Best FX Provider 2019 Comparison

Finding the best FX provider is a critical foreign exchange component impacting the spreads and commissions charged on currency pairs from the EUR/USD to AUD/USD, the forex trading platform and CFD/forex markets traded including cryptocurrencies, fx provider customer support level and regulation from ASIC to FCA.

By Justin Grossbard / Updated: Saturday, November 02nd, 2019

Best FX Provider Image

Top FX Providers

Below shows the ‘top 3’ best forex brokers based on the costs (spreads and commission), choice of forex trading platform, customer support levels, risk management features (such as stop-loss orders) and financial markets offered. These fx providers (in-order of recommendation) are:

  • Pepperstone – Best Forex broker for high volume/expert traders
  • IC Markets – Best FX provider for intermediate/low fee traders
  • EasyMarkets – Best forex provider for those new to forex trading

ii) Pepperstone – Fx Broker For Experienced Traders

Pepperstone Forex Provider LogoPepperstone has tailored it’s offering those with expert trading experience due to their:

  1. Active traders low commission for high volume traders
  2. The lowest minimum deposit requirements
  3. Strong forex broker review
  4. Range of forex pairs including exotics
  5. Fundamental and technical analysis updated daily
  6. Australian Securities And Investments Commission regulation

Key elements are discussed below or you can view the full Pepperstone review here.

Pepperstone Has The Lowest Spreads (Especially For High Volume Traders)

Below shows compare the spreads for the Raw/ECN broker accounts that are the choice for more advanced traders looking to lower their trading fees. It shows how Pepperstone has competitive commissions, especially when factoring in their commissions are charged in AUD.

CommissionSide-ways (Standard lot)Round-turn (Standard lot)
PepperstoneAUD$3.50AUD$7.00
IC MarketsUSD$3.50USD$7.00
AxiTraderUSD$3.50USD$7.00
Think MarketsAUD$3.50AUD$7.00

These commissions are even lower once you trade over 100+ lots and become an active trader for a month. These rebates on commissions start at 10% and for higher volume traders lead Pepperstone to have the best forex broker when it comes to the lowest fees.

Pepperstone Active Traders

Pepperstone Has The Lowest Minimum Deposit

Technically Pepperstone has set a minimum deposit of $200 US Dollars (or the equivalent in the base currency chosen such as the Australian Dollar). While is higher than some other fx brokers Pepperstone is open that this is not actively enforced allowing for smaller deposits to be made.

What sets Pepperstone apart is they don’t charge funding or withdrawal fees. Only some payment methods such as international transfers may see the financial institution themselves charge fee for money transfers. The funding methods include:

  • Bank transfer + BPay
  • Visa + Mastercard
  • PayPal
  • Union Pay
  • POLi
  • Neteller + Skrill

Pepperstone Has The Best Customer Support And Broker Reviews

While most brokers would argue they have the most satisfied customers and best support, Pepperstone has the reviews and awards to back-up their claim. One benchmark annual study is by Investment Trends who run a survey of active forex traders and have awards Pepperstone with the awards below including Customer Service.

Pepperstone Awards

Pepperstone Reviews 2019Another gauge of the forex broker reviews is from Trustpilot which in late 2019 gave the score for Pepperstone:

  • 508 reviews
  • 9.2/10 score

This is the highest of the forex broker reviews that have over 500 reviews.

The Sweet Spot For Pepperstone

Pepperstone is the best forex broker for expert traders looking for a low fee fx provider with strong customer service and happy traders. They offer MetaTrader 4 + 5 as well as cTrader forex trading platforms and are regulated by the Australian Securities and Investments Commission and the Financial Conduct Authority (Registration Number 684312) in the UK.

IC Markets FX Provider Logoi) IC Markets – The Best Forex Broker

IC Markets was awarded the best forex broker based on the following features:

  1. Low spreads and commissions
  2. The choice of the most popular forex trading platforms
  3. Range of CFD markets and currency pairs
  4. High leverage of up to 500:1
  5. Strong Customer Service
  6. Regulation based in Australia (ASIC)

You can view the full IC Markets review or below goes through each of the six points in greater detail.

IC Markets Has The Lowest Fees

Forex broker fees have two main components. The first is similar to an exchange rate known as a ‘spread’ which is the difference between the buy and sell rate of a currency pair. Most forex brokers offer a market-market trading account that has no commissions but high spreads and those closer to an ECN/STP broker accounts. Such accounts that mimic an ECN broker environment with no dealing desk allowing for the lowest spreads but the additional charge of a set commission. Below compares the spreads on these accounts.

