Reviews of the Best Forex Brokers and Trading Platforms

The staff of FX Helpline provides real, unbiased reviews some of the best Forex brokers for beginner and professional traders from around the world. We aim to periodically update these reviews based on our experiences with each broker and provide facts on the latest developments.

These reviews are here to help you make a decision as you shop for an online Forex brokerage for your currency trading activities. Our information is up-to-date and accurate to our knowledge but please do your own due diligence and pay attention to the details on each of the company web sites for the latest trading conditions, account types, and terms of service. Always read the contracts and agreements before funding your account.

[ Alpari UK | FXOpen | Interactive Brokers | OANDA FXTrade ]

INTERACTIVE BROKERS

Established: 1993 (Timber Hill formed 1982)
Country: United States, Canada, UK, Japan, India
Regulator: SEC and CFTC (US), IIROC (Canada), FSA (UK)

Account Types: IdealPro ECN
Minimum Deposit: 10,000 USD to open a new account (2000 USD balance must be maintained to trade)
Maximum Leverage: 40:1 for USD, EUR, JPY, CHF, GBP, AUD, and CAD (30:1 and lower for exotics; 22:1 and lower for Canadians due to IIROC regulations)
Deposit/Withdrawal Methods: ACH (US), EFT (Canadian), Wire Transfer, Checks

Products Offered: ECN for Forex, also offers direct access to exchanges around the world (stocks, bonds, options, futures, mutual funds, etc.)
Minimum Trade Size: 2.5 Mini Lots ($2.50 per pip or 25,000 units)
Trading Platforms: TWS (Free); Other third party pro-level platforms can be used (eSignal, Ninja Trader, ButtonTrader, etc.)
Spreads/Commissions: Minimum $2.50 commission (equivalent to 1 pip spread padding)

Staff Comments:
We would recommend IB for experienced traders with a sufficient amount of starting capital. The company offers professional level service and direct access to the real equities and derivatives markets around the world. In other words, these are not bucket shop contracts or CFDs. As such, there are also a few disadvantages for beginners. Their ECN will generally function like the real interbank market where your trades are placed against other market participants (major banks, their liquidity providers) which carries its own advantages and disadvantages.

The main advantage to IB is that your deposit is extremely safe which is of major concern to experienced professional Forex traders with large account balances. (This is definitely not the best Forex broker for beginners with small balances or reckless, adrenaline-seeking gamblers; there's no protection from negative balances and the minimum balance to trade is $2000 USD or equivalent -- it's worth noting, however, that the risk of going negative is extremely small if proper money management methods are employed.)

Interactive Brokers is very well-capitalized and, as a public company, their financial statements are regularly available to the public. In the extremely unlikely event that IB faces bankruptcy, your deposit is insured -- at least in the US, Canada and UK.

In summary, we would not recommend Interactive Brokers as the best Forex broker for beginners to the currency trading markets simply because the minimum trade size is generally too large for the level of capital that beginners usually start with. However, they are excellent choice for beginners to the stock and options markets due to extremely low commissions (by retail standards) in those markets.

Still, for online Forex trading, Interactive Brokers is highly recommended for well-capitalized and experienced (more than 2 years consistently profitable) professional traders, who generally have larger account balances and are able to consistently protect it from major (excessive) losses.

Overall: Two thumbs up for cost and efficiency.

ALPARI UK
( Click here to receive rebates for spreads paid to this broker )

Established: 1998 (2004 in UK)
Country: UK
Regulator: FSA (UK)

Account Types: Micro and Classic
Minimum Deposit: 200 USD
Maximum Leverage: 500:1
Deposit/Withdrawal Methods: Wire Transfer, Check (Credit Cards for deposits only)

Products Offered: Spot Forex STP, also offers Gold and Silver (Share CFDs planned in the future)
Minimum Trade Size: 1 Micro Lot (0.10 per pip or 1000 units) in Micro account type
Trading Platforms: MetaTrader 4, Alpari Direct and Direct Pro (Currenex access for retail Forex traders)
Spreads/Commissions: Variable spreads, typically 2 to 4 pips on the majors during liquid hours

Staff Comments:
We are reviewing Alpari UK, not Alpari Russia (the original) or Alpari US. Note that Alpari UK is not available to US customers due to the NFA-regulated US branch on Wall Street.

Alpari UK is among our staff's favorite online Forex brokers for intermediate and beginner traders. The company's participation in the Financial Service Compensation Scheme (FSCS), a government program in England that insures your deposits, is a plus for the safety of your deposited funds (by that, we mean that you are safe from the brokerage's creditors in case they declare bankruptcy; you're not safe from your own losses if you fail to practice proper money management and position sizing.) They are also regulated by the FSA (UK's equivalent to the American NFA and SEC), which requires that all customer accounts are segregated (which is why, in the event of the company's bankruptcy, your funds will not be used to pay their creditors).

