Best Australia Forex Brokers for 2024

Forex offers an exciting opportunity for many traders. There are dozens of different currency pairs to trade, the market is highly liquid, and prices can change rapidly. But do you know which Australia forex brokers are best for you?

In this guide, we’ll highlight the best Australian forex brokers that you can get started with today. We’ll also explain what you need to look for when choosing a forex broker so you can decide which platform is right for you.

What is a Forex Broker?

Forex brokers are firms or companies that provide a platform through which currency traders can access the international forex exchange markets. They may be independent retail forex brokers advancing their services to smallholder currency traders or large investment banks that offer the service to institutional investors like hedge funds or smaller commercial banks.

By providing the trading platform, a forex broker makes it possible for the currency trader to open and close currency trades. Most are online-based and integrate all the important resources needed to help the trader make informed trade decisions within this trading platform. These include trade/market analysis, technical indicators, real updates on market data, financial news (Economic calendar), leverage, and adequate risk management tools.

A forex broker earns in either of these two ways – or both. First is the bid-ask spread of every currency pair traded on their platform. There is no standard spread for Australia forex brokers, and it varies from one platform to another. Secondly, forex brokers may impose a fixed or variable commission (fee) for every trade executed on their platform.

What Makes a Good Forex Broker?

When vetting different forex brokers, you have to take into account a host of security, operational, and regulatory measures. The bare minimum qualifications for a good forex broker include:

Regulation: A good broker is adequately licensed by different regulatory authorities and adheres to all the security measures stipulated by the operating license. These include encrypting user data and maintaining segregated bank accounts for client funds.

Advanced trading platform: A good forex broker should also work consistently towards improving their trading platform. They should include updated trading, market analysis, and risk management tools while maintaining the fastest order execution speeds and supporting a reasonable number of currency pairs.

Considerate pricing model: The good forex broker must also be considerate with their fees. In the recent past, most brokers have abolished trade commissions and lowered their bid-ask spreads.

Readily accessible: Registering a trading account with a good forex broker should also be easy and straightforward. They should also make it possible to access the account on multiple devices like web trader, desktop and mobile apps on both proprietary and conventional trading platforms like MT4/5.

What are the Pros and Cons of Australia Forex Brokers?

Best Australian Forex Brokers

Trading forex successfully requires that you have the right broker. Trading is about more than just trade execution, after all. You need research and analysis tools to help you find profitable opportunities and the widest possible selection of currencies to trade, and you’ll also want low fees.

With that in mind, here are the three best Australia forex brokers for 2024

How to Choose the Best Australia Forex Broker

Choosing the right broker is one of the biggest decisions that every new Australian forex trader faces, as it impacts everything from what currencies you’ll be able to trade to the research tools at your disposal to how much you’ll pay in fees on every trade. So, let’s take a closer look at some of the factors you need to consider when deciding which the Australia forex broker is right for you.

Currency Pairs

The best place to start when choosing a forex broker is to look at the currency pairs any brokerage offers. Forex trading is usually categorized into three types of currency pairs:

• Major pairs are the seven most highly traded currencies around the globe. These include the US Dollar-Euro, US Dollar-Pound, US Dollar-Yen, and US Dollar-Australian Dollar. Major currency pairs make up the majority of forex trades placed each day and are offered by almost every forex brokerage.
  
• Minor pairs are currency crosses that pair the US Dollar with lesser traded currencies or that pair the world’s major currencies without the US Dollar. For example, the Australian Dollar-Euro and Australian Dollar-Pound are minor currency pairs. There are between 20 and 50 of these, depending on what trader you ask, and most minor pairs are offered by forex brokers in Australia.
• Exotic pairs are crosses between infrequently traded currencies. These may be significantly less liquid than major and minor currency pairs, and not all exotic forex pairs are offered by every brokerage.

