Forex trading is not as expensive as many people believe it is. Of course, it is associated with relatively high risks, however, thanks to various trading strategies it is possible to minimize them. But, in order to start trading Forex, traders need to go through financial intermediaries, such as Forex brokers. These brokers themselves need to make money somehow in order to keep their brokerage services appropriate to the market standards. Therefore, brokers often charge commission fees or implement them within spreads.
Most of the Forex brokers with low spreads will provide higher commission charges on their trading platforms and vice versa. That is why it is not always easy to encounter the cheapest way to trade Forex. Obviously, the trading costs depend on the type of financial asset that you are trading, your trading volume, and most importantly on the brokerage firm. There are some Forex brokers that offer multiple trading account types for people with different budget ranges, trading styles, and risk tolerance.
For those traders who do not inherit a significant amount of financial resources, we recommend that they make research to identify low-cost Forex brokers. The article below will provide the list of them, as well as the overall description of the fees associated with trading Forex.
Usually, when examining the trading-related costs within the Forex market, traders should look for the trading conditions and prices of the broker. For instance, they should pay attention to the spreads and commission rates, as well as the convenience of the trading environment for the traders. Checking the quality of the brokerage services is also crucial since some of the cheaper brokers will often reduce costs at the expense of reduced quality. You can find the list of low-cost Forex Trading brokers below.
CySEC, FCA, ASIC
MT4, MT5, WebTrader
CySEC, CBI, FSA, FFAJ, BVI FSC, FSCA, FSRA
MT4, MT5, WebTrader, AvaTradeGO
Swedish FSA, Finansinspektionen
cTrader, MetaTrader 4, MetaTrader 5
SVGFSA, FCA, DFSA, FSCA, FSA
From 30% to 100%
Risk Warning: YOUR CAPITAL MIGHT BE AT RISK
FCA, CySEC, FSA
MT4, MT5, WebTerminal
ASIC, CySEC, FSA, BVI
WebTrader, MT4, TradingView
FCA, CySEC, DIFC, CIMA
WebTrader, MT4, MT5, IRESS
ASIC, SCB, CMA, CySEC, FCA, BaFin and DFSA
MT4, MT5, cTrader, TradingView
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
The first thing that comes to mind when talking about the relative costs of trading Forex is the commission of the broker. Even though it has become rather a rare occurrence lately due to the high competition on the market, some of the brokers still charge commission fees on certain account types, especially if they offer tight spreads. The commission fees vary according to the brokers, the account types, financial assets, and the subscription plan of the trader. The Forex broker fees in terms of commissions apply to each traded lot and can be as low as 0.0002 USD on certain products or can represent the percentage of the per traded size.
If your broker offers commission-free Forex trading it most probably means that the fee is integrated into the spread that they are offering on financial instruments. The spread is a difference between the bid and asks prices for any currency pair. These prices represent the difference between at which price you buy an asset from the broker and what is price that the broker will pay you for it. Any remaining amount between the bid and ask prices is the profit that the broker generates from your trades. Let’s admit that spreads starting from 0 pips is a very attractive offer, but if it comes without commission fees or any other price payable to the broker, it is an alert that something wrong is going on with your low-cost online broker.
Even though minimum deposit requirements are not considered as the cost of trading, some people still want to avoid high deposit demands from the brokers. It is a very logical concern from the traders’ side since the deposits do make a difference. For instance, it is not unlikely that you will be able to generate some profits if you start trading with 5 USD. In fact, you could start trading with more than 200 USD but suddenly lose all of it. Therefore, the traders should have a choice when it comes to how much of the funds they want to initially invest in trading. There are quite a few Forex brokers with a low minimum deposit that could start from 1 USD even.
Finding a low-cost broker is not a burden if you know where to look for them. Usually, the advertisement that will pop up when you enter a random website claiming that you can start trading Forex with 1 USD will be somewhat misleading. The best place to look for cheap trading opportunities is actually the review pages that do an extensive overview of each individual Forex broker. Furthermore, if you still decide to trust the budget-friendly brokerage ads, you might compromise the quality of the brokerage services. Additionally, you could visit each and every recommended broker page and check their terms and conditions, minimum starting capital, and the benefits provided to the clients.
