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There are many forex brokers in Australia and choosing the right one can be confusing. You need to make sure that you choose a broker who provides the best services possible and is regulated by ASIC.
The Australian Securities and Investments Commission (ASIC) regulates Forex Trading in Australia. Any Forex broker that you choose must be licensed with ASIC, as trading with an unregulated broker puts your funds at risk.
Risk Disclaimer: Forex and CFD trading is risky, and about 70-90% of retail traders lose money while trading CFDs. You should not risk any money you cannot afford to lose, use leverage wisely, and only trade with ASIC-regulated forex brokers.
When choosing a broker, it’s important to consider other factors asides from regulation. Fees, range of CFD instruments, having AUD as account currency, negative balance protection and other risk management tools, deposit/withdrawal time and customer support are some factors worth considering.
Here, we have made a list of the best Australian forex brokers and their main features which you should consider before you start trading with them.
| Broker | Regulation(s) | AUD/USD Spread (Pips) | Min. Deposit | Visit |
|---|---|---|---|---|
|
ASIC, FCA, CySEC
|
0.20 pips (Razor Account)
|
No minimum deposit
|
Visit Broker | |
|
ASIC, CySEC
|
0.17 pips (Raw Spread Account)
|
US$200
|
Visit Broker | |
|
ASIC, CySEC, FCA
|
1 pips
|
$50
|
Visit Broker | |
XM |
ASIC, FCA, CySEC, IFSC
|
1.6 pips (Standard Account)
|
AUD 8
|
Visit Broker |
|
ASIC, FCA
|
0.7 pips
|
$0
|
Visit Broker | |
|
ASIC, CySEC
|
1.0 pips
|
A$450
|
Visit Broker | |
FP Markets |
ASIC, FCA
|
1.3 pips
|
AUD 100
|
Visit Broker |
Below is the comparison of Australian Forex Brokers as per our analysis and reviews:
In this review, we looked through the websites of different Australian forex brokers to see how they fare relative to these factors. We also tested their customer support to see how quickly they respond to our questions & requests.
On Pepperstone’s cTrader trading platform, the round-turn commission is $6 (US dollars). Overnight charges (Swap) for AUD/USD is on their trading platforms.
Regulation: Pepperstone is licensed with ASIC as Pepperstone Group Limited. Their AFSL number is 414530. Pepperstone is considered a low-risk forex broker for Australian traders.
Benchmark fees for AUD/USD: Pepperstone’s typical spread for AUDUSD is 0.30 pips (Razor Account) and 1.30 pips (Standard Account) as per data on their website. The round turn commission for trading AUD/USD is AUD 7 per standard lot on their Metatrader platforms with the Razor Account, while the Standard Account is commission-free.
Inactivity fees: Pepperstone does not charge inactivity fees.
Trading Conditions:
AUD base currency account: Pepperstone offers an AUD base currency account.
Number of CFD Instruments: The financial instruments offered by Pepperstone are 62 currency pairs, 23 indices CFDs, 600+ shares CFDs, 97 ETF CFDs, 33 commodities CFDs (oil, metals, agriculture), 24 cryptocurrencies, 48 ETFs, 3 currency indices CFDs, 22 dividends for index CFDs, and 25 dividends for shares indices.
Leverage: These are Pepperstone’s leverage per instrument for retail traders.
| Instruments | Leverage |
|---|---|
| Forex Majors | 30:1 |
| Minor currency pairs, Gold, and Major Indices | 20:1 |
| Commodities and Minor Indices | 10:1 |
| Cryptocurrencies | 2:1 |
| Shares | 5:1 |
| Currency Indices | 5:1 |
Negative balance protection: Negative balance protection is available for retail traders. But it does not apply to professional traders.
Deposit/Withdrawal time: Deposits via bank transfers (domestic) are credited in 1-2 business days, and your first deposit through PayPal is credited in 1-2 days, while subsequent deposits via PayPal is credited to your account instantly. Deposits via cards are credited instantly.
Withdrawals via bank transfers can take 3-5 business days for you to receive the funds.
