Starting out as a US forex trader can be challenging in a number of ways. One of the biggest tasks you will face is finding a US forex broker that is well-regulated by one of the recognized regulatory bodies there.
One such body is the CFTC and to make things easier for you, we have gathered together several of what are considered the top CFTC forex brokers in the sector. Choosing from one of these trusted fx broker reviews for the region will help ensure that you select a broker that is the best fit for your own trading style.
- What is the CFTC?
- Top 7 best CFTC Regulated Forex Brokers
- How the CFTC works
- Characteristics and benefits of CFTC
- Prohibitions with CFTC
- Differences between CFTC Regulated and CFTC Licensed Brokers
- How to check if a broker is CFTC regulated
- How CFTC intervene in case of financial abuse?
- How CFTC can help you
What is the CFTC?
The CFTC was established in 1974 and is one of the 4 independent US market regulators. The other three regulators in US trading are the NFA, FINRA, and SEC.
There is a limited number of brokers who have one of these regulators in place and so, finding the ideal broker for US traders can sometimes be difficult. Brokers that are regulated under CFTC (Commodity Future Trading Commission) regulations though can offer trading opportunities in a number of markets. These include commodities, futures, and other derivative products within the US market.
Top 7 best CFTC Regulated Forex Brokers
Here is a collection of what we believe to be some of the best CFTC regulated brokers in the United States:
Forex.com is the first to feature as one of our top CFTC brokers. This broker is well known throughout the industry and licensed and regulated by both the CFTC and NFA under license number 0339826.
Here you will find three distinct account types. These are the Standard, Commission, and DMA account types. The standard account is a regular spreads trading account with no commission while the commission account features lower spreads but does charge a commission. The DMA account does not feature any spreads but does charge commissions. Minimum deposits on these accounts go from $1,000 for a standard or commission account, to $25,000 for a DMA account. Demo accounts are available for you to test out.
You can fund your trading account through wire transfer, credit card, or eWallet deposit and most methods are fee free with USD deposits supported as well as that base currency. Trading here takes place through MT4 or the proprietary forex.com platform and spreads start from 0.2 pips.
- You will have a great range of account types to suit all trading styles.
- 82 forex pairs available and a large selection of other markets.
- Low commissions and fees as well as rebates and other benefits for active traders.
2. IG Markets
Next on our list of top CFTC forex brokers is IG Markets. Again they are well licensed by the CFTC and regulated by the NFA under number 0509630 for your convenience to verify. They offer one specific account type to all traders and a full demo account is also available for you to try our first.
The minimum deposit with this broker for US forex trading is $250 and you can fund this to your account through a wire transfer, credit card, or eWallet payment. Most deposit methods are fee-free and both USD deposits and base currency are supported.
Trading with IG Markets takes place through the brokers own dedicated platform of the well-trusted MT4 trading platform and spreads start from a competitive 0.8 pips.
Why IG Markets?
- This broker offers an excellent balance for both new traders and those with more experience.
- There is a healthy range of forex pairs available with 80 that you can choose from.
eToro is of course one of the best known brokers in the world. They have also made our listing and are authorised to offer trading services within the USA by FinCEN. eToro USA is fast becoming one of the leading places for US traders.
They offer one standard account type with a minimum deposit of $50 for trading. This increases to $500 if you deposit through wire transfer and a full demo account is available. On funding, you can deposit through a wire transfer, credit cards, or eWallets and the majority of methods are fee-free. Both USD deposits and base currencies are supported.
Trading, as always with eToro, takes place through their user-friendly platform. There is a commission in place on eToro cryptocurrency trading and this will depend on the particular crypto in question with a minimum of 0.75% and maximum of 5% charged.
- eToro is one of the best known and trusted brokers in the industry.
- They feature a wide range of cryptos with more than 15 cryptocurrencies and 100 crypto assets with transfer available to their eToroX crypto wallet.
- There is a low minimum deposit available and crypto minimums start at just $25.
Nadex is the next broker to feature on our listing and they are also well-regulated by the CFTC for US trading. Here you can open one type of account which will take a minimum deposit of $250. A full demo account is also available to try out.
When it comes to the funding of your forex trading account, this can be completed through wire transfer, credit card, or eWallet deposit and in the majority of cases there are no fees. Both USD deposits and base currency are supported here.
Forex trading with Nadex takes place through their proprietary trading platform and the place a $1 fixed fee on every forex position that you open as a trader.
- Nadex are an excellent choice for those interested in binary options trading.
- The fixed fees in place may be appealing to many traders who wish to known their cost of trading with precision.
Next on our list of top CFTC brokers is Oanda. They are also comprehensively regulated by the CFTC (325821), and NFA (0325821) under the mentioned license numbers so you can easily verify.
