Forex Trading Accounts
Forex trading accounts connect retail investors with the currency markets. You will likely have to choose between several account types when you sign up. But importantly, the best forex trading accounts are those that suit your personal needs.
In this guide, we review the hottest forex trading account options for 2024. We also discuss geographical considerations, standard accounts versus managed and funded trading solutions, plus how mini and micro FX accounts work.
Top 5 Forex Trading Accounts
- OANDA US - OANDA offers a diverse selection of 68 currency pairs, more than many alternatives. The broker’s in-house platform offers superb day trading capabilities via powerful TradingView charts, including 65+ technical indicators and 11 customizable chart types.
- Vantage - 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 account, lower than many alternatives. There are also no commissions, deposit fees or hidden charges.
- IC Markets - IC Markets maintains its commitment to providing exceptionally tight 0.0-pip forex spreads on major currency pairs such as EUR/USD. This makes it an excellent option if you are seeking superior execution, with an average of 35 milliseconds. Additionally, if you are a high-volume trader, you can benefit from rebates of up to $2.50 per forex lot.
- AvaTrade - AvaTrade offers 50+ currency pairs with competitive spreads from 0.9 pips and zero commissions. You can trade majors, minors and exotics around the clock on industry-leading platforms, including MT4 and MT5. Traders can also access beginner-friendly trading tools and comprehensive forex education.
- FOREX.com - FOREX.com continues to uphold its stature as a premier FX broker, offering over 80 currency pairs and boasting some of the most competitive fees in the industry. With EUR/USD spreads dipping as low as 0.0 and $5 commission per $100k, it stands out. Moreover, its SMART Signals help to identify price behaviors across numerous major currency markets.
Forex Trading Accounts Comparison
| Broker | Forex Assets | EUR/USD Spread | Forex App Rating | Minimum Deposit | Regulator | Visit |
|---|---|---|---|---|---|---|
|
65+ | 1.6 | 4 / 5 |
$0 | NFA, CFTC | Visit |
|
55+ | 0.0 | 4 / 5 |
$50 | FCA, ASIC, FSCA, VFSC | Visit |
|
75 | 0.02 | 4.8 / 5 |
$200 | ASIC, CySEC, FSA | Visit |
|
50+ | 0.9 | 4.3 / 5 |
- | ASIC, CySEC, FSCA, ISA, CBol, FSA, FSRA, BVI, ADGM | Visit |
|
80+ | 1.2 | 4.9 / 5 |
$100 | NFA, CFTC, CIRO, FCA, CYSEC, ASIC, SFC, FSA, MAS, CIMA | Visit |
|
100+ | 0.1 | 4.7 / 5 |
$0 | FCA, ASIC, CySEC, DFSA, CMA, BaFin, SCB | Visit |
|
55+ | 1.6 | 4.7 / 5 |
$5 | ASIC, CySEC, DFSA, FSC, FSCA | Visit |
|
50+ | 0.0 | 3.6 / 5 |
$100 | ASIC, FCA, xCySEC, SCB | Visit |
|
45+ | Variable | 3 / 5 |
$0 | - | Visit |
|
60+ | 14 pips | 4.5 / 5 |
$10 | - | Visit |
|
50+ | 1.2 | 4 / 5 |
$10 | FSC, FSA | Visit |
|
70+ | 1.58 pips (Ave) | 2.5 / 5 |
$100 | FCA, CySEC, FSCA, SCB, FSC | Visit |
|
70+ | 0.2 | 3.4 / 5 |
$0 | CySEC | Visit |
|
70+ | 1.0 | 4.8 / 5 |
$0 | FCA, CySEC, KNF, CNMV, DFSA, FSC | Visit |
|
60+ | 0.6 | 5 / 5 |
$100 | FCA, ASIC, CySEC, DFSA, MAS, FSA, FSCA, FMA, EFSA | Visit |
#1 - OANDA US
Why We Chose OANDA US
OANDA offers a diverse selection of 68 currency pairs, more than many alternatives. The broker’s in-house platform offers superb day trading capabilities via powerful TradingView charts, including 65+ technical indicators and 11 customizable chart types.
"OANDA remains an excellent broker for US day traders seeking a user-friendly platform with premium analysis tools and a straightforward joining process. OANDA is also heavily regulated with a very high trust score."
