Forex trading is one of the most rewarding investments and consistently profitable forex traders are the envy of many. There are two essential things you need to trade forex. The first is a forex broker and the second is a trading strategy. A forex broker is an intermediary between the retail forex trader and a securities exchange that will process your trading orders. As a for-profit company, forex brokers make money by charging you trading costs like spread, commissions, and sometimes swap. A spread is simply a small cost built into the buy and sell price at which you enter the markets when trading currency pairs.
Scalping is one of the popular forex trading strategies that many of the best UK forex brokers support. It is simply when a trader opens and closes a trade within a very short period of time (some seconds or minutes). As a scalping trader that expects to make profits on very small forex market moves, it is important to ensure the spread you are charged is as low as possible in order to somewhat maximize profits and minimize losses. Let’s look at some of the best low-spread brokers that are ideal for scalping.
AvaTrade is a zero-commission broker and was founded in 2006. This broker has low spreads for traders who may want to trade popular forex currency pairs. The standard spreads associated with trading some of the most traded forex currency pairs under normal market conditions are listed below.
- EUR/USD with a standard spread of 0.9 pips
- USD/JPY with a standard spread of 1 pip
- GBP/USD with a standard spread of 1.5 pips
- USD/CHF with a standard spread of 1.6 pips
- USD/CAD with a standard spread of 2 pips
- AUD/USD with a standard spread of 1.1 pips
- NZD/USD with a standard spread of 1.8 pips
There are over 7,200 reviews on Trustpilot for AvaTrade, out of which 94% are very positive as customers state that they enjoy trading with this broker. Also, if you choose to trade with AvaTrade you have access to popular global trading platforms like MT4 and MT5. Alternatively, you can use any of AvaTrade’s unique platforms. These trading platforms can be used for any type of forex strategy including scalping, day trading, and intraday trading. You can choose to manually trade on your master account and automatically copy all trades to a second trading account.
XTB is a leading forex broker that has spreads from as low as 0.1 pips. You can trade up to 48 forex currency pairs. XTB standard and pro accounts use floating spreads so it is not possible to state the exact spread for specific currency pairs. Floating spreads simply mean the spread tightens or widens depending on the available market liquidity.
XTB has a user base of 495,000+ clients and offices in over 13 countries including the UK, Poland, Germany, France, and Chile. This broker has its own innovative trading platform called XStation 5 which has both desktop and mobile versions. The XTB’s XStation 5 is suitable for both experienced and new traders. Also, there is 24/7 customer support to attend to any issues you may encounter. You can easily get started with a demo account and you also get 30 days of free access to the XTB trading platform.
Exness is a popular forex broker that is regulated by important bodies such as the Financial Sector Conduct Authority (FSCA) in South Africa, the Cyprus Securities and Exchange Commission (CySEC) in Cyprus, and the Financial Conduct Authority (FCA) in the United Kingdom. This broker has two standard and three professional accounts.
The standard accounts have spread starting from 0.3 and there is no commission charged for placing forex trades. On the basic standard account, you can use MT5 as your trading platform for forex, and other financial instruments like metals, cryptocurrencies, energies, stocks, and indices. While for the standard cent account, you can use MT4 as your trading platform for both forex and metals only.
Exness’s three professional accounts are raw spread, zero, and pro accounts. Spread starts from as low as 0.00 on the raw spread and zero professional accounts. For the pro professional account spread starts from 0.01.
4. FP Markets
FP Markets is a well-known broker that allows trading of forex (and other CFDs) with tight spreads, fast execution, and flexible leverage. This broker was established in 2005 and has amassed a large number of positive client reviews on Trustpilot. These approved positive reviews on Trustpilot are an average of 4.9 (out of 5.0) from about 3,500 clients.
The forex spread you are charged with FP Markets varies depending on the account type you choose to trade with. There are the standard and raw ECN accounts. Spreads of the raw ECN account for many forex currency pairs are lesser than spreads on the standard accounts.
It is easy to start trading with FP Markets. Simply deposit funds into your trading account through direct bank transfers, credit/debit cards, online banking, and popular payment gateways like skill. Also, you will not be charged any withdrawal fee for debit/credit cards and domestic bank wire but other payment gateways have withdrawal fees. FP Markets is popular among traders with diverse trading strategies including scalping.
Conclusion on Low Spread Forex Brokers ideal for Scalping
There are small trading costs associated with trading any strategy with most forex brokers. The spread a broker will charge a scalper for opening and closing a trade that is just 5 pips is the same spread that will be charged if the same trade is left for days or weeks to reach hundreds of pips. If this pip movement is in the positive direction, hundreds of pips will definitely result in more money than just 5 pips but both scenarios will have the same spread cost.
The point is, as a scalper you need to choose brokers with very low spreads so that your profits are not reduced by the trading costs of high spreads. In this article, we have shown you some of the leading low-spread forex brokers that are ideal for scalping. To learn more about any of these forex brokers, you can visit their website to do more research on their unique offerings.