Here you will find two account types for US trading, the standard, and premium account. While there is no minimum deposit at all to open and trade with a standard account, you will need a $20,000 minimum deposit for a premium account and the benefits it brings such as lower spreads and commissions. A complete demo account is also available.
For funding these accounts, wire transfer, credit card, and eWallet are all accepted. Most are even fee-free and both USD deposits and base currency are supported for trading through the MT4 trading platform where spreads can start from 0 pips.
- There is a great selection of assets available including 70 forex pairs.
- The spread is very low and competitive with others in the sector.
- A low minimum deposit can help attract new traders.
Next to feature as a top CFTC broker is the well known Interactive Brokers. They are a FINRA member and also well-regulated by both the CFTC and NFA (0392970).
As a US forex trader with this broker you can choose from two account types. These are the IBKR Lite, or IBKR Pro accounts. With both these accounts, there is no minimum deposit in place and no maintenance fees with the Lite account. The Pro account has a $10 maintenance fee.
Your account can be funded through wire transfer, bill payment, or credit card and for the most part, your deposits will be fee-free. Both USD deposits and base currency are also supported. Trading with IB takes place through their own dedicated platform or MT4 and they offer more than 100 forex pairs at excellent spreads from just 0.1 pips.
Why Interactive Brokers?
- IB provide for a huge range of assets to choose from including forex, futures, options, stocks, and more.
- This range makes them a top choice for the more experienced forex trader.
Last but not least in our selection of top CFTC brokers is TD Ameritrade. They are a CFTC regulated FINRA member and well known across the financial investment world.
With this broker you can choose between a standard account for 1:1 real trading, or a margin account that facilitates trading on leverage. For a standard account, a minimum deposit of $50 is required. This increases to $2,000 for a margin account. A standard account can also be converted at this balance point.
Account funding options include wire transfers, and credit cards with both options being fee-free in most cases. Both USD deposits and base currency are supported and trading takes place through the brokers proprietary trading platform or the Thinkorswim platform. There are 20 forex pairs available and spreads start from 0.1 pips.
Why TD Ameritrade?
- They are well known as one of the best stock trading brokers in the industry.
- The low minimum deposit makes them easily accessible to all.
How the CFTC works
The role of the CFTC in regulation is to promote trading in commodities and derivatives markets within the US to forex traders and others alike. They also perform the role of ensuring these offerings from brokers are not fraudulent. They have a collaborative relationship with US institutions particularly in finance and the NFA, often working together in tandem.
The CFTC protects the market and traders within the market by looking out for any of the following:
- Fraudulent firms
- Firms that manipulate the market
- Firms that offer illegal instruments such as CFDs
- CFTC rules violation
- Other violations such as inadequate oversight of traders
Characteristics and benefits of CFTC
The CFTC provides forex traders with a maximum leverage of 50:1 on major forex pairs. This is more than allowed for forex trading in the EU under CySEC. Although the CFTC does not provide any negative balance protection or automatic refund in the case of fraud, they are known to be very helpful and active in investigation of such cases.
For these reasons and the fact that they require brokers to hold funds in segregated accounts that protects the trader, the CFTC are considered to be one of the most stringent regulatory authorities in the world.
Prohibitions with CFTC
Since the CFTC regulates forex, commodities, and futures markets, these and other derivatives are all considered legal to trade in the US. CFDs on the other hand are not legal for trading in the United States.
Differences between CFTC Regulated and CFTC Licensed Brokers
There is indeed a difference between a broker that is CFTC regulated, and one that is CFTC licensed. A regulated broker is one which holds a CFTC registration number that is required for it to operate within the United States.
A CFTC licensed broker on the other hand is one which just required written permission from the body to offer services in the US. This permission can be given in different situations, but generally the reason is that CFTC has treaties with other regulators outside the US market. So, since they apply the same rules, the financial institution can offer its services within the US without an actual CFTC regulation and associated number.
How to check if a broker is CFTC regulated
Since they work hand in hand, all CFTC regulated brokers can be double checked through the NFA website. All of this information can be taken as verified and official from a CFTC standpoint.
The NFA website allows you to search for the company. All you need to do is input the business name that you can often find at the bottom of your brokers homepage.
How CFTC intervene in case of financial abuse?
The CFTC have wide ranging powers to intervene if they feel that forex brokers have broken any of the regulations providing protection to you as a forex trader in the US. The case in point here may be FXCM who were banned from the US market in 2017 for claiming to offer negative balance protection.
They were banned from both CFTC and NFA regulation for this issue and fined $850,000. This ban still stands in US markets.
How CFTC can help you
If you have any regulatory questions, issues, or feel you may have been the victim of a forex scam broker, the best thing you can do is go to the CFTC official website and contact the CFTC Division of Enforcement