Best Lowest Spread Forex Brokers

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    Spread in the forex market is the difference between the bid price and the ask price of a currency pair. It can be considered as the cost a trader pays for each transaction they perform in the FX market. On the one hand, the spread is a cost factor for people who trade in currencies. On the other hand, it is how brokers get compensated for their service and providing a trading platform for these transactions.

    Spreads vary from broker to broker and can be wider or narrower depending on the currencies involved and the time of day. Trading with low spreads is especially important to scalper traders who make several short-term trades and target small profits. 

    First off, the fee is deducted for every transaction, and the more the trades the more a trader is hit with this cost. If the spread is on the wide side, this can add up fairly fast and eat into profits. Second, low spreads translate to less operating costs and better long-term savings. It also makes it easier to enter or exit a trade provided there is zero or minimal commission or fee.

    This guide reveals the top regulated forex brokers with the lowest spreads in the market. It is common knowledge that some brokers with fairly high average spreads advertise their minimum spread of the day to lure in unsuspecting traders. 

    To prevent readers from falling prey to this tactic, this research dug further to check for currency trading platforms with the lowest average spread. The article also reviewed 5 critical areas for each broker – which include supported assets, trading tools, platforms, fees and charges, availability of mobile trading as well as the account types and their respective spreads. 

    Advantages of Using a Regulated Broker

    Many individuals engage in forex trading with the aim of increasing their capital investment and making a profit. This purpose can be easily thwarted if an investor decides to trade with just any brokerage firm that has the most compelling offer. 

    Although tighter regulations have greatly reduced the number of fraudulent practices by brokerage firms, however, unethical dealings still exist. On some occasions, some brokers have been known to manipulate spreads and other fees on their trading platforms to execute trades and potentially generate profits. They do this without the prior consent of their customers. 

    For this reason, all FX investors should always select a broker authorized by top-tier regulatory bodies. These agencies – an example is the Australian Securities and Investments Commission (ASIC) – usually have strict requirements all their member brokers must follow regarding their financial products and services and company practices. 

    As an added protection for traders, high-quality regulators mandate member companies to keep their customers’ funds in segregated accounts.  

    Overview of the Best 5 Lowest Spread Brokers – Our Top Picks for 2023 

    When looking for a forex trading company with the most competitive spread, there are many things to consider. For one, it is not enough to only look out for firms whose spread is as close to zero as possible. 

    Brokers generate revenue through spreads, which is the difference between the bid and ask price of a currency pair. With extremely low spreads, they tend to make up for it by charging higher commissions. So, to be sure of getting an all-round lower charge per transaction, it is ideal to factor in the per-trade commission a broker is charging. 

    Besides that, an investor should check to see if the competitive spread a broker is advertising applies to the account type they are eligible for. In the FX market, many of the attractive spreads are only available to professional traders and not to standard or retail account holders. 

    Tickmill – Best Overall for Low Average Spreads and Best for Professional Trading

    Tickmill is a global forex broker authorized by only one tier-1 regulator (the FCA in the UK) which makes it a safe but average-risk platform for trading forex. In addition, the brokerage has 4 lower tier supervisors – BaFin (Germany), CONSOB (Italy), ACPR (France), and CNMV (Spain). 

    Tickmill offers a lesser number of tradable securities compared to industry leaders. Where the broker shines best is in the area of most competitive spreads and trading fees. The average spreads plus commission (0.47 pips for EUR/USD) for its Pro and VIP accounts are the tightest in the industry. 

    Professional traders with high trade volumes often prefer brokers that minimize transaction costs. Some brokerages set low spreads to pull in customers, only to levy high commissions making the total trading costs expensive for the customer. 

    On the downside, the spread for their Standard or Classic account (floating spread starting from 1.6 pips) is higher than those of competitors.

    Account Types
    Classic, Pro, VIP
    (Each of the account types has a demo and Islamic version)
    Supported Assets
    62 forex pairs including major forex pairs like EUR/USD, GBP/USD, USD/JPY, USD/CHF, USD/CAD, NZD/USD, AUD/USD 
    Trading Tools
    Copy trading app
    Autochartist technical analysis software for trading signals and alerts.
    Acuity Trading Tool for sentiment analysis.
    Advanced Trading Toolkit for real-time data charting.
    Pelican Trading – auto-copying application for Android and iOS users.
    Average Spread for EUR/USD 
    0.47 pips (for VIP & Pro accounts)
    Spreads on retail accounts are floating and start from 1.6 pips
    Fees & Charges
    Deposit & Withdrawal Fee: $0
    Minimum Deposit: $100 (All account types except VIP which is $50,000)
    Inactivity Fee: $0
    Commission: 2 Currency units per standard lot of 100,000 units (Pro
    account)                     
    1 Currency unit per standard lot of 100,000 units (VIP account)
    Mobile TradingSupported
    Overall Rating4.8★

