Best CFTC Regulated Forex Brokers In the USA (2024)

Top 5 US-Regulated Forex Brokers

Comparison of the Best Forex Brokers in the U.S.

Reviews of the Best US Forex Brokers

Identified below are a number of the best U.S. Forex brokers identified by the experts at Traders Union.

OANDA

OANDA Review

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Oanda USA, official website

Regulation

Oanda is a regulated U.S. based Forex broker.

• Oanda is a registered retail RFED with the CFTC and a member of the NFA.

• Oanda has over 25 years of experience and holds licenses in several other jurisdictions.

• Oanda offers spot Forex trading and CFDs on various assets.

Main trading conditions

Here are several trading conditions offered by this U.S. Forex broker.

• A standard account caters to beginners and offers access to various Forex pairs and other assets.

• An active trader account offers additional benefits like lower spreads and margin discounts for high-volume traders.

• A minimum deposit of $1,000.

• Minimum trade size is 1 unit (micro lot).

• Oanda offers margin trading, but leverage limits apply.

• Commissions are variable, starting from $0 per trade for certain account types.

• Oanda offers tight spreads, which can significantly impact trading costs.

• Inactivity fees kick in after one year of no trading activity.

• Oanda offers a user-friendly web platform and mobile app for trading on the go.

• Customer support is available 24/5 phone and live chat support, although weekend availability might be limited.

• Oanda offers educational materials, webinars, and tutorials, but the extent might be less comprehensive compared to some competitors.

IG Markets

IG Markets Review

IG Markets US, official website

Regulation

IG Markets (IG US LLC) is a legitimate U.S. based Forex broker. Here's a summary of their legitimacy and regulatory standing.

• IG US LLC is a Registered Retail Foreign Exchange Dealer (RFED) with the CFTC and a member of the NFA.

• IG Markets is a U.S. regulated Forex broker with over 45 years of experience.

• IG US LLC offers spot Forex trading and contracts for difference (CFDs).

Main trading conditions

Here's a breakdown of key trading conditions when considering trading with IG Markets.

• Standard accounts cater to beginners and offers access to various Forex pairs, stocks, and other assets.

• Active trader accounts offer additional benefits like lower spreads and margin discounts for high-volume traders.

• A new account minimum deposit is $250.

• A minimum trade size is 0.01 standard lot (micro lot).

• Leverage is available up to 50:1 (depending on the instrument). Leverage limits are in place to manage risk, and higher leverage options may not be suitable for beginners.

• Commissions are variable, starting from $0 per trade for certain account types.

• Spreads are variable, but IG Markets generally offers competitive spreads compared to other brokers.

• Inactivity fee applies after one year of no trading activity.

• IG offers a user-friendly web platform and mobile trading applications.

• Customer service is available 24/5 phone and live chat support.

• Extensive library of educational materials, including webinars and video tutorials.

Trading.com

Trading.com Review

Trading.com official website

Regulation

Trading.com is a legitimate broker in the USA, regulated by the Commodity Futures Trading Commission (CFTC) and is a member of the National Futures Association (NFA #0516820). This ensures that Trading.com adheres to strict regulatory standards, providing a secure trading environment for its clients.

Main trading conditions

• Trading.com does not specify a minimum deposit, making it accessible for traders with different financial capabilities.

• The broker offers competitive spreads and claims to have no hidden fees, providing a transparent fee structure for traders.

• Offers leverage, which varies based on the trader's location and the instruments being traded.

• Provides access to popular trading platforms, enhancing the trading experience with advanced tools and features.

• A wide range of currency pairs is available, catering to forex traders with diverse interests.

• Offers 24/5 customer support to assist traders with any issues or questions they may have.

• Occasionally runs promotions, such as a $100 promotional credit for new registrations, subject to certain conditions.

FOREX.com

FOREX.com Review

Forex.com official website

Regulation

Forex.com is a reputable forex and CFD broker that is regulated by several financial authorities globally. In the USA, Forex.com operates as a registered Futures Commission Merchant (FCM) and Retail Foreign Exchange Dealer (RFED) with the Commodity Futures Trading Commission (CFTC) and is a member of the National Futures Association (NFA # 0339826). This regulatory framework ensures that Forex.com adheres to strict financial standards and offers a secure trading environment.