Support: Pepperstone offers customer support 24/5 Monday to Friday via live chat, email and phone number. You get immediate replies via their live chat. They also respond to emails within 25 minutes. If you prefer mobile phone communication, an AU toll-free number is available on their website.
Read our Pepperstone review for more on this broker
Pepperstone Pros
Pepperstone Cons
IC Markets charge AUD 7 as a round-turn commission for every Standard lot trading on their MT4 Raw Spread Account. Overnight charges are AUD 2.57 for long positions and AUD 2.02 for short positions.
Regulation: IC Markets are regulated with ASIC as International Capital Markets (Pty) Limited. Their AFSL number is 335692. They are considered low-risk for Australia-based traders.
Benchmark fees for AUD/USD: For their Raw Spread Account, the average spread for AUD/USD is 0.17 pips. On the Standard Account, it is 0.77 pips. The Standard Account charges no commissions, while the Raw Spread Account has commissions of $3 and $3.5 per side on the cTrader and MetaTrader platforms respectively.
Inactivity fees: No Inactivity fees are charged by IC Markets
Trading Conditions:
AUD base currency account: You can open an AUD base currency account.
The number of CFD Instruments: IC Markets offers a good range of CFD Instruments on their platforms. They offer 61 currency pairs and CFDs on 24 commodities (metals, agriculture, oil), 25 Indices, 9 Bonds, 21 digital currencies, 2,100+ Stocks, and 4 global futures.
Leverage: Here is IC Markets leverage per instrument
| Instruments | Leverage |
|---|---|
| Forex Majors | 30:1 |
| Minor currency pairs, Gold, and Major Indices | 20:1 |
| Commodities and Minor Indices | 10:1 |
| Stocks | 5:1 |
| Bonds | 5:1 |
| Cryptocurrencies | 2:1 |
| Futures | 10:1 |
Negative balance protection: IC Markets offer negative balance protection to their retail clients. But it is not available if you are a Pro Account Holder.
Deposit/withdrawal time: Bank wire transfer deposits are processed between 2-5 business days while cards and e-wallets (PayPal/Neteller/Skrill) are credited instantly.
All withdrawals are processed within 1 business day, and it takes about 3-5 business days for funds to reach your cards, 1 business day for bank transfers and instant for e-wallets.
Support: Overall customer support is good. You can reach IC Markets customer support 24/7 via email and live chat. Live chat responses are almost immediate. Email response can take up to five minutes. Two local numbers are also available.
Read our IC Markets review for more on this broker.
IC Markets Pros
IC Markets Cons
eToro does not charge any extra trading commission for currency CFDs except their spread & Swap Fees.
Regulation: eToro is regulated with ASIC under the company name eToro AUS Capital Limited. Their AFSL number is 491139. eToro is considered low-risk because of their tier-1 regulation.
Benchmark fees for AUD/USD: AUD/USD spread is as low as 1 pip. Overnight charges are low at $0.00001983 for a short position and $0.00002453 for a buy position.
Inactivity fees: eToro charges $10 per month after 12months with no login activity.
Trading Conditions:
AUD base currency: AUD base currency account is available.
Exact number of instruments: eToro offers 49 currency pairs, 3,000+ stocks CFDs, 26 commodity CFDs, 20 indices CFDs, 73 cryptocurrencies and 317 ETFs CFDs.
Leverage:
| Instruments | Leverage |
|---|---|
| Major currency pairs | 30:1 |
| Minor currency pairs, Gold, and Indices | 20:1 |
| Commodities and Minor Indices | 10:1 |
| CFD (STOCKS AND ETFS) | 5:1 |
| CFD Cryptocurrencies | 2:1 |
Negative balance protection: eToro offers negative balance protection for retail clients, while professional clients forfeit some of the protection.
Deposit/withdrawal time: Deposits on eToro via cards and e-wallets (Skrill, Neteller, PayPal, Payoneer eToro Money and others are instant while bank transfer deposits take 4-7 business days for the funds to be credited to your account.
Withdrawals to eToro Money are instant, Payoneer takes 3 days, while other e-wallets take 2 days, and cards and bank transfers can take up to 10 days for you to receive funds.
