Brokers With Low Spreads

Brokers with low spreads are often key to reducing trading costs, especially when carrying out short term trading such as scalping and day trading. Spreads are the difference between the buy and sell price, meaning high volume trading with wide spreads can quickly result in diminished trading capital, regardless of whether you’re trading forex, gold or crypto.

In this article, we explain what spreads are, how they are calculated and which factors influence them. We also list the best brokers with low spreads.

Best Brokers With Low Spreads

Our experts reviewed and compared hundreds of brokers and these 5 offer the tightest spreads:

#1 - Forex.com

Why We Chose Forex.com

Forex.com boasts a global reputation with multiple awards and 20+ years experience. Regulated in the US, EU, UK and Canada they provide a huge range of day trading markets, not just forex, and offer competitive fees on a cutting-edge platform. The brand also provides a suite of additional tools, from performance analytics and SMART Signals to advanced charts and strategy builders.

"Forex.com remains a best-in-class brokerage for active forex traders of all experience levels, with over 80 currency pairs, tight spreads from 0.0 pips and low commissions. The powerful charting platforms collectively offer over 100 technical indicators, as well as extensive research tools."

- DayTrading Review Team
  • Instruments: Forex, Spot Metals
  • Regulator: NFA, CFTC
  • Platforms: MT4, MT5, TradingView, eSignal, AutoChartist, TradingCentral
  • Min. Deposit: $100
  • Min. Trade: 0.01 Lots
  • Leverage: 1:50

Pros

  • The free demo account allows you to practice day trading strategies in a risk-free environment
  • The proprietary Webtrader is an excellent option for day traders, offering over 80 technical indicators for detailed analysis
  • Competitive cashback rebates up to 15% are available for active traders

Cons

  • The $15 monthly inactivity fee is higher than some competitors, including XM which only charges $5
  • The investment offering varies between countries
  • It's a shame that there's no copy trading platform for beginners or signal providers

#2 - DNA Markets

Why We Chose DNA Markets

DNA Markets is a forex and CFD broker established in 2020. The broker operates two entities in Australia and the offshore jurisdiction, St Vincent and the Grenadines. Traders can access 250+ markets, with a Standard account for beginners and a Raw account for experienced traders. The reliable MetaTrader 4 and MetaTrader 5 platforms are available, alongside Signal Start.

"DNA Markets is an excellent choice for short-term traders familiar with the MetaTrader platforms. The smooth sign-up process also makes it easy to get started while the $100 minimum deposit is accessible. That said, DNA Markets trails the top brokers in education, research and mobile trading. "

- DayTrading Review Team
  • Instruments: CFDs, Forex, Indices, Commodities, Stocks, Crypto
  • Regulator: ASIC
  • Platforms: MT4, MT5
  • Min. Deposit: $100
  • Min. Trade: 0.01 Lots
  • Leverage: 1:500

Pros

  • 24/5 customer support with response times of <2 minutes during testing
  • Convenient account funding with 7 base currencies, a $100 deposit and a wide range of payment methods
  • Short-term trading strategies are permitted including scalping and automated trading using Expert Advisors (EAs)

Cons

  • There are limited educational and research tools, reducing its appeal to beginners
  • Despite access to MT4 and MT5, there is no proprietary trading app
  • Although it continues to strengthen its client base and reputation DNA Markets lacks the track record of top brokers like Vantage

#3 - Axofa

Why We Chose Axofa

Axofa is a forex and CFD broker registered in St Vincent and the Grenadines. The broker offers three account types with access to forex, commodities and indices. With ECN processing, low minimum deposits and no commissions, Axofa remains an attractive option, although the broker does not hold a reputable license.

"Axofa could be a good option for clients looking for social trading features alongside the MT5 platform. The low entry requirements and ECN spreads are particularly promising, but the lack of transparency and respected regulatory oversight raises security concerns."

