Best UK Forex Brokers Compared for May 2024

Antonia Medlicott

If you are looking to trade forex, you may be wondering which are the best forex brokers in the UK. I have managed to take out the guesswork by performing hours of meticulous research into the best UK forex brokers and the best forex trading platforms, with the highest safety regulations for every level of trader, from complete beginners to skilled traders and institutions.

Trading forex is tightly regulated by the FCA (Financial Conduct Authority) in the UK, and therefore you can rest assured that all the forex trading platforms I have listed here fall under that regulation.

Also consider: My guide on how to start forex trading

Browse the best forex trading platform for May 2024

See my list of the best UK forex brokers below, where I give an overview of each FX broker, their pros, cons and fees.

Plus500 logo

Plus500: Trading forex via CFDs

Plus500 has a slick, intuitive web and mobile platform with an excellent range of tools to trade in various asset classes via CFDs. In terms of fees, the commission-free trading and low non-trading fees make this forex broker highly competitive.

For forex traders who conduct their trades on the move, the Plus 500 mobile app is compatible with most Android devices and smartwatches. From here, traders can access all the great functionality and in-depth analysis, as well as execute trades and manage their trading accounts. There are also several risk management tools to help minimise losses.

Plus500 also offers a free demo account, so traders can test the platform completely risk-free. There are over 60 forex pairs that can be traded as CFDs, with leverage for trading and 24/7 support.

Plus500 is a publicly-traded company that is listed on the London Stock Exchange (LON: PLUS) as well as being regulated by the Financial Conduct Authority to offer forex trading to UK traders.

Pros

  • Heavily regulated across the globe
  • More than 2,500 CFDs across multiple asset classes
  • Commission-free trading
  • Easy to use platform

Cons

  • No customer support via phone
  • Limited education

Plus500 forex trading fees

Plus500’s fees can be complicated.

Fee charges for Plus500 include: inactivity fee, overnight fee, currency conversion fee, and guaranteed stop fee.

We recommend reading our Plus500 review which includes a full breakdown of all Plus500 fees.

Plus500 features I like:

  • Guaranteed stop
  • Trailing stop
  • Stop limit and stop-loss price levels
  • Traders sentiment
  • Price alerts

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 81% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

eToro

eToro: Best forex broker for copy trading

The thriving community of traders utilising the eToro trading platform makes it the perfect forex trading account for copy trading, providing scope to mirror the trading activities of experienced traders with proven track records. Copied traders that use eToro are offered an incentive to continue making successful trades, turning a profit for themselves and, in turn, anyone copying their trades.

eToro is a great option for people just venturing into the forex space, with more than 3 million traders available to copy and options to filter by returns, popularity among copiers, and the number of forex markets they are active in. Copy Trading can help increase profitable trades by relying on the experience and knowledge of other traders.

In addition to this, eToro is highly competitive when it comes to fees and range of currency pairs, with over 45 pairs available to choose from, all available from both the web and your mobile device.

Pros

  • Copy-trading with more than 3 million active traders
  • Good selection of trading tools
  • Large selection of investments

Cons

  • Can only trade in USD so FX fees apply

eToro forex trading fees

  • EUR/USD – Standard Spread 1.00 pips
  • Trading Cost – Standard Spread USD 10
  • EUR/USD – Raw Spread 1.00 pips
  • GBP/USD – Raw Spread 2.00 pips
  • USD/JPY – Raw Spread 1.00 pips
  • Trading Commission Fees included in spread

eToro features I like:

  • 47+ currency pairs
  • Demo account
  • Guaranteed negative protection

76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. Your capital is at risk. Other fees apply. For more information, visit etoro.com/trading/fees

Saxo Markets logo

Saxo Markets: Best for range of financial instruments

Saxo Markets provides access to over 40,000 financial products, making it one of the most extensive offerings on the market. They also come in as a low-cost option, with one of the most competitive spreads available at 0.4 pips on major forex pairs.

In addition, Saxo has managed to successfully bridge the gap between beginners and experienced traders by providing dedicated platforms that match your level of experience. SaxoTraderGO is a beginner-friendly version that allows users to trade Forex in a user-friendly environment. SaxoTraderPRO is for more advanced traders who might benefit from the six screens available and algorithmic ordering.

