Some Fascinating Facts About The Best FX Brokers That Rule The Forex Trading Industry

The Forex trading market is home to some of the most amazing Forex brokers that provide an excellent platform for traders to invest in a diverse range of tradable assets. On the other end of the spectrum, it is also easy to see why FX trading has earned a substantial amount of negative reputation due to the incredibly high leverage and deceptive broker practices.
Forex trading is a multi-trillion dollar industry that stays active for 24 hours a day and close to 6 days a week. Currency transactions make up a majority of financial transactions across the globe, which are facilitated through open brokerages and global liquidity providers. Since the deregulation of the Forex markets in the late 20th century, Forex trading brokers from around the world have been working tirelessly to attract the new generation of investors by developing innovative products and attractive investment opportunities according to modern trends in the market.
Several factors have contributed to the high proliferation of Forex trading among the general global population. Smartphones and high-performance trading terminals, together with high-speed internet connectivity, has helped traders to invest in the financial markets without setting up a trading desk at a dedicated trading floor. Mobile trading and social trading are also gaining immense popularity, where traders are always looking for an edge to achieve consistent profits. Several Forex trading sites and third-party services providers are on the constant lookout for the next best ground-breaking technology that will help them to gain an edge in the ultra-competitive FX markets.
The FX market is perhaps one of the most important online concepts in recent times that have changed the face of the investing and financial markets. More and more traders are now turning to currencies and commodities, instead of the conventional stock markets. The global appeal and 24 hours nature of the market has made it easy for traders to invest in the market according to their convenience. Forex trading is here to stay for the foreseeable future, despite all the criticisms and the negative impact on the integrity of the Forex markets.

Top Recommended Forex Brokers
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  • Plus500 Review
  • Founded: 2008
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*Trading bonus are not eligible for clients registered under Trading Point of Financial Instruments Ltd and Trading Point of Financial Instruments UK Ltt. T&C apply
Top Recommended Forex Brokers
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  • 24option Review
  • Founded: 2009
  • Min. Deposit: $250
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  • American ExpressMaestroMasterCardVISABank WireWebMoneySkrillNetellerPayPal
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5
  • Plus500 Review
  • Founded: 2008
  • Min. Deposit: $100
  • N/A
  • MaestroMasterCardVISABank WirePayPalSkrill
6
*Trading bonus are not eligible for clients registered under Trading Point of Financial Instruments Ltd and Trading Point of Financial Instruments UK Ltd. T&C apply.

 

How Top Forex Brokers Can Help You In The Long Run

The best broker Forex is the one that takes care of your trading needs without forcing you into making any compromises. Forex trading has numerous risks and pitfalls that have resulted in billions of dollars of losses from inexperienced and amateur traders. Unlike traditional forms of investing, Forex trading involves two parties, a buy side, and a sell side; therefore, it is inevitable for a vast majority of traders to lose their money in the currency markets. Together with the massive amount of leverage, traders can lose more money than they invest in the markets, which can lead to instances such as a negative balance.
To succeed in Forex trading, every trader should understand the main advantages of pairing up with a reliable partner. The success of any business depends on the individual components that should work together in harmony for consistent profits. Forex trading is a highly risky business venture that requires a trader to have a sound knowledge of the markets, good money management skills, discipline, a sufficient trading capital, and access to the best Forex broker in the industry.
Safety of funds is an important aspect of trading. Regardless of the profit potential of your trading strategy or your money management skills, a trader must have the freedom to withdraw his profits and his trading capital without any restrictions. If you consider the number of scams rampant in the industry, it is common for brokers to withhold payments to their clients without any credible reason. Some brokers are also incapable of accommodating their traders’ position in the market due to insufficient capital or due to financial irregularities. Other brokers merely stipulate bogus terms and conditions that virtually prevent their clients from making a withdrawal request. In extreme cases, brokers are rendered insolvent without being able to pay their debts to their traders.
Top rated Forex brokers should provide you with a sense of confidence and security without bothering you with any broker redundancies. You should be able to enjoy a sense of continuity with your trading, as Forex trading can only be profitable for a trader that is disciplined and patient in his approach. If a broker cannot guarantee the long-term reliability, it is clearly a sign for you to head for greener pastures for keeping your funds in a secure FX trading account.

