Disclosure

The value of your investments can go down as well as up. Losses can exceed deposits on margin products. Complex products, including CFDs and FX, come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs, FX, or any of its other products work and whether you can afford to take the high risk of losing your money. 69% of retail investor accounts lose money when trading CFDs with this provider.

Denmark's Saxo Bank Group (Saxo Bank), founded in 1992, classifies itself as "a leading Fintech specialist focused on multi-asset trading and investment and delivering ‘Banking-as-a-Service’ to wholesale clients." The company embraced the technological advancements of the late 90's in launching one of the first online trading platforms in 1998. Saxo Bank has operated in the United Kingdom since 2006 through its subsidiary Saxo Capital Markets U.K. Ltd (SCML) and, like many forex brokers, it doesn't accept U.S. traders.

Saxo's flagship platform is SaxoTraderPRO, a downloadable offering that is ideal for advanced traders. SaxoTraderGO, its web-based platform that comes equipped with functional trading features and a user-friendly interface, and a functional mobile application, round out its proprietary interfaces. Additionally, Saxo offers access to third-party tools that can enhance the trading experience and APIs that the client can use to build bespoke applications. A key point to note is that MT4, the ever-present, white-labeled interface that is part of nearly every forex broker's platform suite, is not offered by Saxo Capital Markets.

An impressive product catalog includes forex, shares, commodities, indices, options, bonds, and futures, which can all be bought or sold short through CFDs, forward contracts, and/or direct ownership. Unlike some of its competitors, Saxo's spread betting offering is only available to customers that qualify as "professional clients." FX spreads are extremely competitive across all retail account tiers (Classic, Platinum, VIP).

Investopedia's ranking algorithm factored in this broker's extensive product catalog, advanced user-interfaces, and its superior research offerings in recognizing Saxo Capital Markets as the Best Forex Broker for Advanced Traders in 2020.

Key Takeaways

  • Rated our Best Forex Broker for Advanced Traders.
  • Saxo Capital Markets offers traders a wide range of offerings, advanced user interfaces, and superior research amenities.
  • Relatively high account minimums, limited support options, and higher-than-average bottom-line trading costs make Saxo less than ideal for the smaller, lower-skilled trader.

Who Saxo Capital Markets Is For

Saxo Capital Markets is for the advanced trader. It offers a broad variety of brokerage services geared towards sophisticated active traders, investors, professionals, and institutions. Smaller account holders will encounter a number of unusual obstacles that include higher account minimums, a variety of fees, and fewer customer support options. Tiered accounts lower trading costs and add benefits as equity grows, but the majority of retail traders will have a tough time reaching the higher customer tiers which, for U.K. based accounts, start at £200,000 (Platinum) and £1,000,000 (VIP).

Pros
  • Extensive range of offerings

  • Regulated by FCA (U.K.)

  • Industry's best research

  • Superior user interface

  • Offers protection for client accounts

Cons
  • Lack of emphasis on customer service

  • Confusing instrument fee structures

  • Does not accept U.S. clients

  • No MT4

Pros Explained

  • Saxo Capital Markets offers clients access to an extensive range of offerings, comprised of both leveraged and investment products, that spans a multitude of asset classes. Clients have access to forex, shares, ETFs, commodities, indices, options, bonds, forwards, and futures. It might be easier to list what Saxo doesn't offer.
  • Saxo Capital Markets is regulated by the Financial Conduct Authority (FCA #551422) which is one of the main regulatory agencies in the UK and is highly regarded globally for being strict in ensuring that market practices are fair for both individuals and businesses. Simply put, being regulated by a reputable, government-backed agency goes a long way towards establishing the credibility of a firm. Traders accept the risk that is inherent in markets but they would like the peace of mind knowing that their funds are not subject to risks outside of the ones that they are taking, such as counter-party risk. Additionally, segregated client funds are held at Tier 1 banks.
  • Saxo's dedication to providing clients with top notch research is to be commended. It is the gold standard in the online forex brokerage arena.
  • Saxo built its trading platforms, SaxoTraderPRO (download) and SaxoTraderGO (web-based), with the end user (trader) in mind, providing major upgrades over the industry standard MT4 and competitor offerings. Furthermore, seamless integration with third-party tools opens up a myriad of possibilities for an advanced trader.
  • Saxo offers "negative balance protection" which has become a fairly important feature that most online brokers are offering these days. The catalyst was most likely the SNB event of January 15, 2015 that roiled the markets, especially the highly leveraged retail FX market.

