The best Forex liquidity providers, according to our research, are:

  1. FXCM PRO
  2. B2Broker
  3. Swissquote
  4. Global Prime
  5. X Open Hub
  6. Finalto

In order to make this list of the best liquidity providers we have taken into consideration the following information:

  • The spreads charged by the liquidity provider
  • The overall quality of the service offered
  • The integrations offered
  • The trading platforms offered
  • The amount of leverage allowed
Table of Content

Round-up

Warning

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 can afford to take the high risk of losing your money.

Forex Liquidity Provider Forex Spreads Charged Platforms
FXCM PRO 0.1 pips MT4, Trading Station, Trading View
B2Broker 0.1 pips MT4, MT5
Swissquote 1.2 pips Advanced Trader
Global Prime 0.4 pips MT4
X Open Hub 0.14 pips MT4
Finalto 0.1 pips MT4, MT5

Review

1. FXCM PRO

  • FXCM PRO requires a balance of at least $250,000.
  • Their service is aimed to small-medium sized businesses, or High-Frequency Trading Firms (HFTs).
  • Spreads with FXCM PRO start at 0.1 pips when trading the forex market.
  • FXCM PRO is a tier 2 liquidity provider.

Visit FXCM PRO
(your money is at risk)

2. B2Broker

  • B2Broker offers a wide range of services, including being a Liquidity Provider for forex brokers.
  • B2Broker’s Liquidity Provider service is based on the MT4 and MT5 platforms.
  • Forex commissions starting at 0.1 pips with B2Broker in the forex market.
  • B2Broker’s order execution speed is less than 20ms.
  • The max leverage offered by B2Broker is 1:100.

Visit B2Broker
(your money is at risk)

3. Swissquote

  • Swissquote is a tier 2 liquidity provider.
  • Among the services offered by Swissquote is the FIX API.
  • Swissquote allows for multi-currency account as liquidity provider.
  • Spreads for Swissquote Clients start from 1.2 pips on the forex market, and the leverage goes up to 1:100.

Visit Swissquote
(your money is at risk)

4. Global Prime

  • Global Prime is a tier 2 liquidity provider that is connected with more than 25 first-tier banks, non-banks, and other ECN liquidity providers.
  • MT4 is the platform of choice if you wish to use Global Prime as liquidity provider.
  • FIX API solutions are available with Global Prime.
  • Spreads at Global Prime start from 0.4 pips in forex trading.

Visit Global Prime
(your money is at risk)

5. X Open Hub

  • X Open Hub is the Liquidity Providing service that owns the Polish broker XTB.
  • The platform used by X Open Hub is MT4.
  • X Open Hub can be integrated with FIX API, PrimeXM, oneZero and many other services.
  • Spreads start as low as 0.14 pips on forex with X Open Hub.
  • X Open Hub offers liquidity on over 3000 financial instruments, including forex.

Visit X Open Hub
(your money is at risk)

6. Finalto

  • Finalto has won numerous awards as the best liquidity provider, most recently awarded at FMLS in 2022.
  • Finalto owns the forex broker Markets.com.
  • With Finalto you can have an integrated margin account with API.
  • Finalto offers access to liquidity on more than 800 financial instruments.
  • The company’s liquidity pool comprises tier-1 banks including JP Morgan, non-bank venues including XTX and ECNs including Currenex.

Visit Finalto
(your money is at risk)

What is a forex liquidity provider?

Forex Liquidity providers are financial institutions that own or have access to a large pool of currencies, and lend them to smaller firms (with fees and/or interests) in order to help them to execute trades and orders in the forex market.

These financial firms, depending on the amount of currency at their disposal, can be divided into Tier-1 liquidity providers and Tier-2 liquidity providers.

Both types of liquidity providers act as a Market Maker as they offer liquidity to their clients, set their own prices and commission, as well as being the counterparty of the trade, so essentially not providing direct market access to traders.

What are Tier 1 and Tier 2 liquidity providers?

Among the major Tier 1 liquidity providers we can find large banks and financial institutions, while Tier 2 liquidity providers include liquidity aggregators (e.g. middle-sized forex brokers and other financial firms).

Tier 1 liquidity providers accept only large volume orders, which smaller brokers cannot get. There are different types of liquidity providers in the world, but in the forex world, the main ones are Deutsche Bank, UBS, and Barclays Capital.

If a forex broker does not generate enough volumes to ask for liquidity from a Tier-1 firm, they use Tier-2 liquidity providers. Tier-2 Liquidity providers, also known as Prime of Prime (PoP) or liquidity aggregators, act as a bridge between smaller market participants and Tier-1 liquidity providers.