The Secret To Choosing The Best Forex Brokers

List of the Best Forex Brokers
Broker Regulation Bonus Min. Deposit Details Action
yes $30 No Deposit Bonus* $5
  • offers MT4 & MT5 platforms for all popular operating systems
  • licensed by the FCA, ASIC and CySEC
  • can trade Forex, Stock Indices, Commodities, Stocks, Metals and Energies
Trade NowXM Group Review
yes 100%* $50
  • tight spreads from as low as 0.1 (EUR/USD)
  • trade Forex, Indices, Commodities & CFDs
  • technical analysis by experts Trading Central
Trade NowHotForex Review
yes 40%* $100
  • 200+ instruments to trade, including Commodities, Indices and Stocks
  • desktop, tablet, mobile and web based trading with AvaTrader & MetaTrader 4
  • regulated in Europe, Australia, Japan, British Virgin Islands and South Africa
Trade NowAvaTrade Review
yes N/A $100
  • free time-unlimited demo trading platform
  • low spreads between the buy and sell prices
  • fund your account by credit card, PayPal, Skrill or bank transfer
Trade NowPlus500 Review
yes up to $5000* $100
  • trade all major markets with comfort and security
  • over 40 years of operational history
  • multiple trading platforms
Trade NowHYCM Review
yes up to $1000* $50
  • simple to use trading platforms
  • provide a myriad of tools to guide customers throughout their first steps as a trader
  • offer a wealth of training courses to help turn new customers into traders
Trade NoweToro Review
yes $123 FREE $1
  • trustworthy, continuously developing broker
  • thousands profitable orders executed daily
  • regular contests and advantageous promotions
Trade NowFBS Review
yes 50%* $200
  • dealCancellation, undo your losing trades up to 60 minutes
  • a range of trading instruments
  • free trading signals and SMS alerts
Trade NowEasy Markets Review
List of the Best Forex Brokers
Broker Regulation Bonus Min. Deposit Details Action
yes $30 No Deposit Bonus* $5
  • offers MT4 & MT5 platforms for all popular operating systems
  • licensed by the FCA, ASIC and CySEC
  • can trade Forex, Stock Indices, Commodities, Stocks, Metals and Energies
Trade NowXM Group Review
yes 100%* $50
  • tight spreads from as low as 0.1 (EUR/USD)
  • trade Forex, Indices, Commodities & CFDs
  • technical analysis by experts Trading Central
Trade NowHotForex Review
yes N/A $250
  • tight spreads from as low as 0.1 (EUR/USD)
  • trade Forex, Indices, Commodities & CFDs
  • mobile platform app
Trade NowHotForex Review
yes 40%* $100
  • 200+ instruments to trade, including Commodities, Indices and Stocks
  • desktop, tablet, mobile and web based trading with AvaTrader & MetaTrader 4
  • regulated in Europe, Australia, Japan, British Virgin Islands and South Africa
Trade NowAvaTrade Review
yes N/A $100
  • free time-unlimited demo trading platform
  • low spreads between the buy and sell prices
  • fund your account by credit card, PayPal, Skrill or bank transfer
Trade NowPlus500 Review
yes up to $5000* $100
  • trade all major markets with comfort and security
  • over 40 years of operational history
  • multiple trading platforms
Trade NowHYCM Review
yes up to $1000* $50
  • simple to use trading platforms
  • provide a myriad of tools to guide customers throughout their first steps as a trader
  • offer a wealth of training courses to help turn new customers into traders
Trade NoweToro Review
yes $123 FREE $1
  • trustworthy, continuously developing broker
  • thousands profitable orders executed daily
  • regular contests and advantageous promotions
Trade NowFBS Review
yes 50%* $200
  • dealCancellation, undo your losing trades up to 60 minutes
  • a range of trading instruments
  • free trading signals and SMS alerts
Trade NowEasy Markets Review
*Trading bonus are not eligible for clients registered under Trading Point of Financial Instruments Ltd and Trading Point of Financial Instruments UK Ltd. T&C’s apply to each of the offers. Click “Trade Now” for more details!