When considering which brokerage is right for you, think about whether you’ll primarily be trading major and minor forex pairs or whether you want to specialize in trading exotics. In addition, note that leverage margins and spreads may vary quite a bit between major and minor pairs at the same brokerage. It’s important to make sure you can get the leverage you need for the currency pair you want to trade.

Asset Type

In contrast to stock and bond trading, forex trading rarely involves buying and selling currency directly. That’s because taking ownership of foreign currency often comes with some banking and regulatory headaches that most traders would rather avoid.

Forex brokerages help you get around this by letting you trade contracts for difference (CFDs). CFDs allow you to speculate on the price of one currency relative to another without ever directly owning either currency. When trading without leverage, your return from trading CFDs is the same as it would be if you owned the currencies themselves.

Some brokerages, like AvaTrade, also offer forex options. Options are different from CFDs in that they have expiration dates associated with them. As a result, when trading options, you need to be right about the timing of a price change as well as the price change itself. Options trading opens up much more strategic flexibility compared to CFD trading, since you can buy competing put and call options that cover multiple different timeframes.

Leverage

Different brokers offer different ranges of leverage. This is often due to licensing restrictions and the country from which you’re trading. For example, while UK-based Plus500 offers leverage of up to 300:1, AvaTrader users situated outside the European Union can trade forex with leverage of up to 400:1.

While leverage can be a useful tool, you should always make sure you’re aware of the risks and use it with caution – don’t trade more than you can afford to lose.

Research Tools

For many traders, your broker is also your go-to platform for forex research. So, it’s essential that you make sure that the brokerage you choose has the tools you need to find opportunities and to trade them profitably.

The most important tool that most Australia forex brokers offer is technical charting. Some brokerages, like Plus500, have built-in charting software that caters more to entry-level traders. These charts may be user-friendly and easy to read, but they lack the depth of technical studies and customization that many advanced traders demand. On the other hand, AvaTrade and some other brokers offer access to MetaTrader 4, an extremely comprehensive charting software that’s built for experienced traders.

Another research tool to consider is social trading. While this isn’t traditional research, discussion boards and access to view other traders’ portfolios can give you a glimpse into market sentiment.

Some Australian forex brokers offer additional research tools, such as news feeds and analyst reports. It’s up to you to decide what research tools are most important to you so that you can get the most out of your forex trading.

Commissions and Fees

Finally, before you commit to a forex broker, it’s important to take a look at their fees. The three brokerages that we recommended do not charge trade commissions, although many traditional and online brokers do. It’s a good idea to avoid trade commissions whenever possible, as they can quickly add up.

That doesn’t mean that trading is free, though. All brokers, including the ones that charge trade commissions, make money on the spread, which is the price difference between the buy and sell price of an asset. This may be as low as 0.1% per trade as for Plus500 or as high as 0.5% per trade. It also likely varies between currency pairs at the same brokerage, so make sure to compare spreads for the forex pairs you’re most likely to trade.

It’s also important to check for any other fees your brokerage may charge. Some Australian forex brokers charge for withdrawals from your account, while others charge a fee if you do not place at least one trade every three months. These fees can quickly add up depending on how you use your brokerage account.

Conclusion

Forex trading offers plenty of opportunities for profit, but taking advantage of those opportunities requires having the right broker for the job. Forex brokers can differ widely in what currency pairs they offer for trading, how they let you trade those currency pairs, and how much they charge for every trade. Thanks to our review of the top forex brokers reviews, you can better decide which brokerage is right for your trading needs and get started trading currencies today.

References

To ensure we bring you the most reliable and accurate information possible, our writers use primary sources to support their content. These include studies, government resources and commentary from industry experts.

• Moneysmart.gov.au. “Forex Trading, https://moneysmart.gov.au/investment-warnings/forex-trading“, Accessed March 3, 2021.
• Reserve Bank of Australia. “Electronic Trading and the Australian Foreign Exchange Market, https://www.rba.gov.au/publications/bulletin/2011/jun/6.html“, Accessed March 3, 2021.

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