Support: You can reach eToro 24/5 Monday to Friday through live chat and email. They also have a detailed FAQ section. You can reach them by email via LaunchLink. Also, you can open a query with their customer service.
eToro Pros
eToro Cons
Read our eToro review for more on this broker.
XM does not charge commissions for forex trading.
Regulation: XM Trading is regulated with ASIC as Trading Point of Financial Instruments (Pty) Limited. Their AFSL number is 443670. XM is considered low-risk to trade with.
AUD/USD Benchmark fees: Spread on average is 1.6 pips. Overnight charges are AUD $2.13 for buy (long) positions and AUD$1.83 for sell (short) positions and can vary depending on the trade size. XM does not charge commissions for forex trading.
Inactivity fee: XM charges an inactivity Fee. You pay $5 monthly if your account is inactive after 90 days.
Trading Conditions:
AUD/USD base currency: XM offers an AUD base currency account.
The exact number of instruments: You can trade 6 asset classes with XM. They include 55 Currency Pairs, 8 agriculture commodities, 1,261 stocks, 4 precious metals, 5 energies (oil), and 24 indices.
Leverage:
| Instruments | Leverage |
|---|---|
| Forex Majors | 30:1 |
| Minor currency pairs, Gold, and Major Equity Indices | 20:1 |
| Stock | 5:1 |
| Commodities, Silver and Minor Equity Indices | 10:1 |
| Energies | 10:1 |
Negative balance protection: XM offers negative balance protection.
Deposit/withdrawals: Deposits via cards and e-wallets are credited instantly while bank transfers credited in 2-5 business days. All withdrawal requests are processed within 24 hours, while e-wallets receive funds within 24 hours, it takes about 2-5 it business days for funds to reach cards and bank accounts.
Support: XM can be contacted 24/5 through Email, Live Chat, and Local Phone Number in Australia. Live chat responses were immediate during our tests. We got an email response within an hour.
XM Pros
XM Cons
CMC Markets offers zero commissions for trading all instruments except shares, which attract a fee of 0.09% with a minimum of AUD 7 per trade.
Regulation: CMC Markets is regulated with ASIC as CMC Markets Asia Pacific (Pty) Limited. Their AFSL number is 238054. They are considered a low-risk trading platform
Benchmark Fees for AUD/USD: Spread for AUD/USD is 0.7 pips. CMC Markets charges 0.0038% swap on buy positions and 0.0030% for sell positions.
Inactivity fee: CMC Markets charge 15 AUD monthly after 12 months of inactivity on your trading account.
Trading Conditions:
AUD base currency: CMC Markets offer an AUD Base Currency account.
Exact number of instruments: CMC Markets offers a wide range of CFD Instruments. You can trade 338 currency pairs, CFDs on 82 Indices, 22 Cryptocurrencies, 124 commodities, and 10,000+ Shares, 34 share baskets, 1,000+ ETFs, 55 Treasuries (bonds).
Leverage:
| Instruments | Leverage |
|---|---|
| Forex | 30:1 |
| Indices | 20:1 |
| Crypto CFDs | 2:1 |
| Commodities | 10:1 |
| Shares and ETFs | 5:1 |
| Treasuries | 5:1 |
| Cryptocurrencies | 2:1 |
Negative balance protection: There is negative balance protection on CMC Markets for retail clients while professional clients can lose more than their capital.
Deposit/withdrawal time: Deposits via cards and e-wallets (POLi, PayPal) on CMC Markets are credited instantly or in a few hours but bank transfers deposits can take 2-3 business days for funds to reflect in your account.
Card withdrawals take 3-5 business days while withdrawals to bank accounts take 1 business day.
Support: CMC Markets offers 24/5 customer support via email. We got a response from them after an hour. You can also reach the broker through a local mobile number.
Read our CMC Markets review for more on this broker.
CMC Markets Pros
CMC Markets Cons
IG Markets offers commission-free trading for all instruments except shares which attract commission fees starting from $7 per trade for Australian-listed shares. IG has a low deposit with BPAY of AUD 10. However, other deposit methods are much higher than that.
Regulation: IC Markets are regulated with ASIC as IG Australia Pty. Ltd with AFSL number 515106. We consider IG Markets a low-risk forex broker for Aussie traders.
