Top Day Trading Brokers in 2021

Trading in the Forex market or any other financial market comes in many different styles and incorporates numerous strategies. Some of these strategies are highly recognized and popular among investors. However, certain trading styles began within small groups of traders and are getting more and more common over time. The experts classify the strategies into less risky, budget-friendly, time-efficient, or dummies categories. According to his or her needs, a trader can decide in which category to place the trading style. Day trading is a popular trading strategy that has hundreds of thousands of followers in multiple regions worldwide. This specific strategy essentially falls into a time-efficient category, however, is very risky, requires some expertise in trading, and can be costly depending on the region of the trader.

Day traders are individuals who open and close their positions on the same trading day. Their definition varies from one jurisdiction to another. Accordingly, the day trading rules will differ in various regions and the traders should familiarize themselves with the local regulations and requirements before beginning to trade. Due to the extremely specific strategy of trading, that day trading incorporates, the day traders cannot simply work with any Forex broker that comes at hand. In the first place, day traders need to look for reliable brokers that support the traders’ needs and wishes. We have prepared a review of the best day trading brokers worldwide and the criteria for choosing these brokers.

Best brokers for day traders

First and foremost, your broker of choice should be the firm that pays attention to day traders. You don’t want to trade with a broker who does not care about your special requirements and does not recognize your trading style or strategy. Secondly, you want to optimize your trading costs as much as possible. Day trading already puts you under a lot of financial pressure in terms of risks. So, you do not want to pay extra for the brokerage services. Furthermore, it would be an ideal scenario if the broker provided maximum freedom in terms of your trading style. We ranked the brokers suitable for you according to their cost-efficiency, dedication to day traders, and the flexible rules or trading environment, in general.

XM

Min. Depo

Licences

FCA, CySEC, IFSC, ASIC, DFSA

Leverage

1:888

1:200

Platforms

MT4, WebTrader, Copykat

Global GT

Min. Depo

Licences

FSA, FSCA

Leverage

1:1000

Platforms

MT5,

Plus500

Min. Depo

$100

Licences

FCA, ASIC, CySEC, FSCA, FMA, MAS

Leverage

1:30

Platforms

WebTrader, Windows 10 Trader

What do day traders need?

Day traders do not need much more than the rest of the traders, however, they do require certain broker features. Therefore, these requirements set up general criteria for making up a list of suitable forex day trading brokers. Below is the description of what day traders are looking for when they are choosing the broker:

Reliability
Cost-efficiency
Excellent Customer Support
Advanced Platforms
Freedom in Trading Strategies
Advanced Market Data
Liquid financial instruments
Special Accounts

Reliability

We should start from the safety of your funds. It is the primary concern for each trader, no matter the trading strategy that he or she chooses. If the broker cannot guarantee the refund, timely processing of your withdrawal requests or transfers or cannot secure your funds in case of safety, it should be avoided at all costs. The reliability comes from the legal and regulatory frameworks within which the brokers operate. You should double-check if your broker actually holds authorization from the regulatory organs. The regulations will audit the broker to make sure that the broker keeps your money on a segregated account and keeps sufficient funds to satisfy your trading requirements.

Cost-efficiency

Day trading is already risky enough. Therefore, day trading brokers should not make it more complicated, or at least more expensive for the traders. One of the significant aspects of brokerage firms is the cost-efficiency, which comes from the commission fees, spreads, or administrative costs. Ideally, the broker should let you trade commission-free. Or, in case the commissions apply, at least the spreads should be tighter than the market average. For instance, if you pay for the commission and the broker offers spreads on EUR/USD currency pair in the amount of 1.6 pips, it is a terrible deal for you. You can check for market average spreads on the internet easily and decide on which broker provides the most competitive trading environment for you.

Customer Support

Once again, day trading is stressful due to the high risks associated with it. Therefore, those cheap day trading brokers that you encounter should be able to provide an excellent customer support team. As a day trader, you might face the situation where you immediately need to transfer your funds within your trading accounts and if some issue appears you cannot wait for long. Therefore, fast and efficient communication channels between customer support and clients should be the primary concern of the broker. The support team should be available for at least 24 hours on working days (24/5) and the broker preferably should give you several contact options, such as social networks, email, free-toll phone numbers, live chat and etc.

Advanced Platforms

The platforms are extremely crucial for successful day trades. For the day traders, even the milliseconds count. Therefore, the execution speed of the trading platforms should be seamless and should not take a minute. Most of the forex day trading brokers will support MetaTrader 4 or MetaTrader 5 software inbuilt into their trading platforms. However, these two may not be enough for day traders. First of all, these platforms can only be accessed from the desktop. Therefore, quite a few brokers will incorporate different modifications, such as WebTraders and mobile traders to make it more convenient for the traders to access them. Day traders will usually prefer mobile or WebTraders, as they can track their trades on the go.

Trading Strategies

When choosing a suitable brokerage firm for you, one of the first things that you should pay attention to is the allowance to use different trading strategies. Most of the best day trading brokers will allow all kinds of strategies, including scalping, hedging, or Expert Advisors. However, not all brokers let you choose among them freely. Scalping and Expert Advisors are two of the frequently used day trading strategies. Moreover, day traders are often called scalpers, as scalping means buying and selling an individual stock several times within the same day. The brokers will usually display the list of the strategies that they allow, so do not forget to check it beforehand.

Market Data

Day traders are maybe the most active traders on the market. Therefore, they need to have access to timely market data, market news, and analysis. Ideally, they should be the first ones to find out about the market changes and updates, as they need to make decisions in a matter of seconds. Therefore, regular market data will not do them good. For this reason, leading day trading brokers will provide special level II market data for day traders which has further depth and speed compared to the regular one. Traders should always check with the broker if it operates several account types to choose the one which has better market data analysis tool or provides market data faster.

Trading Portfolio

Due to the nature of day trading, not all financial instruments will be suitable to trade. For instance, it is unreasonable to invest in commodities for day traders as their price change is very little and very slow. For that reason, almost all day traders go for liquid and extremely volatile markets, such as Forex currency pairs or stocks. Accordingly, the most beneficial brokerage offer would be the diversity in the trading assets from these two financial markets. Preferably, traders should choose Forex brokers, CFD brokers, or Stock brokers for their day trading goals.

Account Types

It is almost impossible to find a regular or standard account type that would suit a day trader with any existing day trading brokers. Usually, standard accounts offer regular types of market data, average execution speed and do not always allow freedom in choosing the trading strategy. Furthermore, they would not be addressing the special needs of the day traders. On the other hand, some of the best brokers will provide special accounts, such as ECN accounts that are the perfect fit for day traders.

Is day trading worth it?

Well, it depends on your outlook. If you believe that you have enough funds to cover the high-risk nature of day trading, then yes, it is worth it. Or, if you have professional expertise or knowledge in a specific market or specific financial instrument and you would be able to predict the fluctuations based on available market data, it is your top choice to day trade. However, if you are a beginner trader with low trading capital available, we would not recommend day trading. Instead, maybe it would be better to focus on long-term trading strategies and invest in less volatile markets, such as commodities, metals, indices, or others.

Also, depending on the country of your residence, you may find day trading extremely expensive. If you live in the United States, you would have to satisfy the minimum equity requirement of 25,000 US dollars and you should always have this amount available on your trading account. It is called a Pattern Day Trader rule, or PDT rule. Furthermore, some of the brokers that reside outside the United States might also require minimum equity. Therefore, make sure that you start trading with the day trading brokers without PDT rule.