With a trading volume of over $5 trillion per day, the foreign exchange market, also called forex or FX, is the world's largest market. The size and deep liquidity of the forex market, along with 24-hour trading, five days a week, make it an appealing choice for traders.
Top 10 Brokers
The following 10 financial conduct authority (FCA)-regulated forex brokers, listed in no particular order, are chosen based on factors including financial stability, execution quality, and trading platforms available. When choosing among them, one might consider preferences such as markets available, execution software, and the competitiveness of spreads.
- OANDA: The Canadian-based foreign exchange company offers competitive spreads, as low as 1.2 pips in EUR/USD. Along with their own fxTrade platform launched in 2001, Oanda offers MetaTrader 4.
- Interactive Brokers: Greenwich, Conn.-based Interactive Brokers offer direct access to interbank forex quotes and operate using an Electronic Communication Network (ECN) market structure.
- City Index: Established in the UK in 1983, City Index offers forex trading, along with CFD's and spread betting. The MetaTrader 4 platform is available with added tools and features.
- FOREX.com: Owned by parent company GAIN Capital (NYSE: GCAP). Operating since 2001, FOREX.com was a first mover in bringing currency markets to the retail trader.
- FXCM: Exchange-listed FXCM (NYSE: FXCM) offers a no dealing desk model along with competitive spreads. The firm offers trading in a wide variety of currencies including the Chinese yuan.
The most popular and highly rated brokerages licensed in the UK are not physically based there.
- FxPro: Founded in 2006, London-based FXPro is an online broker offering forex trading along with CFD's. MetaTrader 4 and cTrader trading platforms are available.
- IG Markets: Founded in 1974 as a spread betting business under the name IG Index. The firm offers trading in pairs including EUR/USD, AUD/USD, and USD/JPY with spreads as low as 0.8 pips.
- Alpari: Alpari has over a million customers and is one of the largest forex brokers in the world. Traders can choose from eight different methods to fund their accounts, so getting started is easy. Mobile and web platforms (MetaTrader 4 & 5), provide traders with the ability to trade on the go.
- ActivTrades: Established in 2001, ActiveTrades offers forex trading in mini and micro lots, a diverse product offering, and competitive spreads.
- HY Markets: In business for 30 years, HY Markets provides multiple trading platforms and a wide variety of trading instruments. HY Markets a division of the Henyep Group, a global conglomerate with a presence in 20 countries.
- HYCM: HYCM (Henyep Group) is well known as one of the top forex brokers in the world. With over 40 years of experience in the business, this broker processes over 25,000 orders every day and has over 20 years of FCA oversight in the U.K.
The Bottom Line
Among the leading FCA-regulated forex brokers in the UK, the majority are actually based abroad. In many cases, this means that they are also regulated by other bodies, such as the National Futures Association (NFA) in the United States. While the retail forex industry continues to develop and improve, traders must remain vigilant in scrutinizing where they place their funds for investment.