When you enter the world of Bitcoin trading, you will often come across people talking about spreads. Knowing what spreads are is of the utmost importance because it can have an impact on the profits you generate through your trades in the Bitcoin market. In very simple terms, the word spread refers to the difference between the bid and ask price of the currency pair that you are planning to trade. This is often one of the most important considerations made when choosing a Bitcoin broker because everyone wants to maximize their returns. The spread typically represents the cost of the brokerage service for the given transactions and also for the trading environment as a whole.
An increase in liquidity occurs when there is intensity of completion on both buy and sell orders and this results in a tighter spread. Tight spreads are usually variable and spreads can narrow by a few cents or sometimes, even by like tens of cents. Nowadays, as technology is driving markets forward rather rapidly and they are becoming more and more sophisticated, many reputable brokers have begun to offer tight spreads to traders. The option of tight spreads can be a major incentive because it reduces the trading costs that a trader has to incur.
The loss incurred by the trader on price differences is minimized through tight spreads and they are able to open many positions simultaneously. Moreover, they also get the freedom of using algos or robots with better conditions and can adjust trading strategies. As long as you don’t have a problem with constantly fluctuating trading conditions, there is absolutely no harm in signing up with Bitcoin brokers who offer tight spreads. As aforementioned, there are a multitude of brokers who are providing this option, but it is better to stick with the best.
The top 3 brokers who can offer you tight spreads are:
Launched in 2009, the XM broker has become a force to be reckoned with as it is now operating in more than 196 countries and has a support staff that provides assistance in around 30 languages. The headquarters of the company are located in Cyprus, but it has its offices spread in different parts of the world, including Australia, UK, Greece and Belize. More than 1.5 million traders are currently using the broker’s services for trading foreign currencies. It provides them access to more than 55 currency pairs for trading in the forex market.
XM also offers its users the option of trading more than 700 instruments with advanced solutions. The broker has grown rapidly and has earned the trust of the market because it aims to provide traders with the best user experience. It has focused on the needs of its clients, which has enabled the broker to provide competitive conditions. One of the best things about XM is that it allows you to open an account even with a minimum of $5. Plus, it also comes with a ton of research materials and webinars that can be incredibly useful for beginner traders.
Generally speaking, XM has ensured that every single process on its platform, whether it is account opening, depositing or withdrawing, managing and trading, remains transparent and straightforward.
You don’t have to worry about safety and security when trading on XM since it is regulated by some of the top organizations in the world. In the UK, its operations are monitored by the Financial Conduct Authority (FCA), in Cyprus it follows the rules outlined by the Cyprus Securities and Exchange Commission (CySEC) and the Australian (ASIC). It also has an IFSC Belize license. Similar to the interbank forex market, XM uses variable spreads and imposes absolutely no restrictions on trading at the time of news releases.
This is an advantage because fixed spreads generally tend to be higher than variable ones and are more vulnerable to trading strategies. Moreover, it also means that trading costs are calculated in a spread and there are no hidden fees so you can get the tightest spreads possible. The leverage offered by the broker can vary in regions because they have to follow the regulatory requirements that have been established in a particular region.
Since 2009, RoboForex Group has been operating through 2 global companies, RoboForex with operations all over the world and RoboMarkets Ltd. that supports countries in the European Union and EEA. It is well-recognized in the financial markets and serves a huge number of clients spread out over a total of 170 countries. It provides support in a total of 18 languages and is focused on developing trading technology by providing innovative solutions and a wide array of modern tools for trading. It has received more than 20 industry awards in recognition for its offers and developments.
Not only does RoboForex enable you to trade some of the top forex currency pairs, it does so at the tightest possible spreads. In fact, the spreads offered by the broker begin at 0 pips and they are available through leverage that can go as high as 1:1000. Other than that, you can also benefit from fast order execution, six account currencies and plenty of options when it comes to opening an account with the broker. It also organizes a ContestFX that gives out prizes to the traders, which is definitely a bonus. A demo account is also provided and you can participate in contests through that account as well.
Other than the forex market, you can also trade other instruments via RoboForex and benefit from the tight spreads, which include stocks, ETFs, indices, soft commodities, metals, energies as well as cryptocurrencies. As mentioned above, there are two companies operated by the RoboForex Group and one is regulated by the CySEC as a European broker whereas the other is regulated by the IFSC for operating as an international Bitcoin broker. It also has several other licenses in different areas. When it comes to accounts, the broker offers you six options to choose from and you have to invest a minimum of $10 to get started.
This is definitely a plus as it gives you the freedom of choosing an account that suits your needs and experience level. Moving onto trading platforms, the broker has kept up with market trends and gives you access to both the MT4 and the MT5, which are quite popular and powerful. You can use their web-based versions and also their mobile counterparts. The broker has also developed its own proprietary platform that can be used. There are a number of tools and solutions that have also been added, such as copy trading, to make trading easier and more interesting for traders.
ThinkForex was launched in New Zealand in 2010 with the goal of improving the Bitcoin trading experience and providing advanced technology access to traders. Due to the growing demand and the rapid expansion of the company, the broker rebranded itself to become ThinkMarkets. In addition, in order to become regulated and offer better security to their clients, the broker also chose to relocate itself to the United Kingdom and Australia, where it is now monitored by the FCA and the ASIC, respectively. It has also opened offices in several other countries.
There are not many brokers like ThinkMarkets around because it provides its customers with the tightest possible spread, even when market conditions are very volatile. The spreads start as low as 0.1 pips for the EUR/USD currency pair. Since the broker has established a partnership with Equinix, the largest data center in the world, it is able to offer quick execution of transactions, which is certainly a benefit to all traders. The customer service of the company is also worth noting because it has made it a priority to fulfill their needs as soon and as effectively as possible.
Apart from that, the broker also strives to provide support and assistance to new traders and so it has worked on establishing a comprehensive learning center. Here, traders will be able to take advantage of free learning guides and also listen to webinars that cover technical and fundamental analysis as well as market psychology. Clients do not need to worry about safety and security, because as mentioned above, the broker is heavily regulated. Hence, your investment is safe and you will get it back in case of any problem.
ThinkMarkets provides traders the option of trading through the MetaTrader 4 platform if they wish or they can also make use of the Trade Interceptor. The former is mobile optimized and is packed with a ton of tools for supporting different trading styles whereas the latter comes with various trading tools of its own, along with charting indicators and supports multi-device trading. A demo account option is available and numerous payment methods are also offered for the convenience of the traders. The spreads also vary as per the account you open as there are two options.
You can choose any of these brokers when you are looking for the tightest spreads in the Bitcoin market.