For successful currency trading, it is very important to choose to trade with the right broker. Knowing the best low spread forex brokers can increase your forex profits. Especially if you are an active trader with many trades per day the fees will increase accordingly. But there is no reason to pay higher transaction costs when there are many excellent forex companies offering low spreads in the market. In this article, Yenmachvang will introduce you to the best lowest spread forex brokers 2021.
The Benefits of Low Spreads in Forex Trading
To see the difference in bid and ask prices in the forex market. We give an example of a forex broker’s average bid and ask spread of 2 pips. Each pip is worth 1 US Dollar. So you will lose $4 per trade both on buying and selling. Assuming you are a day trader, you normally make 4 trades per day. That means you pay $16 per day in transaction fees. A year you trade about 220 trades, it will cost you $3520. One of the numbers is not little at all.
Likewise, if the average spread offered by the forex broker is 0.5 pips. As calculated above, a year you only have to pay a fee of $ 880. Thus we see the huge difference and benefits of a low-cost forex broker.
The Best Forex Brokers for Low Spreads
We are unable to provide an exact list of forex brokers that offer the lowest spreads for the following reasons:
- The average spreads offered by different brokers often change over time, so today’s lowest spread broker may not be the lowest spread broker tomorrow.
- New forex brokers are always open and one of those new brokers may offer better average bid and ask spreads than any forex broker you are currently using.
So you should regularly check and update the situation of brokers to be able to get low spreads
Here is a brief description of the forex brokers that are currently among the brokers with the lowest spreads at the moment:
Tickmill is a forex broker that offers clients to trade forex pairs, CFDs, and cryptocurrencies. They use the MetaTrader 4 and MetaTrader 5 trading platforms. Normal market spreads are from 1 pip but Tickmill offers spreads as low as 0.0 on major currency pairs like EUR/USD and GBP/USD. Tickmill charges per account. The Classic account is completely commission-free but the minimum spread is 1.6 pips for all currencies. Pro accounts are charged a spin commission of up to 2 pips per side for every 100,000 trades. The VIP account is 1 pip per side for every 100,000 trades. This is the first company we mentioned in the list of the best lowest spread forex brokers in 2021
Pepperstone is rated at the highest or closest position in offering the lowest spreads in the forex market. Pepperstone uses either the MetaTrader 4 and MetaTrader 5 trading platforms or the cTrader platform and has two account types available. The Razor account has institutional spreads with no upside from 0.0 – 0.3 pips and $7 commission per 100k trades. It is suitable for scalpers and fake traders. The standard account has a minimum spread of 0.6 and no commission. This account is suitable for new traders.
3. IC Markets
IC Markets uses the available MetaTrader and cTrader trading platforms to trade forex and CFDs. The standard account has a spread of around 0.6 pips and no commissions. The raw account offers zero variable spreads and a commission of $7 per spin for every $100,000 trade.
Axiory provides access to a variety of trading markets such as stocks, ETFs, and precious metals. They use the MetaTrader 4 and MetaTrader 5 trading platforms and cTrader. Axiory offers a wide selection of accounts, from the spread only (Standard Account), to lower spreads plus commissions (TERA Account), to spread trading with no commission only (ALPHA Account)
FxPro is a broker that uses the MT4, MT5, and cTrader trading platforms and various account types that charge only spread, spread plus commission, or commission only, with zero spreads. The accounts charge an average spread of around 1.5 pips.
From the information above, we can see that there are three basic types of forex brokers’ transaction fees that you may have to pay:
- Spread only
- Spread plus commission
- Commission only
Which deal is the best?
With the frequency, you usually trade and the type of account you sign up for and the amount of money will be suitable and choose the most optimal deals.
Understanding Zero Spread Forex Trading Accounts
You’ve noticed the ads “no spread forex broker” but that doesn’t mean the trades are free. A broker will charge a commission for offering zero-arbitrage trading all the time. You should remember that no broker works for free.
Other Factors to Consider Besides Lowest Spreads
When choosing a forex broker, pay attention not only to low spreads, but also to consider many factors. For example, is it a reliable broker? It is recommended that you do your research and read online forex broker reviews before you sign up for an account.
Forex brokers offer leverage from 30:1 up to 1000:1, depending on the trading capital you can consider and start opening an account. Another consideration that can reduce your net trading costs is that many forex brokers offer trading rebates, usually based on the number of trades you make. However, the rebates may only be available with some of the different account types the broker offers.
Furthermore, many forex brokers offer trading rebates based on the number of trades you make. Especially if you trade in an account that offers absolutely zero spreads – commissions only – it will be much easier to keep up with your actual trading costs as that is a fixed price for every transaction.
One more thing: You regularly trade a small currency pair, such as USD/SGD. Offers on minor currency pairs are usually much higher than the spreads offered on major currency pairs.
Some brokers charge very low spreads when trading EUR/USD but significantly higher spreads when trading GBP/USD. It may happen that you trade accounts where the average EUR/USD spread can be half a pip, but the GBP/USD average spreads two pips or more. So you need to be careful when trading currency pairs.
In this article, Yenmachvang has provided you with the best lowest spread Forex brokers 2021 at the moment. Take a look and choose for yourself a forex broker with the lowest spreads that will give you the best deals and significant cost savings.