Cons Explained

  • The lack of emphasis on customer service is the biggest drawback to Saxo Capital Markets' online brokerage offering. Being able to readily contact a broker is crucial for anyone engaged in the arena of online trading. Its website has no live chat functionality and online chat is only available to funded accounts. "Chat-bot" functionality is available but Saxo might be better off if it was not. Prospective clients usually test out a broker's offerings via a demo account, and not having access to live chat is a glaring omission.
  • A confusing array of fee schedules and hidden costs make it difficult to estimate bottom-line costs. Commission and spread disclosures are often contradictory, with different prices quoted for similar or identical instruments and venues.
  • Saxo Capital Markets does not accept U.S. clients due to regulatory constraints, which precludes it from truly being considered a global broker, though one would be hard pressed to find another broker with a larger global footprint. This would be a red flag were it not for the fact that the company is regulated by the FCA which, along with U.S. regulatory agencies (NFA, CFTC), is widely considered to be the preeminent regulatory body.
  • MT4, the ever-present, white-labeled interface that is part of nearly every forex broker's platform suite, is not offered by Saxo Capital Markets.

Costs

3.7

Saxo Capital Markets' trading costs are either included in the spread, which is primarily how the broker generates revenue, or added as commissions, which are on par with industry standards. Its forex bid/ask spread minimums for a "classic" account are advertised at 0.6 pips. Average spreads drop while benefits rise for the higher-tiered "platinum" and "VIP" accounts, offering the potential for substantial active-trader discounts, but the £200,000 minimum to upgrade tiers will act as a deterrent to the average retail client. Commission charges added to the listed spread come into play when trading other instruments.

Overnight holding costs are average to competitive and there is an inactivity fee of £25/quarter if the client "only holds cash funds" in their account. There are a host of other costs, broadly characterized as "general charges," which, when combined, tend to be quite onerous to the average retail trader. However, account holders will appreciate free withdrawals.

Different fees and costs among CFDs, contracts, and direct sales of identical instruments are poorly explained, adding to a lack of transparency evident throughout the website and in the trading platforms. This is not to say that Saxo is deliberately trying to be misleading, just that the sheer complexity of costs associated with all that the broker offers can be quite unwieldy to explain for anyone. That said, Saxo Capital Markets does its best to be as transparent as possible.

Documentation for other regions that Saxo Capital Markets operates in was often contradictory to what was listed on the U.K. website, outlining conflicting fees (even after factoring in currency conversions) and trading conditions for identical products and position sizes. It is also easy to miss fine print that adds a separate surcharge on small trades, raising the potential for confusion.

Trade Experience

4

Saxo's user interface is proprietary. The broker built its trading platforms, SaxoTraderPRO (download) and SaxoTraderGO (web-based), with the end user (trader) in mind, providing major upgrades over the industry standard MT4, which can only be accessed through an API interface, and the newer cTrader. Furthermore, seamless integration with third-party tools opens up a myriad of possibilities for an advanced trader.

SaxoTraderPRO is a fully customizable desktop interface that can be downloaded on Windows and Mac operating systems. The user has the option of utilizing up to six screens to take advantage of the advanced workspace management that this platform has to offer. Multi-channel linking between modules and a robust charting package with "a comprehensive suite of annotations, drawing tools and over 50 technical indicators" can greatly aid the trader in their analysis. Order tickets are engineered to optimize productivity while displaying all pertinent information. Additionally, algorithmic trading orders can be fully integrated upon activation. Subscription-based tools, such as "depth of market" and "time and sales" data, are available and can prove to be value-added features.

SaxoTraderGO doesn't offer all the bells and whistles that SaxoTraderPRO does, but is equally impressive. The main advantage it has over its "big brother" is that it's far more accessible. Customization is limited but that doesn't hamper its functionality. This web-based version allows organization of charts, news, research, and watchlists according to trader specifications. Charting and technical indicators are full-featured, with custom time management and linking among platform windows. An impressive variety of market and pending orders handily beats the competition and reinforces Saxo's commitment to attracting the advanced trader.

Both platforms' order ticket has five basic order types with the option of attaching "take profit" and/or "stop loss" orders to them. Additionally, the trader can choose to make the stop loss order a trailing stop loss or a stop-limit. The one omission to an otherwise impressive array of order types is the lack of a guaranteed stop loss order. This might deter the novice trader but an advanced trader would understand that guaranteeing a stop loss order defies market dynamics. The brokers that do offer this feature are essentially admitting that they will absorb the excess losses that can occur in certain market conditions.

