Forex Brokers for Hedging
- Written By thinkforexbrokers
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Forex hedging is a risk management strategy that allows traders to open additional positions to protect against adverse market movements. By buying or selling instruments that offset their existing trades, traders can minimize their overall exposure to risk. Many forex brokers permit hedging, though the rules can vary depending on each broker’s internal policies and the regulations in their operating regions. After thorough research, we’ve identified the 12 best forex brokers that allow hedging.
74-89 % of retails CFD accounts lose money
73.85 % of retails CFD accounts lose money
59.57 % of retails CFD accounts lose money
Trading leveraged product is risky
74-89% of retails CFD accounts lose money
75.5 % of retails CFD accounts lose money
The vast majority of retail client accounts lose money
82 % of retails CFD accounts lose money
Top 12 Forex Brokers for Hedging
1. Pepperstone
Pepperstone offers access to over 1,000 CFD instruments, including forex, indices, shares, and more—opening up a wide range of trading opportunities. The broker is regulated by several major financial authorities, including ASIC, CySEC, and BaFin. Its Razor accounts feature ultra-competitive spreads starting from 0.0 pips.
Traders can hedge their forex positions freely on all supported platforms, including MT4, MT5, and cTrader. Pepperstone offers over 100 assets suitable for hedging strategies, including 60+ forex pairs.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.5% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
2. FP Markets
FP Markets is a globally recognized broker offering a wide range of CFD products, including forex, shares, indices, commodities, metals, cryptocurrencies, and ETFs. It supports hedging across more than 10,000 instruments, including 70 forex pairs, with spreads starting as low as 0.0 pips.
Traders can start with a demo account or jump into live trading with a low minimum deposit—$50 (or A$100). FP Markets offers two main account types: a Standard Account with no commissions and spreads from 1 pip, and a Raw Account with ultra-tight spreads from 0.0 pips and a $3 commission per side, per standard lot.
Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you fully understand how CFDs work and whether you can afford to take the high risk of losing your money.
3. BlackBull Markets
Founded in 2014, BlackBull Markets is a trusted ECN broker licensed in New Zealand and Seychelles, serving clients in over 180 countries. It offers access to thousands of tradable instruments, including 70 forex pairs, 20 cryptocurrencies, 13 indices, 11 commodities, and more than 1,700 shares across 27 global markets.
The broker provides tight spreads starting from 0.8 pips on commission-free accounts. Hedging is fully allowed, with no restrictions, and BlackBull even provides basic risk management resources covering the strategy. Traders can choose from MT4, MT5, and cTrader—platforms well-regarded by hedgers for their advanced order functionality and robust charting tools.
BlackBull also offers swap-free accounts for traders of the Muslim faith. Minimum deposits start at $0 for Standard accounts and $2,000 for commission-based accounts.
all supporting trade sizes from 0.01 to 100 lots with a $100 minimum deposit. The Raw account caters to those seeking ultra-low spreads and direct market access, while Standard and TradingView accounts offer commission-free trading with spreads starting from 1.0 pip.
4. AvaTrade
With over 17 years of experience, AvaTrade is a well-established and highly regulated broker offering access to more than 1,250 financial instruments, including forex, commodities, indices, and more. The broker supports hedging on 60 forex pairs, providing favorable conditions for both retail and professional traders.
Forex spreads start from 0.8 pips for retail clients and 0.6 pips for professional clients. AvaTrade supports multiple trading platforms suitable for hedging strategies, including MetaTrader 4. Opening a live trading account is quick and straightforward, with a low minimum deposit of just $100.
Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you fully understand how CFDs work and whether you can afford to take the high risk of losing your money.
5. IG
IG is a well-regulated and trusted broker that stands out as a strong choice for forex hedging. Whether using IG’s web platform or mobile app, traders can enable Hedging Mode via the “force open” option, allowing them to hold long and short positions on the same currency pair simultaneously.
IG encourages traders to explore hedging strategies risk-free by starting with a demo account. Live account holders can choose from over 80 forex CFDs, with spreads starting as low as 0.6 pips.
Risk Warning: CFDs are complex instruments, and 69% of retail client accounts lose money when trading CFDs with this provider. Leverage can lead to rapid losses. Make sure you fully understand how these products work and whether you can afford to take the high risk of losing your money.
6. Saxo Bank
Saxo Bank is a reliable and well-regarded broker, making it a strong option for traders interested in forex hedging. The company offers a detailed guide to help beginners understand and implement the strategy.
