With forex direct market access (DMA), professional clients can trade on physical forex markets, without the need for a middleman, resulting in access to better pricing, higher liquidity, faster execution and more control over trades. Find out more about Forex Direct with IG, including the benefits of forex DMA and the costs involved.
Who can trade Forex Direct?
Regulatory interventions that came into force in July 2018 mean that certain products are now unavailable to retail traders. As a result, we can only offer Forex Direct to professional traders. To find out more about this, and to check whether you are eligible for a professional account, please see our professional account page.
What is direct market access in forex trading and how does it work?
Direct market access (DMA) is a type of FX execution that offers traders access to the physical market without intermediaries. Traditionally, FX trading is conducted through a forex broker, who will request quotes from exchanges and market makers, and then present the best price to their client. But DMA is an electronic trading mechanism that enables you to see the different orders and prices yourself, and then place your trade accordingly.
It is important to note that while you are trading based on underlying market prices and depth, what you actually receive when placing a trade is a CFD from us. Forex DMA works like this:
- DMA displays the best bid and offer price available for a particular market, plus further prices on either side of the order book
- You place an order, and we instantly conduct a margin check to ensure you have sufficient funds to cover the margin on your proposed trade
- If the margin check is successful we place an order in the market and, at the same time, create a parallel CFD between you and us
Benefits of direct market access in forex
For professional traders there is a variety of advantages of direct market access, such as setting your own price and dealing directly with other market participants. Other benefits of DMA include:
- Faster execution
- Full forex market transparency
- Extended data on currency pairs
- Prices from a wide selection of global banks and liquidity providers
Drawbacks of direct market access in forex
Because of the complex trading environment of forex DMA, there can be increased risk and a few potential downsides that you should be aware of before you start trading:
- Prices are not necessarily better than OTC, but our pricing technology is engineered to find the best available prices on both OTC (over-the-counter) and DMA
- As we take a parallel position in the underlying market, once an order has been executed we are unable to change or reverse the position
- While you are trading at market prices, you do not gain any ownership rights over the currencies which form the subject of your CFD
Forex DMA costs
- Average spreads
Unlike OTC trading, there is no IG spread to pay. Instead we charge a variable commission – as low as USD10 per USD million worth of the currency traded. This charge is based on the volume you traded in the preceding month.
If your account is not denominated in USD, the commission will be converted into your base currency (at current exchange rates) before being deducted.
|Size (millions of USD)||Commission (USD per million)|
There are no IG spreads with Forex Direct – instead you are trading on buy and sell prices provided by major banks and currency providers.
|Average FX Direct spread*|
* Average spread (Monday 00:00 - Friday 22:00 GMT) for the 12 weeks ending 19th March 2019. There is also a commission charge for Forex Direct.
How do I get Forex Direct?
- To trade Forex Direct with IG you need to qualify for an IG professional account. Most clients will need to have a minimum £1000 cash balance on their account
- Choose which platform you'd like to trade on: download our mobile trading app, or our specialised L2 dealer
- If you choose to trade via our app, you will need to give us a call to request DMA access