Visit Interactive Brokers74-89% of retail CFD accounts lose money
Visit XTB79% of retail investor accounts lose money
Visit eToro76% of retail CFD accounts lose money
Visit AvaTrade76% of retail investor accounts lose money
Visit Plus50077% of retail investor accounts lose money
Visit Capital.com84% of retail CFD accounts lose money
The best day trading brokers, according to our research, are:
- Interactive Brokers
To provide you with our list, we’ve considered multiple factors, such as:
- Each broker’s trading features
- Execution times
- Available markets
- Charged commissions on trades
What are the best day trading platforms and brokers?
Below our curated list of the best brokers offering day trading platforms, with details of features and characteristics.
Comparison of the best brokers for day trading
|Forex spread from
|Stocks fees from*
*when buying the underlying asset.
What is the best day trading broker for Forex?
The best day trading broker for forex is IC Markets.
At IC Markets you can find spreads from 0 pips and a competitive commission per lot from $6 round-turn. Additionally, it offers fast order execution, and allows trading on MT4, MT5 and cTrader. For more options, see best forex brokers.
What is the best day trading broker for stocks?
The best day trading broker for stocks is IG Markets.
IG Markets is a CFD broker and offers over 10000 tradable stocks on its trading platform. For more options, see best stock brokers.
What is the best day trading broker for crypto?
The best day trading broker for crypto is eToro.
At eToro you can trade CFDs as well as real cryptocurrencies. In total, you can buy and sell over 80 cryptos in total, with a 1% commission per trade. For more options, see best forex brokers for cryptocurrency trading.
What is the best day trading broker for futures?
The best day trading broker for futures is DEGIRO.
DEGIRO allows futures trading on indices, stocks, commodities and fixed income. Future contracts on DEGIRO charge a commission of 0.75€ per contract. For more options, see best futures trading brokers.
What is the best day trading broker for options?
The best day trading broker for options is IG Markets.
At IG Markets you can trade three different types of options with low fees: Vanilla options, Knock-out options and, if you are a professional trader, Digital 100 options. For more options, see best options trading brokers.
What is the best day trading broker for beginners?
The best day trading broker for beginners is eToro.
eToro offers an unlimited demo account, and allows you to open a real trading account with a minimum deposit of $50 (depending on the country). Additionally, they offer a trading platform with an user friendly interface. For more options, see best forex brokers for beginners.
What is the best day trading broker offshore?
The best day trading offshore broker is FBS.
FBS allows traders to trade with very high leverage up to 1:3000, but only under their offshore entity regulated by IFSC.
What is the best day trading broker for small accounts?
The best day trading broker for small accounts is HFM.
HFM requires no minimum deposit to open a trading account, and under their global entity regulated by the Financial Services Authority (FSA), they also offer a cent account that allows trader to get the best out of their small accounts. For more options, see best cent accounts.
What is the best day trading broker with low fees?
The best day trading broker with low fees is Pepperstone.
Pepperstone offers traders a low-spread standard account where no fees are charged other than spreads, and a razor account with raw spreads which charge cheap commissions of $7 round turn per each lot traded. For more options, see best low spread brokers.
What Is Day Trading?
Day trading is a popular trading strategy that involves buying and selling several assets throughout the day (usually no more than three). The goal here is to profit from short-time price movements in various assets by opening and closing positions by the end of the trading day. Day traders take advantage of the market’s volatility and liquidity.
Considering how often and fast prices fluctuate throughout the day, day trading requires intense market monitoring and rapid trading decisions. That is why it’s so vital to choose brokers with advanced research tools and fast execution speeds. Furthermore, since day trading requires performing multiple trades throughout the day, only brokers with low to no commissions can be treated as profitable options for any day trader.
What are the differences between Day Trading and Scalping?
Although they share several similarities, day trading and scalping are entirely different trading strategies. In fact, there are scalping brokers with special features for this strategy.
The first difference is the timeframe. Scalping involves opening and closing positions even within 1-2 minute periods, with traders taking advantage of even the tiniest movements in market prices. Day traders, on the other hand, open and close positions within a 1-2 hour period, often exceeding it to several hours.
Therefore, due to the nature of scalping, traders can expect to see profits (or losses) almost immediately. Day traders can wait as long until the end of the day to see any profits from their transactions.
Another difference is the risk. While both these strategies involve some level of risk, scalping is much riskier than day trading. That’s because active traders who take advantage of this strategy need to implement much higher leverage to make these extremely small price movements profitable.
The final difference between the two is the number of positions opened throughout the trading session. Scalping requires traders to perform dozens of large trades, whereas day trading usually involves no more than 3 or 4 trades.
What are the Pros and Cons of Day Trading?
Although day trading offers traders several significant advantages, it’s also essential to think about the potential risks it poses when considering it as a trading strategy. Let’s go through the most important benefits and disadvantages of day trading.
Potential Day Trading Benefits
- High and fast potential investment returns. By scoring several profitable, often leveraged, trades throughout the day, day trading can offer an incredible return on investment.
- No overnight risks and fees. Since day trading involves opening and closing trades before the trading day ends, it doesn’t involve any potential overnight risks, such as after-hour news that may negatively impact price movements. Furthermore, it allows active traders to avoid any overnight fees charged by brokers for day trading.
- Chance to benefit from compounding profits. Compounding profits refer to the growing buying power, which increases with every profitable trade a day trader performs.
Day Trading Risks and Disadvantages
- High risk. Every trading strategy comes with some level of risk. However, day trading is one of the riskier ways to trade forex due to potentially high losses due to high market volatility and price fluctuations, especially when a day trader uses leverage. While it can provide large profits, it can also lose you more money than you invested.