    IC Markets – Tight Spreads and High Leverage Broker 

    Founded in 2007, IC Markets is another broker with one tier-1 regulation (The ASIC), making it a safe and low-risk option for forex traders. The company follows closely behind Tickmill with its competitive pricing which is offered to all account holders on the platform. On Pro “Raw Spread” accounts, the all-in-cost for EUR/USD (commission of $3.00 included) comes to 0.6 pips.

    For retail or standard accounts, the average spread (plus commission of $3.50) for major currencies like the EUR/USD is at an equally low 0.62 pips. This makes IC Markets one of the strong leaders in the lowest spread forex brokers’ niche. 

    Other features of the firm include supporting the full MetaTrader suite (MT4 and MT5), and a wide collection of forex instruments.

    Account Types
    Standard account, Raw Spread account
    (Each of the account types has a demo and Islamic version)
    Supported Assets
    61 currency pairs including major, minor, and exotic pairs.Major pairs (AUD/USD, EUR/USD, GBP/USD, USD/CAD, USD/CHF, USD/JPY)
    Tools
    Alarm manager to send notifications to traders or their followers on social media.
    Sentiment Trader gives real-time data on open positions.
    Tick Chart Trader displays varieties of tick charts or bars.
    Stealth Orders allow traders to hide their pending/open orders from other participants on the platform.
    Average Spread for EUR/USD0.62 pips (for all account types)
    Fees & Charges
    Deposit & Withdrawal Fee: $0
    Minimum Deposit: $200 (For all account types)
    Inactivity Fee: $0
    Commission: $3.50 per side for every 100,000 units
    Mobile TradingSupported
    Overall Rating4.7★

    AvaTrade – No Commission and Best Social Trading Broker

    avatrade

    AvaTrade is another forex broker with excellent pricing. The broker offers only fixed spreads and has the lowest (0.6 pips for EUR/USD) on the market but only for its professional traders. Retail traders get an average spread of 0.92 pips. Although certain brokers offer lesser trading costs. AvaTrade has a social copy trading platform that many consider to be extensive and sophisticated.

    AvaTrade’s AvaSocial, ZuluTrade, and DupliTrade software have received top rankings and awards. The selection of forex products on the platform comprises all the major, minor, and exotic pairs. Compared to most brokers in this guide, AvaTrade has the highest number of trading platforms for all trading environments – web, desktop, and mobile. 

    The company gives access to both its proprietary platforms as well as advanced third-party platforms. AvaTrade is regulated by three top-tier regulators including the IIROC (Canada), and ASIC (Australia) making it a safe, low-risk broker for traders. 

    Account Types
    Standard or Retail, MT4, Professional, Corporate
    (Each of the account types has a demo and Islamic version)
    Supported Assets
    Over 50 forex pairs including major pairs like EUR/USD, USD/JPY, GBP/USD, USD/CAD, USD/CHF, AUD/USD, and NZD/USD
    Tools
    AvaSocial, DupliTrade, and ZuluTrade – apps for copying trading strategies of successful traders.

    Profit Calculator for calculating the spread, margin requirement, swaps, and whether to open a position.
    AvaOptions – mobile trading platform exclusively for trading forex assets. 

    AvaTradeGo mobile app contains tools like AvaProtect which allows a client to minimize the risks on an existing position by creating a partial hedge around it using a forex option. 
    Average Spread for EUR/USD
    0.6 (Professional accounts)
    0.92 (Standard account) 
    Fees & Charges
    Deposit & Withdrawal Fee: $0
    Minimum Deposit: $100 (For all account types)
    Inactivity Fee: $50 after 3 months of account inactivity and $100 after 12 straight
    months of dormancy 
    Commission: $0
    Mobile TradingSupported
    Overall Rating4.5★

    Pepperstone – Best for Beginners and Full MetaTrader Suite

    Pepperstone-logo

    Pepperstone is a well-known broker that offers low spreads and quality trading services. The broker does not charge a commission on its Standard account and the average spread for that account starts from 0.6 pip for EUR/USD.

    Another advantage of trading with this provider is their zero minimum deposit which makes them ideal for new and beginner traders. The company also offers the two MetaTrader platforms, MT4  and MT5, for all trading conditions, web, desktop, and mobile.

