Largest Forex Brokers by Trading Volume

Richard Montana | November 21, 2022

When talking about the largest forex brokers, we are referring to those which have a high amount of trading volume and liquidity. These are usually the most popular forex brokers and biggest within the industry. This means that they tend to attract more traders and investors which increases the volume that they execute through to the forex market. They can therefore provide superior pricing and execution to forex traders looking for the very best trading conditions on the market.

What is forex liquidity?

Liquidity refers to how active a market is. It is determined by how many traders are actively trading and the total volume they’re trading. One reason the foreign exchange market is so liquid is because it is tradable 24 hours a day during weekdays.

Liquidity in forex is the ability of a currency pair to be bought and sold in the forex market without majorly impacting its exchange rate. When a currency is easily bought and sold without a lot of fluctuation in its exchange rate, it is considered a liquid currency.

This means that pairs like EUR/USD, GBP/USD or USD/JPY experience high liquidity. In forex, liquidity matters because it tends to reduce the risk of slippage, gives faster execution of orders and tighter bid/ask spreads. This is why it can be important to use a large forex broker with lots of liquidity.

Amongst the most tradable forex pairs in the market are:

  • EUR/USD (European Union euro/US dollar)
  • USD/JPY (US dollar/Japanese yen)
  • GBP/USD (British pound/US dollar)
  • AUD/USD (Australian dollar/US dollar)
  • USD/CAD (US dollar/Canadian dollar)

What is a forex liquidity provider?

A liquidity provider by definition is a market broker or institution which behaves as a market maker in a chosen asset class. The liquidity provider acts at both ends of currency transactions. They buy and sell a particular asset at certain prices. It means that they are making the market. Nowadays forex brokers have liquidity providers who make the commitment to provide liquidity in given equity.

Several types of market participants provide liquidity to the forex market thereby increasing the forex liquidity volume. These include central banks, major commercial and investment banks, hedge funds, foreign investment managers, forex brokers, retail traders and high net worth individuals.

Liquidity providers in forex are organizations that offer their clients foreign exchange trading services. They connect currency buyers and sellers in order to provide the necessary liquidity to the forex market.

Why do I need a large forex broker?

Liquidity on the forex market can be understood as the ability of a valued item to be transferred into currency in a certain period of time. When you are trading on currency pairs, you’re trading on the forex market which is by itself, liquid.

However, you are trading based on the available liquidity of financial institutions that allow you to get in or out of the trade of your choice. Higher liquidity is desirable for everyone on the forex market as it drives down the spreads and the cost of trading.

What is trading volume?

In forex trading, it’s the number of lots traded in a currency pair within a specified time period – put simply, it’s the amount of currency that changes hands from sellers to buyers. The volume of trade is a measure of the market’s activity and liquidity during a set period of time. Generally speaking, the more trading volume a forex broker has, the sharper the pricing they might be able to provide.

Calculating volume in forex is more difficult because it’s a decentralised over-the-counter market. This means that there’s no official record of trades, but rather partial volume figures have to be taken as a proxy for the overall numbers – these figures can either come from a specific market maker, broker or liquidity aggregators.

What is market volatility?

In forex trading, volatility measures how large the upswings and downswings are for a particular currency pair. When a currency’s price fluctuates wildly up and down, it is said to have high volatility. When a currency pair that does not fluctuate as much, it is said to have low volatility.

If you are using one of the largest forex brokers, you should be able to get your positions executed even during times of high volatility. If the broker does not have enough liquidity, they might not be able to execute your trades on time, if at all.

Which country trades forex the most?

Most foreign exchange reserves are held in U.S. dollars, with China being the largest foreign currency reserve holder in the world. The top foreign reserve holders tend to be countries in Asia and South Asia. The biggest geographic trading centre is the United Kingdom, primarily London. Trading in the United Kingdom accounts for a large percentage of the total, making it by far one of the most important places for foreign exchange trading in the world. Notable countries in terms of high forex trading volume include:

  • United Kingdom
  • United States
  • Japan
  • Switzerland
  • Singapore
  • Hong Kong
  • Australia
  • France
  • Denmark

Largest forex brokers in the world by volume

Below traders can find a selection of the largest brokers in the world by volume at the time of writing this guide. The data used has been collected from various different sources.

Broker
Rating
Regulated
Min. Deposit
Founded
Max. Leverage
1.
AvaTrade Review

ADGM FRSA, ASIC, BVIFSC, CBI, FFAJ, FSCA, IIROC, JFSA

$100

2006

1:400

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
2.
IG Review

ASIC, BaFin, CFTC, DFSA, FCA, FINMA, FMA, FSA, FSCA, JFSA, MAFF, MAS, METI, NFA

$250

1974

1:200

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
3.
Pepperstone Review

ASIC, BaFin, CMA, CySEC, DFSA, FCA, SCB

$200

2010

1:400

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
4.
IC Markets Review

ASIC, CySEC, FSA, SCB

$200

2007

1:500

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
5.
XM Group Review

ASIC, CySEC, DFSA, IFSC

$5

2009

1:888

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
6.
City Index Review

ASIC, FCA, MAS

$100

1983

1:200

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
7.
Oanda Review

CFTC, NFA

$0

1996

1:200

Leveraged trading in foreign currency contracts or other off-exchange products on margin carries a high level of risk and may not be suitable for everyone.
8.
Forex.com Review

ASIC, CIMA, CFTC, FCA, FSA, IIROC, JFSA, NFA, SFC

$100

2001

1:50

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
9.
Saxo Bank Review

ASIC, FCA, FINMA, JFSA, MAS, SFC

$500

1992

1:66

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.
10.
CMC Markets Review

ASIC, FCA, FMA, IIROC, MAS

$1

1989

1:500

Between 74-89% of retail investor accounts lose money when trading CFDs with this provider.

Conclusion: should I trade with a popular forex broker?

Yes, I think if you are looking for reliable execution speeds with a safe forex broker, then using one of the largest forex brokers by volume can be a wise idea. They tend to have some of the lowest spreads and quickest execution speeds, which means that you can get your trades executed at some of the best prices on the market at all time. Whilst this might not make a significant difference if you are using swing trading strategies where you hold positions for a long period of time, it can have a big impact when using automated trading systems or a forex scalping strategy.

About the Author

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Richard Montana
Richard has many years of experience in broker research, testing, analysis and reviews. He knows what to look for through years of trading himself with different brokers and listening to the feedback of others.

Review Methodology

For all of our broker reviews, we research, validate, analyse and compare what we deem to be the most important factors to consider when choosing a broker. This includes pros, cons and an overall rating based on our findings. We aim to help you find the best broker according to your own needs. You can read more about our review process.


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