Traders can enable hedging by selecting “force open” after choosing either real-time FIFO or end-of-day FIFO as their netting method. These options are easily accessible within the SaxoTraderGO platform, which makes toggling hedging on or off simple and intuitive.
Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 65% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs, forex, or any of our other products work—and whether you can afford to take the high risk of losing your money.
7. CMC Markets
Founded in 1989, CMC Markets is one of the world’s largest brokers, offering access to over 12,000 tradable markets, including Forex, shares, and indices. Forex traders benefit from competitive spreads starting at 0.0 pips on FX Active accounts. Customers can trade on either the popular MetaTrader 4 platform or CMC’s own Next Generation platform.
Traders looking to hedge their currency positions can open a live account or practice hedging strategies risk-free using a demo account. CMC Markets offers an extensive selection of 330 Forex pairs, covering majors, minors, and exotic currencies. To successfully apply hedging strategies, staying updated with economic news is essential.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70.64% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
8. City Index
City Index serves over 1 million account holders and offers access to more than 13,500 financial markets, with an impressive average execution speed of 20 milliseconds. The broker is authorized and regulated by top-tier authorities, including the FCA, CySEC, and FSA, ensuring a secure and transparent trading environment.
City Index features a proprietary trading platform equipped with advanced research tools and a wealth of educational resources, including materials focused on hedging strategies. Average trading costs start from just 0.7 pips on the EUR/USD pair. Beyond Forex, traders can also hedge positions in commodities and stocks.
CFDs are complex instruments and carry a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. Please ensure you understand how CFDs work and consider whether you can afford the high risk of losing your money.
9. IC Markets
IC Markets is another top-tier Forex broker highly recommended for traders looking to hedge their open Forex positions. The company provides access to over 2,250 financial instruments, including 61 Forex CFDs, through powerful trading platforms like MT4, MT5, and cTrader. Traders who wish to hedge will benefit from ECN execution with raw spreads starting as low as 0.0 pips on Raw accounts. New traders can start risk-free by opening a Demo account, while live accounts require a minimum deposit of just $200.
CFDs are complex instruments and carry a high risk of losing money rapidly due to leverage. 70.64% of retail investor accounts lose money when trading CFDs with this provider. Please ensure you understand how CFDs work and consider whether you can afford the high risk of losing your money.
10. eToro
eToro is a well-known trading platform that supports risk management through hedging. The broker also offers the eToro Academy, which provides educational resources to help new traders deepen their understanding of investing. Additionally, eToro features several comprehensive guides that explain the fundamentals and strategies of hedging. Traders using the platform have access to over 50 currency pairs. Minimum deposit requirements vary depending on the user’s country of residence, typically ranging from $50 to $200 in most regions where eToro operates.
CFDs are complex instruments and carry a high risk of losing money rapidly due to leverage. 61% of retail investor accounts lose money when trading CFDs with this provider. Please ensure you understand how CFDs work and consider whether you can afford the high risk of losing your money.
11. Global Prime
Traders seeking to reduce risk exposure when trading forex CFDs will find Global Prime an excellent choice. The broker’s policy places no restrictions on hedging, scalping, swing trading, or the use of Expert Advisors.
Hedging strategies can be particularly effective for minimizing overnight position risks and mitigating the impact of swap fees on account balances. With over 60 currency pairs available, traders have ample opportunities to hedge potential losses by opening positions in correlated currency pairs. Beyond forex, Global Prime clients can also explore a wide range of other markets, including bond CFDs, indices, cryptocurrencies, US shares, and commodities.
Global Prime is a trading name of FMGP Trading Group Pty Ltd (ABN 74 146 086 017), regulated by ASIC and licensed under Australian Financial Services License No. 385620. Gleneagle Securities Pty Limited, trading as Global Prime FX, is a registered company in Vanuatu (Company Number 40256) and regulated by the VFSC. The Global Prime website is owned and operated by FMGP Trading Group Pty Ltd.
12. ActivTrades
ActivTrades is a multi-regulated broker offering CFDs on over 1,100 instruments, including forex pairs, commodities, stocks, indices, cryptocurrencies, bonds, and ETFs. The broker features competitive spreads starting from 0.5 pips and charges no commissions across all account types and tradable symbols. Hedging is permitted on all supported platforms, including MetaTrader 4 and MetaTrader 5.
