Financial Conduct Authority or FCA regulated forex brokers are a natural choice for UK fx traders. FCA regulation ensures brokers offer top security for their client’s investment. Our experts compare 20 FCA brokers, to find the best forex brokers.
Updated: 04/03/2021
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Our list of the best forex brokers regulated by the FCA are the following.
With the lowest spreads, top trading platforms and award-winning customer services, Pepperstone is the best FCA regulated broker overall. Traders can choose between ECN-like or commission-free trading while gaining access to a wide range of financial markets such as forex and shares. Overall, three of Pepperstone’s greatest strengths are:
When trading with Pepperstone, two account types are available. The main difference between the accounts is spreads and commission fees:
Ideal for beginner traders, standard accounts holders pay no additional commission fees on top of the spread. When compared to other top fx brokers, Pepperstone offers the best commission-free spreads. Average spreads for all the major forex pairs shown below are significantly lower than competitors, with the EUR/USD averaging 1.13 pips commission-free. For the EUR/GBP fx pair, Pepperstone spreads average 1.41 pips, nearly a full pip less than other brokers such as FXTM.
Data taken from broker website. Accurate as at 07/05/2021
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The brokers ECN-style account is well-suited to active traders, scalpers and day traders, or those executing algorithmic trading strategies. As Pepperstone’s Razor spreads are ultra-tight, averaging 0.13 for the EUR/USD fx pair, traders pay a flat-rate commission fee on top of the spread (£2.29 per side, per 100k traded).
The below table shows Pepperstone’s competitiveness compared to other brokers. Across all currency pairs, Pepperstone offers the lowest spreads. While the EUR/JPY averages 0.27 pips when trading with Pepperstone, Admiral Markets averages 0.80 pips.
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As a no dealing desk (NDD) broker, Pepperstone fills customers’ orders through external liquidity sources rather than its own liquidity (as a market maker does). This allows the broker to offer institutional-grade pricing, providing traders with the best bid-ask prices available in the market.
As well as NDD execution and ECN-like spreads, Pepperstone orders are executed quickly thanks to Equinix servers located in New York’s financial district. The majority of orders are filled within 30ms, providing ideal trading conditions for scalping and algorithmic trading strategies.
Pepperstone offers three of the world’s most popular trading platforms, each of which suits different traders’ needs. While Standard account holders can choose between MetaTrader 4 (MT4) and MetaTrader 5 (MT5) as their trading platform, Razor account holders are offered the additional option of cTrader.
Each platform provides a user-friendly trading environment, with automated trading features and advanced technical analysis tools. Users are provided similar trading tools across each platform, yet a key difference between each is market access. If you want to trade Share CFDs, you are required to use MT5. Although MT4 and cTrader are predominately forex trading platforms, Pepperstone offers commodity and index CFD trading on both platforms. While Pepperstone historically offered cryptocurrency trading on all platforms, recent changes to FCA regulation have meant UK brokers are no longer able to offer cryptos to retail traders.
Pepperstone offers award-winning customer support and educational resources. To get in touch with the broker’s customer support team, live chat, phone and email contact methods are available 24/5.
To help develop your CFD and forex trading knowledge, Pepperstone provides a great range of educational materials such as trading platform tutorials, live webinars, articles and a glossary. Hundreds of past webinars are available on the broker’s YouTube channel, covering topics such as technical analysis, scalping strategies, and risk management using different order types.
To supplement Pepperstone’s excellent education section, demo accounts are available for Standard and Razor accounts on either MT4, MT5 or cTrader. A $50,000 virtual account balance is provided to practise trading, with access granted for 30 days. A wide range of payment options is available from Paypal to bank transfer.
View Pepperstone Review >>Visit Pepperstone >>
The overall rating is based on review by our experts
ThinkMarkets is a global, multi-regulated broker offering MetaTrader 4 (MT4) as a trading platform option. To gain access to MT4, CFD and forex traders can choose between three main account types:
To open a ThinkMarkets UK account under FCA regulation and start trading, an initial minimum deposit of £250 is required. This requirement is different in other locations such as South Africa where the broker is regulated under FSCA and in Australia where ASIC is the regulator.
ThinkMarkets customers using MT4 can trade an excellent range of financial products while utilising different trading tools and platform features. With various inbuilt and add-on tools to enhance your trading experience, ThinkMarkets MT4 clients can easily conduct technical analysis and automate trading.
MetaTrader 4’s pre-installed charting tools include 30 technical indicators, 24 objects, and 9 timeframes, with thousands more available to download from the MetaTrader marketplace online.
MT4 is well-known for its automated trading features with Expert Advisors (EAs) allowing users to execute algorithmic trading strategies. Using the MQL4 programming language, traders can create EAs that automatically analyse and enter/exit markets.
As well as writing your own Expert Advisors, MT4 traders may prefer to purchase and download indicators and EAs from the MetaTrader Marketplace online. With thousands of EAs to choose from, those new to trading may find this the easiest way to automate trading.
