Arbitrage trading is a technique used to take advantage of differences in price in substantially identical assets across different markets or in different types of instruments. The process involves the simultaneous buying and selling of an asset in order to profit from a discrepancy in the price in two different markets or exchanges. The existence of arbitrage trading opportunities helps keep financial markets efficient and liquid, and ensures that large price deviations do not exist for extended periods.
In this guide, we explain how it works and list the best brokers for arbitrage trading if you’re a retail investor interested in forex and other global financial markets.
Top-Rated Brokers For Arbitrage Trading
We checked these brokers cater to retail investors looking to deploy arbitrage-style strategies with key components like fast execution and low fees:
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- Demo account
- Min. deposit: $0
- Min. trade: 0.01 Lots
73-89% of retail investor accounts lose money when trading CFDs -
- Demo account
- Regulator: ASIC, CySEC, VFSC, FSA
- Platforms: MT4, MT5, cTrader, TradingView, DupliTrade
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- Demo account
- Regulator: ASIC, CySEC, FSA, FSCA, FSC, SCB, CMA-Kenya
- Min. deposit: $0
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- Demo account
- Regulator: FCA, ASIC, CySEC, SCA, SCB, CMA-Kenya
- Platforms: Web Platform, MT4, TradingView
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- Demo account
- Regulator: FSC-Belize, FSC-Mauritius
- Min. deposit: $10
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- Demo account
- Instruments: Spot, Futures, Swaps, Options, X-Perp Stocks
- Regulator: FinCEN, VARA
Learn how we test brokers and why you can trust our ratings.
This is why we think these brokers are the best in this category in 2026:
- Pepperstone 4.8/5 In our tests, Pepperstone delivered ultra-fast order execution with no requotes and minimal slippage - even during peak volatility. Orders consistently filled under 50ms on Razor accounts, and spreads stayed tight throughout. This precision made scalping and high-frequency strategies notably smoother than with most competitors we benchmarked.
- Fusion Markets 4.6/5 When we tested Fusion Markets, execution was impressively sharp. Market orders were consistently filled near-instantly, even on volatile forex pairs. Slippage was negligible, and we experienced no requotes. Their ECN-style setup, combined with raw spreads, helped maintain trade accuracy, making it a strong performer for speed-focused strategies like scalping.
- FP Markets 4.2/5 In our tests, FP Markets showed consistently fast execution, with market orders filled in under 50ms on their Raw ECN account. Slippage was minimal, and we encountered no requotes even during high volatility. Tight spreads and deep liquidity make it a strong choice for active traders seeking precision.
- Capital.com 4.3/5 Established in 2016, Capital.com initially focused on CFDs across forex, indices, stocks, commodities, and crypto, aimed squarely at active traders. Over the years it has added more instruments, obtained multiple regulatory licenses, improved its charting tools, and introduced an 1X account that lets you trade without using margin (borrowed funds), now catering to a diverse mix of traders worldwide.
- Axiory 3.6/5 Founded in 2011, Axiory is a regulated forex and CFD broker offering tight spreads and highly leveraged trading on industry-leading platforms: MT4, MT5 and cTrader. The broker has won multiple global awards and is regulated by the FSC in Belize and the FSC in Mauritius.
- OKX 4.1/5 OKX is a respected cryptocurrency firm, established in 2017, that offers a large suite of products, from trading to NFTs. Traders can access over 400 crypto tokens via OTC trading and derivatives. With an excellent web platform, developer tools and dynamic charts, OKX is a popular choice for technical traders.
Community Sentiment
See how users rate these brokers based on the average customer ratings submitted on DayTrading.com, plus ratings from Trustpilot, the Apple App Store and Google Play.
| Broker | Our Users' Rating | Trustpilot Score | Trustpilot Reviews | iOS App Rating | Android App Rating |
|---|---|---|---|---|---|
| Pepperstone | 3737 | ||||
| Fusion Markets | 10479 | ||||
| FP Markets | 10388 | ||||
| Capital.com | 15246 | ||||
| Axiory | - | 69 | |||
| OKX | 1766 |
Pepperstone
Pepperstone stands out as a top choice for day trading, offering razor-sharp spreads, ultra-fast execution, and advanced charting platforms for experienced traders. New traders are also welcomed with no minimum deposit, extensive educational resources, and exceptional 24/5 support (18h a day on weekends). Pepperstone's comprehensive package, operating under ASIC regulation, makes them an obvious pick for traders in Australia, where it scooped DayTrading.com's 'Best Aus Broker' annual award for 2025.