The MetaTrader platforms are well-suited for hedging, allowing traders to hold opposing positions simultaneously. ActivTrades provides flexible leverage and margin options, with maximum leverage up to 1:1000 for FSC-regulated clients and 1:200 for SCB-regulated clients. Retail traders in Europe and the UK have a maximum leverage limit of 1:30 on hedged positions. With low spreads and zero commissions, ActivTrades stands out as a compelling choice for hedgers.
CFDs are complex instruments and carry a high risk of losing money rapidly due to leverage. Approximately 75% of retail investor accounts lose money when trading CFDs with this provider. You should carefully consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Comprehensive Comparison of the Top 10 Forex Brokers for Hedging
Forex Broker | Min Deposit | Spread | Markets | FX Pairs | Direct Hedging | Commission | Other Fees | Max Leverage | Negative Balance Protection | Regulators | Platforms |
$50 (AU$100) | 1.0 pips Standard; 0.0 pips Raw | Forex CFDs, Shares CFDs, Metals CFDs, Commodities CFDs, Indices CFDs, Crypto CFDs, ETF CFDs | 70+ | Permitted | $0 Standard Account; $6 round turn on Pro Account | Swap on overnight open positions | 1:30 (Retail) 1:500 (Professional) | Yes (Retail traders) | ASIC, CySEC, FSA (Seychelles), FSCA, FSA (St. Vincent and the Grenadines), SCB (Bahamas) | MetaTrader4, MetaTrader5, WebTrader, IRESS, cTrader, TradingView | |
$200 | 0.8 pips Standard, 0.0 pips Raw Accounts | CFDs on Forex, Commodities, Index, Bond, Cryptocurrencies, Stock, Futures | 62 | Permitted | $0 Standard MT; $6 round turn on Raw cTrader; $7 round turn on Raw MT | Swap on overnight open positions | 1:30 (European and Australian Retail Accounts); 1:500 (Pro); 1:1000 (FSA Clients) | Yes (European and Australian Retail traders) | FSA (Seychelles), CySEC (Cyprus), ASIC (Australia), SCB (Bahamas), CMA (Kenya) | MetaTrader4, MetaTrader5, cTrader, ZuluTrade | |
$100 | From 0.9 pips (retail), 0.6 pips (pro) | Forex, Major stock indices, Cryptocurrencies, Commodities, Bonds, Individual Shares, ETFs | 50+ | Permitted | $0 | $100 dormancy fee after 12 months of no activity Swap on overnight open positions | 1:30 (1:400 for Pro and Non-EU Accounts) | Yes (European and Australian Retail traders) | FFAJ (License No.1574), CySEC (No. 347/17), ISA (No. 514666577), IIROC, ADGM / FSRA (No.190018), CBI (No.C53877), BVIFSC (No. SIBA/L/13/1049), FSCA(No.45984), ASIC (No.406684), JFSA (No. 1662) | MetaTrader4, MetaTrader5, WebTrader, AvaTade App, AvaSocial, AvaOptions, DupliTrade | |
$0 | From 0.0 pips (UK), 0.3 pips (SG, AU), 0.2 pips (IE) | CFDs on Forex, Indices, Shares, Commodities, Treasuries, Cryptocurrencies, Share Baskets, Investments on ETFs, Managed funds, Options, and more | 330+ | Permitted | $0 for forex trading | GSLO premium, market data fees | 1:30 (Retail) 1:500 (Professional) | Yes (retail traders) | FCA, ASIC, MAS, CIRO, BaFin, FMA, BMA, DFSA | MT4, MT5, TradingView, Next Generation (proprietary | |
$0 | From 0.0 pips (Razor Accounts), 1 pip (Standard Accounts) | Forex, Indices, Commodities, Cryptocurrencies, Share CFDs, ETFs | 90+ | Permitted | $0 (Standard Account), $7 round-turn (Razor Account) | Swaps on overnight positions | 1:30 (Retail ASIC, CySEC, FCA); 1:500 (Professional); 1:400 (CMA) | Yes (Retail traders) | ASIC (No. 414530), UK FCA (No.684312), CySEC (No. 388/20), BaFin (No.151148), DFSA (F004356), CMA (128), SCB Bahamas (SIA-F217), FSA (SD108) | MetaTrader 4, MetaTrader 5, cTrader, TradingView | |
