Trading words or slang might be a bit intimidating, especially for beginner traders. Still, if you are serious about joining the trading party, by the end of this blog post, you’ll learn the basics and one important tip to make huge profits in no time.
First, let’s cover a brief intro about Forex and then dive deep into one particular phrase, “low spread Forex brokers.” The profit-making tip is hidden in this phrase, so stay tuned!
Forex, Brokers, Pair Currencies, & Spreads
Forex is short for foreign exchange, which refers to an online financial market for trading different currencies, such as USD, GPB, AUD, etc. The Forex market is open and active 24 hours a day based on different time zones. There are three primary markets in Forex trading, including spot markets, forwards markets, and futures markets; you can learn more about these markets here.
Forex brokers are the middleman in the Forex market; they enable traders to access trading platforms for buying and selling different currencies.
For example, if you want to buy tomato paste, you must go to your local supermarket to purchase one; you can’t go to the factory that produces tomato paste and buy from them directly. Your local supermarket acts like a Forex broker. The difference is that you can both buy and sell currencies through your Forex broker. Some people like to avoid Forex brokers because of privacy and trust issues. But remember, all Forex brokers are registered and licensed by the regulatory agency that is in charge of regulating Forex. (We will introduce them in the upcoming sections.)
Pair currencies are the exchangeable currencies in the Forex market. For example, say you want to buy U.S. dollars in exchange for euros; your pair currency would be EUR/USD (base currency/quote currency). Traders will gain or lose based on the rise or fall of the currency they buy/sell.
Before we talk about spreads, you need to know about the bid and ask prices. So let’s stick with our EUR/USD trading example. The Forex broker declares two prices for the EUR/USD currency pair; the bid and ask price.
The bid price is the price the Forex broker is willing to pay to buy the base currency (EUR) in exchange for the quote currency (USD). The ask price is the price the Forex broker is willing to sell the base currency (EUR) in exchange for the quote currency (USD). To explain Forex spreads, let’s throw in some numbers.
Suppose the bid/ask price of the Forex broker for EUR/USD is $1.1200/1.1205. If we subtract these two price points, we get $0.0005, referred to as bid-ask spread, also known as pip. (So, in our example, the spread is five pips.)
The best thing you can do to benefit from every trade is to find a broker that offers the lowest Forex spreads.
Before we talk about why you need to find low spread Forex brokers, let’s cover two common types of Forex spreads.
Types of Spreads in Forex — Which Is Right for Me?
There are two types of spreads in Forex:
1. Fixed Spread
The spread or the difference between the bid/ask price for the currency pair is fixed and doesn’t change based on market conditions. Fixed spread happens when a Forex broker, who in this case will be a market maker, buys large currency positions and offers them at fixed prices to traders. Trading with brokers that offer fixed spreads might sound like the safest, most logical move for making a nice profit, but if the market frequently fluctuates, affecting the currency pairs’ value, you’ll end up with a no-profit trade. However, trading with Forex brokers that offer fixed spreads is the best move for beginner traders with limited capital.
2. Variable Spreads
The bid/ask price of currency pairs changes constantly. The variable spreads happen based on the supply and demand of currencies, the overall market volatility, economic data releases, and market liquidity. Trading with Forex brokers that offer variable spreads is best suited for advanced or full-time traders with larger accounts.
Most professional traders look for zero spread Forex brokers, but do they even exist? You’ll find the answer in the upcoming sections.
What Factors Affect Forex Spreads?
Even if you find the lowest spread Forex broker, the pricing will eventually change because there are market conditions and other criteria that affect spreads:
Forex Market Overlap
Depending on your timezone, you can trade on Forex 24 hours a day. So, for example, if you live in New York but start your trading session when the London market wakes up, the trading spreads will be affected. So, timing plays a crucial role in how successful your trades are. That’s why we encourage you to read our other blog post on the best times to trade Forex.
Supply and Demand of Currencies
If a currency pair is in high demand, the bid/ask prices increase, and the spread will be higher. Finding a low spread broker can help you make profits even when the market fluctuates rapidly.
Corporate Activity, Governmental Changes, Trends, and Events
These are all economic indicators that affect the financial markets directly. If the currency pair liquidity drops, the spread will be higher. Keeping an eye on these indicators and reviewing past trading results can help you make better trading decisions and improve your trading strategy.
If you are a beginner trader, the best way to avoid trading losses is to stick with low spread Forex brokers until you are able to see trading patterns and make decisions accordingly. As a beginner trader, learning more about the Forex market and educating yourself can change your trading path. If you want to start your forex journey strong, you can read our blog post on this topic.
Forex Pairs with Lowest Spreads
Finding Forex pairs with the lowest spreads enable you to make huge profits quickly, even if you have little to no experience in the Forex market.
- EUR/USD: Both currencies are always high in demand and are affected by news events, political events, social media trends, and the economic calendar.
- GBP/USD: Both currencies’ value constantly changes on the market, making them one of the most profiting Forex pairs with the lowest spreads.