The company's micro accounts are excellent for beginner Forex traders. The execution is advertised as STP (straight-through-processing) linked to a number of liquidity providers and they have moved to a variable spread model. In our past personal experience, their service has been top notch with transactions and withdrawals of profits.

In late 2009, they added the Alpari Direct and Alpari Direct Pro trading software, a couple of proprietary Forex platforms linked to Currenex -- one of the most highly regarded electronic communications networks (ECNs) for professional Forex traders that was typically well beyond the reach of typical retail currency traders on the internet. The minimum balances for these accounts, however, are higher than the company's original MetaTrader accounts.

For now, Alpari UK continues to offer MetaQuotes' widely used MetaTrader 4 (MT4) Forex platform. MetaTrader is perhaps one of the most commonly found pieces of trading software in the online Forex trading world, though often criticised for its ability to allow dealing desk intervention. Whether you trust MT4 brokers or not, it remains one of the most user friendly charting and trading platforms for beginner and intermediate traders, especially those who are interested in automating their strategies.

For many experienced currency traders, MetaTrader 4 may not be your cup of tea, so it may be advisable to try the new Alpari Direct and Direct Pro platforms first, if you've decided to give this company a try for the first time. In our staff's past experience, however, Alpari UK was among the best Forex brokers in the retail MetaTrader 4 category and often allowed automated trading (called Expert Advisors or EA's in the MT4 platform) to function as intended.

Highly recommended for beginners and intermediate Forex traders who would like to use EA automation; or professionals who would like to give their Currenex product a go as a second or alternate trading account.

OANDA FXTrade

Established: 1995 (2001 for FX Trade)
Country: US and Canada
Regulator: CFTC and NFA (US)

Account Types: Flexible single-unit based account
Minimum Deposit: No minimum
Maximum Leverage: 50:1
Deposit/Withdrawal Methods: Wire Transfer, Checks, Money Orders, PayPal

Products Offered: Forex Market Maker
Minimum Trade Size: No minimum (Technically, 1 unit or $0.0001 per pip)
Trading Platforms: OANDA FXTrade (Java application) and FXDesktop (Downloadable version)
Spreads/Commissions: As low as 0.9 per pip on EUR/USD, 2 to 5 pips (or more) on other majors and popular crosses

Staff Comments:
OANDA is considered one of the best Forex brokers in the United States. In fact, they may also be the only choice for many under-capitalized retail currency traders who would like to try their hand at scalping the EUR/USD for a few pips at a time (due to the extremely tight spread, by retail standards, OANDA allows for workable conditions for quick scalping during liquid market hours like London and New York peak times.) They are also a great choice for beginners learning to take longer term trades since positions can be sized down to a single unit (that's right, 0.0001 per pip) so your money management can achieve perfect percentages of risk per trade.

For Canadian and American Forex traders, their execution time is generally good to acceptable. Although, we would advise against trading during fundamental news announcements -- we've witnessed the spreads widen as much as 20 pips during major news reactions.

Deposits and withdrawals are processed promptly. PayPal funding and withdrawal, although carrying the usual PayPal fees, provide an added level of convenience for small trading account holders.

OANDA is among the few reputable, and well-capitalized retail Forex brokers in the US (well-capitalized by retail Forex broker standards, that is) and are regulated by both of America's futures industry regulatory bodies -- the NFA and CFTC. As with all known online Forex brokers in the United States, deposited funds are not insured, so they would not be our first pick for experienced professionals with large trading account balances. On the up side, they pay interest on your balance and, rather than the traditional daily rollover practice in Forex, they charge and pay interest on your positions on a second-by-second basis which can be beneficial to interest-positive (carry trade) positions in the market.

OANDA's trading platform is a proprietary Java-based application that runs from their web site, but you can also download it to your desktop from their FXLabs section. The major advantage over many other platforms is that their Java-based software runs just as well on Linux and Mac OS operating systems as it does on Windows (as opposed to MetaTrader used by the majority of retail Forex brokers, which runs only on Windows). On the down side, experienced traders may find their FXTrade software to be a little overly simplistic and lacking in advanced features. Some intermediate users have opted to use an account with another broker for charting while placing orders through OANDA which has the added benefit of getting a better idea of the real market's current bid and ask when you're watching more than one price feed at a time.

Overall, OANDA provides an excellent service as a retail Forex broker for beginners and intermediates to the currency trading world with relatively small accounts (below 20,000 USD or equivalent), especially those who are interested in scalping the EUR/USD.