- DayTrading Review Team
- GBPUSD Spread: 3.4
- EURUSD Spread: 1.6
- EURGBP Spread: 1.7
- Total Assets: 65+
- Leverage: 1:50
- Platforms: OANDA Trade, MT4, TradingView, AutoChartist
About OANDA US
OANDA is a popular brand offering exceptional execution, low deposit requirements and advanced charting and trading platform features. The top-rated brand has over 25 years of experience and is regulated by trusted agencies, including the NFA/CFTC. Around the clock support is available for short-term traders, alongside flexible contract sizes and automated trade executions.
Pros
- Seasoned day traders can access industry-leading tools, including an MT4 premium upgrade and advanced charting provided by MotiveWave
- The proprietary OANDA web platform continues to deliver a highly competitive charting environment, including 65+ technical indicators powered by TradingView
- There's a strong selection of 68 currency pairs for dedicated short-term forex traders
Cons
- There's only a small range of payment methods available, with no e-wallets supported
- The range of day trading markets is limited to forex and cryptos only
- It's a shame that customer support is not available on weekends
#2 - Vantage
Why We Chose Vantage
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 account, lower than many alternatives. There are also no commissions, deposit fees or hidden charges.
"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."
- DayTrading Review Team
- GBPUSD Spread: 0.5
- EURUSD Spread: 0.0
- EURGBP Spread: 0.5
- Total Assets: 55+
- Leverage: 1:500
- Platforms: ProTrader, MT4, MT5, TradingView, DupliTrade
About Vantage
Founded in 2009, Vantage offers trading on 1000+ short-term CFD products to over 900,000 clients. You can trade Forex CFDs from 0.0 pips on the RAW account through TradingView, MT4 or MT5. Vantage is ASIC-regulated and client funds are segregated. Copy traders will also appreciate the range of social trading tools.
Pros
- It’s quick and easy to open a live account – taking less than 2 minutes
- The low minimum deposit of $50 and zero funding fees make this broker a great choice for new traders
- There are no short-term strategy restrictions with hedging and scalping permitted
Cons
- 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
- Unfortunately, cryptos are only available for Australian clients
#3 - IC Markets
Why We Chose IC Markets
IC Markets maintains its commitment to providing exceptionally tight 0.0-pip forex spreads on major currency pairs such as EUR/USD. This makes it an excellent option if you are seeking superior execution, with an average of 35 milliseconds. Additionally, if you are a high-volume trader, you can benefit from rebates of up to $2.50 per forex lot.
"IC Markets offers superior pricing, exceptionally fast execution and seamless deposits. The introduction of advanced charting platforms, notably TradingView, and the Raw Trader Plus account, ensures it remains a top choice for intermediate to advanced day traders."
- DayTrading Review Team
- GBPUSD Spread: 0.23
- EURUSD Spread: 0.02
- EURGBP Spread: 0.27
- Total Assets: 75
- Leverage: 1:30 (ASIC & CySEC), 1:500 (FSA), 1:1000 (Global)
- Platforms: MT4, MT5, cTrader, TradingView, TradingCentral, DupliTrade
About IC Markets
IC Markets is a globally recognized forex and CFD broker known for its excellent pricing, comprehensive range of trading instruments, and premium trading technology. Founded in 2007 and headquartered in Australia, the brokerage is regulated by the ASIC, CySEC and FSA, and has attracted more than 180,000 clients from over 200 countries.
Pros
- With ultra-fast execution speeds averaging 35 milliseconds and deep liquidity, IC Markets provides an optimal trading environment for scalpers, hedgers, and algorithmic traders.
- You have access to over 2,250 CFDs across various markets, including forex, commodities, indices, stocks, bonds, and cryptocurrencies, allowing for diversified trading strategies.
- IC Markets offers among the tightest spreads in the industry, with 0.0-pip spreads on major currency pairs, making it especially cost-effective for day traders.
Cons
- Despite four industry-leading third-party platforms, there is no proprietary software or trading app built with new traders in mind.
- While IC Markets offers a selection of metals and cryptos for trading via CFDs, the range is not as extensive as brokers like eToro, limiting opportunities for traders interested in these asset classes.
- The breadth and depth of tutorials, webinars and educational resources still need work, trailing alternatives like CMC Markets and reducing its suitability for beginners.
#4 - AvaTrade
Why We Chose AvaTrade
AvaTrade offers 50+ currency pairs with competitive spreads from 0.9 pips and zero commissions. You can trade majors, minors and exotics around the clock on industry-leading platforms, including MT4 and MT5. Traders can also access beginner-friendly trading tools and comprehensive forex education.