When developing algorithmic trading strategies, MT4 users can test and optimise EAs against historical data. MT4’s backtesting features are single-threaded and allow one currency pair to be tested at a time.
If you are signed up to a ThinkZero account, access is granted to Autochartist, a useful technical analysis tool. The pattern recognition software automatically scans financial markets and alerts users of potential trading opportunities, reducing the need to conduct lengthy technical analysis.
ThinkMarkets customers can develop diversified trading strategies with access provided to commodity, index, precious metal and forex markets. Unlike other top fx brokers,
ThinkMarkets is a no dealing desk broker that executes trades with Straight Through Processing (STP). STP brokers fill orders using external liquidity pools, allowing ThinkMarkets to offer institutional-grade pricing to its customers.
As well as tight spreads, ThinkMarkets partnership with Equinix ensures liquidity sources are efficiently connected to your MT4 trading platform. The broker uses Equinix servers based in London and Hong Kong to execute orders, with traders from Asia to the UK enjoying fast execution.
An additional benefit that ThinkMarkets promotes is no requotes, meaning customers do not need to worry about orders being executed at prices different from what it was executed at (known as slippage). To explore MetaTrader 4 tools and features before trading with real money, ThinkMarkets offers a demo account with a virtual balance of $50,000.
View ThinkMarkets Review >>Visit ThinkMarkets >>
XTB is an FCA regulated broker that offers a huge range of CFDs across various asset classes. The CFD broker also has regulation with the IFSC and CySEC. For those wanting to focus on forex trading, 49 different currency pairs are offered by the broker. The maximum leverage available varies between CFD and asset class. For major currencies, the United Kingdom’s Financial Conduct Authority (FCA) limits exotic and minor currency pairs to 20:1 and major pairs to 30:1.
As well as a good range of forex instruments, XTB clients can access the following CFDs and financial markets:
Market access is dependent on the trading platform you use. The broker offers the choice of MetaTrader 4 and its proprietary software – xStation 5. As an MT4 user, you are restricted to index, commodity and forex trading, while xStation 5 can trade ETFs, and share CFDs as well.
Two account types are available on both xStation 5 and MT4. A Standard account can trade minimum spreads of 0.35 pips commission-free, while Pro accounts gain access to discounted spreads of 0.28 pips and pay commission fees starting from £3.00 (GBP). Another comparative broker is Tickmill.
Prior to signing up to a Standard or Pro account, prospective XTB customers can practise trading the broker’s wide range of financial products via a demo account. A virtual balance of $100,000 is provided with access granted for 30 days, although demos can be renewed after the trial period ends.
XTB Review >>Visit XTB >>
If you are a UK or Ireland resident, spread betting is an alternative to CFD trading if you want to speculate on price movements without buying or selling the underlying asset.
When spread betting with FXCM, customers bet on the direction and amount they think the market will move. Benefits of spread betting include:
Active Traders gain access to significantly discounted spreads starting from 0.2 pips. As well as lower spreads, spread betting accounts that qualify as FXCM Active Traders are provided premium customer support and market data.
When spread betting with FXCM, three trading platform options are available.
For those wanting to try out spread betting in a risk-free environment, FXCM offers a demo account with a virtual account balance of £50,000.
View FXCM Review >>Visit FXCM >>
With millions of traders from 140+ countries, eToro is regarded as one of the world’s largest pure social trading platforms. When copying forex trades, no commission spreads start from 1 pip, with a small minimum deposit of $50 required to start trading.
As well as being an excellent introduction to trading CFDs and forex, social-copy trading allows experienced users to reduce the time spent conducting analysis and developing trading strategies. eToro’s social network allows customers to copy the strategies of experienced traders (Popular Investors) while learning from one another via chat features and newsfeeds.
Instead of placing orders yourself, as an eToro client, you can review Popular Investor’s stats, history and location, and copy the strategies that suit your risk and investment preferences. Five different asset classes are offered by eToro with market access provided to forex, stocks, commodities, ETFs and indices.
As well as copying the individual strategies of Popular Investors, CopyPortfolios are available for those wanting to trade diversified bundles of financial instruments. Two types of portfolios are available:
Compared to standard Popular Investors and social trading, CopyPortfolios offer a longer-term investment that is constantly rebalanced by the eToro team. Hence, a higher minimum deposit of $5000 is required. This also meets with their other regulators, including MiFID.
To access eToro’s social trading network and a diverse range of financial products, clients can use the broker’s online trading platform or iOS and Android mobile apps. To familiarise yourself with eToro’s social network and trading tools without risking real money, demo accounts available. eToro demo accounts have no time limits and are funded with a virtual account balance of $100,000.
FxPro is a hybrid market maker broker with low spreads and fast execution. Because the broker fills orders internally as well as from top-tier liquidity providers, FxPro customers gain access to ultra-tight spreads when using cTrader.
