Best CySEC-Regulated Forex Brokers of 2023

Traders in Europe benefit from trading on some of the most tightly regulated financial markets in the world. Even when trading high-risk financial instruments, such as Contracts for Difference (CFDs), their safety on the market is guaranteed by rigorous regulatory oversight. Yet, it may be overwhelming at first to understand what this regulation means for the typical retail trader. That is where we come in with our extensive expertise to sort out the best CySEC-regulated online brokers.

So what exactly does it mean when a broker is regulated by the Cyprus Securities and Exchange Commission (CySEC)? The regulator requires brokers to comply with the Markets in Financial Instruments Directive II (MiFID II), mandated by the European Securities and Markets Authority (ESMA). ESMA seeks to foster fair, competitive, and resilient markets, which is achieved via comprehensive regulation.

When traders open an account with a CySEC-regulated broker, they can expect segregated funds, negative balance protection, maximum leverage of 1:30, and access to the Investor Compensation Fund (ICF), ensuring them against the broker’s credit risks and liabilities by up to EUR 20,000.

But with all of these strict regulations, it is sometimes difficult for retail traders to find a competitive edge in a broker’s service. That is why I went over our base of broker reviews and sorted out the safest companies with the most diverse set of features and services that cater to the different needs of traders.

List of Top CySEC-Regulated Brokers

• IronFX – Best Overall
  Strict regulation. Impressive array of account types. Best execution policy. 80+ FX pairs. Reliable customer support.
• Eightcap – Best for Beginners
  Tight regulation. Strong educational content. Platform with an easy learning curve. Low Commission trading. Choice of tradable instruments.
• Capital.com – Best MT4
  Over 3,000 tradable instruments across multiple markets. Fast order execution under 32 milliseconds. Best execution policy. Suitable for copy and automated trading.
• IC Markets – Best Low Spreads
  MiFIDII compliant. Very low trading fees. Fast order execution, suitable for automated trading.
• FP Markets – Best for Professional Traders
  Broad range of instruments. Best execution guidelines complied. Access to multiple markets. iRESS platform.
• Libertex – Best Trading App
  Libertex app includes sentiment indicators and real-time market news. CFD and investing accounts. Trade from MT4 and MT5 platforms. Great choice between lower-risk securities and higher-yield/risk assets. Competitive prices.

How Did FX Empire Select the Best CySEC-Regulated Brokers?

• CySEC regulation. I checked a broker’s authorizations and whether it complies with the Cyprus Securities and Exchange Commission (CySEC), operating under MiFID 2. I also looked for direct trading protections, such as negative balance protection, and indirect ones, like compensation schemes.
• Offices in Cyprus. I preferred brokers (and broker entities) that are headquartered in Cyrpus, which is necessary for obtaining CySEC regulation and serving traders from the European Economic Area (EEA).
• Deposit and withdrawal. I verified if brokers accept payments in EUR.
• Local customer support. Due to the specific needs of traders based in Europe, I confirmed if brokers provide customer support during the European trading session.
• Trading fees. I measured how competitive the trading fees offered by a broker are, whether commission-free trading is available, and how low the floating spreads are.
• Trading software. I analyzed the usability and efficiency of a broker’s trading platforms and tools by counting the available technical indicators, drawing tools, order types, and more. I also assessed the ease of use of a platform in terms of how clearly price action behavior is represented.
• Trading instruments. I evaluated the range of markets a broker provides and whether traders can exploit various trading opportunities in multiple ways (with CFDs, futures, options, etc.).
• Order execution. I determined whether a broker has a ‘best execution policy’ and whether the broker’s pool of liquidity providers is deep enough to facilitate a steady liquidity supply. I also measured the average speed of order execution.
• Account types. I assessed whether a broker offers versatile accounts for the different needs and experiences of traders. I also looked for swap-free trading (Islamic accounts), minimum deposit requirements, and available base currencies.
• Supporting content. I conducted qualitative and quantitative tests of a broker’s research and educational content that equips traders with the knowledge and skills needed to make informed trading decisions.

Our team of experts has identified each broker’s strengths and weaknesses using FX Empire’s comprehensive methodology. Here’s how we test.

Now, let us go over the selected brokers for each category.

Our Methodology

FX Empire has pioneered a unique methodology for evaluating Over-the-counter (OTC) derivatives brokers worldwide. Our goal is to provide highly sophisticated content outlining the advantages and disadvantages of a broker’s service so that our readers can make informed trading decisions.

