CFD forex trading enables traders to go long or short on popular currency pairs, such as EUR/USD, with leverage to amplify trading results (profit and loss). This guide explains how trading currencies with CFDs work. We’ve also tested, rated and ranked the best brokers for CFD forex trading.
Top-Rated CFD Forex Trading Brokers
These are the top-rated brokers with forex CFDs from our direct tests:
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- FTSE Spread: 2.5
- GBPUSD Spread: 1.5
- Stocks Spread: 1.53 (Apple)
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- FTSE Spread: 1.5
- GBPUSD Spread: 0.5
- Stocks Spread: No mark-up
-
- FTSE Spread: 1.10
- GBPUSD Spread: 0.4
- Stocks Spread: 0.17 (Apple)
84.6% of retail CFD accounts lose money. -
- FTSE Spread: 1.0
- GBPUSD Spread: 0.5
- Stocks Spread: 0.01
-
- FTSE Spread: 1.64
- GBPUSD Spread: 0.2
- Stocks Spread: Variable
-
- FTSE Spread: Variable
- GBPUSD Spread: Variable
- Stocks Spread: Variable
Learn how we test brokers and why you can trust our ratings.
Here is a short summary of why we think each broker belongs in this top list:
- Markets.com 4.4/5 Markets.com offers over 50 major, minor and exotic currency pairs. The range is around the industry average, though spreads are fairly competitive, starting from 0.6 pips for EUR/USD. There’s also an excellent range of tools and education, including forex calculators and trading videos.
- BlackBull 4.5/5 BlackBull offers 64 currency pairs with excellent pricing through its ECN accounts, with the Standard commission-free spread starting from 0.8 pips. BlackBull also ensures its rapid execution carries through to MT4, which still stands as the industry’s most popular platform with active forex traders.
- FXCC 4.6/5 FXCC's key selling point is its forex trading conditions. ECN spreads come in as low as 0.0 pips during peak trading hours, while it supports a wider range of currency pairs than the majority of rivals with over 70 forex assets. Additionally, you have access to MT4, which was built specifically for forex trading and excels for its charting tools.
- Vantage 4.7/5 Vantage offers 55+ currency pairs - above the industry average, so experienced traders can explore plenty of opportunities. Vantage's deep liquidity pool provides forex spreads from 0.0 pips in the ECN accounts, alongside a competitive commission that's typically $6.00 round trip per standard lot. There are also no deposit fees or hidden charges.
- FP Markets 4.2/5 FP Markets stands out as an excellent option for forex traders, boasting a selection of over 70 currency pairs covering a wide range of currencies, especially since expanding its choice of exotics. With average spreads of just 0.1 on the EUR/USD in its Raw account, the broker provides competitive pricing for day traders.
- Bullwaves 3.9/5 Bullwaves has expanded its forex offering, now providing more than 100 major, minor and exotic currency pairs on the advanced MetaTrader 5 platform, which is home to a sophisticated charting package and backtesting capabilities.
Compare CFD Forex Trading Conditions
Compare trading conditions on forex CFDs side-by-side:
| Broker | Number of FX Pairs | Currency Indices | GBP/USD CFD Spread | Maximum Leverage on FX CFDs |
|---|---|---|---|---|
| Markets.com | 50+ | USD | 1.5 | 1:500 |
| BlackBull | 64 | - | 0.5 | 1:500 |
| FXCC | 70+ | - | 0.4 | 1:1000 |
| Vantage | 55+ | USD | 0.5 | 1:500 |
| FP Markets | 70+ | USD | 1.9 average | 1:30 (UK), 1:500 (Global) |
| Bullwaves | 100+ | - | Variable | 1:500 |
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 |
|---|---|---|---|---|---|
| Markets.com | 1259 | ||||
| BlackBull | 3520 | ||||
| FXCC | 225 | ||||
| Vantage | 15949 | ||||
| FP Markets | 10382 | ||||
| Bullwaves | 668 |
Markets.com
Markets.com is best suited to retail investors who trade frequently but don’t want to calculate commissions, thanks to its spread-only pricing (EUR/USD around 1.3 pips). It especially appeals to short-term traders who value fast execution, flexible asset choice spanning 2,200+ instruments and proprietary tools like hedge fund confidence indices and insider trade alerts.
