Forex Brokerage Fees
Brokerage fees are an unavoidable part of forex trading. There are ways a forex broker may charge traders such as with a spread cost or a commission fee. In this comparison, we look at brokerage fees and show the best broker to save for each type.
See our low spread broker comparisons and read our forex brokerage fee review below
– Full Low Spreads table comparisons
Justin Grossbard
Each month we update average spreads data published by the brokers the retail brokers lose %
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How No Dealing Desk Brokers Offer Tight Spreads
Charging Commissions
With relative commission, the commission fee advertised is based on one standard lot. If you are trading with mini, micro or even the rare nano lots then the commission cost will usually be a relative or pro-rata amount based on the commission for a standard lot. Some brokers, however, may charge slightly more commission for smaller lots to encourage larger trades.
The broker offers:
70% of the $6.6 trillion daily forex trading volume is attributed to automated trading. This type of trading refers to the use of existing technologies such as computers, software and the internet to manage one’s trades in the forex marketplace. Automation tools can analyse more markets at one time that possible manually and then execute trades. Types of traders using automation include
Most brokers, regardless if they are an A-Book or B-Book broker will offer what’s commonly called a standard account. This type of account is a spread only account meaning there are no commission costs. Rather than charge commissions, spreads are widened so brokers can earn profits.
ECN and Standard accounts use variable spreads (sometimes called floating spreads) which means they are constantly changing in line with liquidity supply and demand. As the prices are changing so fast, you will occasionally experience slippage which means you the quoted buy or ask price can’t be filled due to the execution lag time. Slippage means there is a risk of large losses should be the market change against you suddenly and dramatically with little warning.
Forex currency pairs – 55 major, minor and exotic pairs with EUR/USD spread of 0.9 pips, GBP/USD spread of 1.6 pips and AUD/USD spread of 1.1 pips
With 1/3 of the world’s population of Muslim faith, many forex brokers offer a swap-free account which meets the sharia law requirements of Islam. Islam forbids business profiting through usury (called a riba in Islam) fees. That is any financial transaction where interest is involved in the transaction. In Islamic law, the lender must share in the borrower’s risk, when interest is charged, all the risk is taken by the borrower which is considered exploitative by the lender in Islam.