Benchmark Fees for AUD/USD: Spread for AUD/USD is 1.01 pips. Swaps are calculated based on the next tom rate, and trade size.
Inactivity fee: Inactive accounts are charged A$18 on the first of every month after two years of no dealing activity. This fee is charged only if there is money in your account.
Trading Conditions:
AUD base currency: IG Markets offer an AUD Base Currency account.
Exact number of instruments: IG Markets offers up to 18,000 markets. 99 currency pairs, 8 energies, 5 metals, 16,000+ stock CFDs, 21 commodities, 17 ETFs, 34 indices, 15 cryptocurrencies, 12 bonds, and 6 interest rates are available.
Leverage:
| Instruments | Leverage |
|---|---|
| Forex | 30:1 |
| Indices | 20:1 |
| Crypto CFDs | 2:1 |
| Commodities | 10:1 |
| Shares and ETFs | 5:1 |
Negative balance protection: IG Markets has negative balance protection.
Deposit/withdrawal time: Deposits via PayPal and cards are credited instantly while BPAY (bank transfers) takes 2 business days. Card withdrawal takes between 3-5 business days while bank withdrawal takes up to 3 business days.
Support: IG Markets offers customer support 24 hours every day except 7 AM – 5 PM on Saturdays via live chat and email. There is also a mobile number that potential clients can call to open a new account.
IG Markets Pros
IG Markets Cons
FP Markets offer ECN pricing on their CFDs. Their spreads are low and commission is charged on their Raw Account only. They also recently added cTrader as one of their trading platforms.
Regulation: FP Markets hold an ASIC license. Their AFSL number is 286354 under the company name First Prudential Markets Pty Ltd. The forex broker is also licensed with CySEC. FP Markets is well regulated and we consider them low risk.
Benchmark Fees for AUD/USD: The average spread for AUD/USD is 1.3 pips on FP Markets’ Standard Account. On their Raw Account, it is 0.2 pips. There is no extra commission per standard lot except for the Raw Account (AUD 3.50 per side for MT4/MT5, $3 per side for cTrader). On the Standard Account, the commission is built into the spread.
You are charged $4.47 as an overnight charge when you go long on AUD/USD. If you go short, you are paid $1.08. Swaps are updated daily so this cost might change.
Inactivity fee: FP Market does not charge any fee for account inactivity.
Trading Conditions:
AUD base currency: FP Markets offer an AUD Base Currency account.
Exact number of instruments: The following CFDs are available on FP Markets: 73 currency pairs, 10,000+ shares, 16 indices, 8 metals, 2 bonds, 12 digital currencies, 290+ ETFs, and 4 commodities.
Leverage:
| Instruments | Leverage |
|---|---|
| Forex | 30:1 |
| Indices | 20:1 |
| Digital Currencies | 2:1 |
| Commodities | 10:1 |
| Shares and ETFs | 5:1 |
| Cryptocurrencies | 2:1 |
Negative balance protection: FP Markets protects your account from negative balance
Deposit/withdrawal time: Funding is instant via credit/debit cards, Skrill, and Neteller. It takes 1 business day via bank transfers. Withdrawal takes up to 1 business day on all payment methods.
Support:You can get support from FP Markets via phone calls, email, and live chat. On Saturdays and Sundays, support is available between 08:00 am and 16:00 pm local time.
FP Markets Pros
FP Markets Cons
A forex broker offers brokerage services, that is a platform, to retail and professional traders who want to speculate on currency pairs & other markets as CFDs, by going long (buy) or short (sell). Through a forex broker, your profit or loss from trading CFDs is cash settled in a brokerage account you have opened with the broker.
A forex broker could be a market maker which means they could be taking the opposite sides of your trades or a no-dealing desk broker that connects you to buyers/sellers through their liquidity providers via computerized networks.
You must only trade with a forex broker that is licensed by ASIC. Trading with a regulated broker guarantees the safety of your funds.
To check if a broker is truly licensed by ASIC, you can follow these steps:
Step 1) Go to the Forex Broker’s website and check their regulation statement. It is usually at the bottom of the website.