"AvaTrade offers the full package for short-term traders. There is powerful charting software, reliable execution, transparent fees, and fast account opening with a low minimum deposit."
- DayTrading Review Team
- GBPUSD Spread: 1.5
- EURUSD Spread: 0.9
- EURGBP Spread: 1.5
- Total Assets: 50+
- Leverage: 1:30 (Retail) 1:400 (Pro)
- Platforms: WebTrader, AvaTradeGO, AvaOptions, MT4, MT5, AlgoTrader, TradingCentral, DupliTrade
About AvaTrade
AvaTrade is a leading forex and CFD broker, established in 2006 and regulated across 9 jurisdictions. Over 400,000 users have signed up with the broker which processes over 2 million trades each month. The firm offers multiple trading platforms, including MT4, MT5, and a proprietary WebTrader. 1250+ financial instruments are available for day trading, alongside a comprehensive education center and multilingual customer support.
Pros
- There's a great range of fee-free deposit methods, including bank wire, credit cards and popular e-wallets like Skrill
- Automated trading is supported through MetaTrader Expert Advisors (EAs), as well as the AvaSocial and DupliTrade tools
- The broker’s unique risk management tool, AvaProtect, protects against losses up to $1 million and is easy to activate in the platform
Cons
- Traders from the US are not accepted
- It’s a shame that there are no rebate schemes for serious traders looking for additional perks - CMC Markets would be a better choice here
- There is no ECN account with raw spreads
#5 - FOREX.com
Why We Chose FOREX.com
FOREX.com continues to uphold its stature as a premier FX broker, offering over 80 currency pairs and boasting some of the most competitive fees in the industry. With EUR/USD spreads dipping as low as 0.0 and $5 commission per $100k, it stands out. Moreover, its SMART Signals help to identify price behaviors across numerous major currency markets.
"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
- GBPUSD Spread: 1.3
- EURUSD Spread: 1.2
- EURGBP Spread: 1.4
- Total Assets: 80+
- Leverage: 1:200 (Retail), 1:500 (Pro)
- Platforms: MT4, MT5, TradingView, eSignal, AutoChartist, TradingCentral
About FOREX.com
Founded in 1999, FOREX.com is now part of StoneX, a financial services organization serving over one million customers worldwide. Regulated in the US, UK, EU, Australia and beyond, the broker offers thousands of markets, not just forex, and provides excellent pricing on cutting-edge platforms.
Pros
- FOREX.com offers industry-leading forex pricing starting from 0.0 pips, alongside competitive cashback rebates of up to 15% for serious day traders.
- There’s a wealth of educational resources including tutorials, webinars, and a stacked YouTube channel to help you get educated in the financial markets.
- Alongside a choice of leading platforms, FOREX.com offers a superb suite of supplementary tools including Trading Central research, SMART Signals pattern scanner, trading signals, and strategy builders.
Cons
- There’s no negative balance protection for US clients, so you may find yourself owing more money than your initial deposit into your account.
- FOREX.com's MT4 platform offers approximately 600 instruments, significantly fewer than the over 5,500 available on its non-MetaTrader platforms.
- Demo accounts are frustratingly time-limited to 90 days, which doesn’t give you enough time to test day trading strategies effectively.
Opening A Forex Trading Account
So, what do you need to consider when opening a new forex trading account?
- Services – Check to see if the broker offers a comprehensive range of services, like accessible customer support, leverage trading, intuitive analysis tools, plus market insights
- Account type – They must provide a solution that best suits your needs. You may even have a preferred account funding method.
- Brokerage firm – Is it reputable or is it a known scammer? You need to understand whether they are trustworthy. Though fewer these days, rogue operators still exist. Such a trading platform is a waste of money.
- Costs & incentives – You also need to consider what incentives your forex trading platform offers. Some platforms provide commission-free trading. Others may even reward you for your trading success with rebates. Make sure you read and understand the full pricing policy. Match up these incentives with the costs.
There is 3 step process for opening a forex trading account:
- Fill out any application forms and provide the information your brokerage requires
- Fund your FX account using a traditional payment solution or e-wallet
- Start looking for investment opportunities in major, minor or exotic currency pairs
Services-wise, you are looking for:
- Trading foreign markets
- Special features you may want
- Access to education and research
- Reliable trading platform, with solid technical analysis tools
- Convenience – Some firms even offer face-to-face guidance. The option of an operator with a physical office may be sensible in terms of trust
When you fill out your application forms, be aware that you may have to provide information on your employment status, investable assets, and net worth. Some investors understandably find such probing intrusive.