- USD/JPY: Both currencies offer high volatility and are considered the most economical Forex pairs with the lowest spreads.
- EUR/JPY: Both currencies’ value constantly changes on the market, but losses will be quite minor since they are categorized as the lowest Forex spreads.
- USD/CHF: Both are the most stable Forex pairs with the lowest spreads, making the pair the perfect choice for beginner traders.
5 Best Forex Broker with Lowest Spread
If you want to find the best Forex broker with lowest spread that requires a $0 deposit, you’ll find it in this section.
1. CMCMarkets
CMCMarkets requires a minimum deposit of $0 and offers 0.0 pip spreads on six major FX pairs (AUD/USD, EUR/USD, GBP/USD, NZD/USD, USD/CAD, USD/JPY). CMC (330 FX pairs) and MetaTrader4 platform (+175 FX pairs) are supported, and they offer a 25% spread discount on over 300 other FX pairs. CMCMarkets has fixed low commission rates ($2.50 per $100,000 notional value) and charges no deposit or withdrawal fees. You can experience ultra-fast executions (0.0030 seconds) with CMCMarkets.
2. Capital.com
Capital.com requires a minimum deposit of $20 and charges no deposit or withdrawal fees. It has an intuitive & easy-to-use platform with advanced analytic tools, including MT4 risk management tools. They offer free trading guides, real-time quotes, dynamic charts, and indicators and are regulated by FCA, ASIC, CySEC, FSA, and SCB.
3. ICMarkets
ICMarkets requires a minimum deposit of $200, charges no fund transfer fees, and offers the average spread of 1 pip for EUR/USD. The average execution speeds are under 66ms, and MetaTrader4, MetaTrader5, and CTrader platforms are supported. ICMarkets is excellent for automated traders and comes with a free low latency collocated VPS.
4. FPMarkets
FPMarkets requires a minimum deposit of $50 and offers low spreads from 0 pips on 60+ forex currency pairs on MT4. FPMarkets has a multilingual and responsive customer support team and offers Superior Virtual Private Servers (VPS) solutions for Expert Advisors (EAs).
There are no dealing desks or requotes, and major platforms, including MetaTrader4, MetaTrader5, IRESS, and WebTrader are supported.
5. IG
IG doesn’t have a minimum deposit rate and offers spreads from 0.6 points on key FX pairs. The average execution speed is 0.014 seconds, and MetaTrader4, ProRealTime, and L2 Dealer platforms are supported. IG has won ADVFN International Financial Awards (Best Multi-Platform Provider- Best Finance App) and offers excellent tutorials such as IG live: Expert trading tips and IG Academy: free online courses, webinars, and seminars.
Choosing a low spread broker is a smart move if you have limited trading experience. Besides, most of these low spread Forex brokers offer excellent trading tutorials and demo accounts, which are great for improving your trading skills. Let’s wrap up the low spread broker topic with a comparison table:
| Low Spread Broker | Minimum Deposit | Supported Platforms | Free VPS |
| CMCMarkets | $0 | CMC, and MetaTrader 4 platform | ✅ |
| Capital.com | $20 | MetaTrader 4 | ❌ |
| ICMarkets | $200 | MetaTrader 4, MetaTrader 5, and CTrader | ✅ |
| FPMarkets | $50 | MetaTrader 4, MetaTrader 5, IRESS, and WebTrader | ✅ |
| IG | 0 | MetaTrader 4, ProRealTime, and L2 Dealer | ❌ |
5 Best Zero Spread Forex Brokers
Zero spread brokers are the ideal choice for beginner traders who don’t have enough knowledge or experience to pivot market fluctuations to their advantage.
1. FOREX.com
FOREX.com requires a minimum deposit of 100 of your selected base currency and offers both fixed and variable spreads. FOREX.com is one of the best zero spread brokers for beginners and has an average execution speed of 0.05s. They offer advanced market analysis and straightforward tutorials for all level traders. MetaTrader 5 and WebTrader platforms are supported on FOREX.com.
2. HFMarkets
HFMarkets requires a minimum deposit of $200 and offers raw spreads with 0 markup. HFMarkets is authorized and regulated by FCA and supports MetaTrader 4, ProRealTime, and HFM platforms. Their support team is available 24/5 and offers multilingual (+27 languages) to all traders. HFMarkets offers free VPS solutions (subject to specific deposit and trading requirements) and holds live expert webinars on trading and market analysis.
3. Exness
Exness requires a minimum deposit of $200, has +$2.8 trillion trading volume globally, and offers instant money withdrawal 24/7. They are regulated by the Cyprus Securities and Exchange Commission and support MetaTrader 4 and MetaTrader 5.
Exness is excellent for experienced traders and offers free VPS for +$500 deposits.
4. Global Prime
Global Prime requires a minimum deposit of $200 AUD and supports EA, scalper, news trader, and HFT. They are fully licensed by Australia (ASIC), Seychelles (FSA), and Vanuatu (VFSC) and support TradingView, MT4 WebTrader, MT4 for Desktop, TraderEvolution, and FIX API.