 IC Markets (RAW)Pepperstone (Razor)Plus500IG
EUR/USD0.10.160.60.6
AUD/USD0.20.270.60.6
GBPUSD0.40.491.10.9
USDJPY0.20.250.700.79

IC Markets Offers A Range Of Markets

Trading forex is just one of the markets IC Markets offers. IC Markets is one of the few online brokers to offer Bonds CFDs trading. These movements are based on market sentiment and interest rate speculation. As interest rates movement are historically small IC Markets offers 200:1 leverage on Bonds CFDs trading. Two newer markets include cryptocurrency Bitcoin to Ripple and futures markets across energy, metals to agriculture. Other core markets are shown below including indices, commodities and stocks.

FX Providers Range Of Markets

IC Markets Offers The Most Popular Forex Trading Platforms

All three popular forex platforms are offered by IC Markets:

MT4 Trading Platform LogoMetaTrader 4

MT4 is the most popular forex trading platform worldwide based on key features including:

  • Fast average execution speed of 36.5 milliseconds across order types
  • The ability to trade across 64 currency markets (currency pairs)
  • The ability to purchase automate programs known as expert advisors.

MT5 Trading Platform LogoMetaTrader 5

MT5 is a platform suited for those looking for more than currency trading including:

  • The full range of CFDs markets from currency trading, commodities to indices
  • Level II Interbank Pricing with the full range of prices from IC Market pricing providers
  • Expert Advisor market for MT5 and easy to use C# code for programming

cTrader Forex Trading Platform LogocTrader

cTrader is for expert forex traders with the forex trading platform focusing on:

  • Trading all markets including 64 currency pairs + 16 major equity indices
  • The lowest spreads for the Euro/USD Dollar of on average 0.1 pips
  • Scalping and the ability to purchase from the cBots marketplace.

The Sweet Spot For IC Markets

IC Markets is ideal for intermediate forex traders looking for a low fee provider. With the leading spreads, IC Markets focuses on providing the basics for traders from the most popular forex trading platforms, decent customer service, ASIC certification to a range of markets. This ensures most traders needs can be met the fx provider.

EasyMarkets – Beginner Foreign Exchange Broker

EasyMarkets FX Provider LogoEasyMarkets (formally Easy Forex) are ideal for those new to forex trading based on their:

  1. High-risk management features
  2. Low minimum deposits
  3. Fixed Spreads and no commissions
  4. Forex training modules
  5. Market and technical analysis

Advanced Risk Management Tools

Easy Markets like most CFDs providers offer a higher risk environment due to their maximum leverage of 200:1. This means you can effectively trade up to 400 times your deposit in real-time increasing your exposure to the market. To reduce this level of risk there are three key features EasyMarkets offers.

Deal CancellationDealCancellation

This feature allows a trader to cancel a trade when:

  • DealCancellation is selected when making the trade
  • Within 60 minutes of trade, the DealCancellation is triggered
  • The amount risked in the trade minus fees is returned

Overall, this feature can avoid heavy losses on a trade within 60 minutes of activation.

Stop LossGuaranteed Stop Loss

All EasyMarkets trades include a guaranteed stop-loss trading tool ensuring:

  • A trader can set the maximum loss they are willing to accept for a trade
  • That loss is guaranteed as the maximum amount
  • No slippage can occur irrelevant of market conditions at the time
  • No other charges are associated with this feature

The guaranteed stop-loss order is standard by EasyMarkets which is used to the fx provider.

Negative Balance ProtectionNegative Balance Protection

The final trading tool offered to reduce the level of risk associated with CFD trading is negative balance protection. This ensures that if a trader’s losses exceed their deposit that EasyMarkets will exist the trader from the market and pay and additional losses. This can be critical when executing multiple trading strategies where profits or losses can be hard to monitor.

Easy Markets Has Fixed Spreads, Not Variable Spreads

The majority of Australian forex providers offer variable spreads which change during the day making it hard to difficult to understand brokerage fees. Below shows the fixed spreads across the two standard accounts offered by EasyMarkets which differ by the forex trading platform across major currency such as the GBP and USD.

EasyMarkets Fixed Spreads

The three key benefits of fixed spreads over variable spreads are:

  • Transparent trading costs as they are a market maker
  • No surprises in spread spikes during turbulent markets
  • Easier trading based on news events when it’s critical to exactly calculate profits/losses

The Sweet Spot For EasyMarkets

EasyMarkets is ideal for those new to currency trading who want a broker with transparent brokerage combined with risk management tools. While EasyMarkets offers MetaTrader 4, it’s recommended to use their own forex trading platform which integrates with all the unique features such as DealCancellation included. Account types include VIP, premium and standard which impact the minimum deposit and spreads. In general, it’s recommended to choose the premium account if your willing to meet the initial deposit of $3,000 AUD when account opening.