 

The best strategy for choosing the best FX broker is to do your homework and work with multiple top Forex brokers in the market to find a reliable company that can safeguard your trading capital. Here are some key factors to consider that will help you to make an informed choice:

What Are The Different Forex Trading Sites & Resources Available To Traders?

The internet is riddled with an enormous amount of Forex trading sites, news portals, review websites, third-party services, and other online FX trading resources that are aimed to make it easy for traders to tackle the financial markets. However, it is not always easy for a trader to choose a website due to the inconsistencies in information and the utter disregard for investor rights from some service providers. Several unethical companies are apparently looking to take advantage of unsuspecting traders by providing a false misconception of instant riches, without actually informing their clients about the potential risks of trading in the FX market.
Nevertheless, traders can find honest and reliable resources that promote safe and secure FX trading through their network of websites and online trading portals. These trading resources often provide timely information about market dynamics, along with other information such as Forex broker reviews, which will help a trader to learn about the fundamental elements of a market that constitute a fair and protected trading experience.
Here is a list of some of the common FX trading sites and resources available online:

Staying Informed Through The Best Forex Broker Reviews & Customer Testimonials

office-roomChoosing a broker should not be done under blind instincts, neither should one invest their money in a broker that they think will be able to honor their agreement. In fact, most traders lose their money in the markets due to their lack of commitment to finding a good broker that can guarantee a healthy trading environment and the safety of their trading capital. So, how does one find a top FX broker?
Forex broker reviews are a great way of learning about the services of different FX trading companies, which should usually provide you with an exhaustive list of advantages and disadvantages of a Forex broker. Most modern reviewers will have a thorough review of each FX broker, but it is also common for affiliates and introducing brokers to leave positive reviews to support a broker and earn a handsome share of the revenue.
It is imperative for traders to cross-reference all existing Forex broker reviews with actual customer testimonials left by verified traders. Customer testimonials are also susceptible to misuse, especially from both advertising agencies and disgruntled former clients. Companies may employ ad and marketing agencies to leave positive reviews on customer testimonial websites, while on the other hand, traders that have lost a fair share of their trading capital due to their own fault may vent out their frustrations at their broker by leaving negative customer testimonials.
Therefore, by comparing the best FX broker reviews with different customer testimonials, it is actually possible for a trader to get a better picture about the overall reliability and trustworthiness of a company. Make sure that you read through the reviews with an open mind, and only choose the information provided if they are in line with your expectations. At FXBrokers.net, we compile our reviews of the best FX brokers by carefully analyzing individual aspects of the company to provide a comprehensive report to our readers.

Market Protocols & Trading Platforms Offered By Top Rated Forex Brokers

Market Maker
Traders are given the option of choosing from different types of market protocols according to their investment capital and their lot requirements. Most retail FX brokers offer a market maker protocol with either a manual or an automated dealing desk, which matches orders internally between their clients. Market maker protocol is one of the riskiest trading options in the market due to the significant conflict of interest that exists between a broker and its client. For instance, if a broker is unable to match a customer’s order at the current market price due to the unavailability of a counterparty to the trade, the broker’s internal dealing desk may take the opposite end of the trade to fulfill their promise of granting orders to their clients. Sometimes, brokers deliberately open orders against their clients to take advantage of their clients’ losses.
Regulated market maker brokers are banned from employing any practices that may lead to a conflict of interest. If they are found to indulge in any trading activities that are against the integrity of the traders, regulators are quick to penalize such companies through massive fines, sanctions, and even permanent ban of regulatory licenses. Market maker brokers typically offer micro and mini accounts that allow traders to trade using micro and mini lots. Some brokers may also provide standard lots for their market maker accounts, but there may be several restrictions on the maximum available lots for trading, especially due to the lower volumes and liquidity offered by a market maker protocol. Large brokers with a global presence and fully automated dealing desks may be able to provide higher lots, but traders should expect a lot of requotes and order denials while trading with such brokers.

