FOREX.com Review.
Akhilesh Ganti is a forex trading expert who has 20+ years of experience and is directly responsible for all trading, risk, and money management decisions made at ArctosFX LLC. He has earned a bachelor's degree in biochemistry and an MBA from M.S.U., and is also registered commodity trading advisor (CTA).
Updated January 28, 2021.
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Overall Rating.
Fast Facts.
Account Minimum : 100 units of base currency Fees : Spread cost; Commissions; Overnight financing costs; Inactivity fees Best For : Active forex traders.
Disclaimer.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
FOREX.com, founded in 2001 as part of GAIN Capital Holdings, is an established global online broker that caters to individuals seeking to trade the retail FX and CFD markets. GAIN Capital Holdings, a conglomerate that includes City Index, an online CFD and spread betting provider, and Daniels Trading, a futures advisory trading firm, was acquired by StoneX Group Inc. in February 2022.
StoneX Group Inc., a publicly traded company (NASDAQ: SNEX), advertises that it connects "clients to the global markets across asset classes through institutional-grade platforms, end-to-end clearing and execution, and high-touch expertise."
Globally, FOREX.com offers an extensive range of offerings, from CFDs, to spread betting to futures, across several different asset classes, though not all are available in every region that it services. Aside from forex, where it derives its name, FOREX.com also offers commodities, indices, individual stocks, bonds, ETFs, gold & silver (unleveraged in US), cryptocurrencies, and futures to provide trading opportunities for all types of traders. FOREX.com (U.K.) also offers client account protection, such as ESMA-mandated negative balance protection and guaranteed stop loss orders.
FOREX.com offers U.S. clients leveraged access to over 80 currency pairs with competitive spreads across different account types. A well-organized and navigable website with fully disclosed services and fees, multiple user interfaces, education and research tools that are on par with industry standards, and regulatory oversight place FOREX.com in the upper echelon of online brokers.
FOREX.com stakes its claim as the #1 FX broker in the U.S. and that claim is validated by the latest (June 30, 2022) CFTC Retail Forex Obligation report which "represents the total amount of funds at an FCM, RFED, or FCMRFD that would be obtained by combining all money, securities and property deposited by a retail forex customer into a retail forex account or accounts, adjusted for the realized and unrealized net profit or loss."
Key Takeaways.
FOREX.com is the #1 FX broker in the U.S in terms of customer funds. FOREX.com is a good fit for high-volume traders. FOREX.com is registered with the CFTC (U.S.), NFA (U.S.), FCA (U.K.), IIROC, ASIC, MAS, FSA, and CIMA .
Who FOREX.com Is For.
FOREX.com is for all types of traders seeking exposure to a wide array of products and asset classes but is a good fit for the high-volume trader. Product offerings vary by region but the broker emphasizes fast and reliable execution, a variety of platforms, and account security. In the U.S., it is geared towards clients who want to trade the foreign exchange markets.
Wide range of product offerings TradingView charts built into web platform Regulated by FCA (U.K.) & CFTC, NFA (U.S.) Offers protection for U.K./E.U. client accounts Rebates for high-volume traders.
No account protection for U.S. clients No guaranteed stop losses for U.S. clients Subpar website maintenance.
Pros Explained.
Globally, FOREX.com offers clients access to a wide range of product offerings that span several asset classes. Clients have access to forex, equities, commodities, indices, bonds, ETFs, industry sectors, cryptocurrencies, gold & silver (unleveraged in US), and futures (through an affiliate). TradingView is "an advanced financial visualization platform" that has been integrated into FOREX.com's web-based platform. Its ease of use and functionality make it, by far, the most impressive aspect of the web-based platform. FOREX.com is a registered FCM and RFED with the CFTC and a member of the NFA (#0339826). Additionally, GAIN Capital UK Ltd is authorized and regulated by the Financial Conduct Authority (FCA #113942). U.K./E.U. clients also have additional asset protection through the Financial Services Compensation Scheme (FSCS), up to £85,000. FOREX.com offers its U.K./E.U. clients "negative balance protection," as mandated by ESMA, and guaranteed stop loss orders (GSLO) (for an additional charge), which protects against market gap risk. These rules likely resulted from the SNB event of January 15, 2022 that roiled the markets, especially the highly leveraged retail FX market. FOREX.com advertises fast, reliable execution making it a good fit for the high-volume trader, who can earn rebates through the "Active Trader" program, thereby lowering trading costs.