Apart from the low commission fees, tight spreads, and the minor deposit requirement, some of the best brokers will provide cheap Forex courses or even free educational material. This is your go-to goal. The ideal scenario would be to find a decent, regulated, and experienced Forex broker that has multiple live trading account types, affordable conditions, flexible leverages, and extensive educational resources along with the promotions. Furthermore, such brokers will often offer trading contests, no deposit bonuses, or other types of rewards to their loyal or new registering customers.
We would recommend starting looking for the list of the brokers that offer the cheapest start in trading Forex. When you find the list or the listing provider that you like, you should pick up few options and check for individual reviews on the Forex brokers with low commissions. You could also check which Forex broker has the lowest minimum deposit or offers commission-free trading with tighter spreads. Then you register with the broker and start trading with as little funds as you can until you become confident in your trading skills.
Some people think it is a joke when they hear about the cost-free entrance in the Forex market. However, it is indeed very much possible. There are few ways you could actually try out depending on the region where you live and get started with Forex trading for 0 USD. The most popular and proven methods on how to start trading Forex without money include:
A demo account is a simulation of the real trading account for Forex traders. However, in contrast to the live trading accounts, on the demo account traders are not required to deposit any funds. Instead, the broker will credit the virtual money on the trading account balance of the demo account trader which could be used to place and close the trades mimicking a real trading environment. There are a number of brokers that provide trading contests for demo account holders, including cheap Forex brokers with low trading costs in South Africa. These contests are based on the performance of the traders and allow them to win actual money if their trades on Demo Account prove to be exceptionally successful.
No deposit bonuses are probably the most popular option among Forex beginners, which is not surprising. In contrast to the deposit bonuses, for no deposit bonus, there is no deposit required from the client’s side. On the contrary, clients receive trading funds directly from the broker without paying a single cent. In this way, brokers encourage traders to get started in Forex risk and cost-free. However, these no deposit bonuses are for trading purposes only and cannot be immediately withdrawn. Only in case, a trader generates money the profit becomes withdrawable.
Welcome accounts are similar to no deposit bonuses. They are real trading accounts, however, without an option to make a deposit. Furthermore, the broker credits a certain amount to the traders’ welcome account, which can later be used as a trading balance. However, in order to withdraw the credited money, the trading volume requirements set by the broker should be met. After the client makes a sufficient amount of trades using the money credited on his or her account, the profit generated can be transferred to any of his or her real trading accounts.
There are quite a few low-cost Forex brokers online with a $1 minimum deposit and favorable trading conditions with either 0 commission fees or tight spreads as low as 0 pips. However, many traders question the legitimacy of such brokers when the prices of trading go down too low. That is a smart call to doubt the Forex brokerage companies, however, one should know how to check the trustworthiness of the brokers in general. The reliability of any firm lies in the legal framework within which the company operates. The same logic applies to brokers and financial institutions within the Forex market. The most reliable Forex brokers would have to be registered and be authorized by one or more regulatory bodies.
Depending on the region where you live or where the broker operates, the firm should hold a license from the respective authoritative organ. For instance, in the European region, there are multiple regulatory bodies with the most notable ones being Cyprus Securities and Exchange Commission (CySEC) and Financial Conduct Authority in the United Kingdom (FCA). If the broker operates in Europe and holds neither of these regulations then it is probably better to avoid trading with this broker at all.
It is also recommended to go through the broker reviews before you start trading with them or open a real trading account. The reviews usually will discuss in greater detail what are the benefits of trading with some of the best low-cost online brokerages and what should traders be aware of. For instance, if you are looking for a review on XM Forex broker, make sure that you approach a reliable website or source that provides multiple reviews on different brokers and is objective. The reviews should contain details on the broker such as XM minimum deposit requirement, spreads and leverages, regulations of XM broker, account types and etc.
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