For this example, we visit Pepperstone’s website, which is an ASIC-regulated forex broker. Here is an example of Pepperstone.
The screenshot shows their registered name as Pepperstone Group Limited with AFSL number 415530.
Step 2) The next step is to confirm the regulation details found on the broker’s website.
If the company name and AFSL number match, the broker’s regulations are valid. To confirm these details, You can Go to the ASIC website.
Enter the broker’s registered name into the search box as shown below. In the within space, select organization and business names.
Click on the go icon. A list of companies will show up. Mark Pepperstone Group Limited as shown in the picture.
Click the view details icon. The next page will show you the broker’s regulation details as displayed below.
Do you see how the details on the ASIC and the broker’s website match?
The details show that Pepperstone Group Limited is regulated with ASIC. It mentioned their registration date of 27/10/2010 and the status of registration. It is important to check all these details and make sure that you don’t miss anything.
Trading charges include spread, swap, and commissions. Non-trading charges can include deposit/withdrawal fees and inactivity fees.
You need to check your broker’s overall charges to know if they are high or low. High trading fees affect your profit or loss so you should check them.
You can always get these details on the broker’s website.
Here is an example of trading charges using IC Markets’ fees.
We are buying a Standard lot of AUD/USD at 0.7211. Two days later, the currency pair rose in value from 0.7211 to 0.7241 (30pips) and you closed the trade. You just made AUD 300 (10x30pips). According to IC Markets, the round turn commission for trading AUD/USD is AUD 7. There is also a swap of AUD 2.57 for overnight charges. The total trading charges here is:
Commissions + 2-day swap which is AUD 7 + AUD 5.14 = AUD 12.14. Your final profit is therefore AUD 287.86 (AUD 300 – AUD 12.14).
The picture below shows IC Markets’ swap rates for some currency pairs.
You can use the search box to find any instruments (currency pairs, indices, commodities, etc.) and their swap rates.
A good trading condition is a combination of different factors. You want to be sure your broker has a good range of CFD markets (currencies, stock, indices, commodities, etc.). These instruments must be available at low prices.
You also want to check the broker’s order execution policy. Is it instant or market execution? Do they have a dealing desk? It is important to ask all these questions & any other questions that you have in your mind.
You should also confirm if your broker offers negative balance protection.
You can check for these in the broker’s FAQs section or directly talk to the broker’s support if you cannot find this information.
Good customer service should include at least a local Australian phone number on the broker’s website & it should be reachable. An email address and live chat should be available too.
These different means of support should be accessible and not hidden deep somewhere where you cannot easily find them. Responses should be as quick as possible.
Here is IC Market’s Customer Service page as an example. Here we could easily find their contact information, emails, and access live chat Support.
Brokers usually give a breakdown of account types on their websites. You will also find in this breakdown key features of the accounts. You want to look for an account with low spreads and low commissions. This is a major factor to consider when choosing your trading account.
Having multiple account types can offer you the flexibility to trade, and generally brokers have different fees structures for different account types.
Let’s understand this with an example. Forex brokers generally have Pro accounts (for Professional traders) & Standard Accounts (for Retail traders). The difference can be in terms of leverage & lower fees for large volume traders.
Standard accounts are basic account types with standard fee structures, generally as spreads. Although some brokers also have Standard accounts with low spreads, but some commission is involved for each trade (depending on your lot size).
For example, below is the screenshot from Pepperstone website where they highlight the difference in leverage for Professional clients.
But the eligibility for opening Pro Account is much higher, including having a large trading volume & adequate knowledge of derivatives trading.
Let us see what it looks like for retail traders at Pepperstone (example broker).
Here is a screenshot of Pepperstone Australia’s account & platform selection.
At the top right of the page, you can see the account type section. You only need to select out of the three options there. You will find that section with every broker. It might not look like this exactly. But you will be the one to decide regardless.
You should also know that there are brokers with one single account type. There isn’t any choice to make here. You open an account and you are good to go.
Another factor to consider is the Base Currency of your Trading account.
Most of the Local regulated forex brokers, like IC Markets & Pepperstone for example, have AUD base currency options. This is important if you are depositing in the Australian Dollar, as there will be no currency conversion fees.
