AvaTrade Fees Explained

AvaTrade Fees - Overview

Trading fees rank among the most defining aspects when evaluating a broker, as they directly impact profitability. Therefore, traders should carefully consider all brokerage fees, as they reveal which strategies a Forex broker supports, and which remain subtly discouraged.

We have conducted an in-depth AvaTrade fee analysis, which provides a complete breakdown of both trading and non-trading costs. Read on to find out if the commission-free pricing environment at AvaTrade is competitive, which strategies AvaTrade remains best-suited for, and which traders should strive to avoid on the platform. Furthermore, feel free to read our updated AvaTrade broker review.

Overview of AvaTrade Fees and Charges

AvaTrade offers one commission-free CFD trading account to all traders, with trading fees that rank in the middle of the competition. Minimum Forex spreads commence from 0.9 pips or $9.00 per 1.0 standard lot, but the average cost for major currency pairs is approximately 1.5 pips or $15.00.

Equity CFDs face a 0.13% markup over market spreads, and cryptocurrencies have costs ranging between 0.20% and 2.00%. AvaTrade adds an internal markup between 0.25 and 10.00 over market spreads on indices, 0.50% on ETFs, and $0.0015 and $1.1000 on commodities.

Therefore, AvaTrade is ideal for medium-to-long-term strategies but generally caters less well to algorithmic traders, scalpers, and high-frequency traders. These types of traders may have their needs best catered for elsewhere.

Here is a snapshot of AvaTrade fees:

AvaTrade Fees, Spreads, and Commission Explained

Online multi-asset brokers like AvaTrade disrupted full-commissioned brick-and-mortar brokers by lowering trading fees and making financial markets accessible to retail traders without needing broker-assisted trade placements. The key driver of positive developments remains technology and scalability. With daily turnover approaching $7 trillion, the Forex market is exceptionally liquid, and remains at the center of the global financial system.

While the cost structure has decreased significantly across the financial system, traders must get to grips with the standard AvaTrade fees. This will help us to understand how much each trade costs, why the fees apply, and how the pricing environment compares to competitors.

Trading costs at brokers fall into two categories: trading and non-trading fees.

Trading fees are:

• Spreads (the difference between the bid and the ask price of an asset, where AvaTrade ranks as neither cheap nor expensive)
• Commissions (AvaTrade offers commission-free trading and replaces costs with markups on raw spreads)
• Swap rates (charged on leveraged overnight positions)
• Currency conversion fees (applicable each time the currency of the asset differs from the account base currency)

Non-trading fees are:

• Deposit fee (not applicable at AvaTrade)
• Withdrawal fee (not applicable at AvaTrade)
• Inactivity fee ($50 after three months at AvaTrade)
• Currency conversion fee (for deposits and withdrawals in currencies that differ from the account base currency)

AvaTrade Trading Fees

AvaTrade trading fees apply to each transaction. While AvaTrade offers commission-free trading, it compensates with internal markups on raw spreads, which generally results in a more expensive pricing environment compared to traditional commission-based brokers.

Here is an overview of minimum trading fees at AvaTrade:

One of the most ignored trading costs is swap rates on leveraged overnight positions. This can become a huge mistake over the longer term, as depending on the trading strategy, it often becomes the most significant fee per trade. Traders should check the competitiveness of these fees before evaluating total trading costs.

Traders must pay swap rates on leveraged overnight positions, which triple on Wednesday to account for trades kept open over the weekend. Notably, closing positions before 5 p.m. EST allows traders to avoid swap rates if it suits their trading strategy.

MT4/MT5 traders can access swap rates from their platform by following these steps:

1. Right-click on the desired symbol in the Market Watch window and select Specification.

2. Scroll down until you see Swap Long and Swap Short.

Forex trading involves two currency pairs, making currency conversion fees a frequent expense. Traders can limit or eliminate them if their account base currency is US Dollars, as the US Dollar is included in over 80% of the global daily Forex trading volume.

Each time AvaTrade converts a currency on behalf of its clients, a currency conversion fee applies, but AvaTrade does not list an internal markup.

AvaTrade Non-Trading Fees

AvaTrade non-trading fees consist of account transactions other than trading, including deposits, withdrawals, and inactivity. While they are less frequent, traders must know about them to avoid confusion. By design, AvaTrade has minimal internal non-trading fees, as outlined below.

