journey for its users.

Cons:

• Higher Standard Spreads: Their standard account might present spreads that are slightly above the industry average.
• Withdrawal Options Variance: Depending on the method, traders might encounter varying processing speeds and potential fees.

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CMTrading

• Minimum Deposit: $250
• Our Score: 65.33%
• Tradeable Symbols: 150+
• Maximum Leverage: 1:30 – 1:200 for professional accounts

CMTrading stands out in the Forex landscape with its diverse account types tailored to different trading preferences, each boasting a unique spread structure. While it offers competitive spreads for some major pairs, it’s noteworthy that it presents the highest spread for AUD/USD among its peers.

This differential could be significant for traders who frequently trade this specific pair. However, it’s essential to view CMTrading not just through the lens of spreads, but also through its holistic offerings, including robust trading tools, comprehensive educational resources, and responsive customer support.

For those seeking a deeper understanding of CMTrading’s account varieties and how they fit into the broader Forex ecosystem, read our comprehensive review here.

Pros:

• Diverse Account Types: CMTrading offers a range of account structures, allowing traders to find a fit for their unique strategies.
• Comprehensive Educational Resources: Their training materials cater to all skill levels, enhancing trading knowledge and proficiency.
• Robust Trading Tools: With advanced tools and analytics, CMTrading equips traders for informed decision-making in the volatile Forex market.

Cons:

• High AUD/USD Spread: Those who trade the AUD/USD pair may find the spread less competitive, impacting potential profit margins.
• High Deposit Variance: Different account types come with varying initial deposit requirements; some accounts require considerable capital to unlock all the features.

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Why Use the Lowest Spread Forex Brokers?

In the intricate world of Forex trading, spreads can be the silent factor that heavily influences your profitability. Here’s why prioritizing brokers with the lowest spreads can be a game-changer:

1. Maximized Profits: Even a slight difference in pips can result in significant cost savings over time, especially for high-frequency traders. Lower spreads mean fewer expenses and, consequently, higher potential profits.
2. Transparent Costs: Brokers with low spreads often have a more transparent cost structure. There are no hidden fees; what you see is what you get.
3. Predictability: A consistently low spread offers more predictable trading costs, allowing traders to execute strategies with greater accuracy and confidence.
4. Suitability for Scalpers: Scalpers, who thrive on minute price changes, will find brokers with tight spreads particularly beneficial, as each trade’s cost is minimized.
5. Increased Trading Opportunities: Tight spreads often translate to more trading opportunities. With wider spreads, the market needs a larger move to achieve profitability.
6. Enhanced Trust: Brokers offering low spreads often signal integrity. They’re demonstrating a commitment to providing value, which can foster a sense of trust among traders.

Pros and Cons of Using Lowest Spread Forex Brokers

Pros:

• Higher Profit Potential: Reduced trading costs mean wider profit margins, especially significant for frequent traders.
• Transparent Fee Structure: Low spreads typically reflect clear pricing, eliminating surprise costs and ensuring trader awareness.
• Optimal for Scalping: Tight spreads benefit scalpers who capitalize on minor price movements.

Cons:

• Variable Spreads Risk: Some brokers offer variable low spreads that can widen during market volatility.
• Possible Compromises: Extremely low spreads might come at the expense of other services like support or platform quality.
• Commission Trade-offs: Some brokers offset low spreads with higher commissions, affecting the overall cost for traders.

How to Choose the Best Lowest Spread Forex Broker

• Grasp Spread Variations: Understanding spread types is pivotal. Fixed spreads remain unchanged, ensuring predictable costs. On the other hand, variable spreads might be enticing due to their often lower averages. But they can fluctuate, especially during high market volatility, potentially making trades costlier than anticipated.
• Total Trading Expenses: When evaluating a broker, don’t just focus on spreads. Look deeper into the fee structure. Commissions, account maintenance charges, and other hidden fees can accumulate. By getting a comprehensive view of all possible costs, you’re better equipped to choose a broker that genuinely complements your trading style.
• Platform’s Efficiency and Interface: The broker’s trading platform should be both robust and user-friendly. This is where you’ll be spending a considerable amount of time. A seamless, intuitive platform with advanced features can streamline the trading process, minimizing errors and enhancing transaction speeds.
• Regulatory Compliance and Safety: Ensure the broker is supervised by a recognized regulatory body. Such oversight guarantees that the broker adheres to certain standards, emphasizing transparency, ethical practices, and the security of your funds. This is paramount in ensuring your capital’s safety.
• Responsive Customer Assistance: Trading can be unpredictable. There might be times when you face issues that need immediate resolution. A broker with a stellar customer support system – available round the clock and accessible via multiple channels – ensures you’re never left hanging.
• Value-added Features and Tools: Beyond basic trading, a good broker provides additional resources. This might include educational materials, real-time market analytics, and research tools. These offerings can significantly bolster your trading acumen, keeping you updated with market shifts and enhancing your strategy formulation.

Alternatives to Low Spread Forex Brokers

Commission-based Brokers

Instead of widening the spread, commission-based brokers charge a flat fee or percentage for every trade. This structure can often be more cost-effective for traders who trade large volumes. The predictability of a set fee can make financial planning and strategy execution more straightforward.

Furthermore, commission-based structures often come with the benefit of more transparent pricing, allowing traders to easily calculate their exact trading costs without having to analyze the vagueness of spread markups.

ECN (Electronic Communication Network) Brokers

ECN brokers connect traders directly to the interbank market. They provide a platform where market participants can trade against each other, offering the best bid and ask prices. With ECN brokers, traders typically see tighter bid-ask spreads but will often pay a commission for this service.

The key advantage is the direct market access, which reduces the possibility of price manipulation. This ensures a more transparent trading environment where prices are driven purely by market supply and demand dynamics. For those seeking a raw trading experience, ECN brokers are an excellent alternative.

FAQs

How can I check the real-time spread a broker is offering?

Most brokers display their live spreads on their websites or within their trading platforms. Real-time spread monitoring is crucial, especially during volatile market hours. It’s advisable to cross-check these spreads during major economic events or news releases, as they can fluctuate rapidly. Some advanced trading platforms also offer tools and indicators to track and display the spread for chosen currency pairs in real time, allowing traders to make informed decisions swiftly.

How do commissions impact trading costs alongside spreads?

Commissions are either flat fees or percentages charged per trade. When trading with a broker that offers low or zero spreads but charges commissions, it’s essential to calculate the cumulative cost. Sometimes, a seemingly small commission can outweigh the benefits of a low spread, especially for those trading in smaller volumes..

Are low spreads beneficial for all trading strategies?

Not necessarily. While scalpers, who make numerous small trades, benefit immensely from tight spreads, long-term traders might prioritize other features, like platform tools or educational resources. The strategy and frequency of trades play a crucial role in determining the significance of spread costs.

How does leverage interact with spreads?

Leverage allows traders to control a larger position with a smaller amount of capital. While it can amplify profits, it also magnifies losses. Even a small spread can translate to a significant cost when trading with high leverage. Thus, it’s even more crucial to find brokers with competitive spreads when using substantial leverage.

Do all currency pairs have the same spreads?

No, spreads can vary significantly across pairs. Major pairs like EUR/USD typically have tighter spreads compared to more exotic or less commonly traded pairs. Factors influencing spreads include the liquidity of the pair, time of day, and geopolitical events related to the countries of the currencies in the pair.