Direct Market Access, ECN, & STP

Electronic Communications Network (ECN) and Direct Market Access (DMA) protocols, also known as Straight Through Processing (STP), connect traders directly to large liquidity providers, where orders are executed in significant quantities. Global liquidity providers have an incredible amount of liquidity and are known to transact billions of dollars in trade volumes at any given instant. Therefore, it is easier for larger traders to enter and exit markets without worrying about requotes or order cancellations. In fact, ECN brokers guarantee that orders will be filled at least partially at market price, but there can be huge slippages, which are common in ECN trading. ECN brokers have the least amount of conflict with their clients due to the direct market access nature of the trading account, where brokers are reimbursed through the spreads and commissions per trade. Therefore, professional traders make it a priority to trade through ECN brokers to enjoy direct market access trading without making any compromises on their trading strategies.

Trading Platforms

Both market maker and ECN protocols are supported by a majority of trading platforms, which include the MetaTrader, the cTrader, the NinjaTrader, TradeStation, and other popular third-party trading software. The MetaTrader is the most popular and widely adopted trading interface in its MT4 and MT5 guises, which are more commonly offered by market maker protocols. The MetaTrader supports ECN trading through ECN bridges, while the cTrader is a proprietary ECN trading platform that connects traders directly to the liquidity providers. Some brokers may also choose to offer their branded trading platforms that are designed to incorporate all financial products and services through their internal trading protocols.

Mobile Trading Platforms

Modern traders are now turning their attention towards mobile apps that enable them to access the markets from anywhere in the world. Increased mobility and the rise in reliable internet connectivity across the globe has helped traders to access their trading accounts through the convenience of their smartphones or tablets. Platform developers are also concentrating their efforts on designing and developing intuitive mobile trading apps for different operating systems. Most trading platforms are now available for iOS, Android, and Windows devices, which are readily available for download through their respective app stores. Even though mobile apps don’t have the flexibility or features offered by a desktop trading interface due to the obvious shortcomings such as small screen sizes and lowered performance, mobile trading is indeed popular among a high concentration of retail and institutional FX investors.

How Are Forex Trading Companies Regulated?

phone-talkingForex brokers are regulated by the organizations that are responsible for overseeing the financial activities of all companies operating in a particular geographic. For instance, brokers in the US are regulated by the CFTC and the NFA, which stipulate several regulatory requirements that prevent any other overseas brokers from operating in the region without a valid regulatory license. EU brokers, on the other hand, are regulated by the respective European regulators that fall directly under the European Central Bank and the European MiFID derivatives. Under the European Economic Area agreement, companies operating in the EU can offer indulge in cross-border sharing of services without obtaining additional licenses. Top regulators in the EU include the FCA (UK), CySEC (Cyprus), BaFin (Germany), AMF (France), CONSOB (Italy), and CNMV (Spain).
There are also other leading regulators in the world that have the best regulatory framework for ensuring the best in investor protection. The FINMA (Switzerland), the ASIC (Australia), the FMA (New Zealand), the FSA (Japan), the FSB (South Africa), and the IIROC (Canada) are some of the other leading global regulators that supervise the activities of Forex brokers in their respective regions. A large number of the regulatory agencies work together to enforce Anti-Money Laundering Laws and create laws and policies to minimize the impact of financial scams on the integrity of the financial markets.
Regulated brokers should keep their clients’ funds in segregated accounts at top tier banks in their respective country. The broker should only use such funds for maintaining their clients’ positions in the market, and cannot use it for their internal operations. A broker is banned from using client money for meeting their expenses or for fulfilling their debt obligations. In case a broker falls into bankruptcy or insolvency, the best regulatory agencies have investor compensation schemes that reimburse traders for their trading capital according to the terms and conditions stipulated in the broker-client agreement. Therefore, by investing your money with a regulated broker, you can ensure the safety of your funds without worrying about retrieving your trading capital if a broker winds up its business without warning.
Other regulatory rules stipulate that brokers should submit periodic audit reports to the concerned regulators, and the company should be open about its financial transactions to both the authorities, as well as their clients. Traders should also receive their withdrawals on time, and there shouldn’t be any instance where the broker withholds any payments by citing spurious reasons. Regulated FX brokers are also barred from trading against their clients, which are further reinforced by guidelines that prevent tampering with the platform, price manipulation, and any other dubious broker practices that might put the trader on the back foot.

