Are you looking for the lowest spread Forex Brokers to find a cheap trading solution?
You’re in the right place.
We have collected for you the 10 best major Forex Brokers with low spreads, with different features and functionality so you can choose the one that best suits your needs.
Top 10 of the Best Forex Brokers with Low Spread 2020
Here’s our ranking.
What is a low spread in forex?
You will very often hear mention of spread in forex, and it is a key figure in determining your trading cost. The spread is the difference between the bid/sell prices of an asset. This price difference is calculated in another common term you will often hear referenced, pip. This stands for percentage in points and typically when trading forex, 1 pip is a 1 point movement in market value based on the fourth decimal place of your currency pair in most cases including the USD.
For example in case of EUR/USD:
- bid/ask of 1.08335/1.08340 (0.5 pips spread)
- bid/ask of 1.08335/1.08345 (1 pip spread)
- bid/ask of 1.08335/1.08485 (5 pips spread)
One of the only exceptions here are the JPY forex pairs (such as the USD/JPY) which is measured to 2 decimal places instead of four, so where 1 pip would be 0.0001 for the EUR/USD, it is 0.01 for the USD/JPY
Spreads are considered to be low when they are below the average on that market. Many may start at 1 pip, although on some more traded markets this could be less, while on other markets like commodities, it could be much higher.
Forex Brokers with Zero pips spread: Which is the best one?
In many cases, where you may see a broker offering a 0 pips spread, what they are in fact offering, is a spread that starts from 0 pips. This is still excellent although you should be prepared for it to vary depending on the market, volume, and volatility at any given time. This does mean that it could sometimes be significantly higher so it is something to look out for.
Since the spread is the main revenue for a broker, you should also take care to note any commission that may apply to low spread, or zero spread trading. If such commission does apply, this will typically be calculated on a per lot ($100,000) of currency traded basis and is usually below $5 depending on the market.
If you are looking for the best broker with a truly real zero spread that is fixed, then the FBS Fixed Zero Spread account type may be perfect for you. This remains fixed at 0 pips spread and does not increase though it is available only under IFSC regulation in Belize, and so, not accessible to Europeans regulated within Europe.
Are low spreads worth it?
Sure. Since a spread is effectively a commission from the broker, then a lower spread is always better. It can also be very necessary if you want to employ trading techniques such as scalping.
With that said, while a lower spread is always better, just make sure you examine the broker offering closely to avoid any other types of commission in place of a spread.