Let’s look at the example of eToro. All the deposits & withdrawals at eToro are in USD, and if you are depositing or withdrawing in another currency, like AUD for example, there are extra conversion charges.
Look at the screenshot below from eToro’s website.
So, it is really important to verify if your broker charges extra fees for conversion. And if they support the base currency account which is the same as your deposit & withdrawal currency.
If you are depositing in AUD & withdrawals are also in the same currency, then it should be preferred to have AUD as your base currency instead of USD.
Metatrader 4 (MT4) and Metatrader 5 (MT5) are the most popular trading platforms. Not all brokers have them though. What you want to pay attention to here are platform-specific features.
Some brokers have more instruments on their MT4 platform than MT5. There could even be differences in swaps and commissions across the two platforms. So make sure to look this up on the broker’s website.
The availability of copy trading is another important thing to check. You will find this on the broker’s website if it is available. On Pepperstone’s website, for example, it is referred to as social trading.
You can find it by clicking on the platforms tab on Pepperstone’s website.
Some forex brokers might also support a proprietary trading platform. These platforms are not usually linked to a third party developer like the MT4, MT5, and cTrader. They are owned by your broker and in some cases might even be named after your broker. XM App, IG App, and IC Social are examples.
Traders favor MT4 and MT5. However, it is possible your broker’s platform has some features, indicators or trading tools that might not be on MT4/MT5. So you might want to give your broker’s platform a try. The only downside is that your broker’s platform might not be available on all devices.
For example, XM and FP Markets only support mobile trading apps. On the other hand, eToro supports their trading app and a trading terminal for desktop users.
Before making a deposit to your broker, you need to know the number of instruments available for you to trade. As usual, you should go through the broker’s instrument page to see what they are offering you. Currency pairs, CFDs, indices, and commodities are important instruments for a broker to have.
Check the exact number of asset classes being offered & the total trading fees (spread, commission & swap fees) for each instruments under every asset class. For example, if you want to mainly trade major currencies like EUR/USD, GBP/USD etc. then you should look at the fees for these exact instruments.
But also in addition to this, check for the trading charges attached for trading other CFDs, stock indices, and commodities. This is because it will give you a general idea of the fees the broker is charging. They take up a portion of your profits and can add to your loss.
To check, you should visit the broker’s website & see the instruments page. Generally, you will find under sections like ‘markets’. Pepperstone for example mention their asset classes under this section & you can check every asset class like this.
Here is a table showing spreads of certain CFDs on Pepperstone UK’s website.
Because forex brokers are regulated in different regions, the rules they have to follow are not always the same. In Australia, forex brokers are only required to let you know that your capital is at risk if you trade CFDs. This is in line with ASIC regulation.
However, if your broker is regulated with both ASIC and the FCA, you can get a more detailed risk disclosure. This is because the FCA requires brokers in the UK to reveal the percentage of retail traders that lose money trading CFDs with them. Also, they are required to update this data so traders can only see recent data.
So if your broker is regulated in the UK. All you need to do is go to the UK version of their website to know how likely you are to lose your money. The data is usually at the header of their websites. Here is an example with IG Markets UK website
For IG Markets, the percentage of losing traders is 77% which is a bit on the high side. The lower this data is, the lower the chances of losing your money. However, nothing is 100% guaranteed. You also have to make sure you practice proper money management when trading.
a. Order types: Varying order types help give you options in the market. Limit and stop orders can come in handy in entering the market at the right time and price. Your chosen broker must have these orders available on their platform.
Guaranteed stop-loss orders close your trades at specified prices. This order is executed regardless of market conditions. It is important your broker has this service in place because it is key for risk management. In addition, GSLOs are not free. So check with your broker to know if they have it and how much they charge.
b. Negative balance protection: Without negative balance protection, you can lose more than the funds in your trading account. This is why ASIC required, in their publication on CFD rules, that brokers protect traders from experiencing this.
If your chosen broker is regulated with ASIC, you can be sure that they offer negative balance protection. Can you see why trading with a regulated broker is important? You can even confirm with your broker if they provide negative balance protection. By contacting their support, you can verify. However, some brokers have FAQs on their websites. You can use it to verify if they have this risk management tool without waiting for an email or live chat response.
