Looking for Best Forex broker reviews? What is the best Forex broker for beginners?.
We have compared the top 7 Forex trading brokers and presented our top online forex brokers for you.
Table of Contents
What are Forex Brokers?
Online Forex brokers are financial firms that provide Forex traders access to buy or sell currency pairs online.
This is made possible by providing traders access to trading platforms that create an interface between the trader and broker (market makers) or between the trader, broker and the Forex interbank market (ECN/STP brokers).
In the mid-90s, there were no individual or retail Forex traders.
The Forex market was exclusively for big banks, hedge funds or high net-worth firms. This is because it was capital intensive with a minimum trading size was $1 million.
With time, the market was decentralized and access was granted to investors with smaller capital. The liquidity gap created by the smaller capital from retail traders and the large trading requirements of the interbank market was filled by market makers.
Today, we have numerous online Forex brokers operating from different parts of the world. With as little as $1, individual traders can access the Forex market from the comfort of their homes.
The Best Forex Brokers 2020 – Forex Brokers Compared
Who are the best Forex brokers in 2020 and who wins the best Forex exchange comparison? This table shows the best Forex brokers and the pros and cons of each one.
What we like
- Supports PayPal deposits
- Many assets to trade
- User-friendly app
- European License
- Credit cards
- Bank transfer
Trading CFDs carries considerable risk of capital loss. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.4% of retail investor accounts lose money when trading CFDs. You should consider whether you can afford to take the high risk of losing your money.
What we like
- Paypal available
- Licensed broker
- Real crypto tokens
- User-friendly mobile app
- Has own wallet
- Wire transfer
- Credit cards
- Bank transfer
eToro is a multi-asset platform offering equity and cryptocurrency investments and CFD trading. CFDs are complex financial instruments. Because of the leverage they carry a high risk of losing money quickly. 75% of private investor accounts lose money when trading CFDs with this provider. Please note that you should be informed in advance about the risks of CFD trading as high losses can not be ruled out. Cryptocurrencies are unregulated and their prices can vary widely. Therefore, cryptocurrencies are not suitable for all investors. The trading of cryptocurrencies is not subject to any supervision by the EU regulatory authorities. Your capital is exposed to risks. Past performance is not indicative of future results.
3 TDS Capital Group
What we like
- Many deposit methods available
- Mobile TDS Capital Group App available
- Low minimum deposit
- Large selection of crypto-CFDs
- Wire transfer
- Credit cards
- Bank transfer
Our services are exclusively for the trade of crypto products. The website does not allow the purchase or sale of cryptocurrencies. Risk Information: All information on tdscapitalgroup.com is for informational purposes only, and does not constitute financial advice related to any topic. No user, trader or site visitor should take or not take any action based on the content of TDS Capital Group without prior use of appropriate Advice from a financial expert. The TDS Capital Group and all its affiliates hereby publicly and expressly disclaim all liability in connection with or as a result of any act or omission based on any content on this site. Traders should be aware that crypto-trading is known as a high-risk financial activity and that it has the potential to lose some or all of the money invested within a relatively short period of time. All traders are strongly advised to consider carefully whether this activity meets their needs, whether they have the financial resources to do so, and whether this is a personally worthwhile endeavor. Support Phone: +1 849-941-2231 whether they have the financial resources and if this is a personally worthwhile endeavor for them. Support Phone: +1 849-941-2231 whether they have the financial resources and if this is a personally worthwhile endeavor for them. Support Phone: +1 849-941-2231
Factors to Consider in Choosing a Forex Broker
- Minimum Deposit Requirement
How much is required as a basic minimum to open an account?
You need to consider how much money you can spare to start off a Forex brokerage.
Usually, traders are advised to make a transition from a demo account to a small live account and ultimately a larger Forex account.
Many Forex brokers now have very low minimum deposit requirements; some as low as $10. This is great for the transitional live account which new traders with budgetary constraints will find useful. Some accounts (such as STP accounts) may require as much as $50,000 as the minimum deposit.
If you are a trader who has such money and wants to trade with an ECN account, then this is the direction to go. So knowing your minimum deposit requirement will help narrow your search.
- What are the spreads and commission structure like?
How low are the spreads and commissions on one FX broker’s platform when compared to another?
Spreads and commissions are a trader’s business costs.
Obviously, the lower the costs, the more profit can be retained. Spreads need to be kept low and competitive.
Imagine trading with a broker that offers a spread of 1.4 pips for EUR/USD and another which offers 0.8 pips on the same asset.