The trading industry is continuously evolving, necessitating regular updates to our methodology so that we can ensure it stays up-to-date with all the latest developments. Our team of dedicated professionals ensures that our reviews reflect all the latest changes and market trends.

We test each broker systematically by employing over 250 variables across nine categories:

• Trust
• Fees
• Account Types
• Tradable Instruments
• Platforms and Tools
• Deposits and Withdrawals
• Customer Support
• Research
• Education

Our aim is to be as objective as possible when we carry out our reviews. We check the licenses of all broker entities operating under the same trade name and the Client Agreement’s clarity to ensure the company is fully transparent. Moreover, we assess the competitiveness of a broker’s trading and non-trading fees.

We collect information by opening a live account with a broker entity and testing its services in real time. We measure the spreads, swaps, and commissions on its most popular account type and compare our findings to the industry average.

We also assess the functionality of the available platforms and supporting tools, the number and class of tradable instruments, and the reliability of the customer support. Finally, we carry out а qualitative and quantitative analysis of the research and educational materials. In all of these aspects, we look for diversity and functionality.

In selecting our top picks for each category, we only considered brokers with an overall score of 4+ that are authorized by the Securities and Exchange Commission in Cyprus (CySEC), have a physical presence in Cypres, accept deposits and withdrawals in EUR, and provide customer support during the European trading session. Other parameters include a high transparency level, trading fees below the industry average, and user-friendly and feature-rich platforms.

We abide by our strict guidelines for editorial integrity based on the objective standards we have set for our reviews. You can read more about our review process here.

Meet Our Writers

The team of forex and CFD analysts and editors at FXEmpire is composed of trading industry professionals and seasoned financial journalists. Our experts have been published on leading financial websites such as Investopedia and Forbes. In addition, they all have extensive trading experience.

How to Choose a Forex Broker Regulated by CySEC?

Now that we have outlined our top picks for each category, it is time to delve deeper and examine all the small details in a broker’s offering that traders need to consider before deciding to move forward and opening a trading account with the company.

What protections do you have under ESMA regulation?

As mentioned in the introduction, CySEC operates under ESMA’s MiFID II. What that means for retail traders is that they are entitled to certain protections mitigating their trading and non-trading risks. To understand what those protections are, consider the following:

• Segregated funds. In order to reduce the risk of accounting errors, brokers are mandated to keep their clients’ funds in separate bank accounts from the ones used for their corporate capital.
• Negative balance protection. This safety mechanism prevents a trader’s losses from exceeding their account balance. In case a trader’s margin is running dangerously low and a sudden upsurge in market volatility causes their running losses to exceed their account balance, the negative balance protection will be triggered, and the broker will cover the resulting negative markup. In that regard, negative balance protection is a retail trader’s last line of defense in a volatile market environment.
• Leverage. The advantages of trading leveraged products are twofold – instantaneous entries into trades since there is no need for physical delivery and bigger profits. That is, the leverage multiplies the profits generated from winning trades and the losses incurred from losing ones. In that regard, leverage is the key determinant of a trader’s market exposure, which is directly affected by market volatility. That is why under MiFID II, the maximum leverage afforded to retail traders is capped at 1:30.
• Compensation scheme. Compensation schemes and private indemnity insurances protect clients of a broker against the company’s credit risks and liabilities. In the unlikely event that a broker should go bankrupt, a trader will be compensated for any losses incurred as a consequence of the insolvency by up to a certain amount. Brokers regulated by CySEC participate in the Investors Compensation Fund (ICF), which covers their clients by up to EUR 20,000.

What are the differences between retail and professional traders?

Under MiFID II, brokers are mandated to classify their clients in two categories: as ‘retail’ or ‘professional’. Retail traders are protected by the above-mentioned safety mechanisms, whereas the same may not be applicable to professionals. They are classified as such when they have sufficient trading experience and capital to take on larger risks. I would advise against opening a pro account unless you have at least 5 years of experience trading leveraged products.

A professional trader with a CySEC-regulated broker can opt for a maximum leverage of 1:500 in order to gain bigger market exposure, whereas the maximum leverage for retail traders is capped at 1:30. Accordingly, the risks faced by professional traders are also multiplied. And since they usually trade much larger volumes compared to retail traders, professionals are excluded from the negative balance protection mechanism.

Choosing whether to be classified as a retail or professional trader essentially boils down to means, goals, aspirations on the market, and a trader’s risk aversion. Traders are ultimately responsible for deciding whether they are ready to face larger risks to make bigger profits.

How to choose a trading account based on its pricing?