Christian Harris, Reviewer
Markets.com quick facts
- FTSE Spread
- 2.5
- GBPUSD Spread
- 1.5
- Stocks Spread
- 1.53 (Apple)
- Leverage
- 1:500
- Regulator
- ASIC, CySEC, FSCA, BVI FSC
- Platforms
- Web Platform, MT4, MT5, TradingCentral
- EURUSD Spread
- 1.3
- EURGBP Spread
- 1.4
- Total Assets
- 50+
- Account Currencies
- USD, EUR, GBP, AUD, ZAR, SEK, NOK, DKK, CHF, PLN, CZK
Pros
- Markets.com’s Hedge Fund Confidence and Insider Trading tools pulls SEC filings into the dashboard within 24 hours of disclosure, helping to spot fund moves and C-suite buys before most retail newsfeeds updated.
- Markets.com provides commission-free trading on most assets with spreads starting from around 0.6 pips on major forex pairs, making it cost-effective for casual traders.
- Switching between the proprietary web platform (great for alerts and quick analysis) and MT5 (strong for algorithmic EAs) was smooth in our tests; positions synced across desktop, web, and mobile without gaps or re-quotes.
Cons
- While CySEC and FSCA oversight is solid, the SVGFSA and BVIFSC entities offers 1:500 leverage under a light-touch framework, meaning protections like compensation schemes and strict conduct rules lag behind the strictest regulatory standards.
- During sign-up, we hit unclear account type explanations and got stuck in an email verification loop that locked us out for an hour - way less streamlined than other brokers we’ve tested.
- The proprietary web platform felt a bit basic once we pushed into advanced charting with fewer drawing/indicator options than full TradingView or MetaTrader.
BlackBull
After improving its trading infrastructure with Equinix servers in London, reducing latency for traders, BlackBull is an obvious choice if you want to day trade stock CFDs with ECN pricing. With competitive spreads and no commission on a growing roster of digital tokens paired with USD, BlackBull also works for active crypto traders.
Christian Harris, Reviewer
BlackBull quick facts
- FTSE Spread
- 1.5
- GBPUSD Spread
- 0.5
- Stocks Spread
- No mark-up
- Leverage
- 1:500
- Regulator
- FMA, FSA
- Platforms
- BlackBull Invest, BlackBull CopyTrader, MT4, MT5, cTrader, TradingView, AutoChartist
- EURUSD Spread
- 0.16
- EURGBP Spread
- 0.8
- Total Assets
- 64
- Account Currencies
- USD, EUR, GBP, CAD, AUD, NZD, JPY, ZAR, SGD
Pros
- BlackBull offers every ingredient for day traders; fast execution speeds of <100ms and tight spreads from 0.0 pips.
- After partnering with ZuluTrade and Myfxbook, alongside improvements to its own CopyTrader, and finally enabling cTrader Copy, BlackBull offers one of the most comprehensive copy trading experiences we've seen.
- With two ECN-powered accounts (Standard and Prime), plus Prime+ - an active trader rewards program offering trading rebates - BlackBull accommodates beginners through to high-volume active traders.
Cons
- Despite a growing selection of 2,180+ assets, including additions to its Asia Pacific indices, they are mainly stocks with an average selection of currency pairs and indices.
- Although the Education Hub now features improvements like webinars and tutorials, the courses we’ve explored need more focus on explaining the wider economic factors influencing prices.
- Unlike most top brokers, BlackBull charges an irritating $5 withdrawal fee, which can detract from the overall cost-effectiveness, especially for active traders who frequently move funds.
FXCC
FXCC continues to prove itself an excellent option for day traders with a particularly strong selection of 70+ currency pairs, ultra-tight spreads from 0.0 pips during testing, and a free VPS for qualifying traders.