Pros

  • Dedicated trading platform for beginners and pros
  • Extensive list of tradable assets
  • Very competitive spreads
  • 190 FX pairs

Cons

  • Can be slow to verify accounts
  • No 24/7 support

Saxo forex trading fees

  • 0.4 pips
  • £25 platform fees per quarter for accounts with cash funds

Overnight fees:

  • +2-3% long positions
  • -2-3% short positions

Saxo Markets features I like:

  • Variable pricing
  • Educational tools
  • Six screens on SaxoTrader Pro
  • Algorithmic ordering
  • Third-party tools
  • MetaTrader 4

61% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs, or any of our other products work, and whether you can afford to take the high risk of losing your money. The value of your investments can go down as well as up. Losses can exceed deposits on some margin products. Professional clients can lose more than they deposit. All trading carries risk.

IG Investments logo

IG Investments: Best overall forex broker

IG has managed to retain its spot as the best forex broker in the UK with an excellent range of CFD accounts from which retail investors can trade forex, as well as a comprehensive suite of tradable assets, research tools, and educational material accessible on the trading platform.

In addition to this, IG is also competitive with their fees while retaining excellent levels of quality with a highly advanced and intuitive forex trading platform. Users can also rely on excellent levels of 24/7 customer service via chat, phone, email, and social media.

For forex traders looking to expand their knowledge, the trading account at IG also provides access to IG’s guide for forex traders. This includes details on forex and what it entails, how to trade currencies, and the benefits of trading forex.

IG is regulated by the FCA. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

Pros

  • Excellent web platform for trading
  • Comprehensive educational tools
  • Low trading fees
  • Tight spreads
  • Good market analysis

Cons

  • High inactivity fee
  • Lack of social or copy trading

IG forex fees

  • EUR/USD – Standard Spread 0.60 pips
  • Trading Cost – Standard Spread USD 6
  • EUR/USD – Raw Spread 0.85 pips
  • GBP/USD – Raw Spread 1.40 pips
  • USD/JPY – Raw Spread 0.94 pips
  • Trading Commission Fees included in spread

Features at IG I like include:

  • 80+ currency pairs
  • Technical analysis on charts
  • Real-time streaming news
  • Negative balance protection
  • Offers GBP/USD, EUR/USD and USD/JPY on the weekend
  • MetaTrader 4 (MT4)
  • Guaranteed stop loss
  • Demo account

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

Pepperstone logo

Pepperstone: Best FX broker for lowest spreads and commissions/scalping

Pepperstone is ideal for scalpers as most trades have execution in less than 30 minutes, as well as some of the tightest spreads among forex brokers in the UK. CFD trading and spread betting are also available, and I suggest you read my guide to CFD trading and my guide to spread betting before you commit.

Pepperstone offers two main accounts catering to different levels of traders, the standard account for beginner forex traders and the razor account for advanced traders. The forex spreads in the standard account start at just 0.6 pips, and alongside the commission-free pricing structure, this makes for a very cost effective solution.

For veteran traders, the Razor account is highly competitive, with super tight commission spreads for each major forex pair.

In addition to this, Pepperstone has award-winning customer support, which includes phone support, live chat, and email. For traders who like to conduct trades on the go, the Pepperstone mobile platform offers a seamless experience with optimum functionality.

Pros

  • Copy-trading with over 20 million traders
  • Easy to use interface
  • Excellent range of tools for advanced traders
  • Large selection of investments
  • Excellent customer service
  • Tight spreads

Cons

  • Limited market analysis

Pepperstone forex trading fees

  • Minimum Initial deposit to start trading $200
  • Average spread EUR/USD – active 0.17
  • Average spread EUR/USD – standard 0.77

 

Pepperstone features I like:

  • MetaTrader 4
  • MetaTrader 5
  • TradingView
  • cTrader
  • Automated trading
  • Social and copy trading
  • Standard stop loss
  • Guaranteed negative protection
  • Demo account
  • Spread betting
  • Active Trader is only available for professional clients
  • Commission rebates for active traders

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.6% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

Interactive Brokers logo

Interactive Brokers: Best forex broker UK for institutions and professional traders

With its advanced research platform and risk analysis tools, as well as technical research news, advanced charting, and 20 order types, Interactive Brokers (IBKR) makes for the ideal forex trading account.

While the platform and its vast array of customisable tools may be too daunting for the novice trader, there is a wealth of educational material to support trading development, including video courses, webinars, and articles.