AvaTrade Deposit Fee

AvaTrade does not levy an internal deposit fee. Therefore, a trader who makes a $1,000 deposit into their AvaTrade trading account will receive the full $1,000. However, potential third-party payment processing costs and currency conversion fees may apply, especially considering that AvaTrade prefers bank-related transactions like wires, online banking, and credit/debit cards, and limits alternative options for many clients.

AvaTrade Withdrawal Fee

AvaTrade withdrawals face no internal costs. However, traders should consider third-party payment processor charges and currency conversion fees, in addition to follow-on costs if traders plan to use withdrawals for bill payments, consumption, or other purposes, to the destination of funds.

AvaTrade Inactivity Fee

AvaTrade levies a $50 inactivity fee, or a currency equivalent, after three months of dormancy. This charge applies for each cycle of inactivity. Further, AvaTrade charges an annual administration fee of $100 or a currency equivalent if traders remain dormant for twelve consecutive months.

AvaTrade does not specify what it classifies as inactivity — whether it requires trade placement — or for traders to merely log into their trading account. Potentially affected clients should seek clarification from the AvaTrade customer support team.

AvaTrade Safety and Security

AvaTrade has established itself as one of the most trusted, safe, and secure brokers industry wide. It has a spotless operational track record since being founded in 2006.

AvaTrade segregates client deposits from corporate funds, offers negative balance protection, and its investor compensation fund adds additional protection for subsidiaries where regulators mandate one.

AvaTrade complies with nine regional regulators, as outlined below.

AvaTrade has licenses and oversight from the following regulators:

• FFAJ - (Financial Futures Association of Japan / Financial Services Agency Japan, for Japanese clients))
• CySEC - (Cyprus Securities and Exchange Commission, for EU clients)
• ISA - (Israel Securities Authority, for Israeli clients)
• IIROC - (Investment Industry Regulatory Organization of Canada, as Friedberg Direct, for Canadian clients))
• ADGM / FSRA - (Abu Dhabi Global Markets Financial Services Regulatory Authority, for UAE clients)
• CBI - (Central Bank of Ireland, the AvaTrade global headquarters, for UK clients)
• BVIFSC - (British Virgin Islands Financial Services Commission, where most international clients trade)
• FSCA - (Financial Sector Conduct Authority, for South African clients)
• ASIC - (Australian Securities and Investments Commission, for Australian clients)

AvaTrade Fees Bottom Line

AvaTrade presents traders with a reasonably priced commission-free cost structure, placing it an acceptable offering within the industry. AvaTrade fees are neither cheap nor expensive but fall somewhere around the industry average for the broker type.

Minimum Forex costs start from $9.00 per 1.0 standard round lot with an average closer to $15.00 for major currency pairs, and notably more for the minors and exotics.

Non-trading fees consist only of high inactivity and administration fees of $50 after three months and $100 after twelve, respectively, but both are not an issue for active traders. Currency conversion fees apply, and swap rates on leveraged overnight positions also rank towards the average. This is typical of the overall cost structure at AvaTrade, which remains ideal for casual traders using medium-to-long-term strategies.

FAQs

Does AvaTrade charge raw account commission?

AvaTrade does not offer raw accounts and therefore does not levy commissions on them.

Does AvaTrade charge inactivity fees?

AvaTrade charges a $50 inactivity fee after three months of dormancy and an administration fee of $100 after twelve months.

When does AvaTrade charge fees?

Spreads immediately apply when traders open positions, while swap rates are due on leveraged overnight positions after the cut-off period, usually 1700 EST.

How much does AvaTrade charge for withdrawal?

AvaTrade withdrawals are free, but traders may face third-party payment processing costs in addition to currency conversion fees.

What trading fees does AvaTrade charge?

AvaTrade charges internal markups on raw spreads and swap rates on leveraged overnight positions.

Does AvaTrade have a commission?

AvaTrade does not charge commissions but replaces them with internal markups on raw market spreads. The fees are reasonable and place AvaTrade within the middle of the industry, as they are neither cheap nor expensive.

By DailyForex.com Team

The DailyForex.com team is comprised of analysts and researchers from around the world who watch the market throughout the day to provide you with unique perspectives and helpful analysis that can help improve your Forex trading.