The difference of 0.6 pips, on 50 Standard Lot trades in a month ($10 per pip), equates to a savings of $300. Trade this in a year, and this goes up to $3,600.
Can you see the impact that a decision as simple as broker choice based on the competitiveness of spreads can make?
- Does the Forex brokers offer swap-free accounts?
If you are a Muslim trader (and there is a large population of traders of the Islamic faith in the MENA region) and you want a swap-free account that complies with the tenets of the faith, then you would want a broker that offers this option.
So this is a key point of consideration in broker selection.
- Is the Forex broker regulated?
Regulation in the forex market is all about trader protection.
You need to have an independent body you can go to if you are not satisfied with your broker’s services.
This underscores the importance of making sure the Forex broker you use is a regulated broker.
- What has been the experience of other traders?
A very good way of knowing what your own experience on a brokerage platform will be like is to get first-hand information about the experience of other traders on the same platforms you desire to use. Such information can be obtained from online forums.
- Quality of customer support among Forex Trading Brokers
In order to avoid frustrating experiences, it’s good to know if your preferred broker has good customer support.
A quick search can show you whether their customer support staff treat their clients well, or just as if they are doing them a favor.
How Forex Brokers Are Rated?
This article will present a list of the Best Forex brokers for 2020 that you can use now.
How were these brokers selected and rated? The following points present the basis for our broker selection:
a) Regulatory Forex Broker Status
All the brokers in our list are regulated and in good standing with regulators.
They present their traders with trader insurance in the form of investment compensation fund registration with the respective regulators.
b) Ease of Software Use
The brokers in our list present their traders with trading software and applications that are easy to use and which do not present obstacles to the trader’s profit potential.
Trading software should be user-friendly.
They should not constitute an extra layer of work for the trader to unravel before engaging in core trading.
c) Presence of Mobile Trading Apps
Some trading opportunities come at the most inopportune of times.
It is only with mobile trading apps that these times can be converted to periods of opportunity.
All brokers in our list allow their traders to trade on the go with easy to use mobile applications and website interfaces optimized for mobile devices.
d) Trader Education
Traders come to the market with little education about trading.
Providing their clients with proper market-based education boosts the trader’s knowledge of the trading platforms, the forex market itself and also simple processes involved in the trading process.
e) Market Research
Market research is a critical tool for profiting from Forex.
The brokers in our list provide outstanding market research using in-house experts and also in partnership with Trading Central.
f) Ease and Affordability of Account Opening
Account opening is a breeze with the brokers in our list.
Some of them allow you to open accounts using your existing email or social media profiles.
Top 7 Forex Brokers for 2020 – Best Forex broker for beginners List!
The list below represents our top 7 forex brokers for 2020.
These brokers have stood the test of time and have provided extra features that benefit their clients.
How Forex Brokers Operate? Forex Brokers Working Model!
The modus operandi of forex brokers is related to how they execute customer transactions. Here are the popular forex broker models.
i) ECN Forex Brokerage model
Electronic Communications Networks (ECN) brokers give their clients direct market access (DMA). Traders access the interbank forex market directly through the brokers’ ECN network.
There is no dealing desk (NDD) and the broker only acts as an agent between the client and the interbank forex market.
ECN brokers transmit the actual currency quotes to their clients in real-time and the trades are executed at the market. This reduces or eliminates requotes.
The spreads are usually very low and in some cases, zero spreads are incurred. This is why most ECN brokers prefer to collect a commission on each side of a trade.
ii) STP Forex Broker Model
Straight Through Processing (STP) brokers are Non-Dealing Desk (NDD) brokers that operate an automated system where trades are routed to liquidity providers for execution at competitive prices.
The liquidity providers are interbank forex market participants. Most times, the liquidity providers are top tier brokers, investment companies, payment aggregators or major banks.
The advantage of the STP brokerage model is that there is more liquidity from different sources; hence, orders are promptly fulfilled. The whole process is automated without broker intervention eliminating human errors, costs or delays.
iii) Market Makers Forex Broker
These brokers operate a dealing desk (DD) brokerage model.
Most market makers quote the bid and ask price with fixed spreads and execute trades by taking the opposite side of a client’s trade.
Market makers can adjust the spread, delay trade executions and even manipulate traders’ positions to trigger a stop-loss.
The advantage of this brokerage model is that orders are executed instantly as it is not routed to another source but executed by the broker.
They also charge low trading fees and offer very high leverages. Because many beginner traders believe the illusion that forex trading can bring quick money, many scam brokers operate this brokerage model.