In addition to this, traders have the option to test out the platform without risking any of their own funds with Interactive Investors demo trading account.

Trading forex at Interactive Brokers can be conducted from two main platforms, the Trader Workstation (TWS) and the Client Portal platform. The Trader Workstation is an ideal platform from which professional investors can access its impressive array of features. This can all be accessed on both the web platform and the IBKR mobile app.

Pros

  • Huge range of tradable assets
  • Very low cost for high-volume traders
  • Access to 125 markets

Cons

  • Slow and unresponsive customer service
  • Expensive for low volume traders
  • Hidden fees on the IBKR Pro plan
  • Inactivity fee

IBKR forex trading fees

  • Average spread EUR/USD standard: 1.60

IBKR features I like:

  • 105 forex pairs
  • Recommendations
  • Fundamental data
  • Charting
  • News feed
  • Demo account

Investing in financial products involves taking risk.Your investments may increase or decrease in value, and losses my exceed the value of your original investment.

Tickmill logo

Tickmill: Best for range of accounts

With the vast range of account types available at Tickmill, the platform has successfully managed to bridge the gap between experienced traders and beginners. In fact, the Pro Account has some of the lowest spreads I’ve seen, starting at 0.0 pips; however, beginners will have to contend with higher spreads averaging at 1.6 pips on the Classic Account.

Beginners are well provided for in terms of education, with webinars, ebooks, tutorials, and seminars available to help expand their forex trading knowledge.

Tickmill is also an excellent option for traders who enjoy the MetaTrader suite of trading platforms. In my main Tickmill review, I have also gone into some of the trading tools available, which are excellent in both their scope and functionality.

Pros

  • Low fees on the Pro Account
  • Negative Balance Protection
  • Excellent Education

Cons

  • Limited news feed
  • High spreads on the Classic Account

Tickmill forex trading fees

  • Minimum initial deposit to start trading $100
  • Average spread EUR/USD – 0.11 pips Pro Account
  • Average spread EUR/USD – 1.7 Classic Account

Tickmill features I like:

  • MetaTrader 4
  • MetaTrader 5
  • Autochartist
  • Myfxbook
  • Demo account

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd. You should consider whether you understand how CFDs or our other products work and whether you can afford to take the high risk of losing your money..

City Index logo

City Index: Best forex broker UK for beginners

City Index has one of the lowest spreads available as one of the best UK forex brokers, making them an excellent choice for beginners. They also have a low initial deposit of only £100 as well as a comprehensive suite of training resources to help beginners all the way through to advanced forex traders. This includes webinars and videos, articles, platform tutorials, risk management tools, daily market analysis, and training.

There are three main account types on offer including; Trader, Premium Trader, and Professional. This illustrates City Index’s commitment to catering to all levels of traders, and their free demo account offers scope to try the service without any risk to your personal funds.

When traders open an account at City Index, they can access a range of support features, including a welcome pack and a call to walk them through the platform. In addition to this, regular market intelligence emails and trading ideas can help develop skills for trading forex.

Forex traders at City Index can access 84 global FX pairs with tight spreads of 0.5 points.

Pros

  • Low forex fees
  • Quick and easy account opening
  • Excellent research tools
  • Excellent educational material

Cons

  • High stock CFD trading fees

City Index forex trading fees

FX Pair Minimum spread Typical spread Margin from*
EUR/USD 0.5 0.8 3.33%
AUD/USD 0.5 0.9 5%
USD/JPY 0.6 0.8 3.33%
GBP/USD 0.9 1.8 3.33%
EUR/GBP 0.9 1.7 3.33%

City Index features I like:

  • Economic calendar
  • Platform walkthroughs
  • Tight spreads
  • Research portal

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

CMC Markets logo

CMC Markets: Best forex broker for spread betting platform

CMC Markets is an exceptional platform for forex trading, catering to both beginners and experienced traders. With over 330 forex pairs, this is one of the most extensive selections I have come across to date. This is accessible via their proprietary web-based platform, MetaTrader 4, and a robust mobile app, offering versatility and accessibility.

For beginners, CMC Markets provides an array of educational and research tools. Meanwhile, experienced traders benefit from dedicated sites, rebates, and a free API interface. The platform is renowned for its reputation and security, being listed on the London Stock Exchange.