    In terms of regulation, Pepperstone is highly regulated and has two tier-1 regulations, FCA from the UK and ASIC from Australia, making it a low-risk option.

    Account Types
    Standard account, Razor account
    (Each of the account types has a demo and Islamic version)
    Supported Assets
    60+ currency pairs including major, minor, and exotic pairsMajor pairs offered include EUR/USD, GBP/USD, and GBP/JPY
    Tools
    Smart Trader – a suite of 28 advanced advisor tools to help customers improve their trade execution and management.

    Myfxbook, MetaTrader Signals, DupliTrade – an autotrade software that allows a user to copy trades from leading successful FX systems.

    cTrader Automate – tool for backtesting and optimizing trading strategies. 
    Average Spread for EUR/USD0.87 pips (For all accounts)
    Fees & Charges
    Deposit & Withdrawal Fee: $0
    Minimum Deposit: $200 (For all account types)
    Inactivity Fee: $0
    Commission: $0 on Standard and swap-free accounts (but there’s a 1 pip
    markup on raw spreads)                      
    7 units of base currency per lot per trade (Razor account)
    Mobile TradingSupported
    Overall Rating4.3★

    Interactive Brokers – Low Spreads and Great Web Trading Platform 

    interactive-brokers-3-1

    Interactive Brokers is a highly regulated brokerage firm, which may provide clients with a sense of security, having 11 licenses in various countries across the world. It has 4 top quality supervisors – FCA (UK), ASIC (Australia), CFTC and SEC (USA), and IIROC (Canada) – Some clients may feel more secure with brokers that prioritize the safety of their funds. Where most brokers would avoid revealing their average spreads to prevent comparison with their competitors, this provider does the opposite.

    They show real-time quotes of spreads for major securities in a neat table on their website. Interactive Brokers has an appealing pricing structure where commissions drop the higher the volume of trades. The broker also provides various classes of tools to help clients protect and manage their forex investments. The research resources, trading tools, and educational materials rank among the best in the industry.

    That said, one of the weaknesses of this outstanding broker is their low leverage of 1:30 imposed on them as safety measures by regulators. While low leverage would help a trader minimize their loss, this element may be a hindrance to professional traders who need much higher leverage.  

    Account Types
    1) Individual, Joint, Trust, IRA, and UGMA/UTMA Accounts;
    2) Family Office Accounts;
    3) Non-Professional Advisor Accounts;
    4) Small Business Accounts;
    5) Money Manager Accounts;
    6) Advisor Accounts;
    7) Broker & FCM Accounts; 
    8) Hedge & Mutual Fund Accounts;
    9) Proprietary Trading Group Accounts;
    10) Compliance Officers;
    11) Administrators; and
    12) Institutional Hedge Fund Investors account.     

     (Each of the listed account types has a demo and Islamic version)
    Supported Assets100+ currency pairs including GBP/USD, EUR/USD, USD/JPY, USD/CHF, 
    Tools
    FXTrader, a platform with a suite of tools that provides real-time streaming quotes, pending trades, positions, and up and down indicators.

    IBKR Mobile is specially customized specially for forex trading and contains functionalities like charting, watchlists, and an economic calendar.

    The Trader Workstation (TWS) trading platform gives access to technical research, analysis tools, and interactive, customizable charts.
    Average Spread for EUR/USD0.6 pips (Standard account)
    Fees & Charges
    Deposit Fee: $0 
    Minimum Deposit: $100 (For all account types)
    Withdrawal Fee: One free withdrawal per month. $10 is charged for each
    subsequent withdrawals
    Inactivity Fee: $0
    Commission: 0.2 basis points – 0.08 basis points
    (commissions tend to drop for clients with a high volume of
    trades.)
    Mobile TradingSupported
    Overall Rating4.3★

    Key Features to Consider When Choosing the Best Lowest Spread Broker

    All forex brokers have their advantages and disadvantages. To choose the right one, a trader has to first figure out their goals for investing in currencies and map out a trading plan in that regard.

    When researching the brokerage with the most competitive spreads and overall trading cost, it is important for potential clients to do thorough homework. This is because these fees are subject to fluctuation and some brokers are known to bury these charges within voluminous legal jargon on their websites. 