Here is an example on Pepperstone’s website
Finally, forex brokers are not mandated to provide negative balance protection if you are a professional trader. However, retail traders are guaranteed to get it.
c. Deposit/Withdrawals: Quick processing, multiple deposit/withdrawal methods, and low charges are the factors to keep a close eye on here. You should also be able to deposit and withdraw through your local bank. Most forex brokers do not charge extra fees for deposits/withdrawals. However, you can incur charges from your bank or e-wallet providers. Your broker does not receive any of these fees.
Summarily, what you want here is a broker with fast processing with little to no fees. Here is a screenshot of Pepperstone’s (example broker) deposit/withdrawal methods.
As you can see, Pepperstone combines low fees, multiple payment methods, and quick processing for deposits. Withdrawals can take 1-3 days.
In this regard, eToro is an example of a broker that charges extra fees. They charge zero fees for deposits and $5 for withdrawals.
Another factor you might want to consider here is minimum withdrawals. This is not common but you should speak with your broker’s support to know if they have minimum withdrawals.
d. Education: Education is key. A forex broker should be friendly to beginners. Structured online courses, webinars, articles, and free research tools a forex broker should offer. These should be offered free of charge without extra costs.
Finding a broker’s education is easy. It is usually on their homepage. With few clicks, you can access quality courses and videos for your learning. Let us show you how you can do this (IC Markets is our example). On IC Markets’ homepage, click on ‘More’.
You will see all of the broker’s learning resources under ‘Education’or ‘Help and Resources (both in yellow box). Here is an illustration below
From the image, you can see IC Markets have videos, webinars, podcasts, blogs, etc for your learning. These are not limited to beginners alone. Experienced traders can also learn a thing or two from them. Furthermore, the broker also has trading tools like forex calculators and economic calendars.
Opening an account with a forex broker should be easy and not take too long. Here is how to go about it with Pepperstone:
1) On your browser, go to pepperstone.com/en-au and click on join now
2) Enter your email on the following page
3) The next step is to enter your password and click on register.
4) The next page is your secure client area. Here, you are to fill in your personal details. Make sure they are correct because they will be verified.
5) Now we are getting to the end. For this step, you will be choosing your preferred account type and trading platform.
On the same page, you will need to fill in your employment details and agree to terms and conditions. You will also need to submit your KYC documents to verify your ID.
Once you complete this final step, you can fund your account and begin your trading journey.
Yes, you need a forex broker to trade in the foreign exchange market. They act as an intermediary between you and the interbank market where currencies are actually traded.
Here’s why:
1) Access to the Market: Retail traders like you and me can’t directly access the interbank market.
Forex brokers have the licenses and relationships to do so, and they provide you with a platform to place your buy and sell orders. For example, on the backend, the access different providers to get the prices.
2) Order Execution: Your broker takes your order and finds a counterparty to match it with on the interbank market. They handle the execution of the trade, ensuring it’s done efficiently and at the best available price.
You can see this process play out on their forex trading platforms.
The brokers have access to liquidity providers, or a market maker may act as the counterparty themselves to your trades.
Let’s understand through an example. Let’s assume that you want to buy GBP/USD. First of all you need quote (Bid & Ask prices), which you can check on the broker’s platform. When you place a ‘market order’, the broker finds the fill for you by send it to their liquidity providers or directly acting as the counterparty.
All of this happens in real time within a few micro seconds. Without a broker, retail or professional traders cannot trade currencies directly.
Traders living in Australia have to pay taxes on gains from forex trading. Australia has a complex tax code so it is essential you have a tax professional handle your filings.
The Australian Tax Office does not give much clarity on what tax percentage is applicable. It can vary based on unique situations. The major difference is between retail traders, investors and business/corporate traders. There are tax allowances allowed if certain conditions are met.
Furthermore, you could also offset your trading losses so you can pay less taxes. However, investors might have to carry their losses forward. Heavy financial penalties are doled out if you default on your taxes. So make sure you work with a tax professional to ensure compliance.