PoP firms are mostly non bank liquidity providers. They are prime brokers that have an account with a tier 1 bank and their main task is to aggregate numerous small volume orders (from small forex brokers) in order to send big volumes orders to tier 1 providers. This is why tier 2 are also known as “liquidity aggregators.”

Tier 2 liquidity providers are sometimes forex brokers who are large, well-known, and reliable enough to aggregate orders from smaller brokers. In fact, these include FXCM and Swissquote.

How does a liquidity provider work in forex

A liquidity provider works in the following way:

The client sends an order to a broker. This broker receives the order and lets market know that there is an order to fulfill. Liquidity providers then make an offer to the broker who processed the order from which, the broker chooses the best offer. The broker finalizes the client’s order using liquidity from the liquidity provider that provided the best offer.

What are the advantages of using a liquidity provider?

Liquidity providers help forex brokers to offer lower spreads to their clients, they make spreads more stable when the market is volatile, and help improve the trade execution speed.

Better Stability: when the market is volatile, traders are more active than usual. In this case, the broker may not have enough liquidity to execute the orders set by forex traders on their platform. This lack of liquidity can lead to higher spreads, large requotes and failing SL/TP orders.

Better trading conditions: more liquidity means that the broker can offer lower spreads to their clients, a smaller delay in the execution thanks to the deep liquidity, and a better accuracy in orders such as stop loss/take profit. This is especially true for smaller forex brokers, as they cannot supply their clients with enough liquidity, so they have to rely on liquidity providers.

Help to reduce requotes: When there is financial news, or when the London and New York markets overlap, forex markets become extremely volatile. In the absence of adequate liquidity pools to access, clients may experience large requotes on their orders.

How do liquidity providers earn money?

Liquidity providers earn primarily from the commissions generated by buying and selling currencies with their partners, though this is not the only way.

If broker finalizes the order using a liquidity provider, the liquidity provider will charge a small markup on the spread. A Liquidity provider’s spreads are usually around 0.1 pip per trade. The value of 1 pip, on the USD/EUR forex pair, is around 10 USD per 100,000 USD traded.

However, the value of 1 pip can change depending on the forex pair. For more information, you can take a look at this pip value calculator from Babypips.

Can a forex liquidity broker lose money?

Liquidity providers are market makers, consequently, they lose money if the counterparty takes a positive trade. However, market makers can choose to delegate the risk to other liquidity providers.

For instance, if a forex trader sets a “buy” order on EUR/USD, the forex broker he’s using will look for the best liquidity provider to satisfy that order. Once the forex broker chooses the right liquidity provider, the liquidity provider himself will run a risk analysis on that specific EUR/USD order. If the risk to take that order is too high, they might decide to refuse it. So the forex broker will have to look for liquidity providers that are willing to take that risk.

How many fees do liquidity providers charge?

Liquidity providers typically charge a markup on the spread. A markup is an additional fee on the bid-ask of the forex pair. If EUR/USD trades at 0.95230, and there is a markup of 0,1 pip, the markup will cause the liquidity provider to supply the EUR/USD pair at 0.95231.

If the liquidity provider also acts as a white label, or offers additional services, they will charge fees. hedge funds  large brokers direct market access to professional traders financial institutions.


filippo ucchino

About The Author

Filippo Ucchino
Co-Founder - CEO - Broker Expert
Filippo is the co-founder and CEO of InvestinGoal.com. He has 15 years of experience in the financial sector and forex in particular. He started his career as a forex trader in 2005 and then became interested in the whole fintech and crypto sector.
Over this time, he has developed an almost scientific approach to the analysis of brokers, their services, and offerings. In addition, he is an expert in Compliance and Security Policies for consumers protection in this sector.
With InvestinGoal, Filippo’s goal is to bring as much clarity as possible to help users navigate the world of online trading, forex, and cryptocurrencies.

Trading CFDs, FX, and cryptocurrencies involves a high degree of risk. All providers have a percentage of retail investor accounts that lose money when trading CFDs with their company. You should consider whether you can afford to take the high risk of losing your money and whether you understand how CFDs, FX, and cryptocurrencies work. Cryptocurrencies can widely fluctuate in prices and are not appropriate for all investors. Trading cryptocurrencies is not supervised by any EU regulatory framework. Your capital is at risk. The present page is intended for teaching purposes only. It shall not be intended as operational advice for investments, nor as an invitation to public savings raising. Any real or simulated result shall represent no warranty as to possible future performances. The speculative activity in forex market, as well as in other markets, implies considerable economic risks; anyone who carries out speculative activity does it on its own responsibility.
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