Traders enjoy useful features such as negative balance protection and guaranteed stop losses. Competitive pricing, rebate programmes, and retail trader discounts make CMC a low-cost choice.

In summary, CMC Markets offers an excellent trading platform, extensive educational resources, and a diverse range of tradable assets. Its long-standing reputation and regulatory oversight ensure a secure trading environment. While it lacks backtesting capabilities and may have higher CFD spreads on certain indices, it remains a top choice for traders.

Pros

  • Excellent trading platform
  • Advanced research and educational provision
  • Excellent range of tradable assets

Cons

  • No backtesting capabilities
  • CFD spreads on some indices are high

CMC Markets forex trading fees

  • Minimum spread on: EUR/USD 0.7
  • EUR/GBP1.1
  • GBP/USD0.9

CMC Markets features I like:

  • Over 330 forex pairs
  • Excellent trading platform
  • Low cost

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.

XTB Trading logo

XTB: Best FX broker for free demo account

XTB is the perfect platform for new traders to practise their skills and strategies without risking any of their personal funds. The demo account is completely free for up to 4 weeks, and traders get £100k of virtual funds with which to start trading on 1500+ CFD markets, including forex, indices, commodities, and shares.

To support the development of new traders, XTB also offers a comprehensive range of educational resources, including videos explaining trading strategies, trading instruments, and forex platforms, as well as live webinars. This is all helpfully categorised by experience level, including basic, intermediate, expert, and premium.

Traders who are then confident enough to try their hand at trading with real funds can choose between three account types; Standard, Pro, and Islamic. Each of these accounts has a unique take on commission fees, minimum deposits, leverage, and swap fees.

Pros

  • Low forex fees
  • Quick and easy account opening
  • Excellent educational materials

Cons

  • Limited forex pairs compared to some UK forex brokers
  • No 24/7 support

XTB forex trading fees

  • Average spread EUR/USD – active 0.78
  • Average spread EUR/USD – standard 0.78

XTB features I like:

  • Live performance statistics
  • Comprehensive charting package
  • Market news
  • Price tables
  • Market calendar

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Oanda logo

Oanda.com – Best for research

Oanda’s strength lies in its robust selection of market research materials. This includes podcasts, daily articles, videos, news, trading signals, technical analysis, and market insights.

In terms of spreads, Oanda can’t compare with some of the lowest cost brokers on this list, but with spreads starting at 0.8 pips, they are still a competitive option. In addition, their limited selection of tradable assets can be constrictive, although average traders will still find the 70 different FX currency pairs to be sufficient.

Where it does shine is with its strong regulatory track record and ease of use, which both make this a good option for beginners. There is also a decent selection of educational material.

Pros

  • Offers a free demo trading account to all traders.
  • Compatible with MT4 and TradingView.
  • Regulated by the Financial Conduct Authority (FCA) in the UK.

Cons

  • Only FX and CFD available

Oanda forex trading fees

  • EUR/USD average spread 1.60 pips

Oanda features I like:

  • Demo account
  • MT4 and Trading View
  • Currency converter
  • FX data services
  • Advanced analytics

76.6% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money

Forex.com logo

Forex.com – Best for mobile forex trading

At Forex.com, forex traders have the choice of two mobile trading platforms, MT4 and their own proprietary mobile app. While many traders will be familiar with MT4, the proprietary platform is also worth considering as it comes with excellent tools and navigation, including place market, limit, stop, stop trailing, and COC orders.

Forex.com also offers traders the security of knowing they are listed on the New York Stock Exchange and provide access to over 80 currency pairs, some of which you won’t find elsewhere.

This isn’t a low cost broker, but still has decent spreads that start at 0.8%.

Pros

  • Over 80 currency pairs
  • Extensive range of features
  • Good mobile app

Cons

  • Inactivity fee

Forex.com trading fees

  • Standard spread 1 pip
  • Zero commissions

Forex.com features I like:

  • Good range of platform options
  • Advanced charting tools
  • Demo account
  • Real-time view of pricing

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

IC Markets logo

IC Markets – Best for tight spreads

While you won’t find FCA regulation at IC Markets, they are regulated out of Australia and Cyprus, which ensures tier 1 regulation and will ensure the safety of your funds.