Jemma Grist, Reviewer
FXCC quick facts
- FTSE Spread
- 1.10
- GBPUSD Spread
- 0.4
- Stocks Spread
- 0.17 (Apple)
- Leverage
- 1:1000
- Regulator
- CySEC, MISA
- Platforms
- MT4, MT5
- EURUSD Spread
- 0.1
- EURGBP Spread
- 0.4
- Total Assets
- 70+
- Account Currencies
- USD, EUR, GBP, CAD
Pros
- FXCC has stepped up its offering over the years, adding MT5 to its suite of platforms, hundreds of stocks and more cryptos to its product line-up, plus a copy trading feature and greater margin trading opportunities.
- The free VPS for qualifying traders and the ability to build or buy EAs on MetaTrader make FXCC a strong option for algo traders.
- FXCC’s ECN XL account has been built with active traders in mind, featuring spreads from 0.0 with no commission, while also passing our execution speed benchmark for day traders.
Cons
- Although the economic calendar has benefited from a facelift, FXCC still offers very little in terms of market research beyond basic daily technical analysis and aggregated market news, with no tools like Autochartist or social sentiment data.
- Although regulated by the CySEC, FXCC’s offshore entity operates with weak regulatory oversight from MISA and may not provide safeguards like investor compensation in the event of broker insolvency.
- FXCC charges steep withdrawal fees on many of its payment methods, including $45 for bank transfers and 2% crypto transfers, which may cut into the returns of traders making regular withdrawals.
Vantage
Vantage remains an excellent option for CFD traders seeking a tightly-regulated broker with access to the reliable MetaTrader platforms. The fast sign-up process and $50 minimum deposit make it very straightforward to start day trading quickly.
Jemma Grist, Reviewer
Vantage quick facts
- FTSE Spread
- 1.0
- GBPUSD Spread
- 0.5
- Stocks Spread
- 0.01
- Leverage
- 1:500
- Regulator
- FCA, ASIC, FSCA, VFSC, CIMA
- Platforms
- ProTrader, MT4, MT5, TradingView, TradingCentral, DupliTrade
- EURUSD Spread
- 0.18
- EURGBP Spread
- 0.5
- Total Assets
- 55+
- Account Currencies
- USD, EUR, GBP, CAD, AUD, NZD, JPY, HKD, SGD, PLN
Pros
- The broker has made efforts to expand its suite of CFDs providing further trading opportunities
- It’s quick and easy to open a live account – taking less than 5 minutes
- The app was upgraded in 2026 with wider asset visibility bringing together balances across Contract, Copy, and Funding accounts on one screen
Cons
- The average execution speeds of 100ms to 250ms are slower than alternatives based on tests
- A steep $10,000 deposit is needed for the best trading conditions, which include the $1.50 commission per side
- It's a shame that some clients will need to register with the offshore entity, which offers less regulatory protection
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
- FTSE Spread
- 1.64
- GBPUSD Spread
- 0.2
- Stocks Spread
- Variable
- Leverage
- 1:30 (UK), 1:500 (Global)
- Regulator
- ASIC, CySEC, FSA, FSCA, FSC, SCB, CMA-Kenya
- Platforms
- Iress, MT4, MT5, cTrader, TradingView, AutoChartist, TradingCentral
- EURUSD Spread
- 0.1
- EURGBP Spread
- 0.3
- Total Assets
- 70+
- Account Currencies
- USD, EUR, GBP, CAD, AUD, NZD, JPY, CHF, HKD, SGD
Pros
- FP Markets offers a superb selection of tradable assets, especially since expanding its suite of commodities and supporting over 10,000 stocks.
- FP Markets delivers fast and dependable support, available 24/5 with average response times of less than 1 minute during testing.
- FP Markets has a seamless onboarding experience, standing out with crypto deposits and over 10 base currencies, catering to global traders.
Cons
- 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.
- 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.
- 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.
Bullwaves
Bullwaves may appeal to aspiring day traders looking for the MetaTrader charting platforms with a growing suite of research tools, including AI-powered market analysis. However, the limited track record and weak regulatory credentials raise questions about its reliability.