Most beginner traders lose money and these scam brokers easily make the money by trading against the newbie, manipulating trades and closing winning trades.
That is why it is always advisable to trade with a regulated broker.
iv) Hybrid Forex Broker Model
This involves the combination of two or more broker models in operation.
Most ECN brokers also add a dealing desk to their operations which caters to low volume traders with small capitals.
They usually specify different account types and tie the execution type to the account type. The Hybrid model is arguably the best brokerage model as it benefits both the new and professional traders.
Expert traders with huge capitals are given special accounts, favorable benefits and have their orders executed at the market. Tyros and low volume traders are offered a dealing desk with instant executions.
In this guide, we look at the best forex brokers with the most attractive leverages. We, however, start by looking at how it works and the criteria used to rank the best high leverage brokers.
High Leverage Forex Brokers:
Leverage is a form of investment loan given to an investor by the brokerage firm. It serves to inflate your trading account balances, making it possible to enter into larger trading positions with the hope of scoring higher returns. To access this loan, you will need first to open a margin account with your preferred broker. The leverage advanced is then expressed as 1:50, 1:100, 1:200, or 1:500.
But what does this mean? In the case of 1:200, it implies that for every one base currency you are willing to stake into a trade, the broker will loan you two hundred more. If you, therefore, wished to enter into a $200,000 trade, you would only need $1,000 in your trading account.
What are the pros and cons of using a Broker’s Leverage?
Their primary means of making money is from the bid-ask spread. But brokers have other means of making money such as charging commissions on trades, withdrawal fees, inactivity fees, etc. Consider the following factors: security, trading costs, trading platforms, customer service, deposit/withdrawal methods, and asset listing. Check the broker’s website for the above-listed services. Read broker reviews and try to avoid unregulated brokers. Brokers offer leverage so that traders can increase their capital, trade larger currency volumes, make more profits and of course, pay larger trading fees to the broker. Yes, especially the brokers that are regulated by reputable agencies like FCA, ASIC, etc. These brokers abide by strict rules in order to provide a safe trading environment for their clients. They segregate traders’ funds from their brokerage funds and use modern security software and firewalls to ensure a secure digital environment. An ECN broker uses Electronic Communications Network to give its clients direct access to other participants in the currency markets. They usually charge a commission for every trade executed. A market maker is a broker who acts as a liquidity provider. They have an electronic dealing desk where they execute clients’ orders. NDD stands for Non-Dealing Desk and it means that the broker does not execute trades in-house, rather it is executed at the interbank market or by a liquidity provider. In this case, the broker only acts as an agent to transmit prices and orders for execution at the interbank market. The forex interbank market is the forex electronic market where liquidity providers, top-tier brokerages and major financial banks converge to trade world currencies. Visit any of the broker websites listed above. Complete account opening forms and upload verification documents. The brokerage account will be opened.
Best High Leverage Broker For 2020:
How do Forex brokers make money?
How do I choose a Forex broker?
Why do Forex brokers offer leverage?
Are online Forex brokers safe?
What is an ECN Forex broker?
What is a Market maker Fx Broker ?
What is NDD?
What is the Forex interbank market?
How can I open a Forex broker account?
Their primary means of making money is from the bid-ask spread. But brokers have other means of making money such as charging commissions on trades, withdrawal fees, inactivity fees, etc.
Consider the following factors: security, trading costs, trading platforms, customer service, deposit/withdrawal methods, and asset listing. Check the broker’s website for the above-listed services. Read broker reviews and try to avoid unregulated brokers.
Brokers offer leverage so that traders can increase their capital, trade larger currency volumes, make more profits and of course, pay larger trading fees to the broker.
Yes, especially the brokers that are regulated by reputable agencies like FCA, ASIC, etc. These brokers abide by strict rules in order to provide a safe trading environment for their clients. They segregate traders’ funds from their brokerage funds and use modern security software and firewalls to ensure a secure digital environment.
An ECN broker uses Electronic Communications Network to give its clients direct access to other participants in the currency markets. They usually charge a commission for every trade executed.
A market maker is a broker who acts as a liquidity provider. They have an electronic dealing desk where they execute clients’ orders.
NDD stands for Non-Dealing Desk and it means that the broker does not execute trades in-house, rather it is executed at the interbank market or by a liquidity provider. In this case, the broker only acts as an agent to transmit prices and orders for execution at the interbank market.
The forex interbank market is the forex electronic market where liquidity providers, top-tier brokerages and major financial banks converge to trade world currencies.
Visit any of the broker websites listed above. Complete account opening forms and upload verification documents. The brokerage account will be opened.