IG: A Deep Dive into their Fee Structure
IG is a well-established global broker, known for its extensive market access and advanced trading platforms. When it comes to fees, IG primarily operates on a spread-based model for most of its CFD offerings, including forex.
* Forex Spreads: For major currency pairs like EUR/USD, IG typically offers competitive spreads, often starting from 0.6 pips for their standard accounts. For more active traders or those on their Professional account tier, these spreads can be even tighter. However, for less liquid pairs, spreads will naturally be wider.
* Share CFD Commissions: Unlike forex, trading share CFDs with IG usually incurs a commission. This is typically a percentage of the trade value or a fixed minimum charge, varying by market. For example, UK shares might have a commission of 0.10% (minimum £8-10).
* Indices and Commodities: Similar to forex, these are generally traded on a spread-only basis, with spreads varying based on market conditions and instrument liquidity.
* Overnight Funding (Swap) Fees: Holding CFD positions open overnight will incur swap charges, which can be positive or negative depending on the instrument and direction of your trade. These are standard in the CFD industry.
* Inactivity Fees: IG does not typically charge an inactivity fee for standard trading accounts, which is a positive for less frequent traders.
IG's overall fee structure is transparent, and detailed information is readily available on their website. Their pricing model tends to reward higher volume traders with better conditions.
AvaTrade: Unpacking Their Cost Model
AvaTrade is another globally recognised broker, known for its user-friendly platforms and diverse asset classes. AvaTrade primarily uses a spread-only model for its CFD trading, with no commissions on most trades.
* Forex Spreads: AvaTrade aims to offer competitive fixed or floating spreads, depending on the account type and instrument. For EUR/USD, typical spreads might start from 0.9 pips. While slightly higher than some of IG's best offerings, these can be consistent, which some traders prefer for predictability.
* No Commissions (Mostly): A key differentiator for AvaTrade is its general policy of not charging commissions on forex, indices, or commodity CFDs. The cost of trading is built into the spread.
* Share CFDs: Similar to other asset classes, AvaTrade generally incorporates its fee for share CFDs into the spread, meaning no separate commission is charged.
* Overnight Funding (Swap) Fees: Like IG, AvaTrade charges overnight funding fees for positions held past the daily rollover. These rates are dynamic and dependent on the underlying asset.
* Inactivity Fees: AvaTrade does charge an inactivity fee, typically after three months of no trading activity, which is something infrequent traders should be aware of. This is usually around $50 or equivalent.
AvaTrade's fee model is designed to be straightforward, with the spread being the primary cost for most traders.
IG vs AvaTrade: Fee Comparison Table
To provide a clearer picture, here's a comparison of key fee aspects:
| Feature | IG | AvaTrade |
| :---------------- | :---------------------------------------- | :----------------------------------------- |
| Spreads EUR/USD | From 0.6 pips (typical, at time of writing — check broker site) | From 0.9 pips (typical, at time of writing — check broker site) |
| Spreads GBP/USD | From 1.0 pips (typical, at time of writing — check broker site) | From 1.6 pips (typical, at time of writing — check broker site) |
| Spreads XAU/USD | From 0.3 points (typical, at time of writing — check broker site) | From 0.34 points (typical, at time of writing — check broker site) |
| Commission | Share CFDs: 0.10% min £8-10 (typical, at time of writing — check broker site) | Generally $0 (spread-only model) (typical, at time of writing — check broker site) |
| Min Deposit | £0 (for card/bank transfer, varies by account type) (typical, at time of writing — check broker site) | £100 (typical, at time of writing — check broker site) |
| Regulators | FCA (UK), ASIC (AU), BaFin (DE), etc. | Central Bank of Ireland, ASIC, FSC (BVI), FSA (JP), FSCA (ZA), ADGM/FSRA (UAE) etc. |
| Platforms | Web Trader, MT4, L2 Dealer, ProRealTime, Mobile App | WebTrader, MT4, MT5, AvaTradeGO, DupliTrade, ZuluTrade, Mac Trading |
*Please note: Figures are typical at the time of writing and can change. Always check the broker's official website for the most current and exact pricing details.*
Verdict by Trader Type
* For the Active Forex Trader (High Volume): IG might offer slightly tighter spreads on major forex pairs, especially if you qualify for their premium accounts. The commission structure on shares is standard and competitive.
* For the Beginner or Low-Volume Trader: AvaTrade's pure spread-based model simplifies cost calculation, as there are generally no separate commissions to worry about. However, be mindful of their inactivity fee.
* For the Share CFD Trader: Both brokers offer share CFDs. IG charges a commission, while AvaTrade builds it into the spread. Your preference for a transparent commission or an all-inclusive spread will guide your choice.
* For Traders Prioritising Regulatory Safety: Both brokers are very highly regulated in multiple jurisdictions, offering robust client protection. IG's direct FCA regulation for UK clients is a strong point.
Ultimately, the "better" broker depends on your individual trading frequency, preferred assets, and how you prefer fees to be structured. Both are reputable choices, but their fee models have subtle differences that can impact your bottom line.
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