Forex Broker with the Lowest Spread: Complete Guide to Reducing Costs in 2025

Investing in forex requires attention to costs. One of the main villains of trading is the spread – that invisible difference between the price you pay and the price you receive. Many beginner traders do not realize the cumulative impact of spreads on profitability, especially when executing multiple trades. In this guide, we will unveil how spreads work, what factors influence them, and, most importantly, which forex broker with the lowest spread best suits your trading profile.

Unveiling the Spread: The Invisible Cost of Forex

Every forex operation involves costs. Besides commissions charged by the broker, there is a cost that occurs with each position entry: the spread.

What is spread? It is simply the difference between the buy price (ask) and the sell price (bid) of a currency pair. When you open a position, this difference acts as an automatic discount that the broker retains.

Taking EUR/USD as an example:

• Sell price (bid): 1.09727
• Buy price (ask): 1.09734
• Resulting spread: 0.00007 (or 0.7 pips)

Seems minimal? True. But consider: trading 100 EUR/USD pairs per month with this spread means paying ~70 pips in pure costs – amounts that come straight out of your potential profit.

High Spread versus Low Spread: When Does the Difference Matter?

The dynamics between high and low spreads are not as simple as they seem.

High spreads mainly occur in:

• Emerging market currency pairs (less liquid)
• Periods of high volatility (economic announcements, political events)
• Outside London trading hours (1pm–5pm)
• Early mornings or low liquidity periods

Low spreads appear in:

• Major pairs like EUR/USD, GBP/USD, and USD/JPY
• Peak trading hours
• Normal market conditions

But beware: the forex broker with the lowest spread is not always the best choice. Some brokers offer accounts with near-zero spreads but charge hidden higher commissions. It’s essential to compare the total cost (spread + commission + other fees) and not just focus on the advertised spreads.

Main Pairs and Their Average Spreads

Want to know which pairs tend to have the lowest spreads? The main pairs always offer the best conditions:

• EUR/USD: 1.17179 (-0.03%) – average spread: 0.5-1.5 pips
• GBP/USD: 1.35423 (0.01%) – average spread: 1.0-2.0 pips
• USD/JPY: 156.371 (0.04%) – average spread: 0.5-1.5 pips
• AUD/USD: 0.67203 (0.10%) – average spread: 1.0-2.5 pips
• GBP/JPY: 211.765 (0.05%) – average spread: 1.5-3.0 pips

Professional tip: if you want to minimize costs, focus on the first three pairs during liquid hours.

Analyzing the Best Platforms: Which Offers the Lowest Spread?

There are dozens of brokers in the market. Here are those that truly stand out for offering reduced spreads:

Mitrade: Accessibility and Competitive Spreads

Mitrade has gained popularity among beginners by combining low floating spreads with total ease of use. The platform uses dynamic spreads (varying by asset), but the practical average remains among the lowest in the market.

Features:

• Minimum deposit: just US$ 5
• No additional commissions (R$ 0)
• Leverage: up to 1:200
• Minimum trade size: 0.01 lot
• Regulation: ASIC, CIMA, FSC

Available instruments: Forex, indices, commodities, stocks, cryptocurrencies, CFDs

Perfect for: Novice traders who don’t want to start with large capital.

Exness: For More Sophisticated Traders

Exness offers 5 different account types (2 standard + 3 professional). This flexibility allows experienced traders to find exactly what they seek.

Those with larger capital can opt for professional accounts, which offer spreads starting at 0.0 pips – practically cost-free in spread.

Specifications:

• Spreads: from 0.0 pips (professional accounts)
• Commissions: up to US$ 3.50 per lot
• Max leverage: 1:2000
• Minimum trade: 0.01 lot
• Regulation: CySEC, FCA, FSA, BVIFSC, CBCS, FSCA, FSC

Ideal for: Professional traders seeking maximum leverage and ultra-low spreads.

IG Market: The Established Veteran

IG Market was a pioneer in CFDs and remains one of the largest global brokers by trading volume. Therefore, its spreads stay competitive, starting at 0.6 pips.