Disclaimer: We are not a tax advisory organization. We advise that you contact tax professionals to know about taxation as it pertains to you and your locality in Australia.
There is no specific amount that applies to every trader or forex brokers. The minimum deposit for forex trading is a decentralized phenomenon. No regulatory body enforces minimum deposit. It all depends on how each broker wants to operate. This is the first factor.
Some brokers have trading accounts with no minimum deposit. There could also be accounts with low minimum deposits requirement like AUD 50. There are a few brokers with minimum deposits as high as AUD 500 or more. So when it comes to the money you need to begin trading, your forex broker is a key factor.
The second factor is you. You need to consider your risk tolerance, trading goals, and financial state. How much are you willing to lose trading? How much is your gross monthly income? Why am I trading? These are pivotal questions you need to ask yourself. The answers to these questions will affect how much you put in your trading account.
How do you choose the amount to begin forex trading? A good consideration of the two factors above will help you make the right choice. After determining how much you are willing to risk in trading, then you need to choose your ideal broker.
If your risk tolerance is low, then you might have to choose brokers with zero minimum deposit account or low minimum deposit account like AUD 5-AUD 10. Though this little money, you can trade more positions with it using leverage. However, you should note that you can lose all of your money with leveraged CFD trading.
Even if your risk tolerance is high or you have enough money to trade CFDs, we caution that you do not put too much money in CFD trading because it is very risky.
Its best to trade with forex brokers that offer some form of safety for your funds. Here are some red flags to avoid when choosing a forex broker:
1) Unregulated Brokers: Do not trade with forex brokers that are not regulated. Only trade with brokers who are regulated by a reputable authority.
2) Hidden Fees: Another sign to avoid a broker is high fees or commissions. Make sure you know and understand all the costs associated with trading before you open an account with any broker.
3) Absence of risk management tools: Because the forex market is risky, you should avoid brokers that do not have risk management tools or features, such as stop loss order.
Forex brokers have different account types. There are accounts that cater to retail traders and there are accounts for professional traders.
For retail traders, brokers have different names for their accounts. However, there are usually standard accounts. These accounts have high spreads with little or no commission. The next popular account is a trading account with raw spreads. The advantage of this account is that the spreads are low (almost zero).
Because the spreads are low, you will pay more in commission. So which account has the lowest fees? The truth is forex brokers will make money through trading fees. There is no way around that. It depends on your choice. Do you want a high spread/zero commission account or vice-versa.
You can also use a calculator to see your projected trading cost. There are forex brokers with trading calculator on their websites.
For professional traders, it is entirely different. You will hardly find the fees for professional accounts on your forex broker’s website. When you successfully open a professional account, you will have access to all the fee and other charges that come with it.
Please note that a Pro Account does not mean a professional trading account. There are many forex brokers who have retail accounts name Pro Account. Make sure you contact your broker for more details.
Forex trading is legal in Australia & it is regulated by Australia Securities and Investments Commission (ASIC). You should only trade with ASIC regulated Forex Brokers for the safety of your funds & ensuring grievance redressal in case of any dispute with a broker.
This depends on many factors such as regulation, trading fees, non-trading fees, and customer support. A low-risk forex broker for Australian traders will be the one that performs well on all these factors. But an important fact is that you must never trade with an unregulated broker.
Some forex brokers that are considered low-risk for trading CFDs are Pepperstone, IC Markets, and CMC Markets.
Forex Broker in Australia must be licensed with ASIC. You must not trade with any unlicensed forex broker, otherwise, there is a high risk that your funds will be unsafe.
To check whether a forex broker is regulated you must verify its license no. on ASIC Connect’s Professional register. Refer to the steps in our regulated forex brokers guide on how you can check if a broker is regulated or not.
Forex Broker offer their platform to retail & professional traders to allow them to trade currencies & CFDs on various instruments. By using a forex broker, you can buy or sell currencies like AUD/USD as a CFD instrument to speculate on their price.
Total fees vary with forex brokers. Some brokers charge a commission while some do not. Some charge inactivity fees and some do not. Fees can be high or low depending on the broker.
We use overall fees as a metric in our comparison of Australian Forex Brokers along with many other factors.
