In the world of forex trading, the difference between the bid and asking price is known as the spread. Thus, a zero spread account is one that doesn’t have any difference between the bid and asking price. A brokerage firm that gives its clients the option of signing up for zero spread accounts is referred to as a zero spread forex broker. Put simply, the transaction fee is replaced by the spread, which means that traders are not required to pay anything. When you are working with a broker that offers you zero pip spreads, you should be aware that when the spread becomes bigger, your cost of trading will increase. But, when the spread is narrow, the cost of trading will be very limited.
Zero spread brokers are known to offer Straight Through Process (STP) or an Electronic Communications Network (ECN. As compared to the traditional forex brokers that you will find in the market, zero pip spread brokers have a very different approach. There are certain benefits that these brokers have to offer like they give you the ability of directly accessing the financial markets. Other than that, traders will also know their entry and exit points as soon as a position opens up.
This kind of brokerage can be immensely helpful for traders who prefer high-frequency scalping because it makes it easy to calculate non-trading losses. Furthermore, you can also implement your day trading strategies a lot more accurately. As you are given direct access to the relevant markets, you can execute the trading moves very quickly, which is certainly a benefit. Another advantage of signing up with zero pip spread brokers is efficiency. The entire model of this form of trading enables fast executions and allows direct access; this is mostly due to the fact that the broker cannot make any interventions in your trading decisions. You can enjoy a lot of efficiency because all trading systems are automated.
However, it is important to note that the brokers do not set the prices because they are set by the market. If you want to sign up with zero pip spread brokers, make sure you work with reliable ones. Listed below are the top 3 brokers you will find:
1 - HYCM
Formerly known as HYMarkets, HYCM is one of the leading forex brokers in the market as they have garnered more than 40 years of experience. The broker is part of the Henyep Group, which was founded in 1977 and has its headquarters in London, United Kingdom. The broker specializes in offering trading services and there are more than 100 financial trading instruments, which are spread out over different markets, such as forex, energy products, commodities, stocks and indices.
The broker is strictly regulated and it has offices located in various areas of the world, including Dubai, Hong Kong and Limassol (Cyprus) and it complies with the standards of regulatory agencies in every jurisdiction. Some of the organizations that regulate the broker include FCA in the UK, CySEC in Cyprus, SFC in Hong Kong, DFSA in Dubai and the MiFID in the European Union. There are three different account types offered by the broker, which are Micro, Standard and a VIP account respectively. You can choose an account type based on your experience and skill level. The spreads offered by the broker generally vary according to account type. You can find fixed spreads starting from 1.8 pips, variable spreads that start from 1.2 pips and also raw spreads from 0 pips. Since spreads are being used, it means that HYCM does not charge any commission from its traders.
Keeping up with technology, HYCM has provided its clientele with advanced trading platforms they can use for executing their transactions. It has given preference to the most popular option i.e. MetaTrader 4 and has also developed a Mobile application for traders who enjoy trading on the move, which allows them to trade from anywhere and at any time. You can use the mobile app on both iOS and Android platforms. Apart from that, the HYCM platform also provides 24-hour support to its users, top-notch security, integrated technical analysis indicators and tools, automated trading capability, personal VIP dealer services, streaming market news, expert advisors and a lot more.
The minimum deposit requirement of the broker is $100 and it offers a 10% Welcome Bonus of up to $5,000.
2 - XM
This broker introduced its operations in 2009 from Cyprus, but it gradually spread out to other countries including Australia, UK, Greece and Belize. It now offers its services in more than 196 countries and its customer service staff provides support in 30 countries. You can trade more than 55 currency pairs via XM and it allows you to benefit from advanced technologies that it has incorporated on its platform. Moreover, the broker has also made it a priority to offer the best customer service to its traders.
You can get started with trading on XM by depositing just $5 and there is no need to worry about getting scammed because the broker is strictly regulated. In fact, it complies with the regulations established by various organizations in different countries where it operates. In the UK, it is regulated and monitored by the FCA, the Cyprus Securities and Exchange Commission (CySEC) in Cyprus, the ASIC in Australia and the Markets in Financial Instruments Directive (MiFID) in the European Union.
In fact, the broker has also gotten an IFSC Belize license. As mentioned above, the broker offers access to a range of trading instruments, all from a single account. There are three account types offered and you can make a choice between them. There is a Micro account, a Standard account and also a Zero account. The last account, as the name indicates, offers zero spreads to the traders, but it does require a higher minimum deposit of $50. Each of these accounts can also be adjusted to become swap-free or Islamic accounts. This is suitable for all traders who wish to comply with the Sharia law.
Every client is also provided access to a wide array of educational materials, research information and other essential information, which can help improve your trading skills. It is recommended that whether you are a beginner or an experienced trader, you shouldn’t skip the education because the data and information you get can help you make smarter decisions. XM has also included a demo account, which can be used for getting in some practice. When it comes to trading platforms, the broker has offered both MetaTrader 4 and MetaTrader 5 and they are directly accessible from just one account.
3 - FBS
Another one of the top zero pip spread brokers is none other than FBS. The broker has become the choice of more than nine million traders due to their exemplary online operations. FBS has established its presence in different parts of the world and it has become a very attractive environment for new traders because it is able to offer access to zero pips. This is considered beneficial because it can reduce the trading costs significantly, which is a major concern for a lot of traders who do not wish to share their profits with the broker in the form of commissions.
With FBS, traders can enjoy considerable security in terms of operations as well as funds. This is due to the fact that the broker is strictly regulated and keeps the money of its clients in segregated accounts. Even if the broker goes bankrupt, you can rest assured that your investment is safe and you will be able to get it back. The headquarters of the broker can be found in Belmopan, Belize. It is regulated by the Cyprus Securities and Exchange Commission (CySEC) and the IFSC in Belize itself.
One major perk of signing up with FBS is that it requires a minimum deposit of just $1 and it offers a leverage of 1:3000, which increases the potential of making returns. Not only does the broker allow you to trade in the forex market, but also gives you access to other trading instruments, such as futures, cryptocurrency and more. The broker has also kept up to date with market trends and advancements and provides its clients with access to MT4, which is the most popular trading platform in the market.
The platform is available for Windows and you can also use its web version. Other than that, you can also find its mobile version, both for Android and iOS. This ensures that you can trade on the go and make trading decisions regardless of your location. The broker offers several account types, including a demo account that can be used for practice purposes. You can benefit from various trading tools that are part of the MT4 platform, which enhance your trade precision.
You can consider any of the three top brokers outlined above when you want to sign up with one that can offer you as low as zero pip spreads for keeping your trading costs at a minimum.