Christian Harris, Reviewer
Bullwaves quick facts
- FTSE Spread
- Variable
- GBPUSD Spread
- Variable
- Stocks Spread
- Variable
- Leverage
- 1:500
- Regulator
- FSA
- Platforms
- MT5
- EURUSD Spread
- Variable
- EURGBP Spread
- Variable
- Total Assets
- 100+
- Account Currencies
- USD, EUR, GBP
Pros
- Registering on the Bullwaves website and setting up an account is super smooth, only taking a few minutes based on tests.
- Bullwaves now offers copy trading, allowing users to replicate the moves of traders across 900+ strategies with thin spreads from 0.01 pips.
- USDT deposits and withdrawals are facilitated, in addition to regular bank cards, bank wire transfers, and an e-wallet.
Cons
- Day traders and scalpers will likely prefer the VIP or ECN accounts, but these require significantly higher starting deposits ($3,000 and $5,000) compared to many brokers offering similar trading conditions with lower entry barriers.
- Bullwaves has limited education tools, reducing its appeal for beginners, especially compared to category leaders like IG that provide structured courses and interactive elements.
- Customer support performed poorly during our initial tests with no 24/7 chat support as advertised, and no response to our email queries, though it performed much better in our latest round of tests with most queries getting answers same-day.
What Is CFD Forex Trading?
A contract for difference (CFD) is a contract between a buyer (trader) and a seller (broker) that stipulates that the difference between the current value of an asset and its value at the end of the contract will be paid to one of the parties at the expiry. CFDs allow investors to profit, or lose, from price movements without having to own the underlying asset.
How CFD Forex Trading Works
Essentially, CFD forex trading entails opening trades based on whether the value of one currency will rise or fall against another.
The investor can speculate on either upward or downward movement in the value of the currency. If they think the value of the base currency will rise, they will open a long position. If the value does increase, the net difference between the purchase and sale prices will be the net result of the trade (either profit or loss).
Similarly, the trader could believe the value will drop and open a short position. In this case, the profit or loss is the net result of the value between the initial price and the final value.
A good way to understand CFD forex trading is to look at an example, such as the GBP/USD forex pair. Consider that the ask price is 1.20720 and an investor believes the value of the pound (GBP) will rise against the US dollar. That investor purchases 1,000 pips of GBP.
Two weeks pass and the value of the GBP has risen as the investor predicted, the bid price is now 1.22220.
The trader is paid the difference between the initial ask price and the final bid price, multiplied by the size of the trade. That is 0.015 multiplied by 1000, which equals a £15 profit.
CFD Forex Trading Vs Spot Forex Trading
Forex trading can be conducted with or without CFDs, but what difference does it make?
In non-CFD (spot) forex trading, traders still speculate on the value of a currency rising or falling against its pair.
However, they then directly buy or sell the currency, depending on their position. This means the investor owns the currency itself and more money is required to buy the currency. Profit or loss is then finalised by directly selling the currency when the price has risen or fallen.
In CFD forex trading, you are only speculating on the value rising, without buying and owning the currency. CFD brokers usually require a much smaller margin (around 5%) and any profit or loss comes from the spread between the initial currency value and the final value of the currency.
Where You Can Trade Forex CFDs
CFD regulations vary in different countries. CFD trading, forex or not, is banned in the US and Brazil. However, many other major trading countries allow these instruments. Countries like the United Kingdom, Germany, Switzerland, Spain and Hong Kong all allow forex and CFD forex trading in over-the-counter (OTC) markets.
Strategies
There are a few different trading strategies you can adopt when trading forex CFDs. We will run through four of the most popular below.
Day Trading
This is the practice of making short-term trades on the same day. Typically, the CFD forex trading position is held for anywhere from a couple of minutes to several hours before being sold, though it is not generally held overnight. The premise involves taking advantage of volatile forex pairs and requires high levels of concentration, you need to constantly monitor the market and be ready to make quick decisions.