Christian Harris, Reviewer
Pepperstone quick facts
- Demo Account
- ✔Yes
- Instruments
- CFDs, Forex, Currency Indices, Stocks, Indices, Commodities, ETFs, Crypto CFDs, Spread Betting
- Regulator
- FCA, ASIC, CySEC, BaFin, DFSA, SCA, SCB, CMA-Kenya
- Platforms
- Pepperstone Trading Platform, MT4, MT5, cTrader, TradingView
- Minimum Deposit
- $0
- Minimum Trade
- 0.01 Lots
- Account Currencies
- USD, EUR, GBP, CAD, AUD, NZD, JPY, CHF, HKD, SGD
Pros
- Pepperstone emerges as a low-cost broker, especially for serious day traders with spreads from 0.0 in the Razor account and rebates up to 30% (index and commodities) and $3/lot (forex) through the Active Trader program.
- There’s support for a range of industry-leading charting platforms including MT4, MT5, TradingView, and cTrader, catering to various short-term trading styles, including algo trading.
- Pepperstone has greatly improved the deposit and withdrawal experience in recent years, adding Apple Pay and Google Pay in 2025, as well as PIX and SPEI for clients in Brazil and Mexico in 2024.
Cons
- Pepperstone has removed support for several tools that elevated the trading experience for active retail traders, notably Autochartist, Capitalise.ai and a free VPS for qualifying traders (now only pro traders in some countries).
- Execution may not feel as reliable in fast markets as headline speeds suggest. In our own testing, execution was fast at desired prices, but some community complaints focus on slippage, stop-loss fills and spread-sensitive order triggers during volatile conditions.
- Despite improvements to its range of markets, crypto CFD offerings are still fairly limited compared to other brokers who focus on this area, such as Eightcap, and there's no option to invest in real coins.
Fusion Markets
Fusion Markets is a standout option for forex traders looking for excellent pricing with spreads near zero, industry-low commissions and recently TradingView integration. It’s a particularly good broker for Australian traders where the company is headquartered and regulated by the ASIC.
Jemma Grist, Reviewer
Fusion Markets quick facts
- Demo Account
- ✔Yes
- Instruments
- CFDs, Forex, Stocks, Indices, Commodities, Crypto
- Regulator
- ASIC, CySEC, VFSC, FSA
- Platforms
- MT4, MT5, cTrader, TradingView, DupliTrade
- Minimum Deposit
- $0
- Minimum Trade
- 0.01 Lots
- Account Currencies
- USD, EUR, GBP, CAD, AUD, NZD, JPY, CHF, HKD, SGD
Pros
- Average execution speeds of around 37 milliseconds are noticeably faster than many rivals and can help day traders secure optimal prices in fast-moving markets.
- Fusion Markets continues to impress with its pricing that provides tight spreads with below-average commissions that will appeal to active day traders.
- The range of charting platforms and social trading features is excellent, with MT4, MT5, cTrader and more recently TradingView, catering to a wide range of trader preferences.
Cons
- There is no proprietary trading platform or app built with beginners in mind, a notable drawback compared to AvaTrade.
- Traders outside of Australia and Europe must sign up with weakly regulated global entities with limited safeguards, though in August 2026 they made negative balance protection available to all eligible accounts.
- Fusion Market trails alternatives, notably IG, in the education department with limited guides and live video sessions to upskill new traders.
FP Markets
FP Markets strikes an ideal balance between affordability and quality for active traders. They’ve managed to keep trading costs low while expanding their investment offering, charting tools, and research features, all while providing excellent support you can rely on for urgent trading queries.
Christian Harris, Reviewer
FP Markets quick facts
- Demo Account
- ✔Yes
- Instruments
- CFDs, Forex, Stocks, Indices, Commodities, Bonds, ETFs, Crypto
- Regulator
- ASIC, CySEC, FSA, FSCA, FSC, SCB, CMA-Kenya
- Platforms
- Iress, MT4, MT5, cTrader, TradingView, AutoChartist, TradingCentral
- Minimum Deposit
- $0
- Minimum Trade
- 0.01 Lots
- Account Currencies
- USD, EUR, GBP, CAD, AUD, NZD, JPY, CHF, HKD, SGD
Pros
- AI-powered sentiment analysis, trading signals and real-time NewsIQ research, integrated with MT4 and MT5, has been added via FP Markets Intelligence.
- With MetaTrader, cTrader, Iress and more recently TradingView, FP Markets is one of the most accommodating brokers in terms of platform choice.
- FP Markets has a seamless onboarding experience, standing out with crypto deposits and over 10 base currencies, catering to global traders.
Cons
- FP Markets trails the best MetaTrader brokers, despite offering a Trader's Toolbox on MT4, just 130 instruments are available, limiting opportunities for serious traders, especially compared to Pepperstone with its 1,300 assets.