FX OPEN
( Click here to receive rebates for spreads paid to this broker )

Established: 2003
Country: Egypt
Regulator: FSC (Republic of Mauritius)

Account Types: Micro, Standard, ECN
Minimum Deposit: $1 for Micro, $25 for Standard, $1000 for ECN
Maximum Leverage: Up to 500:1
Deposit/Withdrawal Methods: Local deposit/withdrawal, Wire Transfer, AlertPay, WebMoney, Liberty Reserve, Perfect Money, AlterGold, CashU, c-Gold, Prepaid Card

Products Offered: Forex, Gold and Silver
Minimum Trade Size: 100 units (0.1 of a micro lot or 0.01 per pip) in Micro accounts; 10,000 units (1 mini lot or $1 per pip) in Standard accounts; 100,000 units (1 standard lot or $10 per pip) in ECN accounts
Trading Platforms: MetaTrader 4
Spreads/Commissions: 2 to 3 pips on Majors in Micro and Standard accounts; Commissions charged on ECN varies based on monthly volume

Staff Comments:
FXOpen is an overseas Forex broker that offers a unique blend of trading account types, including a micro account that denominates your balance in terms of US Cents (as opposed to Dollars.) In other words, when you deposit $100 USD into a micro account, your platform will show a balance of 10,000 -- which actually refers to 10,000 cents. Although this may complicate your perception of your trading activity a bit, it's actually a clever way to allow beginners to trade in what appears to be the scale that seasoned professional Forex traders are more likely to be dealing with on a daily basis. It could potentially be confusing for beginner currency traders who are accustomed to seeing dollars shown in their trading platform's balance display but just think of everything in terms of 1/100th the size of the real thing. Likewise, the 1.00 lot trade size in the micro platform is really 1000 units of base currency (1 Micro Lot) which, in terms of cents, functions just like 100,000 units of currency (1 Standard Lot). If you can wrap your head around that and still apply good money management to your trades (percentages work the same either way -- and that's how you should be thinking anyway), you might find this to be a helpful psychological training grounds for a future time when you'll really be controlling larger amounts -- ie. hundreds of thousands in real US dollars. (We realize that this feature isn't entirely unique to FXOpen but they were the first ones that our staff came across to have implemented this feature, and they are relatively larger than some of the other start-ups offering a similar Micro/cent Forex trading account product.)

On the opposite end of the spectrum, FXOpen is beginning to cater to larger and more well-capitalized traders by way of their new ECN account type. As of this writing, none of our staff members have any experience with their ECN account, so anything we would say about it would either be purely speculative or based on advertising material -- neither of which is the purpose of this review section -- so we'll just leave it at a simple mention that the account type is now being offered.

FXOpen's standard accounts function similarly to their micro ones, except for the obvious difference that the balance is denominated in actual dollar values and the 1.00 lot trade size in the platform is actually a real standard lot (100,000 units or $10 per pip.) It's also worth noting that it does still allow smaller trade sizes in the platform as you can open a trade for 0.1 lot (which, in the case of the standard account, works out to be 10,000 units or $1 per pip.) For this reason, the actual minimum trade size in their standard account is actually equal to the minimum trade size on many American brokers' Mini Accounts.

FXOpen's Forex trading platform is the online Forex industry's standard: MetaTrader 4 (MT4), which is the most widely used trading software for online Forex trading around the world. In other words, it's exactly the same piece of software that you would find at 99% of the other retail shops today, with the only real difference being the name on the title bar (and, in the case of the micro account, the treatment of US cents, although that's technically more of an accounting method than a software modification.)

Overall, FXOpen is perfectly suited for beginners wanting to give the MetaTrader 4 platform a go and, with a micro account, be able to experience the psychological effect of trading real standard lots using US cents. If nothing else, the rest of us can see how the Japanese feel when their currency is denominated in the smallest units already (1 yen, even locally in Japan, is treated more like 1 cent in US dollars, this is why JPY-quoted pairs are always 100 times the typical price of a major currency -- so in case you ever wondered why the world's 2nd largest economy has such a low valued currency, that's why. It's more of an accounting trick especially when you consider that their local CD's often sell for 3000 Yen and upper-middle classed workers are paid in the millions per year. Apparently their government had the same idea as FXOpen's micro accounts.)

In all honesty, we would recommend one of the UK or US regulated brokers for larger sized accounts simply because their respective governments are more likely to reinforce laws against any wrong-doings involving large amounts of your capital. For beginner currency traders' micro accounts, however, there's nothing wrong with dropping a few hundred into this company and withdrawing your profits conveniently via AlertPay (which, by the way, is a Canadian equivalent of PayPal -- it stores its money in one of Canada's "big 5" banks.)