Scalping
This is similar to day trading, except that positions are held open for minutes at a time and closed as soon as it becomes profitable. Again, this involves constant monitoring of the market.
The strategy hopes to minimise risk by reducing the opportunity for a reversal and profits are made by the aggregation of many low-profit, high volume trades. Margin trading is often used to facilitate scalping, though you should be careful as one large loss can erode a significant portion of your progress.
Position Trading
Position traders don’t take short-term approaches like day traders and scalpers. Instead, a position trader will buy CFD contracts and hold them for a few days or weeks. This is a strategy that doesn’t require such constant monitoring of the market but it can need perseverance if there are market dips.
Swing Trading
Swing trading is suitable in more volatile markets than position trading. The emphasis is on looking for strong price swings over one or several days. The strategy entails identifying short-term trends and waiting for signs of a reversal, trading against the trend once there are some. Swing trading may require that CFD forex positions be held overnight, incurring additional interest fees.
Pros Of CFD Forex Trading
- High leverage
- No shorting rules
- Low/no commission
- Instant order execution
- Trade both short and long positions
- No minimum day trading requirements
Cons Of CFD Forex Trading
- Not all countries allow CFD forex trading
- Quick execution makes it easy to overtrade
- Financing fees can be high when contracts are held for days/weeks
How To Start CFD Forex Trading
This step-by-step guide will help you get started trading forex CFDs:
Choose A Broker
The first thing to do is select the best CFD forex trading brokerage for you. Low spreads and financing fees are two basic things to look out for, along with trading platforms, asset ranges and customer service.
There are many brokers, both regulated and unregulated. Forex and CFD trading with IG Group, Oanda or XTB are popular choices. Additionally, more options, like CFDs on forex, stocks, indices, oil and gold are available with XM.
Those investors looking for mobile trading may want to consider Trade Interceptor and xStation, both of which offer APK and iOS trading apps.
Select An Asset
Each forex pair comes with a different level of risk. Major pairs like USD/GBP are relatively stable and demonstrate strong liquidity. Exotic pairs such as GBP/HKD are more volatile and have more dramatic price movements, giving more potential for those that know what they are doing.
Open A Position
Once you have selected an asset, you can open a CFD forex trading position by taking out a contract. Be sure to check the leverage ratio and ensure you have the funds to cover any potential losses. Also, look at implementing stop loss and take profit orders to limit risk.
Monitor & Close Position
Keep an eye on the price and trends for the currency pair you have a position open on. Many platforms will have a mobile app for you to use on the go. Consider any fees when looking to leave the position open overnight. As soon as the price is right, close your position and finalise the trade.
Trading Tips
This list of tips will boost your CFD forex trading skills:
- Stay Up To Date: Price movements can change rapidly and randomly. Make sure you are constantly monitoring the charts. Also, keep up with any news announcements, major stories can have a large impact on forex pairs.
- Stop Losses And Take Profit Orders: Don’t let your losses run wild, set a stop loss to automatically pull out and stop yourself burning funds if the market swings against you. Equally, ensure the trade closes if the value hits a certain point. You don’t want to miss out if you were asleep at the time.
- Demo Account: If your brokerage offers it, practise on a demo account before staking capital. These accounts are the perfect place to trial your strategies and get to know the platform you are using.
Final Word
CFD forex trading is a way to speculate on the foreign exchange markets without physically converting currencies. Investors can make use of high leverage rates and simpler fee structures than their spot forex counterparts. However, it is important to implement robust risk management systems and carry out detailed research to guide your strategy. See our list of recommended CFD forex brokers and follow the guide above to get started.
FAQ
Why Is CFD Forex Trading Illegal In The US?
Part of the reason is that they are an over-the-counter (OTC) product. This means they don’t pass through regulated exchanges and hence the US have banned them.
Is CFD Forex Trading Legal In The UK?
CFD forex trading is legal in the UK. However, Financial Conduct Authority (FCA) regulated brokers have several restrictions and rules they must abide by to protect their clients, including segregating bank accounts.