As one of the most prominent brokers in the Forex industry, XM has attracted a large following due to its competitive spreads, multiple account types, and a reputation for reliability. For traders, choosing a broker involves examining factors like spreads, commission fees, and trading platforms to determine if the broker aligns with their strategies and risk tolerance. In this review, we’ll analyze XM’s spreads, fees, and overall trading environment to help you assess if XM is the right choice for your Forex trading needs in 2024.
XM offers four main types of accounts: Micro, Standard, XM Ultra Low, and Shares. Each account type caters to different trading needs and comes with its own fee structure, spread conditions, and minimum deposit requirements. Here’s a quick look at each:
| Account Type | Minimum Deposit | Spreads (as low as) | Commission |
|---|---|---|---|
| Micro Account | $5 | 1.0 pip | No commission |
| Standard Account | $5 | 1.0 pip | No commission |
| XM Ultra Low Account | $50 | 0.6 pip | No commission |
| Shares Account | $10,000 | N/A | Commission applies on shares |
For traders who prioritize tight spreads, the XM Ultra Low Account is the most attractive option, with spreads starting as low as 0.6 pips and no additional commission charges. Meanwhile, the Micro and Standard accounts offer spreads from 1.0 pip, suitable for traders looking for smaller trade sizes without added commission fees.
Spreads are a critical factor for Forex traders, as they directly impact trading costs. Here’s how XM’s spreads compare to other major brokers in 2024:
| Broker | EUR/USD Spread (Avg) | Commission |
|---|---|---|
| XM | 0.6 – 1.0 pips | No commission |
| FXTM | 1.3 pips | No commission |
| OANDA | 1.2 pips | No commission |
| Pepperstone | 0.0 – 0.3 pips | $7 per lot |
As shown, XM offers competitive spreads, especially with the XM Ultra Low Account, where spreads are as low as 0.6 pips on major pairs like EUR/USD. However, traders seeking the lowest possible spreads may find options like Pepperstone attractive due to its raw spreads (0.0–0.3 pips) but should consider the $7 commission per lot.
XM charges no commission on Forex and CFD trades across its Micro, Standard, and Ultra Low accounts. For traders focusing on shares, the XM Shares Account incurs a commission fee, which varies depending on the traded share’s exchange and other factors. XM’s no-commission structure is ideal for traders who prefer to keep trading costs simple and transparent.
Swap Fees: XM applies overnight swap fees on positions held past market close. Swap rates are variable and depend on the currency pair and market conditions.
Inactivity Fees: XM charges an inactivity fee of $5 per month for accounts with no trading activity over a period of 90 days. This is a consideration for traders who may not trade regularly.
Deposit and Withdrawal Fees: XM does not charge fees for deposits or withdrawals, a strong advantage for traders as it reduces hidden costs.
For Forex traders, developing effective strategies often revolves around understanding the costs associated with each trade and incorporating these into planning. XM’s low spreads, especially on major pairs, are well-suited to a variety of trading strategies:
Scalping is a strategy focused on short-term trades with quick profits. With XM’s low spreads on the Ultra Low Account, scalpers can execute multiple small trades with minimized costs. For example, scalpers targeting the EUR/USD pair can take advantage of 0.6-pip spreads without commission, which enhances profitability. It’s important for scalpers to monitor XM’s swap fees, as positions held overnight can incur extra costs that affect returns.
Swing trading, which involves holding trades for several days or weeks to capture larger price movements, can also benefit from XM’s low spreads. For instance, a swing trader may open a position on USD/JPY based on technical indicators like the moving average or Fibonacci retracement. XM’s 1.0 pip spread on Standard accounts helps swing traders reduce costs and maintain a profitable strategy.
Day traders close all trades before the market closes each day, aiming to profit from daily price fluctuations. For day traders using XM, the no-commission structure on Forex pairs is advantageous, as they can execute multiple trades without accruing additional costs. Additionally, with XM’s access to MetaTrader 4 and 5 platforms, day traders have a range of tools and indicators to support high-frequency trading.
XM’s platform offerings include MetaTrader 4 (MT4) and MetaTrader 5 (MT5), both of which are available for web, desktop, and mobile devices. MetaTrader platforms provide an extensive range of indicators, automated trading options, and charting tools, making them suitable for both novice and experienced traders.
Educational Resources: XM provides educational content, including webinars, video tutorials, and trading tips, which are beneficial for traders who want to refine their skills.
Account Types for Different Needs: XM offers flexibility in account types, from Micro accounts for beginner traders to the Shares account for those focused on equity trading.
Customer Support: XM’s customer support is available 24/5, with support in multiple languages, enhancing accessibility for traders worldwide.
To illustrate the practical costs of trading with XM, let’s consider a trader with a $1,000 account balance using the XM Ultra Low Account. If the trader opens a 1-lot position on EUR/USD at a 0.6-pip spread, the cost of this trade would be:
Cost of Spread: 1 lot = 100,000 units; therefore, 0.6 pips = $6.
For comparison, if the same trade were executed with another broker offering a 1.2-pip spread, the cost would be $12, double the amount with XM. This example highlights how XM’s low spreads can help traders save on costs over time, especially in high-frequency trading.
XM continues to be a competitive choice for Forex traders in 2024 due to its low spreads, zero commission on most accounts, and access to MetaTrader platforms. For traders who prioritize low-cost trading and flexibility, XM’s account options offer a balance of affordability and feature-rich trading tools. With its range of account types and competitive pricing, XM is well-suited for traders employing various strategies, from scalping to day trading.
As Forex trading continues to evolve, XM remains an adaptable broker for traders aiming to optimize their trading costs and capitalize on market opportunities. Whether you’re new to Forex or a seasoned trader, XM provides a well-rounded platform to support your trading goals in 2024.