The Best FX Broker Locations For Safe Investments

Although there are numerous regulatory agencies in the world, only a few of them are considered to be reliable and trustworthy from a trader’s perspective. Brokers from the US, the UK, the EU, Australia, and from some parts of Asia are considered to be reasonably safe from broker scams, while tax havens such as BVI, Belize, St. Grenadines & Vincent and other similar jurisdictions seem to lack the necessary regulatory policies to ensure fair and transparent protection.
While choosing your broker, always try to choose a local FX trading company that is regulated by your local regulatory organization, which should offer you the best protection against fraudulent broker practices. For instance, if you are a victim of a broker scam, your local regulatory authority should be able to provide fast and instant support than any other overseas regulatory organization. In the US, traders are required by law to trade with US-based FX brokers that are regulated by the NFA. Similarly, other regulatory organizations also have similar policies that dictate their citizens to trade with authorized companies, rather than depositing their money in lesser-known Forex brokers.
It is also important for you to ascertain the legality of FX trading in your country, as some types of Forex products such as spread betting and binary options trading are banned in several countries. Therefore, you should always ensure that you are following all the laws applicable in your local jurisdiction before indulging in any investment-oriented activities. A professional financial consultant or your local authority should be able to shed some light into the legality of FX trading in your region, which should help you to prevent any legal hassles in the future.
If you are unable to find a local FX broker, you should always consider trading with top Forex brokers that are domiciled in countries such as the US, EU, and the Asia-Pacific, where regulated FX trading can guarantee the safety of your funds. You should approach your Forex investments from a long-term perspective, and you should only trade with a broker that has an established presence. You may also trade with new brokers if they have all the sufficient regulatory licenses and a viable business model that can assure you of excellent quality services for many years into the future.

Choose Your Trading Partner From Our Highly Reliable Forex Brokers List

To make it easy for our readers, we have devised an excellent Forex brokers list that should be able to provide you with all the information required for a safe and trusted trading experience. All of the brokers in our recommended list are properly regulated, have excellent trading products, offer great financial security, and dedicates their efforts towards maintaining the best in customer satisfaction.

List of the Best Forex Brokers
Broker Regulation Bonus Min. Deposit Details Action
yes $30 No Deposit Bonus $5
  • offers MT4 & MT5 platforms for all popular operating systems
  • licensed by the FCA, ASIC and CySEC
  • can trade Forex, Stock Indices, Commodities, Stocks, Metals and Energies
Trade NowXM Group Review
yes 100%* $50
  • tight spreads from as low as 0.1 (EUR/USD)
  • trade Forex, Indices, Commodities & CFDs
  • technical analysis by experts Trading Central
Trade NowHotForex Review
yes 40%* $100
  • 200+ instruments to trade, including Commodities, Indices and Stocks
  • desktop, tablet, mobile and web based trading with AvaTrader & MetaTrader 4
  • regulated in Europe, Australia, Japan, British Virgin Islands and South Africa
Trade NowAvaTrade Review
List of the Best Forex Brokers
Broker Regulation Bonus Min. Deposit Details Action
yes $30 No Deposit Bonus $5
  • offers MT4 & MT5 platforms for all popular operating systems
  • licensed by the FCA, ASIC and CySEC
  • can trade Forex, Stock Indices, Commodities, Stocks, Metals and Energies
Trade NowXM Group Review
yes 100%* $50
  • tight spreads from as low as 0.1 (EUR/USD)
  • trade Forex, Indices, Commodities & CFDs
  • technical analysis by experts Trading Central
Trade NowHotForex Review
yes N/A $250
  • tight spreads from as low as 0.1 (EUR/USD)
  • trade Forex, Indices, Commodities & CFDs
  • mobile platform app
Trade NowHotForex Review
yes 40%* $100
  • 200+ instruments to trade, including Commodities, Indices and Stocks
  • desktop, tablet, mobile and web based trading with AvaTrader & MetaTrader 4
  • regulated in Europe, Australia, Japan, British Virgin Islands and South Africa
Trade NowAvaTrade Review
*Trading bonus are not eligible for clients registered under Trading Point of Financial Instruments Ltd and Trading Point of Financial Instruments UK Ltd. T&C’s apply to each of the offers. Click “Trade Now” for more details!