  • Market - The simplest order where a trader signals that their trade request should be executed at the prevailing market rate. The platform offers a variant of this called "quick trade" which allows the trader to "hit the bid" or "pay the offer" to place a trade without any pending stop loss or take profit attached. This is there to satisfy the trader's need for speed.
  • Limit - A pending order where the entry is at a predetermined point below or above the prevailing market rate depending on whether it's a buy or sell. The trader also has the option of selecting the expiration time of this order.
  • Stop - A pending order where the entry is at a predetermined point above or below the prevailing market rate depending on whether it's a buy or sell. The trader also has the option of selecting the expiration time of this order.
  • Stop-Limit - A pending order where the entry is at a predetermined point above or below the prevailing market rate depending on whether it's a buy or sell, but where the trader can select the tolerance range for execution. For example, if the market gaps over the selected rate and the tolerance interval then this order is immediately cancelled. The trader also has the option of selecting the expiration time of this order.
  • OCO - A pair of pending orders (one an entry stop and the other an entry limit) where the execution of one automatically cancels the other. The trader also has the option of selecting the expiration time of this order.
SaxoTraderGo OCO Order
SaxoTraderGo OCO Order.

SaxoTraderGo apps for iOS, Android, and tablets provide easy access to the impressive features on the desktop and web versions, with full syncing across platforms. The indicator list is shorter but comprehensive, and traders can read real-time news and research with a few swipes. The apps provide fingerprint ID entry, but this useful feature isn't part of a two-­tier authentication process.

A key point to reiterate is that MT4, the ever-present, white-labeled interface that is part of nearly every forex broker's platform suite, is not offered by Saxo Capital Markets.

Additionally, Saxo offers clients the option to build bespoke applications via APIs, both its own OpenAPI and third-party API (Excel, etc.), that can access Saxo's data feeds. On top of all this, clients can also access third-party applications, such as TradingView, Dynamic Trend, and MultiCharts, to assist them in their trading. For example, MultiCharts allows traders to back-test strategies while TradingView advertises itself as a social trading platform. Saxo does not offer local VPS hosting.

Range of Offerings

4.1

Saxo Capital Markets offers clients access to an extensive catalog, comprised of both leveraged and investment products, that spans a multitude of asset classes. It might be easier to list what Saxo doesn't offer. As advertised on its U.K. and international websites, the available instruments include:

  • 182 FX spot pairs
  • 140 FX forwards
  • 44 FX vanilla options
  • 200+ futures contracts
  • 19,000+ stocks (36 worldwide exchanges)
  • 1,200+ listed options (24 exchanges)
  • 9,000+ CFDs
  • 19 commodity CFDs
  • 5,000+ bonds (government and corporate)
  • 3,000+ ETFs (30+ exchanges)
  • Managed portfolios
  • 250+ mutual funds (non-U.K. International accounts)
  • Cryptocurrency ETNs (non-U.K. International accounts)

Many instruments can be traded through multiple venues and order routing techniques, providing impressive diversity, but some venues will generate higher-than-average costs. Nonetheless, the product suite is quite impressive and is sure to please a global markets aficionado.

Customer Service

3.8

If there is a flaw in Saxo Capital Markets' online brokerage offering it would have to be with its customer service. The website has no live chat functionality. Online chat is embedded within the trading platforms but only available to funded accounts and local language support is limited to higher-account tiers. "Chat-bot" functionality is available but Saxo might be better off if it was not. The broker is active on Twitter and Facebook, but it handles no service inquiries through those social media interfaces.

Prospective clients usually test out a broker's offering via a demo account, and not having access to live chat is a glaring omission. This forces prospective clients to contact the sales department by phone or email. The broker does provide a robust support page with numerous topics, but the search function could be more efficient. Saxo advertises industry-standard 24/5 customer support, yet the contact page includes office reception and sales numbers, but no local or toll-free support number, while the small print indicates that departments are open between 9:00 a.m. and 5:30 p.m. local time. There is also no direct number to the dealing desk.

Education

3.8

Educational materials focus primarily on platform and product tutorials and introductory coverage of fundamental and technical analysis topics with few skill-building resources. But, then again, that fits with what appears to be Saxo's unstated goal of attracting advanced, well-funded traders. There is no glossary, at least in the widely accepted definition of that term, adding another obstacle for lower-skilled traders. There is, however, an FAQ page that is functionally adequate.

