Top 5 Forex Market Makers Brokers in August 2022
A large majority of Forex brokers are market makers, which means that they determine the prices offered for trading to their clients and act as counterparties to their clients’ transactions. While many argue that this creates a potential conflict of interest, other analysts point out that for some traders, using a market maker can result in better and less risky trading.
High floating leverage + fast execution
Daily market research and access to Autochartist
High level regulation in multiple jurisdictions
Impressive range of tradable assets, including vanilla options and gold options
Solid broker for scalping and hedging
Institutional Style Trading Opportunities for Retail Traders
The most comprehensive crypto derivatives offering. Choice of over 250 Crypto CFDs
Multiple Funding and Quick Withdrawal Options
Ultra-Low Spreads on All Crypto Derivatives
- FXMC, Best all round broker with high floating leverage and fast execution.
- FP Markets, ECN trading with leverage up to 1:500..
- AvaTrade, Highly regulated, choice of fixed or floating spreads.
- BlackBull Markets, Best ECN trading environment, with scalping and hedging.
- eightcap, Competitive prices + excellent daily videos.
5.0/5 in this category
FXTM, or Forex Time, is one of the best all-round brokers in the world. The 10th anniversary of this growing forex broker was celebrated this year. This reputable broker, with a decade of experience, now accepts traders from Cyprus, UK and Mauritius. You can trade a wide range of currencies, as well as gold, silver and other precious metals, with FXTM. Traders who buy shares through Forex Time become full legal owners of the stock. FXTM is the right broker for you if you want to invest in commodities, CDFs, stocks, metals, indices or oil.
Excellent commission-based Forex pricing environment and transparency
Upgraded MT4/MT5 trading platforms and proprietary mobile trading app
Quality market research and educational content for newbie traders
Proprietary copy trading platform, low minimum deposit and high leverage
5.0/5 in this category
fpmarkets is an ASIC-regulated Australian brokerage firm that was launched in 2005. For most traders, this broker’s unique selling point is in the extremely wide range of tradable assets offered, offering the possibility of exchanging more than ten thousand stocks and individual shares, including companies listed on the stock exchanges in Hong Kong and Australia. Ffpmarkets also offers 60 Forex pairs and crosses, 11 equity indices, the main commodities, and 5 crypto-currencies including Bitcoin. fpmarkets offers an unusual hybrid ECN/STP execution modelmeaning that their clients can choose between the ECN execution style offering a very high level of speed and a ‘straight through’ execution style which allows for more ‘natural’ spreads.
Advantages and disadvantages of FP Markets
Choice of trading platforms and auxiliary trading tools
Very competitive cost structure and excellent asset selection
Low minimum deposit requirement and leverage up to 1:500
Well regulated and trustworthy
5.0/5 in this category
AvaTrade is a fantastic forex broker for both new and experienced traders. Although AvaTrade is available in a number of countries and has official regulator certificates in Australia, Israel, UAE, Ireland, British Virgin Islands and Japan, obviously the broker is a better fit to traders from South Africa and the British Virgin Islands. This is especially true for traders from various parts of the world who require higher maximum leverage. With over 50 currency pairs, almost 30 commodities, many cryptocurrencies, CDFs, assets, some bonds, metals and more, you will have a wide range of trading possibilities.
High quality educational offering through SharpTrader
Excellent choice of trading platforms catering to various trading needs
Wide selection of assets and multi-asset diversification opportunities
Well-regulated and trusted broker under the supervision of a central bank
4.5/5 in this category
BlackBull Markets was founded in 2014 in New Zealand. Like many Down Under Forex brokers, BlackBull Markets is an ECN broker, offering raw spreads and commissions. They are regulated in New Zealand by the Financial Services Providers Registry (FSPR) and offer maximum leverage on certain Forex currency pairs of up to 500 to 1. In addition to their global headquarters in New Zealand, BlackBull Markets also has a presence in the form of branches in New York and Malaysia. BlackBull Markets offers a relatively small range of tradable assets: 27 Forex currency pairs and crosses, gold, silver, crude oil, natural gas and 6 major stock indices. It should be sufficient for traders with more targeted strategies that do not require large diversification.
Advantages and Disadvantages of BlackBull Markets
ECN/NDD execution model with high liquidity
Institutional-grade pricing for retail merchants via proprietary price aggregation
ZuluTrade and Myfxbook for social trading
Leverage up to 1:500
4.5/5 in this category
MetaTrader 4, MetaTrader 5
Advantages and disadvantages of Eightcap
Low minimum deposit and high leverage up to 1:500
Competitive cost structure
Excellent technology infrastructure and seasoned management team
Daily research and quality educational content
Once you have decided that a Forex Market Maker Broker meets your trading needs, You’ll be spoiled for choice. The most important considerations you should have in making your final choice are broker regulation and reputation, fees, and the range of assets offered. The best approach is to make a shortlist based on these factors and then compare our ratings to see what will give you the best deal for your trading style.
Despite the largely negative depiction of the execution model of market maker brokers versus ECNs, market makers can offer a good deal to many traders. Moreover, they remain essential to the financial ecosystem and provide liquidity. Without market makers, the retail Forex market would be considerably less fluid and trading for everyone would be riskier. Traders will often find that in more illiquid markets, market makers offer spreadsexecution and liquidity to what is offered by ECN brokers.
Market makers do not charge commissions but earn revenue via a markup on the gross market spreads they get from their liquidity providers, which are larger (usually non-retail) brokers or banks. For example, if EUR/USD is trading with a 0 pip spread on an ECN (Electronic Communications Network), accessible through ECN brokers who charge volume-based commissions, a market maker might show the same with a markup of 0.8 pips. It covers their costs, generates profits, and generally protects market makers from a loss in the value of the asset after buying it from the seller and selling it to a buyer. However, market makers take risks by actually taking unhedged positions in the market and may find themselves fatally exposed to sudden and dramatic market movements.
Since market maker brokers have their own inventory of assets, they can also profit directly from their traders’ losses. Market makers typically maintain two order books, often referred to as the A and B books. Traders with profitable records are assigned to the A book, with all others placed in the B book. The first is the one with which they access the markets, the second manages the internal order flow of the clients. For example, if a group of traders at a market maker want to buy 50 lots on EUR/USD and another group is looking to sell 100 lots, the market maker can match the 50 lots between clients in their book B and buy all 50 bore lots. lots for his inventory in Book A. He can then sell the 50 lots on the open market to any buyer. Book B handles internal retail orders, and with an average of 75-80% of traders losing their deposits within a few months, it presents a very profitable (but potentially very risky) business model for brokers. Market maker brokers make money on their A-book via markups on raw spreads, where they compete for orders.
There’s a good reason why it’s important to be very careful when selecting a Market Maker Forex Broker and to use a reputable list like ours as a guide – the execution pattern can be conducive to abuse at the hands of unregulated or unscrupulous brokers. . Sharp practices to watch include stop-loss hunting, which generates premature trade losses by artificially increasing spreads, typically using a news event as a hedge for plausible denial. Traders should ensure that market maker brokers offer reasonable markups. The best market maker Forex brokers will quote EUR/USD spreads between 0.4 pips and 0.8 pips during the London/New York set, with all major currency pairs below 1.2 pips and most minors below 2.2 pips.