IC Markets has some of the tightest spreads in the industry, sometimes as low as 0 pips and averaging 0.1 pips on the EUR/USD pair. This is available on the Raw Spread Account, but you should be aware of the small commission of 3 USD on the cTrader platform and 3.5 USD on the MT4 and MT5 platforms.

IC Markets has also created a very beginner friendly environment with excellent educational material, detailed market analysis, expert webinars, and great technical support 24/5.

Pros

  • Tight spreads
  • Extensive range of assets
  • Good choice of platforms

Cons

  • High minimum deposit

IC Markets trading fees

  • 0.1 pips on the EUR/USD pair
  • Commission of 3 USD

IC Markets features I like:

  • Good educational material
  • Access to MetaTrader
  • Plenty of automated trading tools
  • Copy trading
FXPro logo

FxPro – Best for day traders and scalpers

FXPro offers access to more than 70 forex pairs on both the MetaTrader and cTrader platforms, with multiple account options. Spreads are often as low as 0.6 pips, and there is a low minimum deposit of just £100.

This is a well regulated broker and, therefore, a safe option for UK traders who also enjoy protection from the Financial Services Compensation Scheme.

FxPro is a great option for forex day traders, as it allows scalping on multiple trading platforms with prime-grade market execution and real time technical analysis.

Pros

  • Tight spreads
  • Fast execution speeds
  • Good regulation

Cons

  • Inactivity fee
  • No automated trading

FxPro trading fees

  • Spreads start at 0.3% on the raw account

FxPro features I like:

  • Demo account
  • 1,800 markets and products on offer
  • Spreadbetting available
  • Several account types

List of the best forex brokers UK: FCA Regulated

Below is my authorised list of the best forex brokers for UK investors regulated by the FCA.

Forex Broker UK Residents Accepted Regulated by the FCA Minimum Deposit
ActivTrades Yes Yes $500
Admiral Markets Yes Yes $100
Capital.com Yes Yes 20
City Index Yes Yes 100
CMC Markets Yes Yes $0
eToro Yes Yes $10
FOREX.com Yes Yes $100
FXCM Yes Yes $50
HFM (HF Markets) Yes Yes $5
HYCM Yes Yes $100
IG Yes Yes 250
Interactive Brokers Yes Yes $0
IronFX Yes Yes $100
LegacyFx Yes Yes $500
Pepperstone Yes Yes $200
Saxo Bank Yes Yes $2000
Swissquote Yes Yes 1000
Tickmill Yes Yes $100
Trade Nation Yes Yes $0
Vantage Yes Yes $200
XTB Yes Yes $0.00

What is forex trading?

Forex trading is the largest and most liquid financial market in the world, involving the changing of one currency into another, often with the anticipation of making a profit in doing so.

The foreign exchange market, also known as the FX market or forex market, is the global market for the exchange of one currency for another. This can be conducted for commerce, trading, or tourism reasons, and forex is usually traded as exchange rate pairs. An example of an exchange rate pair or currency pair would be GBP/USD which is the pair for trading the Great British Pound against the U.S. dollar.

In contrast to a stock market, with forex trading, there is no central marketplace. Currency trading is conducted electronically over the counter (OTC) via computer networks among traders from across the globe. This means the market is open 24 hours a day for five and a half days a week, with price changes constantly moving. This allows for speculative opportunities for trading one currency against another for professional traders and retail investors.

How to trade forex

There are two ways to trade currencies. The first is to earn the interest rate differential between two currencies. This works by buying the currency with the higher interest rate and shorting the currency with the lower interest rate.

The other way to trade currencies is to profit from changes in the exchange rate.

These fluctuations in the price of a currency will depend on supply and demand from banks participating in the spot market. These large trade flows prevent rogue traders from having any influence on the price of any given currency, which in turn helps to provide some transparency for investors.

MetaTrader 4 (MT4)

MetaTrader 4 (MT4) is a trading platform commonly associated with forex trading, but it can also be used to trade a range of other markets via CFDs, including indices, cryptocurrencies, and commodities.

See my guide to the best MT4 brokers offering the MetaTrader 4 forex trading platform.

What influences price changes in the FX market?

The value of any particular currency is based on supply and demand; however, there are some currencies, such as the Chinese renminbi, that have a fixed exchange rate. Currencies without a fixed exchange rate are known as floating currencies, and this is the case for most advanced economies, including the UK pound.