- FP Markets’ Iress platform is only available to clients in Australia. It also primarily emphasizes stock trading over forex trading, and data fees can accumulate rapidly unless you're an active trader or maintain a high-balance account.
- While pricing in the Raw account is excellent, spreads in the Standard account trail the cheapest brokers with a 1.1-pip average spread on the EUR/USD compared to the 0.8-pip average at IC Markets.
Capital.com
Capital.com is a great match for day traders with its thousands of CFDs, SmartFeed providing tailored market updates, and TradingView charts for advanced technical indicators paired with Capital.com’s fast and reliable order execution.
Christian Harris, Reviewer
Capital.com quick facts
- Demo Account
- ✔Yes
- Instruments
- CFDs on Forex, Stocks, Indices, Commodities, ETFs, Crypto
- Regulator
- FCA, ASIC, CySEC, SCA, SCB, CMA-Kenya
- Platforms
- Web Platform, MT4, TradingView
- Minimum Deposit
- $20
- Minimum Trade
- 0.01 Lots
- Account Currencies
- USD, EUR, GBP, AUD, SEK, NOK, DKK, CHF, HKD, PLN, CZK, AED, HUF, MXN
Pros
- Capital.com enhanced the mobile trading experience in 2026 with an AI assistant, live trading analytics, and a more customizable home screen with cleaner watchlists.
- Capital.com’s SmartFeed curates news and market updates tailored to your watchlist and trading style. This proactive feature helps day traders stay on top of relevant events without feeling overwhelmed by generic market noise.
- Capital.com offers a unique 1X CFD account option that lets you trade without leverage, though market risk still exists. This is great for beginners or cautious day traders who want exposure without the risks of margin or overnight fees, something few CFD brokers provide. Availability depends on jurisdiction.
Cons
- The broker’s research resources focus on educational content and in-house analysis but do not currently include third-party tools such as Trading Central, Autochartist, sentiment indicators, and professional-level screeners that some top competitors offer.
- While Capital.com supports MT4, it lacks MT5 integration, limiting access to advanced trading features, including additional timeframes, indicators, and order types.
- Capital.com offers primarily a standard CFD account and a professional account (subject eligibility) with higher leverage, but it lacks ECN/raw spread accounts or tiered pricing, which can limit trading flexibility for high-volume scalpers.
Axiory
Axiory remains a top choice for beginners with its low deposit, unlimited demo account and high-quality education. Experienced day traders will also appreciate the advanced capabilities of the cTrader platform, although the range of 350+ instruments may be too restricting.
William Berg, Reviewer
Axiory quick facts
- Demo Account
- ✔Yes
- Instruments
- CFDs, Forex, Indices, Commodities, ETFs, Stocks
- Regulator
- FSC-Belize, FSC-Mauritius
- Platforms
- MyAxiory App, MT4, MT5, cTrader, AutoChartist, Quantower
- Minimum Deposit
- $10
- Minimum Trade
- 0.01 Lots
- Account Currencies
- USD, EUR
Pros
- A good range of accounts are available with just a $10 minimum deposit required and Islamic swap-free versions
- Axiory added a Zero Account, offering zero spreads on major forex pairs for over 90% of the day, catering to forex day traders looking for tight spreads
- Upgraded infrastructure now gives execution speeds of 29 milliseconds, while Axiory guarantees zero or positive slippage on 70% of trades
Cons
- The broker’s range of 350+ instruments is much smaller than the hundreds offered by most leading firms
- Axiory doesn’t hold any top-tier licenses in Europe, the US or the Asia-Pacific region
- Only USD and EUR are accepted as account base currencies, so many clients may have to pay conversion fees
OKX
OKX is a top pick for crypto traders looking for emerging coins and crypto projects to invest in. Traders can also make use of the broker's copy trading service and automated bots.
William Berg, Reviewer
OKX quick facts
- Demo Account
- ✔Yes
- Instruments
- Spot, Futures, Swaps, Options, X-Perp Stocks
- Regulator
- FinCEN, VARA
- Platforms
- AlgoTrader, Quantower
- Minimum Deposit
- 10 USDT
- Minimum Trade
- Variable
- Account Currencies
- USD, EUR, GBP, INR, JPY, SGD, RUB, AED, SAR
Pros
- In 2025, OKX secured a MiFID II license, enabling it to offer regulated derivatives products across Europe, providing peace of mind
- X-Perps, added in 2026, provides opportunities on traditional financial assets, including US stocks and commodities
- There's a vast developer lab plus access to a marketplace of pre-built trading bots with auto-arbitrage
Cons
- The quality of customer support was inconsistent based on testing
- The firm offers limited regulatory oversight, though this is common among crypto exchanges
- In 2025 OKX agreed to pay over $500 million in penalties for violating AML laws in the US
Arbitrage Trading Example
Let’s say an exchange-traded product (ETF) is trading for $50 per share and its intrinsic price based on its individual components should be $50.10.
