FxBrokerReviews.org – The forex market is the largest financial market globally and continues to grow with time. High liquidity, proper regulation, and availability of a wide range of trade instruments make the market a popular choice amongst all kinds of trades
If you are aware of how the market works, you might have come across the term ‘spread’. A spread is the difference in pips between the BID and ASK Price (buy/sell) of a currency pair in the forex market. Spread is used by many brokers as a source of revenue for each transaction the trader makes. You can also call spread as compensation for forex brokers for the services they provide.
Spreads charged may differ from broker to broker and since trading costs are declining to attract more and more people to trade, certain offerings can be made to lure people into a forex scam by promising extremely low spreads. Therefore, finding a forex broker forex brokers with lowest spread UK is essential.
This guide will review some of the best forex brokers in the UK who offer low spreads and will explain what you need to know to choose the best option for your needs.
Best forex brokers in the UK 2022
Listed below are the best low-spread forex broker UK that offers a cost-effective way to place FX trades. We will review these forex brokers below based on their spreads, assets, features, fee structure, and more.
1. Pepperstone: best broker for forex UK
Pepperstone has a reputation for being the best forex broker in the UK. the trading platform has earned a good name amongst the traders as it provides a variety of assets, charges low trading fees, and is a storehouse of educational resources and market information.
Pepperstone is also a top choice when it comes to low spread forex broker in UK. This is because the trading platform uses multiple top-tier liquidity providers and has competitive pricing as compared to other brokers. Traders can choose between a Standard account, which has no commission costs, and a Razor account, which provides the lowest spreads starting from 0.0 pips.
- It averages the lowest spreads for most currency pairs
- Has a wide range of assets to trade from
- Supports trading platforms like MT4, MT5, and trading view
- Highly regulated platform
- Offers fast execution fees
- Can be intimidating for new traders
- e-wallets such as Skrill and Neteller are not accepted.
Also read: Pepperstone Forex Review
2. Capital. Com – forex broker with the lowest spread UK
Capital.com is a high-leverage broker that supports low trading fees and a range of assets to trade from. The platform is regulated by several authorities such as the FCA, ASIC, CySEC, and MiFID. Apart from this, the platform doesn’t charge any inactivity or withdrawal fees, making it a suitable option for beginners. It even offers a vast array of educational content for all kinds of traders.
Capital.com is considered the best forex broker UK as the trading fees is relatively low, amounting to an average of just 0.6 pips for EUR/USD during peak trading hours. the trading platform accepts almost all e-wallets and bank transfers for deposit and withdrawal.
- Low trading fees
- Offers MT4 and MT5 trading platforms
- Has Over 130 currency pairs to trade
- Doesn’t charge a commission for trading
- Regulated by ASIC
- Does not accept US clients
3. FXCM – low spread betting forex broker UK
Traders in the UK prefer to trade in CFDs and FXCM is the best trading platform to trade CFDs. it allows trades to trade globally regardless of whether you prefer to use shares from Australia, the USA, The UK, or even Hong Kong, all the major stock markets are available. The platform offers commission-free trading along with a wide range of CFDs to trade from. FXTM has excellent customer support and can be contacted in several languages. For beginners, the platform offers a lot of educational tools, including a demo account and live webinars. The platform has tight spreads starting from 0.1 to 1.5 pips.
- Regulated by the Cyprus laws
- Wide range of assets
- Has an easy account opening process
- Offers tight spreads as compared to other platforms
- Supports an array of educational content for beginners
- Charges withdrawal fees
- No two-step authentication on trading platforms
Also read: FXCM Forex Review
4. AVATrade – best forex broker UK with strict regulation
Avatrade is regulated by the Central Bank of Ireland, ASIC, FSA, and FSCA and offers a high degree of protection. It is a CFD trading platform with no commission charges when you open trades. This trading platform is a good option for those who are new to the market and are concerned about the dramatic changes in spreads due to market volatility.
While the platform does not come under the best low spread low forex broker UK, it certainly has a fair amount of spreads, suitable for most traders. The spreads start from 0.9 pips for highly-liquid pairs.
- The platform supports MT4 and MT5
- Offers a wide range of trading assets
- Heavily regulated platform
- Easy for beginners to understand
- Provides personal support through a relationship manager
- Charges high inactivity fees
- Has a slow withdrawal process
Also read: AvaTrade Forex Review
5. E-toro – The best broker for forex in the UK for beginners
E-toro is the least expensive trading platform all across the world. The trading platform has earned an excellent reputation amongst traders, as it offers over 49 currency pairs to trade and various other financial instruments. E-toro has a minimum deposit of only $10 and does not charge any additional fees apart from this. The platform is looked after by several leading organizations, including FinCEN, FINRA, CySEC, ASIC, and the FCA.
The spreads at e-toro start from just one pip for liquid pairs like EUR/USD and USD/JPY. Furthermore, the platform has its copy trading feature which makes it the best broker for forex in UK for beginners.