A broker may have several account types, each with different pricing mechanisms. The question is, how to know which one is best fitted for your particular style of trading? I will try to answer this question by providing an example with two distinct accounts, one STP and the other ECN:

The biggest difference between STP and ECN accounts, apart from the execution model, is the pricing mechanism. Usually, STP accounts afford commission-free trading and floating spreads, whereas ECN accounts have fixed commissions and raw spreads (typically starting from 0.1 pips). At first glance, the former sounds more favorable because you only have to pay one cost – the spread – rather than two.

Read more about Best STP forex brokers and Best ECN forex brokers.

Many brokers recognize the psychological significance of this sort of thinking and seek to exploit it by raising the spreads on their STP accounts to the point where they are no longer the more competitive option. I will now demonstrate how to do a quick test for yourself to evaluate the competitiveness of a broker’s ECN and STP accounts.

Pick an instrument, say, the EURUSD. Suppose also that the spread on the pair is 0.9 pips on a broker’s STP account and 0.1 pips on its ECN account. There is also a $6 commission for trading 1 lot (100,000 units) contract. If the EURUSD pip value is $10, you can do a simple calculation to determine the value of a hypothetical position on the EURUSD executed on both account types. The formula is the value of a trade = spread x pip value + commission. When we pop in the above values, this is what we discover about our hypothetical broker:

This is just a hypothetical example, but hopefully, it illustrates how more can be less in trading. So it’s worthwhile evaluating the costs of a broker you consider opening an account with for yourself before doing so. And if you are still uncertain, you can always check out our database of reviews to sort out the most competitive brokers.

Check out our list of best lowest spread forex brokers.

What should you consider when it comes to liquidity?

Market liquidity, in short, relates to the ease with which brokers can execute trading orders. The more liquid the market, the smaller the discrepancy between the requested price and the price where the order gets filled. Accordingly, the risk of negative slippage is more significant in illiquid markets. That is why traders must select a broker with access to deep liquidity that can guarantee fast order execution in under 100 milliseconds.

The most common brokers operate on a No-Dealing-Desk (NDD) basis, meaning they obtain their liquidity from external providers, such as banks and large financial institutions. The most reliable brokers tend to have a large pool of liquidity providers to ensure quality order execution at most times.

To make sure you choose a broker that guarantees order execution under the most favorable market conditions at all times, look for a ‘best policy execution’ in the legal docs section of the website. This is a legal mandate and commitment by the broker to provide traders with the most favorable price feeds at all times. I have always sought to work with brokers with such a policy to decrease the likelihood of negative slippage.

What to look for in terms of tradable instruments?

When it comes to tradable instruments, both quantity and variety count. It is great when your broker offers multiple instruments, but it is also essential to consider them by asset class. With regards to Contracts for Difference (CFDs), brokers tend to offer FX pairs, commodities, shares, indices, cryptocurrencies, bonds, and ETFs. Exposure to many different markets is important for your versatility in the market.

Read more about best crypto trading brokers.

Consider the following example. If you cannot afford to invest more than $100-200 in your trading account, your options will be greatly limited. In this case, your broker’s otherwise broad range of highly volatile instruments, such as cryptocurrencies and indices, will be of little use to you. That is because your limited available margin may be exhausted too quickly when the underlying volatility is too great.

It is, thereby, important to consider your goals and means on the market and the offering of tradable instruments by your broker. Balance is key here, and it is prudent to look for a diverse selection of lower-risk securities, such as bonds, and higher-risk assets, like shares and indices. The more markets you are given access to, the more opportunities you can exploit.

Selecting a broker that allows you to choose how to exploit these opportunities is also beneficial. In addition to CFDs, some brokers offer options trading, which can be used to mitigate the risk of adverse volatility. To understand the difference between CFDs and options, consider the following example:

Suppose you expect the EUR/USD to rise from the current spot price of 1.0850 to 1.1000 (150 pips in total) in the coming days. You execute a long market order and place a protective stop-loss at 1.0820 (30 pips below the entry). Things go according to plan at first, but then some unexpected news cause an upsurge in adverse volatility. The EUR/USD temporarily drops to 1.0810 before rebounding and eventually reaching the 1.1000 target. Even though you were correct in your initial forecast, your trade still resulted in a loss.

A rookie mistake would have been to place a deeper stop-loss because there is no way of knowing how severe could such adverse fluctuations get. The stop-loss order in this example ultimately fulfilled its purpose of preventing larger losses. Overall, this is not an example of a failed trade as much as it is an example of the limitations of CFDs.

