Best Forex Brokers
Finding a reputable forex broker for retail currency trading can be challenging. Open 24/7, the foreign exchange market is an over-the-counter international marketplace that determines the exchange rate for currencies worldwide. The best forex brokers require a unique set of criteria, distinct from best brokers for beginners.
When selecting the best forex trading brokers we considered account pricing, number of currency pairs offered, customer service and trading platform functionality. While educational tools for beginners is a plus, the best forex trading platforms include features needed for forex traders, which might differ from typical investing features. We find that dedicated forex trading platforms frequently offer more features than those platforms that offer multiple assets to trade.
Foreign currencies were originally traded on the foreign exchange market among large banks and financial institutions. Today, FX, as the currencies market is known, includes retail traders and is among the largest of all financial trading markets. Forex brokers and the FX trading marketplace are regulated by the CFTC, or Commodity Futures Trading Commission, and the NFA, or National Futures Association.
This over-the-counter marketplace takes place on multiple international exchanges. Forex traders can buy, sell, exchange and speculate on the exchange rates between scores of currency pairs.
The CFTC cautions investors about the inherent risks associated with trading in the volatile forex markets.
- Don't trade forex with any money that you cannot afford to lose.
- You can lose all of your money when trading forex.
- Forex trading scams are increasing, so investors need to thoroughly vet their forex broker.
- The market moves quickly and amateur forex traders are competing with professional traders.
Due to the preponderance of scams and bad actors among forex brokers, make sure that the firm you choose is registered with the National Futures Association and the Commodity Futures Trading Commission.
Fortunately, many of the top forex brokers offer demo or paper trading accounts. By signing up with a trial platform, you'll be able to test out the platform features and usability.
Make sure that you understand the fee structure for trading and margin. Forex fees usually encompass a spread-based fee. Buyers will pay the higher price in the spread between bid and ask, while sellers receive the lower price. Some forex brokers also charge commissions. Margin accounts are common when trading forex and carry a range of interest rates.
The number of currency pairs offered is also a consideration. If you're looking to trade more exotic currencies, you'll need to ensure that your preferred forex broker carries the pairs you're seeking.
Education is important. Although it's helpful to choose a forex broker with robust educational features, you can also educate yourself on forex trading at other reputable online financial educational portals.
All five of our recommended brokers accommodate foreign exchange trading carried out within the U.S. They were chosen after consideration of factors such as trading platform, execution, pricing, number of currency pairs, phone customer service and educational offerings. There are many factors to consider when choosing a forex broker, and the 24/7 market is not for the faint of heart, as amateur traders must compete right alongside market pros. However, for those serious about navigating the steep learning curve, these brokers are worth your consideration.
Find the Broker That's Right for You
| If You Are: | Consider: |
| Looking for a platform that provides a solid all-around service for general trading | Best Online Brokers |
| A beginning investor looking for services that cater to people just starting out on their investing journey | Best Brokers for Beginners |
| Aiming to primarily trade stocks | Best Brokers for Online Stock Trading |
| Interested in exploring the world of cryptocurrency trading | Best Brokers for Crypto Trading |
| Thinking of dipping your toes into options trading | Best Brokers for Options Trading |
| Wishing to get started in day trading | Best Brokers for Day Traders |
| Wanting to automate a portfolio that aligns with your goals and risk tolerance | Best Robo Advisors |
Forex trading requires specific features that are distinct from the best brokers for beginners. While beginning forex traders may want a good educational platform, you'll also need features designed specifically for forex trading. The best forex brokers for beginners include both of the above, such as Interactive Brokers and Charles Schwab.
It can be difficult to make money on foreign currency exchange, or forex, trading. Successful forex trading requires being able to accurately predict the direction of two currencies relative to each other. To profit on a forex trade, you then need to earn more than the spread between the buy price and sell price of a currency pair. If you're unsure of your ability to profitably trade directly on the forex market, consider currency exchange traded funds, or ETFs.
Here are our best forex brokers (in no particular order):
- Interactive Brokers
- Forex.com
- IG Group
- Charles Schwab
- OANDA