- High balance requirements. Day trading can quickly get very expensive, in particular if you are in the USA. That’s because once you start performing four or more day trades for five days a week, the broker will deem you a “pattern trader” or “pattern day trader”. In such a case, you will need to obey the rules set by the Financial Industry Regulatory Authority (FINRA), which require pattern traders to maintain at least $25,000 on margin accounts. If your balance falls below that, you will need to deposit more funds to continue trading.
- It’s time-consuming. Day trading requires traders to constantly monitor the market and news for potential price movements and trading opportunities. Day traders also need to spend time researching strategies and learning how to use various tools.
- Day trading can be stressful. Many traders describe day trading as an extreme rollercoaster ride. According to one study, approximately 75% of day traders quit within the first two years of day trading. Why? Because of the high level of stress pressure. As covered, day traders must constantly be alert, researching opportunities and making snap decisions. These can take a toll, especially when not all of them are correct.
How to Choose the Best for Day Trading Broker?
To get started with day trading, you will need to understand the risks and rewards, ensure you have enough funds to invest, and learn more about market volatility. Finally, you will also need to find the appropriate broker.
That final step is actually more critical than many aspiring day traders think. That’s because day trading characteristics don’t make it suitable for every brokerage platform. So, what should you look for when choosing the best day trading broker? Here are some of the key factors to consider:
- Low commission trading fees. Day trading requires performing multiple trades a day. If a broker charges high commission fees per trade, it can significantly affect your earnings and lose you more money than you can afford. Luckily, many brokers charge no or very low commissions, and these are the ones that are the most suitable for day trading.
- Fast execution speeds. Day traders need to make instant decisions once they see the opportunity. In such instances, even the tiniest delay can have severe consequences, which is why it’s vital to ensure the broker you choose offers rapidly fast trade execution speeds.
- Advanced research and trading tools. Day traders rely heavily on research and trading tools that allow them to find trading chances and perform trades quickly. As a rule of thumb, it’s best to find a broker that offers more advanced tools to make your day trading a bit easier regarding research. Unless, of course, you have your own tools you use.
- Security and licensing. Ensuring the broker is secure and regulated should be one of your top priorities. Search for brokers regulated by international financial institutions, such as the FCA (Financial Conduct Authority) in the UK, ASIC (Australian Securities and Investment Commission) in Australia, ESMA (European Securities Markets Authority) in Europe, or the CIRO (former IIROC) in Canada. All the best forex brokers in the world are transparent about their security measures and licenses, and that includes the ones on the list above.
- Customer service. In case of technical problems, network outages, or other broker-related issues, you should not encounter any problem when reaching out to the broker’s customer service. It may not look that important initially, but reliable customer support is one of the crucial things we expect a reputable broker to have.
How Does Day Trading Work?
Day trading is all about taking advantage of the market’s volatility. This requires a solid understanding of how trading markets work. We won’t beat about the bush, day trading is a strategy reserved for experienced traders who have the time and analytical skills to monitor price fluctuations and make snap trading decisions.
If you believe day trading is something you’d like to try, here’s an example of what an average day trader’s trading session looks like:
- Picking the correct trading strategy. Day traders use various strategies for entering and exiting trades. Picking one or two strategies and sticking to them is the key to maintaining discipline and consistency, which are the two crucial factors in day trading. We’ll talk a bit more about popular day trading strategies in a moment.
- Monitoring the market. Day traders actively monitor the market, keeping an eye on any price movements, trading volumes, market news, and other market factors that might trigger a decision to open a position. Learning how to use various real-time research tools is crucial, and the more of them a broker and the more advanced they are, the better.
- Evaluating trading opportunities. By monitoring the market and having the correct trading strategy in place, a day trader can quickly evaluate opportunities aligning with their criteria and make an instant trading decision. Day traders usually rely on patterns and trend reversals to evaluate how the price will behave.
- Executing the trade. Once a day trader sees the opportunity, they make an immediate decision to execute the trade. Day traders usually take advantage of various order types to get the right prices, for instance, market orders and limit orders.
- Managing the risk. Learning how to manage your trading is an essential skill any aspiring day trader must learn. Most day traders, for instance, use automated trading tools, such as stop-loss orders, which automatically exit trades if the price movement reaches the set maximum loss.
- Closing positions. Day traders always want to close all their open positions before the trading day ends to avoid any overnight risks and fees. That way, they ensure their positions aren’t exposed to market movements while they aren’t actively watching the market.
Day Trading Strategies
There are several trading strategies an aspiring day trader can use. The most popular include the following:
- Momentum trading. A momentum strategy refers to a situation where a trader enters the trade of an asset whose price is moving up (using the underlying asset’s “positive momentum”). Momentum assets can either include major positive price movements triggered by a catalyst or price movements of 30% or more.
- Pullback trading strategy. This strategy involves looking for an asset with an established trend and waiting for a decline in price. That price decline – the pullback – is the entry point for the day.
- News trading. This strategy requires a trader to constantly monitor the news that may affect price movements. Based on how they impact assets’ prices, traders can either go long or short on new positions.
Besides learning basic day trading strategies, aspiring day traders also need to learn how to manage their funds and risks. Also, with day trading relying on volatility and price fluctuations, learning how to use various research and market monitoring tools to your advantage is an absolute must.
Use Demo Accounts to Find Your Day Trading Strategy
Entering the day trading game is incredibly risky. It takes a lot of dedication to learn how to use day trading to your advantage. Fortunately, there’s a chance to learn the ropes of day trading 100% risk-free. All it takes is to take advantage of a demo account available through all renowned online brokers.
These accounts don’t require traders to deposit any funds. Instead, demo accounts offer traders a virtual currency they can use to learn how the platform works or test various strategies without putting real money on the line.
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