Cons Explained.
FOREX.com does not offer "negative balance protection" for U.S. clients. This means that U.S. traders with negative account balances are on the hook for more money than they initially deposited into their accounts. FOREX.com does not offer guaranteed stop loss orders (GSLO) for U.S. clients. An effective web presence is crucial for an online broker. While FOREX.com's website has an intuitive feel, there are a few pages with either incorrect, outdated, and/or incomplete information, which speaks to a general lack of attention to detail.
Costs.
FOREX.com started out primarily as a market maker, but has since morphed into an ECN that generates revenue either through customer trades that "cross" the bid/ask spread, or as commissions, which are on par with the industry. Pricing is transparent and easily found on FOREX.com.
The spreads vary depending on the type of account the client chooses. For example, the minimum EUR/USD spread for U.S. clients on a "standard" account is 1 pip while "commission" and "STP Pro" accounts will show spreads of 0.2 and 0.1, respectively. However, the latter two have commissions of $50 and $60 per million added to the displayed spread. Regions outside the U.S. also offer Direct Market Access (DMA) accounts for larger account sizes (25,000+). The DMA account offers no markup on spreads, but a commission is charged.
Standard account and commission account traders may also benefit from the Active Trader Program. The program is open to anyone who opens an account with at least $10,000 or who trades $25 million of volume in a month. The program is not open to DMA account holders, as that account already has volume-based fee reductions.
FOREX.com requires that the minimum initial deposit "is at least 100 of your selected base currency," though they recommend a deposit of 2,500 so that the client has "more flexibility and better risk management" in their trading.
As is the norm in the FX industry, clients may be charged swap fees on positions they hold overnight, which can be subject to currency conversion charges if they trade in a currency other than the account's base currency.
In terms of other fees, accounts with no trading activity for more than 12 months are subject to a $15/month inactivity fee. The website does not list additional fees for deposits or withdrawals.
Trade Experience.
FOREX.com's trading platforms accommodate the active day trading professional as well as the occasional longer-term trader. Clients can choose between the downloadable advanced trading platform or MetaTrader 4 (MT4) for a desktop experience, the web trader for a browser-based trading experience, or choose the FOREX.com or MT4 mobile app for trading on portable smart devices.
Within the platforms, traders can access charts, economic calendars, news, positions, and trade/order history, and access trade signals and research reports, as well as market analysis from FOREX.com analysts. There aren't many drawbacks to the platforms. There are a sufficient amount of indicators and drawing tools to satisfy the avid technical analyst, and the platforms are functional enough to make rapid-fire trades, if needed. The charting package is provided by TradingView and is, by far, the most impressive aspect of the web-based platform.
Placing trades on the web trader or the downloadable advanced trading platform is intuitive. Clients can trade directly from charts by right-clicking and selecting the "trade" option or by clicking on the "buy" and "sell" buttons along the top of the chart. This brings up an order window where the entry, stop loss, and profit target are set. One-click trading can be enabled for rapid trade execution.
FOREX.com's platform has four 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 a trailing stop loss order. The one difference between the web-based and downloadable offering is that guaranteed stop loss orders are only available on the latter and, furthermore, only for U.K./E.U. clients.
Market - The simplest order where a trader signals that their trade request should be executed at the prevailing market rate. 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. 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.
A FOREX.com account can also be integrated with NinjaTrader, a popular third-party trading platform. VPS is available for MT4 accounts. Clients can use FOREX.com's API to connect in for their own strategies. MT4 and MT5 connectivity allows the use of automated strategies using MetaTrader algorithms.
Forex.com Web Platform.
The mobile app is functional, providing traders with access to all their account information. Traders can add or withdraw funds, view trade history, create watchlists, access news, and view charts from the mobile app. It is also easy to navigate and set up.
The charting feature is one of the drawbacks of the mobile app. There are a limited number of common indicators available, such as RSI, MACD, and moving averages, but drawing functions and more advanced technical tools are missing. Full order functionality is available, including conditional orders and the ability to easily place stop losses and profit targets at the time of a trade.
Functional demo accounts are provided for free, giving potential clients time to assess the pricing structure before committing real capital. The one criticism of the broker's demo accounts is that they expire in 30 days and FOREX.com doesn't give the prospective client the option of extending or applying for a new one under the same credentials. The implication seems to be that you've had enough time to test our platform, so either open a funded "live" account or go elsewhere.