Should You Trade Forex?

FX trading occurs throughout the day on weekdays. In addition, Forex trading does not have limitations on short currencies. If you believe a currency will fall, sell it and if you feel it will increase in value, purchase it. In Forex, money can be gained or lost at any time. The fact that most traders concentrate in a few currencies means there are plenty of people trading. This makes it easy for you to get in and out of trades at any time you prefer. The liquidity available is deep and allows you to trade at high leverage to take advantage of market movements. However; you need to remember that it might increase your profits as well as your losses.

The low trading costs is another reason why there are plenty of Forex Australia traders and brokers. Usually, there are no hidden mark-ups or charges associated with liquidity providers with most trading accounts having tight spreads with competitive commissions. Forex trading creates international exposure. Investors are always looking for opportunities where they can make money. Forex is the easiest way to invest in other markets without the need for financial statements and securities laws.

An Overview of the Forex IndustryAUD-USD FX Australia Exchange Rate

Forex describes the act of trading currencies often undertaken by speculators and investors in the foreign exchange market. For example, if the U.S dollar weakens in value relative to the Australian dollar, a trader will sell U.S dollars and buy Australian dollars. In case the AUD strengthens, the USD’s purchasing power increases. In such a case, the trader can buy more USD thus making a profit. It is almost the same as stock trading. Traders purchase stocks that they think will increase in value and sell stocks whose value is likely to depreciate in the future.

How to read a quote?

Since traders compare one currency to another, they are quoted in pairs on the forex market. Reading a quote is a straightforward method. For example, you compare the value of one Australian dollar to the U.S dollar. The first listed currency is known as the base currency and the currency is quoted in this currency.

USD AUD

What is a lot?

A ‘lot’ represents the number of units that are bought and sold when trading currency. FX accounts in Australia use ‘standard’ lots which means 100,000 units of currency. Other types of lots available include mini-lot which is 10,000 units and micro-lots which is 1000 units. You can trade as many lots as you wish as long as they are in increments of the chosen lot. Ie: if you trade 5 standard lots that will be 500,000 units.

One thing to look out for when trading lots is the cost charged by the broker per lot. Costs trading with smaller lots may be more expensive, especially if since will need to buy or sell more lots to achieve the same volume as a single standard lot.

What is margin/leverage?

Online forex brokers and CFD brokers allow you to execute trades using borrowed money. It allows traders to take advantage of a margin. A leverage of 100 to 1 enables you to trade with $10,000 in the market by using 1,000 dollars as a security deposit. This $1000 is known as the margin. You can take advantage of margins to control more money in the market than you have in your account. However, this leverage can also substantially increase your losses. FX trading is not a suitable venture for all investors who are not willing to take risks. A margin requirement is a specific amount a trader is required to keep aside to hold a position. It can be a good faith deposit expected to keep open positions. It is a part of your account equity allocated as a deposit and not a transaction fee.

Leverage or Margin are fundamentally the same except they are expressed differently. Leveraged products will usually be expressed as a ratio. Thus, leverage of 100:1 as mentioned meant you can trade $10,000 using $1,000 as security. Margin or margin rate, on the other hand, is expressed as a percentage. Thus 1% Margin rate of $10,000 equates to $1,000 needed margin. Forex brokers such as OANDA have a low margin rate compared to IC Markets or Pepperstone.

Margin Forex Australia Accounts

What is a pip?

It is the unit used to count losses or profits. Most currency pairs are quoted to four decimal places. The fourth value after the decimal point is what you use to count a pip. Anytime a point in the quote moves, it is counted as a pip of movement. For example, if the AUD/USD increases from 1.4011 to 1.4018, the AUD/USD currency pair has grown by seven pips.

What is Spread?

Spread is similar to pip. The spread is the difference between the sell or bid price and the buy or ask price. For example, if the buy price is 0.83860 and the sell price of the foreign currency is 0.83855 then 0.83860 –  0.83855 = 0.00005 is the spread and this can be expressed as 0.05 pips when rounded.

Licensed and Regulated Forex Brokers

It is important to consider signing up with a service provider that licenced in your local market. In Australia, this means the broker must be granted an adequate Australian Financial Services License by the Australian Security and Investment Commission to legally trade in Australia. They also monitor all Foreign Exchange Contracts and Derivatives to make sure they are legal. To see if a broker is ASIC regulated you will find the brokers ASFL licence number published on their website. There are also regulatory bodies in the UK (known as the FCA), Singapore and Cyrus. The best brokers are always regulated and any forex scams are almost always associated with unregulated fx brokers. When you start trading check with the regulator’s site to make sure the broker has a current licence.