You may also have to provide a copy of your ID/driver’s license. If you want to trade options or gain access to margin, you may have to provide additional information.
Forex brokers generally accept several account-funding methods:
- Cheques
- Bank transfer
- Cryptocurrency
- Various e-wallets – Neteller, PayPal, Skrill etc.
Some may accept asset transfers and even paper stock certificates.
Which Is The Best Forex Trading Account?
The best account type for you is the one that suits your needs and personal profile. Some factors to consider are your investment objectives and the type of trader you are, for example, day trader, swing trader or long-term investor.
Investment Objectives
Most “casual” traders invest with a relatively short-term goal. The “make some money” mantra is the main driver behind such efforts. If this mantra describes your investment objectives, you likely need a traditional online brokerage account. Such accounts do not generally offer any tax advantages. On the other hand, they do not tie up your investments long-term either.
You may also be able to trade forex on margin with such an account. Margin trading involves borrowing money from the broker. The FX assets in your account will serve as collateral. This carries risks.
If your goal is to secure your nest egg for retirement, an IRA (Individual Retirement Account) is the best option. All IRA options, such as Traditional IRA, Roth IRA, and Rollover IRA offer tax benefits. On the downside, you will not be able to touch this money before you are old.
Types Of Investor
- Absolute beginner – At this stage, you need education. Additionally, good forex trading signals could be advantageous. Customer service and user interface are also important factors in your account selection.
- “Value” investor – If you buy and hold assets to sell them when they appreciate. Most likely, you are not an active trader and value fundamental analysis. You have little use for charting and technical indicators.
- Passive investor – You invest in index funds passively and do not require much from your broker. You need access to index funds and good tradable asset selection within this category.
- High-frequency trader – You are an active trader who doesn’t hold your positions long-term. You want reliable trading platforms with superb charting, outstanding reporting, and a highly functional interface. Technical analysis and low trading costs are essential for you.
USDEUR Live Forex Chart
Forex Trading Account Types
There are four basic account types (standard, funded, mini, managed) and a few additional variants, such as micro, Islamic, demo, and VIP.
Standard Forex Trading Accounts
The name of this account option stems from the standard lots to which it gives traders access. A typical currency lot is worth $100,000. Such a lot size seemingly places this account type out of the reach of average traders.
However, you do not need to have $100,000 in your account to trade. The existence of margin and leverage means that you only need $1,000 to use a standard lot. Leverage varies. In the EU, for example, it is capped at 1:30. In other regions, you can find rates up to 1:500, even on standard accounts.
Forex day trading platforms offer full services for this type of account. They require upfront capital, so these are all depositing traders. The profit potential is significant as well.
On the downside, the same goes for loss potential. For this reason, you should only trade through a standard account if you are an experienced trader.
Funded Forex Trading Accounts
Some firms and other financial organizations fund specific forex traders. They provide starting capital in exchange for a share of future profits.
Account owners usually need to pass an evaluation program. If the company’s analysts consider them good candidates, they grant a funded account.
Funding can run into millions of dollars, and profit splits in the 50% range. The brokerage pays out the profits periodically. These accounts carry monthly profit targets. Forex traders who fulfil these targets can gain additional funding.
What do you need to do to secure this account:
- Sign up for the evaluation program
- Trade forex through the evaluation account and reach the targets
- Earn a proper funded account and start making money for you and the account provider
Mini & Micro Forex Trading Accounts
A standard forex trading account features $100,000 lots. For investors who cannot afford to trade in that league, despite margin and leverage, mini accounts offer an alternative. They support mini lots worth $10,000 each. Mini versions usually accompany standard ones, and they target new FX traders.
Micro accounts take this approach further, supporting micro lots of $1,000. This makes them even more affordable. Similar to the mini solutions, they target forex beginners.
The main advantage of mini and micro resides in risk reduction. You can open an FX trading account for a mere $250-$500. Even professional traders like them. They can test strategies in a low-risk, real-money environment. Importantly, trading forex in lower increments prolongs your funds. Thus, you can better micro-risk-manage them.
The obvious downside is that risk/loss minimization reduces profit potential. Therefore, such forex trading accounts are less suited to cover the profit needs of advanced traders.
Managed Forex Trading Accounts
Forex trading account management works as follows: a managed account holds your cash but defers decision-making to a third party. You make a deposit, and someone else – often a broker-side expert – trades on your behalf. You may also be able to set objectives.