    In summary, here are 7 features to consider when picking the right forex trading platform:

    Account Types

    The type of account a broker trades with matters a lot and the best one for any client depends on the individual’s trading style. There are ECN-type accounts where the user pays a fixed, round-turn commission. These accounts usually feature ultra-tight spreads on major FX pairs like the EUR/USD and GBP/JPY. Then there are the no-commission accounts such as AvaTrade which carry a fixed spread on their standard or retail accounts.

    Supported Assets and Investment Options

    If an investor plan on trading in a large variety of currencies, it may be ideal to go for a brokerage that supports an extensive list of currency pairs. Since some currency pairs are considered illegal in some jurisdictions, a second consideration is to check whether a platform has assets legal in your country.

    Tools Offered

    The forex market is extremely volatile and risky. Considering this, it is crucial to seek FX platforms with a wide range of risk management tools such as demo accounts and order types. Demo accounts, for instance, let a client familiarize themselves with the various functionalities on a platform with virtual funds but real-time market data. Order types, on the other hand, are a key risk management tool to have at hand as they help minimize loss during adverse price movements.   

    Trading Interface

    Whether a trader intends to create complex algorithmic strategies or engage in social trading, it is essential they choose platforms with an easy-to-use interface. In addition, the software must have fast order execution and the least possible slippage.

    Fees & Charges 

    Choosing a broker with low commission fees reduces trading costs and increases account profits. As stated earlier, no-commission accounts do not charge trading fees. However, they have wider spreads than commission-type accounts. Some traders may prefer brokers with fixed average spreads, as it simplifies profit or loss calculations and may be suitable for beginners. 

    Mobile Trading

    Mobile trading has become a necessity as it helps the user to trade or check up on their investment anytime and anywhere. Nearly all brokers have mobile apps in this era. However, the trick is getting one with an advanced suite of tools and an effective trading environment and speed. 

    Customer Support

    The best broker should provide multiple channels of reaching their customer service team or resources such as phone, email, and live online chat. Reaching these people should be quick and easy as well. Further, potential brokers should offer multilingual customer support including the client’s native language.    

    Comparison Between the Best Lowest Spread Forex Brokers for 2023

    There is no one right lowest spread broker for everyone. The five forex brokerages identified in this guide are all leaders in competitive pricing and will serve all you’re your trading needs. Each has its unique strengths and weaknesses which are presented in the table below. Compare the platforms to make your own informed decision of which is the most ideal for you. 

    BrokerProsCons
    Tickmill
    Low trading fees.

    Competitive pricing for VIP and Pro accounts.

    Access to advanced trading platforms (MT4 and MT5).

    Interactive research tools available on Acuity Trading platform.

    Competitive pricing for professional traders.

    No fixed-spread accounts.

    Not available for clients from the US.

    Fewer trading platforms compared to industry leaders.
    IC Markets
    Low spreads on retail and pro accounts.

    Easy and quick account opening.

    Free deposits and withdrawals.

    Supports all MetaTrader platforms.

    Offers social trading software.

    Good for algorithmic traders.
    No trading on weekends.

    No proprietary trading apps.

    Trading apps lack 2-step authentication.

    Outdated interfaces for MT4 and MT5 platforms.

    Inferior educational materials and market research resources compared to industry leaders.
    AvaTradeSimple and fast account opening process.

    Multiple trading platforms for desktop, web, and mobile.

    Highly rated social trading apps.

    Authorized by top tier regulators like ASIC.

    High inactivity fees.

    Withdrawals may take 3-5 working days.

    Outdated and slow AvaOptions desktop platform.
    Pepperstone
    Free deposits and withdrawals

    Quick Registration and on-boarding process

    Great customer service 

    Has regulatory license from top regulators
    The minimum deposit at $200 is high – above the industry average  

    News content not available

    Limited analytical content

    Lacks interactive educational content
    Interactive Brokers
    Excellent research tools

    Margins significantly lower than those of rival platforms

    Has an extensive array of trading tools

    Offers a large selection of currency pairs
    Desktop trading platform difficult to navigate

    Customer service is not fully responsive

    The pricing structure is complicated 

    Conclusion

    There are many forex brokers out there with various attractive promises of low fees. However, the bottom line for all investors when shortlisting potential companies to trade with is to choose highly regulated platforms. The advantage of these firms is that the investor is sure a large percentage of their advertised offers are genuine.

    Top-tier regulators are constantly watching for violators of their rules who they heavily fine and penalize. The best broker should have a good reputation for being transparent with their fees and spreads. Further, they should provide access to an efficient trading environment and robust research and educational resources. Their customer service should be fairly responsive as this implies a customer will experience less stress in reaching the company and resolving any future issue. 

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