The City of London is one of the world’s most famous financial centres and it is no surprise that many of the most established financial services providers are based in the United Kingdom. This of course also applies to the UK forex brokers and CFD trading providers, whose clients can rely not only on the experience and good business practices of the companies, but also on the competence and reputation of the regulatory authorities.
Leaving the European Union has not led to a loosening of regulations and protections for clients in the UK. On the contrary, the Financial Conduct Authority (FCA) in some respects imposes stricter rules than its EU counterparts. For example, there is now a complete ban on crypto derivatives trading in the UK. At the same time, retail traders can be compensated with up to 85,000 GBP in case the broker goes bankrupt, compared to the 20,000 EUR covered by the EU Investor Commutation Funds.
Of course traders get negative balance protection, their money is segregated from the broker’s operating capital and they can trade with leverage up to 1:30.
Let’s take a look at some of the oldest forex brokers operating in one of the oldest global financial hubs.
IG
IG, formerly IG Index, was founded in 1974, and in the 1990s became one of the pioneers of online trading. The broker has a global presence with an impressive number of branches in Germany, Austria, Switzerland, Australia, New Zealand, UAE, Japan and Singapore.
In terms of trading conditions, the IG keeps things simple and straightforward. There is no fixed minimum deposit and you can start trading with an amount you feel comfortable with.
You can choose between two account types – Standard, where the trader only pays a spread of around and under 1 pip, and Direct Market Access (DMA), which provides lower spreads, but the client also pays a variable commission, based on the client’s order size.
This broker offers a selection of robust platforms: the industry’s standard MetaTrader 4 (MT4), mobile trading app, its proprietary IG platform and another web-based named ProRealTime, as well as a special platform for DMA – L2 Dealer. IG allows you to fund your account via credit or debit card, bank transfer or PayPal.
HYCM
HYCM, formerly HY Markets, has four decades of experience during which it has collected an impressive number of industry awards. The UK broker is operated by Henyep Capital Markets UK Ltd., a division of the Henyep Group. The brand also operates in the EU through a company registered in Cyprus as well as in Hong Kong.
The broker offers three types of trading accounts that should suit traders with different investment intentions. The trader can choose between a fixed spread of 1.5 pips with no commission, a variable spread of 1.2 pips with no commission, and a raw spread plus commission of 4 USD per round. There is an option for the account to comply with Islamic requirements and against interest.
All account types can use the two most popular trading platforms in the industry, MetaTrader 4 and MetaTrader 5. But fixed spread clients cannot take advantage of Expert Advisor bots.
The minimum deposit is just 100 USD. Available payment methods are credit/debit card, wire transfer, Skrill and Neteller.
ETX Capital
ETX Capital is a trading name of London-based Monecor Limited, established way back in 1965. The broker has a slightly different approach to the account types offered than most competitors. The client must first choose between two trading platforms – the well-known MT4 or the also very advanced broker’s own platform, ETX TraderPro. The other choice that must be made is the type of trading you will engage in – spread betting or CFD trading.
In all cases you trade with competitive spreads and without additional commissions. However, the broker encourages you to use its proprietary platform with slightly tighter spreads compared to MT4. At the same time, spread betting has the advantage of being tax free in the UK.
There is no fixed minimum deposit and the account can be funded via credit card, wire transfer, Skrill and UnionPay.
With City Index we once again have a brand dating back over 35 years, offering a basic range of services but very competitive terms. Over the past decade, City Index has changed ownership several times and the broker is now run by StoneX Financial Ltd. But City Index continues to receive industry awards, indicating that the quality of its services has not degraded.
Like other brokers in the UK, City Index offers tax-free spread betting. Of course there is also the option of standard forex and CFD trading with very favourable spreads at and below 1 pip. The broker only charges additional commissions for shares trading.
A decent range of trading software is available – Web Trader platform, iOS/Android mobile Apps, and of course MetaTrader 4. There is no fixed minimum deposit and deposits and withdrawals are made via credit/debit cards and wire transfer.
CMC Markets
CMC Markets was established in the UK in 1989 and was the first company to launch an online FX trading platform in 1996. Subsequently, the broker expanded its activities not only to other European markets, but also to Australia and New Zealand.
CMC Markets clients have the opportunity to trade over 11500 financial instruments. Similar to other UK brokers, the choice is between spread betting and standard CFD trading. There are no commissions except for shares trading. Spreads are extremely competitive, with higher volume clients with a balance of more than 25,000 GBP able to earn the “Alpha” client status and enjoy additional spread discounts.
Like most of its competitors, CMC Markets does not set a minimum deposit and allows account funding via credit/debit card, wire transfer and PayPal. The choice of trading software is also standard, but quite sufficient – MetaTrader 4 for desktop, Web trader and apps for mobile devices.
UK forex brokers tick all the boxes for the needs of the trader – established brands, high standards, strict regulatory oversight and competitive terms. But you should be aware that because of the fame of UK brokers, many scammers pose as being based there. Therefore, before investing, you should make sure that you are really working with one of the FCA licensed brokers and not a clone firm.
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