Now let us consider the same setup but traded by purchasing a long call option, which gives the trader the right but not the obligation to open a long position at a predetermined strike price at a future date. And the trading risk is limited to the premium paid for the option. The advantage of options over CFDs is that the price of the underlying can move far away from the strike price (the option becoming deep out of the money), and the option could still turn profitable as long as the underlying rebounds and reaches the strike before the option’s expiry.

In short, choosing a broker that offers options trading is advantageous because it allows you to be more versatile on the market, particularly when it comes to managing and protecting against adverse volatility.

Check out our guides on best gold trading brokers and best oil trading brokers.

How to choose a trading platform?

Trading platforms are used to observe price action behavior and determine viable opportunities for entries into the market. Traders use technical indicators, drawing tools, and other features to examine various price patterns, changes in volatility, liquidity, and so on to gauge the underlying market sentiment.

The best platforms, in my experience, are also the most versatile ones. They include a wide spectrum of technical indicators, such as Fibonacci retracement levels, oscillators, trend-based and range-based indicators, and others, as well as drawing tools, such as trend lines, channels, wedges, and so on. Their design is also important. The most user-friendly platforms are the ones that afford price action to be manipulated with ease.

Traders should also consider whether their broker’s platform accommodates easy and fast order execution via one-click trading, supports algorithmic trading via Expert Advisors (EAs); and supports complex orders, like market, limit, and limit and stop orders, etc.

Check out our dedicated guide on best forex platforms.

Here are some popular trading platforms you could find on the market today:

MetaTrader 4 (MT4): MT4 is one of the most widely used trading platforms in the forex market. It offers a user-friendly interface, advanced charting capabilities, and a wide range of technical indicators and expert advisors (EAs). MT4 is known for its stability and is compatible with Windows, Mac, iOS, and Android devices.

Read more about best MT4 brokers.

MetaTrader 5 (MT5): MT5 is the successor to MT4 and offers additional features and improvements. It provides enhanced charting options, a built-in economic calendar, more order types, and access to other markets like stocks and commodities. Like MT4, MT5 is available on various operating systems.

Read more about best MT5 brokers.

cTrader: cTrader is a popular trading platform known for its advanced order execution and transparency. It offers a customizable interface, multiple charting options, and a wide range of technical analysis tools. cTrader also provides access to a community of traders where you can share strategies and indicators.

Read more about best cTrader brokers.

TradingView: Although not a dedicated trading platform, TradingView is widely used for its powerful charting capabilities and social trading features. Many forex brokers integrate TradingView charts into their platforms or offer them as a standalone option. TradingView allows you to analyze charts, create and backtest trading strategies, and engage with a community of traders.

NinjaTrader: NinjaTrader is a platform primarily used by futures and forex traders. It offers advanced charting, analysis tools, and strategy development capabilities. NinjaTrader provides a range of order types and integrates with various data providers. It is known for its algorithmic trading capabilities.

Read more about best NinjaTrader brokers.

Also, some brokers offer proprietary trading platforms, which are developed in-house and unique to their brokerage. These platforms are designed to provide a tailored trading experience with specific features and functionalities.

What to Avoid When Choosing a CySEC-Regulated Broker?

When it comes to protection, CySEC-regulated brokers offer almost the same safety mechanisms across the board because they are all made to comply with MiFID II. Hence, traders can focus more on other aspects of a broker’s offering when looking for the right partner.

Here are several things to avoid in a broker:

• Classic (STP) accounts with spreads starting from 1.5 pips or Raw (ECN) accounts with round-turn commissions above $7. These are considered above the industry average.
• Brokers that do not offer access to all major markets including FX, commodities, CFD shares, and indices.
• Brokers that cannot guarantee average order execution speeds under 100 milliseconds.

How to Avoid Forex and CFD Scams?

Scammers rely on the gullibility of traders. A commonly employed tactic by fraudsters is to promise quick and easy profits at no risk to the trader. Often, scammers would use labels that closely resemble the brands of real and legitimate companies.

To make sure you are not falling victim to such a scam, always check CySEC’s registry before funding an account with a broker. You can check if a broker’s URL matches the one listed on the website, which is a sure way of knowing you are not dealing with a clone firm.

Another thing to remember is that you must be careful where you leave your information online. Registering your details on suspicious pop-ups promising you enormous profits could result in your contact details ending up in a scammer’s dialing list. Remember, no licensed broker would make unsolicited cold calls.

The next time you get contacted out of the blue with promises of becoming the next Warren Buffet, you must remember that you are most likely speaking to a scammer. In my experience, nowhere is the “if something sounds too good to be true” saying more accurate than in the world of trading. That is why you should do your due diligence before opening an account with a broker.

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