Predominately a forex trading platform, cTrader provides an ECN-like trading experience with access granted to over 70 currency pairs with EUR/USD spreads averaging 0.37 pips. As forex spreads are ultra-tight, traders pay a flat rate, round turn commission fees of $9 (USD) per 100,000 traded. In addition to forex, FxPro provides access to commission-free index trading.
FxPro’s cTrader users can expect minimal slippage and requotes when placing orders, with the majority of trades being executed within 11.06 ms. FxPro’s partnership with Equinix Data centres in London and Amsterdam ensure fast execution speeds, with cross fibre connecting cTrader users with top-tier liquidity sources.
As well as an ECN-style trading environment, FxPro’s cTrader users are provided with the following trading tools and features:
Depending on your preferred device, cTrader is available as a webtrader platform online or mobile apps (Android or iOS). To open a FxPro cTrader account, the broker recommends an initial minimum deposit of $500.
FxPro offers demo accounts for those wanting to explore the cTrader platform, with access granted for 6 months and unlimited virtual funds.
View FxPro Review >>Visit FxPro >>
Plus500 is a market maker broker that offers a range of risk management features such as premium order types and demo accounts. When trading with Plus500, customers are limited to the broker’s proprietary trading platform, available online or as a trading app.
To manage the high risk on individual trades, the Plus500 trading platform allows users to place standard and premium order types. Basic orders such as trailing stops, stop limit, stop-loss orders are free of charge, while guaranteed stop-loss orders (GSLOs) can be placed for a fee.
Traders pay a fee to place guaranteed stop-loss orders as the premium order type eliminates the risk of slippage that is possible with basic orders. The premium ensures that even if prices move rapidly, the order will be executed at the price level you have specified.
Unlike the majority of fx brokers, Plus500 does not restrict access to demo accounts. With no time restrictions, users can practice trading strategies and learn in a risk-free environment for as long as they please. Additionally, Plus500 demo account trading balances can be reset at any time, with no limit on virtual funds.
View Plus500 Review >>Visit Plus500 >>
*Your capital is at risk ‘76.4% of retail CFD accounts lose money’
The Financial Conduct Authority (FCA) is the main financial authority overseeing forex and CFD markets in the United Kingdom (formally known as the FSA, Financial Services Authority). Seen as one of the strictest regulatory body in the world, the FCA promotes healthy competition within financial markets, while ensuring retail investor accounts are protected from scams and deceptive conduct. The FCA follows the guidelines of the Bank of England who manage the top-end policy.
As forex and CFDs are complex instruments that carry a high risk of losing money, FCA regulated brokers are required by law to enforce policies such as leverage limits, negative balance protection, and segregated client funds. This is also based on EMSA requirements for all European CFD brokers.
The FCA requires allows caps maximum leverage limits for different asset classes, varying with the volatility of the financial product. Major fx pairs such as the EUR/USD are less volatile, therefore the maximum leverage allowed by the FCA is 30:1.
Traders can access the following leverage when trading with FCA regulated brokers:
Negative balance protection (NBP) is a risk management feature that ensures traders cannot lose more than they have initially deposited into their trading account. Designed to protect retail investor accounts from ending up in deb to their brokers, NBP closes all open positions if an account balance decreases to zero. While certain brokers choose to offer NBP to all clients, FCA regulated brokers in the United Kingdom are required by law to provide NBP.
The requirement for brokers to segregate client funds from operational company capital funds is a common regulation enforced by well-respected financial authorities around the globe. The FCA, as well as ASIC (Australian Securities and Investments Commission), CySEC (Cyprus Securities and Exchange Commission), FMA (Financial Market Authority, NZ) and the NFA (National Futures Association) all enforce segregated client funds as it ensures that if a broker becomes insolvent, a customer’s trading account balance is protected.
As with segregated client funds, the United Kingdom’s Financial Services Compensation Scheme (FSCS) protects retail traders in the case that a broker becomes insolvent. If a broker liquidates or has its assets frozen, customers can claim up to £50,000 under the compensation scheme.
All brokers operating in the UK and licensed by the FCA are required to provide negative balance protection and the FSCS while enforcing leverage limits and segregated client funds. With some of the most stringent regulation in the world, those trading with FCA regulated brokers are protected through various policies that promote risk management and fair brokerage services.
This comparison was created for UK residences trading forex (not binary options). For these traders, only FCA forex brokers should be considered with a wide range of brokers considered but not shortlisted such as CMC Markets and City Index. You can also view our best forex broker UK list.
Justin Grossbard has been investing for the past 20 years and writing for the past 10. He co-founded Compare Forex Brokers in 2014 after working with the foreign exchange trading industry for several years. He also founded a number of FinTech and digital startups including Innovate Online and SMS Comparison. Justin holds a Masters Degree and an Honours in Commerce from Monash University. He and his wife Paula live in Melbourne, Australia with his son and Siberian cat. In his spare time, he watches Australian Rules Football and invests on global markets.
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