- DayTrading Review Team
  • Instruments: Forex, CFDs, Stocks, Indices, Commodities
  • Regulator: SVGFSA
  • Platforms: MT5
  • Min. Deposit: $1
  • Min. Trade: 0.01 Lots
  • Leverage: 1:1000

Pros

  • There's a proprietary social/copy trading service for beginners looking to follow successful strategies and for experienced traders looking to sell their strategies
  • The $1 minimum deposit across all 3 accounts will appeal to novices and those on a budget
  • The broker offers a range of local payment methods, especially for clients in Asia, as well as crypto deposits

Cons

  • There is a lack of transparency around pricing and account conditions, which significantly reduces the trust score
  • There is limited verifiable information about the broker’s owners and background
  • Our team found inconsistencies between international subsidiaries and website information

#4 - Sage FX

Why We Chose Sage FX

SageFX is an offshore, unregulated CFD broker that offers highly leveraged trading on forex, stocks, commodities, indices and crypto via the TradeLocker platform. Traders can access commission-free trading or an ECN account with tight spreads. While the broker's regulatory status is weak, it does provide segregated accounts and two-factor authentication.

"Sage FX will suit forex traders looking for high leverage and ECN spreads. The broker's prop trading service will also appeal to users looking for funded accounts with up to $200K available."

- DayTrading Review Team
  • Instruments: Forex, indices, cryptos
  • Regulator: Pending
  • Platforms: TradeLocker
  • Min. Deposit: $10
  • Min. Trade: 0.01 Lots
  • Leverage: 1:500

Pros

  • Prop trading accounts with multiple funding tiers
  • High leverage up to 1:500
  • Bonus offers and trading competitions

Cons

  • Lacks educational resources and other extra features
  • Relatively narrow range of asset classes
  • Not regulated by any reputable body

#5 - Coinexx

Why We Chose Coinexx

Coinexx is an unregulated broker that provides leverage up to 1:500 on forex, commodities, indices and cryptocurrencies with deep liquidity, pure ECN spreads and negative balance protection. The broker uses crypto as base currencies and has low minimum deposit requirements of 0.001 BTC.

"Traders seeking highly leveraged CFDs with a broker that uses crypto as a base account currency will find a good match in Coinexx. The ECN model also offer tight spreads from 0 pips. On the downside, traders should note the weak regulatory oversight."

- DayTrading Review Team
  • Instruments: Forex, Commodities, Indices, Cryptocurrencies
  • Platforms: MT4, MT5
  • Min. Deposit: 0.001 BTC
  • Min. Trade: 0.01 Lots
  • Leverage: 1:500

Pros

  • MetaTrader 4 and MetaTrader 5 integration
  • Full range of investments including cryptos
  • 100% deposit bonus for new clients

Cons

  • No regulatory oversight reduces safety
  • No copy trading service for aspiring investors
  • No fiat account funding options - crypto only

Spreads Explained

A spread is the difference between the bid (buy) and ask (sell) price in trading. Often this results in the offer price sitting just above the underlying value and the sell price sitting just below it.

This is usually how brokers make a profit, although some will charge commission instead of or on top of spreads.

Because of this, spreads can quickly cut into trader’s available capital, especially when executing a large number of trades.

Calculating Spreads

Spreads are calculated by subtracting the bid price from the ask price.

This difference is measured by small price increments called pips (percentage in points) which is the fourth decimal point of a price (or second if trading forex pairs quoted in JPY).

For example, a forex pair with an ask price of 1.2323 and a bid price of 1.2330 has a spread of 8 pips.

Spreads are the difference between what the market is willing to sell and pay for an asset. If these prices are close, it means buyers and sellers agree on the value of an asset.

What is a spread
Pepperstone spreads

Fixed Vs Variable Spreads

Spreads can be either fixed or variable, with each type offering its own advantages. Fixed spreads allow the trader to develop more predictable strategies as the costs are known upfront.

This is especially useful when scalping, to understand what exit price is required to measure profit or loss. (Check your broker allows scalping prior to trading).