Why would you want to give up control through such a trading account?
- You are not an expert, and you feel that the manager will do a better job than you ever could.
- You feel that pooling your money with the funds of other forex investors offers you a degree of protection. Such managed accounts work like mutual funds. Managers handle the trading, and they distribute the profits.
Managers provide a risk rating to these pooled funds based on their risk tolerance. Those seeking more earnings choose riskier investments, while those with a lower risk tolerance choose a safer route and usually earn less.
The top advantage of a managed account is that it allows you to cash in on the skills of forex professionals. Furthermore, you get to do it hands-off.
Having a forex expert will lower your profits because of the commission. They often require larger deposits than regular accounts. Individual ones may need as much as $10,000. Pooled options are slightly cheaper at around $2,000.
To decide which is the best managed account, you can find reviews online. Check for benefits, drawbacks, performance, cost, account managers, the regional availability (like South Africa, USA, UK, Australia, etc), and any other criteria which interest you.
Islamic Forex Trading Accounts
Islam generally holds trading to be haram (not permitted). However, there are arguable ways to turn it into halal (permitted).
All forex trading activity has to adhere to the principles of Islamic finance:
- No gambling is allowed
- There must not be any interest (riba) involved
- Risks, as well as benefits, have to be distributed
- Exchanges involved in trading have to be immediate
Islamic accounts are swap-free accounts, through which transactions and the payments of costs happen instantly. In the context of Islamic forex trading accounts, the margin, commissions, and administrative fees are not riba.
VIP Forex Trading Accounts
Brokers reserve their VIP forex trading accounts for their most active clients. A VIP account holder enjoys special benefits, such as superior trading conditions and tighter spreads. The trading platform often invites them to special events or offers rewards.
To gain access to such an account, you usually need to deposit a considerable amount of money (often upward of $100,000). You will also need to trade forex frequently and normally meet specific trade volume requirements.
Demo Forex Trading Accounts
A forex demo account, or a dummy account, is the “play money” simulation of a real account. It allows investors to test the platform and trading conditions. Some clients use them to test-run strategies.
When you sign up for a free account, the brokerage credits it with virtual funds. Some offer the same functionality as a standard/mini/micro account. Others limit their users’ access to certain features.
You can open a demo forex trading account no matter where you are in the world, be it India, USA, UK, Canada, Philippines, Jamaica, or even Pakistan. From a brand’s website, you can download one for free, create an account, and login.
Geographical Considerations
Sometimes, your geographical location can play a role in your account type selection. Some jurisdictions may limit certain trade types. In the US, there is no CFD trading. The practice is against US securities laws.
Leverage varies greatly between EU-regulated countries and other parts of the world. The EU’s forex margin is limited to 1:30 by ESMA, the European regulator. In other parts of the world, like India and South Africa, leverage can be offered up to 1:1000 (though 1:400 or 1:500 is typical).
The taxes you have to pay on your profits also vary from one jurisdiction to another. Read our taxes page for more on that.
Final Thoughts On Forex Trading Accounts
There are many types of forex trading accounts. The best one will suit your needs, experience, trading style, and risk tolerance. When choosing a solution, keep in mind their reputation, rewards, services, and ease of use. You can always start with a demo account to test your strategies and the trading platform.
FAQ
Can You Open A Forex Trading Account At A Bank?
Some banks offer this service, such as the First National Bank (FNB) in South Africa. Check with your local banking provider.
Is There A Free Forex Trading Account With Real Money?
Funded or demo forex accounts allow you to earn money while learning without risking your capital. They often come with training and many learning resources. This option is ideal for beginner forex day traders.
How Can I Tell The Difference Between A Live Forex And A Demo FX Account?
By definition, a live forex trading account involves real money, while a demo account uses virtual capital. Importantly though, investors still operate under real-time trading conditions with a paper trading solution.
Do I Need A Demat Account To Trade Forex?
A demat (dematerialized) account holds equities (shares), bonds, and mutual funds in an electronic form. This is not needed for trading forex and commodities.
Which Are The Best Forex Trading Demo Accounts?
The best forex trading practice accounts offer hassle-free access to the currency pairs you are interested in and let you test the platform’s features. You can also use them to trial new techniques before investing real money.
Do Forex Trading Accounts Offer A Sign-up Bonus?
This depends on the provider. Some forex brands offer up to 100% sign-up deposit bonuses. Check terms and conditions for bonus amounts and offers.