Forex trading in India has gained acceleration in the past few years. Forex presents an immense opportunity to investors who understand its basic concept to trade responsibly. Nowadays, it has become one of the largest online trading markets. There are several international forex brokers that avail traders and investors based in India to sign up with their platform to trade forex in a safe and legally compliant way. Since the Securities and Exchange Board of India (SEBI) does not allow forex trading that overrules existing rules within the country, make sure that you involve with a properly regulated broker for a hassle-free forex trading experience.
Tip: Simply visit the SEBI website to check licenses held by listed brokers.
But before you open a forex trading with a broker of your choice in hopes to make profits you should be aware of the fees applied to users. The first step before opening a trading account for forex should be asking oneself what is annual fees of a forex trading account in India?
What are the annual fees of the forex trading account in India?
When you sign up to make use of any forex broker online which has required licenses and certifications to facilitate its customer’s orders then you have to accept a few terms and conditions. At times these terms may also include various fees or charges which traders are liable to pay under specific conditions. One of them is an annual fee which as the name suggests, traders need to pay to their forex broker once a year. But it is important to note that the annual fee is not customary for every single forex broker that is up and running.
Other fees levied by some forex brokers in India
As mentioned earlier, there could be many other hidden charges applicable on a user who signed up recently with a forex broker such as the following:
1. Direct trading fees:
These are charges which are levied on a forex trader directly for facilitating each forex trade performed on the trading platform. Many trustworthy forex brokers maintain a transparent fee structure that is open for all traders to see and follow accordingly. These trading costs are what beginner forex traders tend to calculate before choosing a proper forex broker. Any forex broker which offers a proprietary trading platform applies these trading costs (either on a monthly or a yearly basis).
2. Overnight costs:
If you are interested in margin trading then you might get acquainted with overnight costs applicable on such trades. Your broker of choice will make sure to put all the information regarding this cost and how is it calculated on its website. The amount of leverage used per trade of any specific asset normally influences the overnight financing rates of a forex broker. Keeping an eye on these types of charges is important because it could change and increase on account of fixed assets.
3. Inactivity fees:
Usually, whenever you open a live trading account to trade forex pairs of your choice with a reputed forex broker that has millions of users, you are expected to trade often. Some brokers put a limit on how frequently one is allowed to remain inactive on their trading platform. Inactivity fees are levied on forex traders who despite having a live trading platform fail to access it for several months (minimum 6 months). Simply, put it is the fee charged on a trading account that does not meet the minimum trading activity over a specified period that has been pre-determined by a broker. To avoid it, forex traders need to make sure that they actively participate in trading.
List of forex brokers that do not charge annual fee for holding account
Any forex broker could change the conditions for all of the aforementioned costs on their trading platform for its traders. People interested in registering with any forex broker have to carefully review the information section to understand when and how much is charged as a fee. Some reputed forex brokers do not charge an annual fee for holding a trading account at all such as:
1. IG Markets
IG is considered one of the top forex brokers currently operating in the industry that has quite an experience when it comes to providing brokerage services to people. Whether it is choice of assets, seamless automated trading, and a transparent fee structure, IG Markets is a personal favourite of most forex enthusiasts.
Features:
- The overall trading performance on IG is remarkable for both new and expert traders from all over the world who get an extensive upgrade package for the MT4 trading platform.
- This high-performance forex broker offers its traders an exclusive tool known as ProRealTime Charts that monitors charts in real-time and has a lot of functionalities.
- Like many other brokers, the majority of IG Market’s income comes from mark-ups and commissions. Most of the fees levied on a customer are kept competitively low.
- IG Market charges a 0.50% currency conversion fee and a $12 per month fee for inactivity which is charged if a trader has not traded in over 2 years.
Visit IG Markets to know more.
2. CMC Markets
This one is another UK-based famous online brokerage company that is also listed on the London Stock Exchange. CMC Markets caters to both retail forex clients and institutional customers that includes hedge funds, brokers, banks, and some trading desks. This brokerage firm functions with MT4 and its proprietary trading platform.
Features:
- Profiting from spreads and commissions depending on the assets involved allows CMC Markets to offer low fees to its clientele.
- Some trading costs are charged as premium for guaranteed stop-loss orders which can be compensated if a particular order remains unused.
- There are overnight holding costs, market data fees, and swap rates that should be considered by traders. There is also a $12 inactivity fee per month on CMC Markets users.
Visit CMC Markets to know more.
3. Interactive Brokers
Operation since 1978, Interactive Brokers has come a long way to become one of the top choices of forex traders that utilises advanced technology to be considered a competitive broker. As a publicly listed company on the NASDAQ exchange, this broker possesses a combination of expertise in forex and reputed background which makes its infrastructure safe enough to trade.
Features:
- This broker covers over 135 markets across 33 different countries all over the world. Forex enthusiasts get to choose from 23 currencies in their unique trading environment.
- For someone who has never used Interactive Brokers before, their fee structure might seem a little too complex due to the vast offering mentioned above.
- Swap rates are applicable on leveraged overnight positions opened by traders. Market data fees are not applied to all traders but to those having specific needs depending on the assets.
Visit Interactive Brokers to know more.
4. AvaTrade
AvaTrader has been functioning as a dedicated forex broker for nearly 15 years since it was founded in 2006. This means that AvaTrade is one of those brokers that have a trustworthy background and an indisputable reputation in forex markets.
Features:
- Being a suitable forex/CFD broker, AvaTrade profits from its spreads rather than commissions.
- AvaTrade offers a 400:1 leverage on most of its forex pairs with a 0.25% of minimum margin which rises to 2% at times.
- This broker comes clean about its overnight financing rates because many of its competitors tend to hide existing rates.
- The account inactivity fee applied on AvaTrade is $50 per quarter when traders fail to keep their account active for more than 3 months.
It’s crucial for traders based in India to review a forex broker’s fee structure minutely to avoid paying an annual fee for holding accounts.