Global Prime is known for its fast execution speeds, as low as 1 ms, and they also have a Discord chat room to discuss ideas and feedback. Traders won’t be charged any deposit or withdrawal fee.
5. LQDFX
LQDFX requires a minimum deposit of $20 (with no deposit fee) and works with over 265 banks worldwide. LQDFX offers E-Books, Trading Courses & Video Tutorials for all level traders, and the 100% Bonus Program (applies to all deposits above $250). They gained significant recognition after winning the Most Reliable Broker award in January 2017.
LQDFX is one the most cost-friendly zero spread Forex brokers because you can open an account with as little funding as $20. Also, you will have access to tons of educational material to learn new trading techniques and stay ahead of your competitors. The only reason we listed LQDFX at the bottom is that it just supports MetaTrader 4.
Let’s wrap up the zero spread brokers topic with a comparison table:
| Zero Spread Brokers | Minimum Deposit | Supported Platforms | Free VPS |
| FOREX.com | 100 of your selected base currency | MetaTrader 5 and WebTrader | ❌ |
| HFMarkets | $200 | MetaTrader 4, ProRealTime, and HFM | ✅ |
| Exness | $200 | MetaTrader 4 and MetaTrader 5 | ✅ |
| Global Prime | $200 AUD | TradingView, MT4 WebTrader, MT4 for Desktop, TraderEvolution, and FIX API | ❌ |
| LQDFX | $20 | MetaTrader 4 | ❌ |
Forex VPS; Why Do You Need It?
You saw that some of these low spread Forex brokers offer free VPS. So what is VPS?
VPS is short for Virtual Private Server, like a stand-alone computer that is 100% private, and you have full control over its resources. The reason you should use a VPS for trading is that it ensures uninterrupted access to your trading platform, stable execution of trades, and allows you to run your trading software 24/7 without relying on your personal computer, leading to faster and more reliable performance. And guess what? Our Forex VPS offers all of these features and more. You can get our VPS with MT5 if you’re comfortable using MetaTrader 5, or you can choose an MT4 VPS if you’re a fan of the older app. Both are pre-installed, and you only need one click to set up your Forex VPS.
Give yourself a better chance at the Forex market by hosting your trading platform right next to your broker.
Want to Improve your Trading?
The main factor that distinguishes us from other VPS providers is that we value customer feedback and actually take action upon it. The best Forex VPS in the market can elevate your profits and have a positive impact on your trades. So, check out our plans and get in touch with us if you have any questions.
Wrap Up
Low spread Forex brokers are the way to go if you are tight on funds and have a risk-averse personality. However, successful traders don’t just look for the lowest Forex spread; they have learned to analyze the market from different aspects and then predict the most likely outcome.
We mentioned that many factors affect Forex spreads, such as the economic calendar, political events, social media trends, and so forth. So it’s important to pick a currency pair that can give you the highest profit; sometimes, that currency pair has a high spread.
The best thing about these low spread Forex brokers is that they are under strict supervision from Forex regulators such as CFTC, ASIC, FSA, etc. So you won’t have to worry about losing your deposit or profits and can focus on making better deals.
If you are a beginner trader, we suggest you start with one of the zero spread brokers and study the educational material they offer meticulously.
There are many risks in trading, and if you go into it with zero training, you’ll end up using a lot of your capital plus your most precious commodity, your time.
FAQ
Which broker has the best spread?
Zero spread Forex brokers seem like the perfect choice for all traders. But you must keep in mind that some of these brokers charge high commission fees, which would typically be much higher than any spread. All the low spread Forex brokers we mentioned in this article are reputable brokers that charge low commission fees, so be sure to check them out.
Is a zero spread account good?
A zero spread account means you won’t lose any spread money, which is a huge advantage. However, you should keep a lookout for brokers’ fees and commissions and also find out that the zero spread brokers you use offer variable or fixed spreads.
Can I trade Forex without a broker?
Yes. Although with low spread Forex brokers, traders can make larger profits, there is a way to cut through Forex brokers altogether, by becoming a Forex broker yourself. See, Forex brokers are those who open the gateway to the Forex market, and only by investing huge capital and paying hefty license fees can you become one and access the market directly.
What is the best Forex broker with lowest spread that requires a $0 deposit?
CMCmarkets offers the lowest Forex spreads, and the minimum deposit for trading is $0.
Is there a zero spread broker?
Yes. FOREX.com is one of the best zero spread Forex brokers. However, you must pay a per-trade commission which differs based on brokers’ pricing policies.
Low spread Forex brokers; are they the best choice for everyone?
If you are a risk-averse day-time trader with limited funds, finding the lowest Forex spreads is the best way to make respectable profits in the long run.
What pairs have the lowest spread in forex?
The forex pairs with the lowest spreads are typically the most traded ones, including EUR/USD, USD/JPY, and GBP/USD. These pairs enjoy high liquidity, resulting in tighter spreads and lower trading costs.