Main trading conditions

• Forex.com does not require a minimum deposit to open an account, making it accessible for traders of all levels.

• The broker offers competitive spreads and low forex fees. However, stock CFD fees are considered high with respect to its peers.

• Forex.com provides leverage options, which can vary depending on the trader's location and the traded instruments.

• Traders have access to powerful, purpose-built currency trading platforms, including MetaTrader 4 and Forex.com's own platforms.

• A wide variety of currency pairs are available for trading, catering to different trading strategies and preferences.

• Forex markets are available 24 hours a day, five days a week, providing continuous trading opportunities.

• Forex.com is known for super-fast and reliable trade executions, which is crucial for taking advantage of market movements.

Interactive Brokers

IBKR Review

Interactive Brokers US, official website

Regulation

Interactive Brokers (IBKR) is a legitimate Forex broker in the U.S.

• IBKR is a CFTC-registered futures commission merchant (FCM).

• IBKR is a member of FINRA.

• They are a member of the Securities Investor Protection Corporation (SIPC), a non-profit organization that protects investors in case of broker failure.

Main trading conditions

Here's a summary of key factors when considering this U.S. based Forex broker.

• The TWS platform offers advanced features, but may be overwhelming for beginners.

• Educational resources focused on Forex trading might be less extensive compared to other brokers.

• The individual investor account type is for most traders, offering access to various asset classes, including Forex.

• Minimum deposit of $10,000.

• Minimum trade size varies depending on the currency pair.

• IBKR offers margin trading, but leverage limits apply.

• Commissions start at $0.005 per share for U.S. stocks and ETFs, with specific rates for options and other asset classes.

• IBKR generally offers competitive spreads, but they can vary depending on market conditions and the currency pair traded.

• Inactivity fee applies after one year of no trading activity.

• Customer service might be less readily accessible compared to some competitors and potentially geared towards experienced traders.

• IBKR offers educational resources, but specifically Forex focused materials might be less extensive compared to other brokers.

• IBKR offers a free demo account with virtual funds to practice trading and test the platform before risking real capital.

How to choose the Best Forex Broker in the U.S.

Here are several tips to help you select the best U.S. Forex broker.

• Look for U.S. regulated brokers registered with the CFTC or the NFA.

• Different brokers cater to various trading styles and experience levels. Evaluate your preferred trading platforms, account types, available currency pairs, and minimum deposit requirements.

• Compare U.S. Forex broker spreads, commissions, and fees to find options with competitive rates that suit your trading style.

• Select a U.S. Forex broker’s platform with a clear interface and features that support your preferred trading style.

• Prefer a U.S. Forex broker with readily available customer service options.

Is Forex trading legit in the U.S.?

Yes, Forex trading is legal in the U.S., but with some crucial caveats and regulations. Forex brokers operating in the U.S. must be registered with CFTC and often must also be members of the National Futures Association (NFA).

How to confirm if a Forex broker is regulated in the U.S.

Here's a step-by-step guide on how to check if a U.S. Forex broker is regulated by the CFTC, along with screenshots for clarity.

Step 1: Go to the Commodity Futures Trading Commission's website.

Commodity Futures Trading Commission's website

Step 2: From the main navigation page, click on the "Learn and Protect" tab and then select "Check Registration & Disciplinary History" from the dropdown menu.

Commodity Futures Trading Commission's website

Step 3: Select the red icon “NFA BASIC Database” in the middle of the page.

Commodity Futures Trading Commission's website

Step 4: You will then be redirected to the NFA BASIC search page. Here you can search for a broker using several searching methods.

Commodity Futures Trading Commission's website

Step 5: Click "Search" and examine the results.

• If the broker is registered with the CFTC, their records will appear:

  The registration status (active or inactive)

  Any disciplinary history or regulatory actions

  Financial information

While focusing on U.S. based Forex brokers offers the benefits of CFTC regulation and direct customer support within the country, do not overlook the potential advantages of reputable international brokers. Expanding your search internationally can widen your choices in terms of trading conditions, features, and potential cost savings.

Do I pay taxes on Forex trading in the U.S.?

In the U.S., taxation on Forex trading falls under Section 1256 of the Internal Revenue Code, which specifically addresses the taxation of certain types of financial instruments, including futures contracts and options.