An arbitrageur will come into the picture and buy the ETF while simultaneously selling the individual stock components in the appropriate proportions – that is, sized to the weighting of the individual components and monetary amount of the long position in the ETF – until the price discrepancy is eliminated.
Arbitrage in Day Trading
Below are examples of arbitrage that day traders can realistically employ:
Merger Arbitrage
Because of modern-day technology, it is difficult for traders to take advantage of traditional statistical price arbitrage opportunities in the market. Proprietary trading firms and hedge funds often exploit these opportunities within a matter of seconds (sometimes even a fraction of a second) with high-powered computing capacity, leaving little opportunity for those with less sophisticated technology.
There are, however, different type of arbitrage in the market outside of basic statistical arbitrage. For example, there is a type of strategy known as “merger arbitrage” (sometimes called “takeover arbitrage”) in the market where traders attempt to arbitrage out risk in the markets.
Example
When company A seeks to buy company B, the former will usually pay the latter a premium – i.e., an amount above fair market value – in order to take control of the firm. If company B is trading at $100 per share before the takeover announcement and company A publicly announces that it will be buying its target for $125 per share, the market will never re-price company B at this new $125 takeover price.
This is due to the fact that it’s possible company A will retract its offer, company B may turn it down (or demand a higher price or engage in other negotiations), regulators may either block the deal or ask one or both companies to meet specific conditions that one or both sides may not be willing to meet, or some other third-party intervention could alter the prospective transaction.
Therefore, company B may price somewhat lower than the $125 takeover price, such as $120 to reflect an 80% chance of the deal closing – that is, high but not certain.
At the same time, because company A is paying beyond the market’s believed fair price for company B (and due to other factors, such as integration risk), company A’s price may fall from its current point in the market.
If company A was trading at $100 per share, it may fall to something lower, such as $96. Given the transaction has some chance of not occurring, the market would price company A’s stock at closer to $95 if there was a 100% probability of the deal going through to completion.
If a merger arbitrage trader believed that the transaction would follow through to completion – or at least has higher odds relative to those priced in – he or she would go long the target (company B trading at $120 per share) and short-sell the acquirer (company A trading at $95 per share).
Relative Value Arbitrage
If two stocks historically have high levels of correlation, it would be expected that, unless their business models fundamentally change, this correlation would continue to hold up.
Example
Goldman Sachs (GS) and Morgan Stanley (MS) have a correlation of 80% since both began trading simultaneously in May 1999. This correlation has run as high as 96% and as low as 50%
If one observed that the current correlation was in the 50%-60% range and was due to Goldman Sachs rising more than its competitor, one could take advantage of this potential opportunity by short-selling Goldman and buying Morgan Stanley. Eventually, the trading pattern between the two could be expected to revert to the mean, after which one would close the position once the correlation normalized.
Liquidation Arbitrage
Liquidation arbitrage is a type of trading by which one invests in stocks trading below their book value. The basic metric to evaluate such cases is the price-to-book ratio (P/B). If P/B < 1 – put another way, the sum of its parts is greater than the whole – then a company is trading below its book value and would be theoretically more valuable than its current stock price if the company were liquidated.
Banks commonly trade at under their book value in environments of low interest rates, flat or inverted yield curves, and high amounts of regulation.
This strategy, like others, is not foolproof. A catalyst generally needs to emerge to push the market in the right direction rather than rudimentary measures of a particular security being cheap.
This is a common strategy under the umbrella of “value investing”.
Net-net Arbitrage
This is a form of liquidation arbitrage but involves a more conservative version of the strategy. Net-net is defined as net working capital (current assets minus current liabilities) minus the long-term portion of debt – i.e., debt with maturity of greater than one year in the future (debt coming due within one year is part of current liabilities).
Some define it as net working capital minus all liabilities. When this value is greater than the market value of equity, this would suggest that there is a high chance that, should the company be liquidated, shareholders would receive more than the stock’s current value. Or the company may be poorly managed and better unlock or realize its value under new stewardship.
Why do these opportunities occasionally exist?
For one, net-net stocks tend to be smaller capitalized stocks and more easily escape Wall Street’s attention.
As companies, they may be “in limbo” and neither value-creating nor susceptible to insolvency risk in the short- or intermediate-term, leading the share price to lag what might be implicated by its balance sheet for extended periods of time.
Moreover, investors might believe that the value of its assets may be overrepresented on its balance sheet (e.g., forthcoming markdown of inventory value) and thus may truly not be an opportunity with a high margin of safety.
More on Arbitrage Trading
- Crypto Arbitrage – How to do arbitrage trading with cryptocurrencies.