 

Forex Banking, Financial Transactions & Forex Bonuses

There are several banking options available to traders, thanks to the multitude of online payment options such as Skrill, PayPal, and Neteller. Traders can now deposit and withdraw their trading funds through e-payment processors, bank wire transfers, and credit card payments, all of which facilitate fast, easy, and secure payments. Unfortunately, due to the several anti-money laundering laws enforced by global regulatory agencies, traders can only withdraw funds using the same payment option used to deposit funds to your trading account. Therefore, you have to be careful while initiating a withdrawal request, especially if you have deposited money using a credit/debit card that you no longer use.
Online payment processors such as Skrill and PayPal are the safest payment options, which ensure that all of your payments are securely transacted through encrypted security protocols. Unlike traditional wire transfers, online payments are completed within seconds, and it is easy to track your payments without having to wait for days for the funds to be deposited into your trading account. International wire transfers take a long time, and are hugely expensive, which may eat into your trading capital. Nevertheless, online payments and card transactions also incur small transaction fees, which are sometimes waived off by certain brokers.
Forex deposits are often accompanied by Forex bonuses, which are rewards offered by companies to entice new traders into opening an account with a particular broker. Forex bonuses usually start from 5% of the deposit capital and can reach up to 500%. Although bonuses may sound attractive, brokers are known to take undue advantage of their clients by imposing stringent trading conditions for those who accept bonuses. Several traders have been known to get into a conflict with their brokers over a lack of understanding of the bonus terms, which gives the complete right to the broker to withhold client funds as they desire.
Regulated brokers don’t generally offer any bonuses to their clients, fearing the consequences of a conflict of interest. Instead, several top Forex brokers provide other promotions and rewards such as cash back programs, loyalty points, and other electronic gifts to keep their clients satisfied. If possible, try to avoid bonuses for your FX trading, but better yet, accept a bonus only after reading through the associated terms of your bonus agreement.

The Costs Of Forex Trading

The cost of FX trading keeps changing according to market conditions, especially if you are choosing a direct market access broker. The main cost of trading comes in the form of spreads and commissions, which are markup costs that a trader should pay to a broker to open an order in the market. The spread is defined as the difference in price between the bid and ask (buy/sell) prices, which fluctuates according to the current liquidity in the market.
Market maker brokers have spreads starting from 1 pip on the major currency pairs such as the EUR/USD, the USD/JPY, while other exotic currency pairs such as the USD/ZAR can have spread as high as 250 pips. On an average, most major currency pairs should be available with 2 to 6 pips spreads during regular market hours, which may increase significantly during news hours. Market maker brokers primarily earn money through these spreads, while non-regulated and dishonest brokers may earn indirect income by trading against their clients, by selling advertisements, or by selling user information to third parties. Therefore, it is always advisable to stick with regulated entities that will not take undue advantage of their clients.
ECN brokers offer the most competitive spreads starting from 0 pips, mainly due to the increased volumes, but ECN brokers charge a commission per trade to offset the losses incurred due to the tight spreads. You can expect the commission to be in the region of $2 to $20 per round lot traded, which is charged separately. Brokers might also incorporate the commission into the spread as markup to provide 0% commission trading for their clients.
There is another substantial cost of trading to consider, known as SWAPs, which are charged for all overnight positions. SWAPs can be positive or negative depending upon the existing base rates of the countries that issue the currency in the market. SWAP works by calculating the difference in rates between two countries’ central bank rates, where buying the currency with the higher interest rate against a lower interest rate currency earning a positive SWAP, and selling the currency with the higher interest rate against a currency with lower interest rate resulting in a negative SWAP. SWAP or interest rate differences between two countries and their currencies often provide an attractive opportunity for traders to actually make money without speculating about the movement of the markets.