Main features:

• Spreads: from 0.6 pips
• Commissions: No commission on OTC trades; from US$ 10 per million via DMA
• Leverage: up to 1:200
• Platforms: MT4, ProRealTime, app
• Regulation: ASIC, FCA, FSA, FMA, MAS

Advantage: Established reputation and high volume ensure quick execution.

Tickmill: Specialist in Ultra-Low Spreads

If your focus is solely on reduced spreads, Tickmill deserves special attention. Its ECN account is designed for traders who demand transparency in costs.

Platform profile:

• ECN Account: ultra-competitive spreads
• Minimum deposit: ~US$ 100
• Platforms: MT4 and MT5
• Regulation: FCA and CySEC
• Target audience: beginners and experienced traders seeking maximum transparency

Differential: ECN model where you trade directly with the market, without hidden intermediaries.

Pepperstone: The Choice of Algorithmic Traders

Pepperstone offers two distinct accounts. The Standard is conventional; Razor was developed for traders using algorithms (EAs) and intensive scalping.

In the Razor account, EUR/USD spread varies between 0.0 and 0.3 pips – extremely competitive.

Technical features:

• Supports TradingView (advanced charts)
• Supports automated strategies and algorithms
• Standard account: no commission
• Razor account: from 7 AUD per lot (100k)
• Leverage: up to 1:500
• Platforms: MT4, MT5, WebTrader, cTrader, TradingView
• Regulation: ASIC, FCA, SCB, CySEC, DFSA, BaFin

Ideal for: Automated traders and professional scalpers.

Simplified Comparison Table

Spread vs. Commission: Which Cost Truly Matters?

Here’s the big secret many ignore: a forex broker with a lower spread is not necessarily the cheapest.

Scenario 1: Platform with 0.5 pip spread + no commission
Scenario 2: Platform with 0.0 pip spread + US$ 5 per lot commission

For a standard lot (100k units), you need to calculate: (spread in pips × lot size) vs. charged commission.

Often, slightly higher spreads combined with no commission turn out cheaper than “zero” spreads masked by high commissions.

Tip: Always request the total cost per trade before choosing.

How to Trade with Lower Spreads: 5 Practical Strategies

1. Choose the right times: Trade during London peak hours (1pm–5pm). This is when liquidity is highest and spreads are naturally narrower.

2. Focus on major pairs: EUR/USD, GBP/USD, and USD/JPY always have reduced spreads. Avoid exotic pairs (like USD/TRY) if cost is your concern.

3. Avoid volatile events: Economic announcements, central bank decisions, and political events increase spreads. Stay out of the market during these times.

4. Use specialized accounts: If scalping, look for ECN or Razor accounts. If you’re a beginner, start with standard accounts from reputable brokers.

5. Calculate the real cost: Don’t compare only spreads. Add spread + commission + other fees to determine the actual operational cost.

Frequently Asked Questions about Forex Spreads

Q: Do “zero” spreads really exist?
A: Technically, yes. But they often come with high commissions or other restrictions. What I call “zero” is just a cost reallocation.

Q: What is the ideal spread to make money?
A: Depends on your style. Scalpers need spreads below 2 pips. Swing traders can tolerate 2-5 pips. Day traders operate well with 1-3 pips.

Q: Why do spreads widen outside trading hours?
A: Liquidity drops outside peak hours. With fewer buyers and sellers, the bid/ask difference naturally widens.

Q: Can I trade forex with fixed spreads?
A: Yes, some brokers offer fixed spreads. But during extreme volatility, they may refuse execution or widen spreads anyway. Most use floating spreads for safety.

Q: Is IG Market still competitive in 2025?
A: Yes. Despite being traditional, their scale ensures competitive spreads and quick execution.

Conclusion: Which Broker to Choose?

The best forex broker with the lowest spread depends on your profile:

• Beginner with little capital? Mitrade offers minimum US$ 5 deposit and low spreads.
• Professional trader seeking maximum leverage? Exness with professional accounts offering 0.0 spreads.
• Seeking total transparency? Tickmill and its ECN model.
• Scalper or algorithmic trader? Pepperstone with Razor account.
• Looking for security and reputation? IG Market remains a top choice.

Remember: spread is not the only factor. Regulation, execution speed, customer support, and trading platform matter equally. Test each platform, start with small amounts, and see which best fits your trading flow.

Good luck with your trades!