- Has a comprehensive set of educational tools and resources
- Has low trading fees
- Provides excellent customer support
- The platform offers a wide range of trading instruments
- Allows crypto trading
- Charges high nontrading fees
- Has a slow withdrawal process.
XTB is a well know forex broker for trading stocks, mutual funds, cryptocurrencies, CFDs, and more. The platform offers quality educational content for both beginners and advanced traders. To keep the traders up to date with the market the platform also provides market news and analysis. XTB supports micro lot trading and is a highly regulated platform.
The spreads are set at an average of 0.1 pips depending on the instrument. The spread on the Standard account is floating and the minimum spread is 0.9 pips. The spread on the Pro account is the market spread, and the minimum spread is 0 pips.
- Has fast withdrawals and execution speeds
- Supports micro lot trading
- The platform has a good reputation amongst traders
- Offers low spreads
- Wide range of trading instruments
- Charges inactivity fees
- The Product portfolio is limited mostly to CFDs
Also read: XTB Forex Review
7. NAGA – best forex broker for Forex UK and copy trading
The global community of NAGA has more than 1 million registered users who share their investments, get copied on their strategies, and drive millions of transactions on the platform. With access to over 1000 trading instruments, the platform has made its way into the list of the best forex broker UK
The extensive copy trading feature and social networking capabilities make the platform a go-to option for all beginners. Additionally, NAGA also supports trading platforms like the MetaTrader 4 and MT5, which gives access to advanced chartings and technical indicators.
- Has a strong social network
- Offers low trading fees
- Provides access to MT4 and MT5 platform
- It is a heavily regulated platform
- Offers auto-copy for all traders
- Does not accept US clients
- Charges high withdrawal fees
Also read: How secure is the NAGA trading platform?
How do spreads work?
Before we answer this question it is important to know what are spreads. Spreads are the difference between the bid price and the ask price. The spreads are charged by the forex broker for the service they provide for each transaction they make. Spreads can vary from broker to broker and may be fixed or variable. Read below to learn about how spreads work in the forex market.
Whenever a currency pair’s price is quoted on a trading platform, it has a ‘bid’ and an ‘ask’ (or a sell/buy) price.
For example GBP/USD – 1.3055/1.3058
The number on the left represents the buying amount, whereas the number on the right is the selling price of the currency. Therefore, the difference between these two prices will be termed the ‘spread’.
Mostly, the bid price is less than the ask price as forex brokers look for a trade where the buy is less and the sale of a currency pair is more – thus making a ‘cut’ on each trade. This cut is measured in ‘pips’, (percentage in point or price interest point) which is the change in the fourth decimal place on a price quote.
What is low spread?
In this guide, you might have come across terms like best forex broker in Uk with low spreads, or zero spreads. Let us give you a clear understanding of what are low spreads and how to choose a low spread forex broker UK.
low spreads mean tight bid/ask spreads, which allows traders to make more profit on each trade. However, each broker has a different way of charging spreads. Spreads can be dynamic or fixed spreads.
Dynamic spreads, as the name suggests change according to the condition of the market. Therefore, when liquidity is high spreads are low and vice-versa. This is also the reason why most traders prefer to trade during peak hours. While, on the other hand, fixed spreads are those that do not change according to the market conditions and are constant.
What are zero spreads?
Zero spreads do not have any difference between the bid and the ask price. Several brokers offer a zero spread account to traders. These accounts have no difference between the bid and ask price, or spreads that average close to zero.
However, this does not mean that there won’t be any charges levied. Brokers can still charge additional trading costs such as a commission depending on the account you choose. Zero spread account makes it easier for new traders to enter and exit a trade without incurring trading costs, provided there are no additional commissions or fees. If you want to trade with a zero spread account we have given a list of the best forex broker in the UK that provides a zero spread account.
How can you get the lowest spread in forex?
To get the lowest spread in the forex market you can use numerous strategies while trading. One of these strategies is scalping. It is the most common type of forex strategy. It is a day trading strategy that involves buying or selling currency pairs with a short holding period to make profits.
Scalping helps traders to set a stop-loss for long trades a few pips below the lower band, and their stop-loss for sell trades a few pips above the upper band. The strategy is time-consuming and requires you to have a sufficient amount of market knowledge. If you want to try scaling then, we would recommend trading with only the best forex broker UK that offers low spreads.
Which is the best forex broker with lowest spreads UK?
According to our team of experts at forex broker reviews, Pepperstone and Capital.com are among the best broker for forex in UK in terms of low spreads. Both platforms offer tight spreads to traders, giving them more chances to earn profits.
Pepperstone allows traders to choose between a Standard account, which has no commission costs, and a Razor account, which provides the lowest spreads starting from 0.0 pips. Whereas Capital.com amounts to an average of just 0.6 pips for EUR/USD during peak trading hours.
For most brokers, spreads are the only way to charge for the service they provide. Therefore, the spreads differ from broker to broker. Our guide above has reviewed the best forex broker UK that offers low spreads. We have highlighted their fees, features, and asset selection. So, before you choose which broker to partner with go through our guide and we will help you make your decision.