Preferred Brokers In Your Location
Bonus: N/AMin. Deposit: $100Plus500 Review
Bonus: $5000Min. Deposit: $100HYCM Review
Bonus: 100%Min. Deposit: $50HotForex Review
Bonus: 40%Min. Deposit: $100AvaTrade Review
Preferred Brokers In Your Location
Bonus: N/AMin. Deposit: $100Plus500 Review
Bonus: $5000Min. Deposit: $100HYCM Review
Bonus: N/AMin. Deposit: $25024option Review
Bonus: 100%Min. Deposit: $50HotForex Review
Bonus: 40%Min. Deposit: $100AvaTrade Review

Forex Brokers and Sites
Broker Rating License Leverage Spreads Live Chat Trade Now
Read Review
6/6Rating 6/6
MiFID 1:400 from 0.9 pips yes Trade with AvaTrade
Read Review
3/6Rating 3/6
CySEC 1:300 typical 2 pips no Trade with Plus500
Read Review
6/6Rating 6/6
FCA 1:500 from 1.5 pips yes Trade with HYCM
Read Review
5/6Rating 5/6
CySec & FCA 1:200 from 2 pips no Trade with eToro
Forex Brokers and Sites
Broker Rating License Leverage Spreads Live Chat Trade Now
Read Review
6/6Rating 6/6
MiFID 1:400 from 0.9 pips yes Trade with AvaTrade
Read Review
3/6Rating 3/6
CySEC 1:300 typical 2 pips no Trade with Plus500
Read Review
6/6Rating 6/6
CySEC 1:300 typical 2 pips no Trade with 24option
Read Review
6/6Rating 6/6
FCA 1:500 from 1.5 pips yes Trade with HYCM
Read Review
5/6Rating 5/6
CySec & FCA 1:200 from 2 pips no Trade with eToro

Should You Trade With Forex Trading Brokers That Offer High Leverage?

Forex trading is a leveraged product, as it is essential for traders to choose a high amount of margin to open a meaningful position in the market. A standard lot in FX trading is worth at least $100,000 (precisely $105,300 for the EUR/USD pair as of writing this article). A 100 pips movement in the EUR/USD pair is just worth $100, which is just 0.1% of the overall movement of the currency pair. In context, a popular stock in the US financial market (NYSE) is known to experience around 1 to 10% moves in a day during regular market conditions, which yields better returns for an average trader. Therefore, to increase the profit potential, a Forex broker offers margin for their clients starting from 1:50 all the way up to 1:3000.
Trading on margin has an enormous amount of risk, as a 100 pips move for a 1:100 leverage can wipe out an entire account instantly. To protect negative balances, the best Forex brokers employ margin call policies that prevent negative balances regardless of the movement in the markets. However, as a trader, you should stay away from high leverage, even if a broker promises to offer you the largest leverage available in the market. For safety reasons, traders should only use a maximum leverage of 1:10, or an absolute maximum of 1:50. Any leverage greater than that would require you to have excellent money management skills and an incredible amount of psychological strength to protect your capital from wild swings in the market.

What Are The Other Factors To Consider Before Choosing A Top Rated Forex Broker?

You should do plenty of research and try out different brokers before taking the plunge and making a deposit. Although reviews and existing customer testimonials may help you in the beginning, test a broker’s services using a small amount of trading capital, which can give you a good idea about the credibility of the company that you have chosen. You may also trade on a demo account to test a broker, but only a real account can give you a better picture.