On the other hand, variable spreads can be tighter, especially when the asset is highly liquid.

The best type of spread therefore depends on the trading volume and time of day. Scalpers might choose variable spreads to try and get the best rates at certain points.

However, in volatile times, for example when trading news events, spreads can quickly widen.

Spreads & ECN Brokers

ECN brokers use Electronic Communication Networks to directly match buyers with sellers.

Because ECN brokers can combine prices from multiple market participants, the spreads are often tighter and may be the best bet for traders looking for brokers with very low spreads.

However, they charge a commission to carry out the trade, which is a fixed fee per transaction.

Influences On Spreads

Spreads are affected by several variables:

Examples of Brokers With Low Spreads

Here we review five of the top regulated brokers with the lowest spreads, across instruments including forex, indices and commodities.

Plus500

Plus500 offers variable spreads. The spreads are tight compared with other leading brokers, at an average of just 0.8 pips for EUR/USD (variable).

Additionally, Plus500 does not charge commission on CFDs, though it does have standard overnight charges, currency conversion rates and account inactivity fees.

Best forex brokers with low spreads
Plus500 Platform

Pepperstone

Pepperstone is an ECN broker offering spreads as low as 0 with their Razor account, though commission fees apply ($0.04 per 0.01 lots for EUR/USD). With the Standard account spreads are wider, but still low versus other leading brokers, with an average of 0.79 pips for EUR/USD and no commission fees.

Overall, Pepperstone is a great broker choice for traders looking to use the leading MT4, MT5 or cTrader platforms, with some of the lowest forex and gold spreads around.

Top brokers with tight spreads
Pepperstone Platform

CMC Markets

CMC Markets is a UK based broker that offers low spreads on a wide range of instruments including forex, commodities, stocks and indices. The EUR/USD spread of 0.7 pips is competitive, with commission fees charged on shares only.

There are also no minimum deposit requirements, making CMC Markets an excellent choice for traders looking for FX brokers with low spreads and straightforward account registration.

Leading brokers with best spreads
CMC Markets Platform

Eightcap

Eightcap is one of the best CFD and forex brokers with low spreads. On EUR/USD, Eightcap offers variable spreads starting from 1 pip with their Standard account, dropping to a minimum spread of 0 with their Raw account. However, commission fees are charged on the Raw account, unlike the Standard account.

Regulated brokers with low spreads
Eightcap Platform

XTB

XTB is one of the best CFD and forex brokers with tight spreads of just 1 pip (fixed) for EUR/USD and equally low spreads on indices such as NASDAQ. However, traders can qualify for even lower spreads with a discount of between 5 and 30% when trading higher volumes.

FX brokers with tight spreads
XTB Platform

Final Word On Brokers With Low Spreads

Brokers with tight spreads help prevent fees from cutting into trading funds. While many leading brokers offer competitive spreads across a range of instruments, consider whether they are fixed or variable, as well as any commission fees that might be applied on top. The most suitable broker will depend on the time and frequency of the trade, as well as what is being traded.

FAQ

What Is A Broker With Low Spreads?

A broker with low spreads is one that has a small gap between the buy and sell rate. This is often how brokers make a profit though they can charge commission too.

Why Use A Broker With Low Spreads?

Using a broker with low spreads means the costs associated with your trade are lower, and your remaining balance is higher.

Which Brokers Offer The Tightest Spreads On Forex?

CMC Markets offers low variable spreads on forex pairs, while XTB offers some of the tightest fixed spreads. Pepperstone is an ECN broker that offers spreads as low as 0 pips with their Razor account, though this comes with commission fees.

Which Brokers Offer Low Gold Spreads?

The Pepperstone Razor account offers some of the lowest spreads for trading spot gold. Gold can be traded against USD, EUR, AUD, GBP, JPY and CHF.

Which Forex Brokers Offer The Lowest Spreads In Nigeria?

Pepperstone offers low spreads across a range of instruments including forex and accepts customers located in Nigeria.