Floating currencies are constantly moving up and down in value against other currencies. These are usually small changes in movement, as small as a fraction of a cent higher or lower at the end of a trading day. However, this can change dramatically at the hands of extreme economic or political news. In this instance, there can be wild swings in price, such as a 10% fall in value the day after the UK voted to leave the European Union. This encouraged traders to sell the pound quickly, decreasing its demand and thus its value.

Another example of a market influencer are economic developments such as data that reveals the economy is growing faster than predicted, which in turn could lead to the Bank of England increasing interest rates. Higher interest rates lead to a greater return on your money and therefore increase demand, boosting its value. This is how financial markets ebb and flow in line with economic, financial, and political news.

The best forex trading platforms will often include live news feeds in their suite of tools to enhance retail traders capacity for profit. This is also the reason why mobile trading is so important: traders can react instantly to changes that may affect the price of currencies.

Why is FX trading so popular?

Forex trading is arguably one of the most popular forms of investment, with a daily average trading volume of about $5 trillion.

The main reason for this demand among investors is that forex is one of the largest financial markets in the world. The high volume and number of different currencies being traded offer a decent amount of liquidity.

However, the downside to this amount of liquidity that potential investors should be aware of is that, while you may be able to generate a return by trading forex, there’s always the potential of losing value on your investment, too.

Indeed, most platforms will report that the majority of retail investment accounts lose money when trading CFDs and forex.

There are things you can do to mitigate this risk in your investment strategy. For example, building up your knowledge of the market can help you make informed investment decisions.

Additionally, the fact that the forex market is available for trading 24 hours a day for five and a half days of the week means individual investors can react quickly to market influences, such as political and economic news.

Unlike stocks and shares, where time in the market is typically more of an influence on your success than timing the market, these rapid price movements mean gains and losses are immediate.

The forex market also benefits from leveraged trading, whereby investors can open a position on a larger portion of the forex market.

This increased exposure can magnify your gains by this margin without you having to invest the same amount of money that would usually be needed for such a trade at the outset.

However, you should bear in mind that this also means that any losses you make will be magnified in the same way. Therefore, it is important to fully understand how leveraged trading works before you invest.

Remember: no investment is risk-free, and you may not get back as much as you invested, regardless of the strategy you use.

Please note: The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Is FX trading legal in the UK?

Yes, FX trading is legal in the UK, although each platform will have its own level of regulation, and this is always worth checking. On the whole, forex brokers in the UK are regulated by the FCA (Financial Conduct Authority), which is responsible for ensuring that all UK forex brokers are licenced and are providing a trading environment that is in the best interests of the traders that use it. Regulation by the Financial Conduct Authority also provides protection for your funds under the Financial Services Compensation Scheme (FSCS), which aims to compensate traders for the loss of their trading funds in the event the broker runs into insolvency issues.

In addition to this, the FCA requires that a multi-asset trading platform keep its operating capital separate from that of its traders to ensure this is protected should the platform experience financial difficulty.

However, it may be the case that some forex brokers are regulated by a similar body outside of the UK. These regulators will be responsible for the same level of regulation as the FCA and can include:

  • Securities and Exchange Commission (SEC) and the National Futures Association (NFA) in the USA
  • Australian Securities and Markets Authority (ASIC) in Australia
  • European Securities and Markets Authority (ESMA) in the European Union
  • Autorité des Marchés Financiers (AMF) in France
  • Comisión Nacional de Mercado de Valores (CNMV) in Spain
  • The Financial Services Agency (FSA) in Japan
  • The Securities and Futures Commission (SFC) in Hong Kong

This level of regulation should be considered the minimum when selecting a forex trading platform in order to ensure the correct levels of protection for you and your funds. This can be confirmed on the FCA’s own website, where they supply a register of all forex brokers in the UK who adhere to these standards.

Despite these regulations, it is crucial to understand that trading CFDs, FX, and cryptocurrencies comes with a high degree of risk, and providers are required to publish the percentage of retail investor accounts that lose money when trading CFDs on their trading platform.

How to choose the best trading platforms for forex

Trading forex has become accessible for all levels of experience, due in large part to the plethora of forex brokers and forex trading apps available. This is good news for retail investors who can take advantage of trading platforms in an increasingly competitive forex trading industry.

However, when considering any trading platform for forex and CFD trading, there are some key elements that you should take into consideration.