$50 or $100 based on country ($10 for the UK, $1 in the US) | From 1 pip | CFDs on Forex, Stocks, Commodities, Crypto, ETFs, and Indices | 55 | Permitted | $1 or $2 (stocks only) | A $10 monthly inactivity fee; a $5 withdrawal fee; a 2% fee for transferring crypto assets to eToro Money; a 1% fee for buying/selling crypto | 1:30 (FCA, ASIC, CySEC); 1:400 (FSA) | Yes (retail traders) | FCA, CySEC, ASIC, MFSA, FSRA, FSA, FINRA/FinCEN, AMF, SEC, GFSC | eToro Investing, eToro App, TradingView, eToro CopyTrader, Proprietary | |
$0 ($150 for Singapore and Australia) | From 0.7 pips (UK); 0.5 pips (Singapore and Australia) | Forex, Indices, Shares, Gold, Silver, Commodities, Cryptocurrencies, Bonds, Thematic Indices, Interest Rates | 84+ | Permitted | $0 on forex trades; 1.8 CPS for US shares ($10 minimum); 0.08% for other shares ($10 or A$5 minimum) | +/- 2.5% overnight financing fees; 1.5 x CFD for triggered GSLOs | 1:30 (Retail, 1:20 for Singapore) 1:400 (Professional) | Yes (for limited risk accounts) | FCA (No. 446717), MAS (No. 201130598R), ASIC (No. 345646), HKFSC (BCQ152), JFSA (2010401047199), DFSA (F000542) | MT4, WebTrader, Trading App, TradingView | |
$0 | from 0.6 pips Forex trading; 0.165 pips av. spread DMA trading | CFDs on Indices, Shares, Crypto, Futures, Commodities, Options, Interest Rates, Sectors, Bonds, Knock-out trading | 100+ | Permitted | $0 | Guaranteed stop premium charge Swap on overnight open positions | 1:30 (Retail) 1:500 (Professional) | Yes (for limited risk accounts) | ASIC, FCA, DFSA, CFTC, FMA, FINMA, BaFin, MAS, JFSA, FSCA, BMA (Bermuda) | MetaTrader4, L2 Dealer, ProRealTime, IG proprietary software, TradingView | |
$100 ($1 for Invest MT5 Account) | From 0.0 pips (Invest and Zero Accounts), 0.5 pips (Trade Accounts) | CFDs on Forex, Indices, Stocks, Commodities, Bonds, ETFs, Cryptocurrencies | 82 | Permitted | $3 per lot | Inactivity fee of $10 per month Swap on overnight open positions | 1:30 (Retail) 1:500 (Professional) | Yes (Trade and Zero MT5 /MT4 Accounts) | CySEC (No. 201/13), ASIC (No. 410681), FCA (No. 595450), JSC (No. 57026), FSCA (No. FSP51311), EFSA (No. 4.1-1/46), CMA (No. 178), CIRO, FSA (No.SD073) | MetaTrader4, MetaTrader5, WebTrader, MT Supreme Edition, StereoTrader | |
$0 Classic $200,000 + Platinum $1,000,000 + VIP | 0.9 pips (Classic), 0.8 (Platinum), 0.7 pips (VIP) | Stocks, ETFs, Bonds, Mutual funds, Crypto ETPs, Options, Futures, Forex, Forex options, Crypto FX, CFDs, Commodities | 185+ | Permitted | $3 per lot | Swap on overnight open positions | 1:30 (Retail, EU traders); 1:200 (FSA) | Yes (EU, UK, and MENA regions) | FCA (No. 551422), FSA Denmark (No. 1149), MAS (No. 200601141M), ASIC (No. 32110128286), SFC Hong Kong (No. 1395901), FSA Japan (No. 0104-01-082810), Registered with CONSOB (no. 296) | Proprietary, SaxoTraderGO, SaxoTraderPRO, TradingView, SaxoInvestor |
Best Forex Brokers for Hedging Ranked by Trustpilot Score
Forex Broker | Trustpilot Reviews | |
8,641 | ||
45,311 | ||
10,141 | ||
2,243 | ||
28,259 | ||
27,550 | ||
382 | ||
7,895 | ||
1,978 | ||
7,235 | ||
Hedging Trading Strategy Explained in Brief
Forex hedging is a strategy used by traders to protect their positions in a currency pair from unfavorable market movements by opening additional offsetting positions. Typically, it serves as a short-term risk management tool, especially during periods of heightened volatility triggered by news or economic events. While hedging reduces exposure to currency risk, it also tends to limit potential profits.