Under Section 1256, 60% of gains from Forex trading are taxed at a long-term capital gains rate, while the remaining 40% are taxed at the short-term capital gains rate. The long-term capital gains tax rate for the majority of taxpayers is 15%. This means that a significant portion of Forex gains can be taxed at a favorable rate compared to regular income tax rates, which can be substantially higher.

This tax treatment applies to gains and losses generated from Forex trading contracts held for more than one year. Any gains or losses from contracts held for one year or less are considered short-term and subject to the ordinary income tax rates, which can be higher than the long-term capital gains rate.

Forex trading hours in the U.S.

Forex trading is a global activity that operates 24 hours a day, five days a week. However, not all Forex markets are open at the same time, and the trading volume and liquidity vary depending on the time zone and the session. For U.S. traders, it is important to know the Forex trading hours in the U.S. and the best times to trade Forex.

The U.S. Forex market is mainly influenced by the New York session, which runs from 8:00 am to 5:00 pm Eastern Standard Time (EST). The New York session is the second busiest and most volatile session in the Forex market, as it overlaps with the London session, which is the busiest and most liquid session. The London session operates between 3:00 am to 12:00 pm EST. The overlap between the New York and London sessions, from 8:00 am to 12:00 pm EST, is the peak trading time for U.S. traders, as more than 50% of the Forex trading volume occurs during this period.

The U.S. Forex market is also affected by the Tokyo and Sydney sessions, which are the first to open after the weekend. The Tokyo session runs from 7:00 pm to 4:00 am EST, while the Sydney session opens from 5:00 pm to 2:00 am EST. These sessions tend to be less active and less liquid than the New York and London sessions, but they can still offer some trading opportunities, especially for the Asian and Australian currency pairs. The overlap between the Tokyo and Sydney sessions, from 7:00 pm to 2:00 am EST, is the quietest time for U.S. traders, as the trading volume is low and the price movements are minimal.

The best time for U.S. traders to trade Forex is when the New York and London sessions overlap, from 8:00 am to 12:00 pm EST, as this is when the market is most active, liquid, and volatile. However, U.S. traders can also find trading opportunities during the other sessions, volatile. However, U.S. traders can also find trading opportuni

Is Forex trading profitable in the U.S.?

Forex trading can be profitable in the U.S. For beginners embarking on this exciting financial journey, here are several tips to navigate the complexities of the Foreign exchange market.

• Before diving into the world of Forex, it is crucial to build a solid foundation of knowledge. Understand the basic concepts, terminologies, and market dynamics. Numerous online resources, courses, and educational materials are available to help beginners get started.

• Opt for a reputable and regulated U.S. Forex broker that complies with the regulatory standards. This ensures a secure and transparent trading environment.

• Begin with a modest investment and gradually increase your exposure as you gain experience and confidence. This approach allows you to learn without risking significant capital in the early stages of your trading journey.

• Most of the best U.S. Forex brokers offer demo accounts where you can practice trading with virtual money. Utilize this feature to familiarize yourself with the trading platform, test strategies, and hone your skills without the risk of real financial loss.

• Develop a sound to protect your capital. Set stop-loss orders and determine the amount of capital you are willing to risk on each trade. Avoid overleveraging, as it can magnify both profits and losses.

• Keep abreast of economic indicators, news, and geopolitical events that can influence currency markets. Understanding the factors driving market movements will help you make informed decisions.

• Establish a well-thought-out trading plan that includes your financial goals, risk tolerance, and trading strategy. A plan provides a roadmap, helping you stay disciplined and focused on your objectives.

Our Methodology

Traders Union applies a rigorous methodology to evaluate brokers using over 100 both quantitative and qualitative criteria. Multiple parameters are given individual scores that feed into an overall rating.

Key aspects of the assessment include:

• Regulation and safety. Brokers are evaluated based on the level/reputation of licenses and regulations they operate under.

• User reviews. Client reviews and feedback are analyzed to determine customer satisfaction levels. Reviews are fact-checked and verified.

• Trading instruments. Brokers are evaluated on the breadth and depth of assets/markets available to trade.

• Fees and commissions. A comprehensive analysis is done of all trading costs to analyze overall cost to clients.

• Trading platforms. Brokers are assessed based on the variety, quality and features of platforms offered to clients.

• Other factors like brand popularity, customer support, education resources are also evaluated