Portfolio Analysis

3.3

Portfolio analysis including performance data, risk assessment, and portfolio breakdowns are available across all of Saxo's platforms. The platform reporting suite allows clients to export all historical position, trade, and performance data in PDF or Excel format. This reporting functionality offers the opportunity to consolidate holdings in an external spreadsheet or third-party reporting software.

Trade tickets include such necessary information as margin requirements and allow the user to select the unit (percent, pips, price, value) to set stop loss and take profit orders. All data is in real-time so that the trader can make an informed decision.

Saxo Capital Markets offers access to third-party portfolio tools (eXimius), and external tax reporting and reclaim services can be requested from third-party provider GlobeTax. All clients have access to a comprehensive reporting suite directly in the trading platforms. The provided reports facilitate tax reporting by displaying performance, profitability, dividend, interest income, and fee data in both PDF and Excel format.

Research Amenities

4.3

Saxo Capital Markets' dedication to providing clients with a plethora of timely and informative research is to be commended. Access to this section alone might entice a serious trader to open a live account with this broker. Research materials can be accessed through the website or directly through the platforms. Saxo has an impressive roster of in-house analysts who provide regular market updates, ratings, and timely commentary.

Multiple real-time, streaming news services (Dow Jones Global News, NewsEdge Equities, NewsEdge Macro, Ransquawk), a variety of market reports in varying time formats, trading idea generators (Trade Signals by Autochartist and trade ideas from Sales Traders and SaxoStrats), and access to analyst rating reports (TipRanks), should satisfy even the most seasoned trader.

Basically, any research that a client would require in order to make an informed trading decision is likely offered by Saxo Capital Markets.

SaxoTraderGO Market Analysis
SaxoTraderGO Market Analysis.

Security

4.3

Saxo Capital Markets takes security seriously and is licensed by many jurisdictions around the world. Full licensing information can be found here.

Saxo also takes steps to ensure that client funds are not co-mingled with corporate funds, in accordance with the U.K. Financial Conduct Authority's (FCA) client money rules. This ensures that client assets are protected in the unlikely event that Saxo becomes insolvent by holding those funds in segregated accounts at regulated banks. Clients also have additional asset protection through the Financial Services Compensation Scheme (FSCS), up to £85,000.

Saxo provides clients with a guarantee that they will never lose more than they have in their accounts via the negative balance protection rules mandated under ESMA that went into effect in 2018. However, guaranteed stop-loss protection is not available, exposing accounts to potentially catastrophic losses in extreme market conditions, like the 2015 Swiss franc currency shock.

Saxo's software security is aligned with the best that the industry has to offer. In addition to two-factor and bio-metric authentication, the user will be logged out of both the web-based and mobile applications if they are not being used for a user-specified period of time.

Web disclosures include company procedures to ensure the best executions possible, underpinned by a broad range of direct market access (DMA), aggregated, and in-house liquidity providers.

Verdict

Saxo Capital Markets offers an excellent option for advanced traders and professionals with well-funded accounts. Extensive and comprehensive research facilities, an API interface, and discounted fees (high-tier accounts) could add to account profitability, but trader education falls short and customer service is sub-standard. Saxo's approach leads one to conclude that its business objectives are focused squarely on larger-scale and professional account holders.

A confusing array of fee schedules and hidden costs make it difficult to estimate bottom-line costs. Commission and spread disclosures are often contradictory, with different prices quoted for similar or identical instruments and venues.

There is a certain arrogance to Saxo's approach that might be justified given their track record, but can be off-putting to a novice trader seeking access to its service. Small and lower-skilled traders can find better deals elsewhere due to Saxo's surcharges for small trades, few educational resources, relatively high account minimums, limited support options, and higher-than-average bottom-line trading costs.

However, for a sophisticated, well-funded market professional, Saxo's extensive product catalog, advanced user interfaces, and superior research offerings would be quite attractive.

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Methodology

Investopedia is dedicated to providing investors with unbiased, comprehensive reviews and ratings of online brokers. Our reviews are the result of six months of evaluating all aspects of an online broker’s platform, including the user experience, the quality of trade executions, the products available on their platforms, costs and fees, security, the mobile experience and customer service. We established a rating scale based on our criteria, collecting over 3,000 data points that we weighed into our star scoring system.

In addition, every broker we surveyed was required to fill out a 320-point survey about all aspects of their platform that we used in our testing. Many of the online brokers we evaluated provided us with in-person demonstrations of their platforms at our offices.

Our team of industry experts, led by Theresa W. Carey, conducted our reviews and developed this best-in-industry methodology for ranking online investing platforms for users at all levels. Click here to read our full methodology.