Although hedging cannot completely eliminate the risk of adverse price changes, a well-executed strategy can help minimize losses or cap them at a predetermined level. Before implementing hedging, traders should carefully select a currency pair—major pairs generally offer more hedging opportunities than minor ones.
Traders also need to consider the amount of capital they are willing to allocate, as opening multiple positions increases trading costs. Additionally, they must assess how much time they can dedicate to monitoring the markets. It is highly advisable to start with a demo account to test and refine hedging strategies before trading live.
Types of Hedging
Forex traders have various risk management techniques at their disposal to limit potential losses, and hedging is one of the most popular. Two common hedging strategies are simple (direct) Forex hedging and multiple-currency hedging.
Simple Forex hedging, also known as direct hedging, involves opening a position that directly opposes an existing trade. For example, a trader holding a long position on the EUR/USD pair would open a short position on the same pair simultaneously. Although this strategy neutralizes profits and losses on the hedge itself, it allows traders to maintain exposure to the market while awaiting a potential trend reversal.
Multiple-currency hedging involves selecting two positively correlated currency pairs and taking opposite positions in each. For instance, a trader might buy GBP/USD to hedge a short position in EUR/USD. When executed correctly, this method can reduce risk and even generate small profits. However, if the correlation breaks down or the market moves unfavorably, traders may incur losses on multiple positions.
Who Should Use Hedging?
A wide variety of market participants use Forex hedging as a risk management tool. Retail traders with solid knowledge of the financial markets and economic news often apply hedging to protect their positions. Professional traders and institutional investors also employ hedging strategies to safeguard large sums and diversify their portfolios. Ultimately, hedging is designed to preserve profits and reduce risk, rather than to generate additional gains.
Is Hedging Legal Everywhere?
Hedging is legal in most financial markets worldwide. However, whether your broker permits Forex hedging depends on the country’s regulatory framework. For instance, the United States imposes restrictions on hedging in Forex trading. The Commodity Futures Trading Commission (CFTC) enforces rules that prevent traders from holding opposing positions on the same currency pair. Conversely, hedging is generally allowed and widely practiced in many countries across Europe, Asia, and Australia.
Factors to Consider When Choosing Forex Brokers for Hedging
When choosing a Forex broker for hedging, traders should consider several key factors. First and foremost, verify the broker’s regulatory status, license, and reputation. Being authorized by a reputable financial authority ensures a high level of security and investor protection.
To implement hedging strategies effectively, traders need a broker that offers a user-friendly, feature-rich trading platform. Brokers with fast execution speeds and access to multiple liquidity providers facilitate prompt trade execution and competitive pricing. Additionally, consider average spreads, minimum deposit requirements, and the variety of supported account types.
It’s also important to evaluate the range of financial instruments available and the number of currency pairs supported for hedging. Lastly, advanced research tools and educational resources—particularly those focused on Forex hedging—can be invaluable for both novice and experienced traders.
Trading Software Suitable for Hedging
The best Forex brokers usually provide multiple trading platforms that support hedging. This risk management strategy is allowed across various popular platforms, including MetaTrader 4 (MT4), MetaTrader 5 (MT5), TradingView, and cTrader, as well as many brokers’ proprietary platforms. It is crucial to verify that your broker permits hedging on their platform, especially for live trading accounts. Choosing the best software ultimately depends on individual trader preferences and their unique trading style.
Why Hedge Your Forex Trades?
Many traders prefer to hedge their positions when trading Forex for several reasons. Hedging is a risk mitigation strategy that helps offset losses from one investment with gains from another, thereby protecting traders from significant losses during unfavorable market conditions. Additionally, hedging is legal in most markets, with the notable exception of the USA, where direct hedging is restricted under CFTC regulations. Finally, currency pairs—both major and minor—are among the best instruments for hedging due to their high liquidity and low spreads.
Does Hedging Guarantee Success in Forex Trading?
Similar to insurance, hedging is a risk management tool designed to limit losses to a known amount. It does not guarantee success in Forex trading or prevent unfavorable market movements, but it can protect traders if the worst-case scenario occurs. Rather than aiming to generate profits, traders use hedging primarily to minimize losses. The amount of capital available for hedging is an important factor, varying according to each trader’s risk tolerance. Forex hedging can be an effective strategy to secure long positions during periods of short-term volatility. However, it should not be viewed as a simple way to make profits or eliminate all risks in the long term.