Regulation

As mentioned previously, the gold standard for regulation in the United Kingdom is the Financial Conduct Authority. It is always advisable to check that any of the forex trading platforms you are considering have this level of regulation. The best way to check this is via the FCA website, where there is a published list of FCA-regulated forex brokers.

Trading Costs:

Platform costs and trading costs can start to erode away at your gains, and it is therefore important that the UK forex broker you are considering is competitive in this respect. You will need to be aware of commissions and spreads.

Commissions are usually calculated as a percentage of the spread. The spread is the difference between the bid and ask prices of a forex pair. If the broker does not charge a commission, then it is worth checking the spread, as this is often where they will make their money.

Spreads are often depicted as a pip. A pip is the minimum unit of price change in forex. Look for a forex broker that has tight spreads.

Currency pairs offered

There are a vast number of currency pairs available, but not all UK forex brokers will offer all the pairs. The most common pairs trade with the greatest liquidity and include EUR/USD, GBP/USD, USD/JPY, and USD/CHF.

Trading platform

Check the reviews for CFD and forex trading platforms on sites such as Trustpilot to ensure the FX broker you are considering is reliable and trades can be executed with ease. Usability and layout are all important elements, as are tools such as automated trading options, strategy builders, and alerts.

A demo account offers an opportunity to get to grips with the platform before risking any of your own funds. Demo trading accounts will usually offer a sum of virtual money with which to trade.

Minimum deposit

Some forex trading accounts will support a low minimum deposit; however, other platforms will require a large minimum deposit. Due to leverage, the buying power is far greater than the minimum deposit, and therefore you should ensure you are aware of the minimum deposit and whether that is suitable for your trading requirements. This is especially true for beginner traders who may not wish to commit to a large investment amount.

Deposit and withdrawal times

It is wise to check the deposit and withdrawal policies on any given trading platform, as times and costs can vary significantly. Funding can often be done online using a credit card, ACH payment, PayPal, wire transfer, or bank cheque. Withdrawals are often done using cheque or bank transfer. Check the average withdrawal times as well as customer reviews to ensure the trading platform is operating within its published times.

Customer service

FX trading takes place 24 hours a day, five and a half days a week. Therefore, many brokers will offer 24-hour customer service so you can access help when you need it. However, this is not always the case and is therefore worth checking. Also check the method of contact the forex brokers are offering. These should include phone, email, and live chat.

Are forex brokers reliable?

There are many forex brokers on the market, and while some will be totally reliable, others are less so. This is why it is important to do your own research before selecting a broker to ensure you are dealing with a reputable company.

There are several factors to consider in order to ensure reliability, including:

  • Regulation: Make sure the broker you are considering is regulated by a reputable financial authority. This will ensure that your funds are protected should the broker fail. The gold standard for regulation in the UK is the Financial Conduct Authority.
  • Fees: Comparing fees charged can help prevent high fees from eating into your profits.
  • Platform: Ensure the broker’s trading platform is user friendly and has all the tools to meet your trading needs.
  • Customer service: Make sure you are supported with excellent customer service should you encounter any problems.

The brokers I have suggested above all meet these minimum requirements and have a good reputation.

How do I verify if a Forex broker is regulated in the UK?

Here are the steps on how to verify if a forex broker is regulated in the UK:

  1. Go to the Financial Conduct Authority’s (FCA) website.
  2. Click on the “Financial Services Register” tab.
  3. In the search bar, enter the name of the forex broker or its FCA registration number.
  4. If the broker is regulated by the FCA, it will appear in the search results.
  5. The search results will also show the broker’s registration number, the date it was authorized by the FCA, and the type of permissions it has.

In addition, you should take the time to check the broker’s website: The broker should have a prominent statement that declares it is regulated. Regulation will also mean that risk warnings are clearly visible on the website.

Forex broker FAQs

Will I be taxed on my forex trading profits?

If you are an amateur trader who is trading as a side gig, then you are only liable for tax on profits over and above the trading allowance. The trading allowance allows you to earn up to £1000 of income tax-free, anything over and above this amount will be taxed at the standard rate for capital gains tax.

What is the difference between CFDs and forex?

The main difference between CFDs and forex is that CFD contracts cover a wide range of assets whereas forex is limited to just currencies.
You might also like...
*Capital at risk
Have you tried Plus500? Visit Site

81% of retail CFD accounts lose money