What is a forex broker? How currency trading brokers work and earn
By SendPay Business · · 2 min read
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A forex broker is a firm that lets individuals trade on currency prices, usually through an online platform. Most retail forex trading is speculation on price moves, not a way to exchange money you need to spend or send abroad.
How brokers make money
Tap to explore
Tap each one to see what it means.
The spread
the gap between the buy and sell price on each trade.
Commission
a fee per trade, often on accounts with tighter spreads.
Overnight financing
a charge or credit for holding a leveraged position overnight.
Types of broker
Some brokers pass your orders on to banks and other market makers. Others take the other side of your trade themselves. Many retail forex products in the UK are contracts for difference (CFDs), which let you bet on the price without owning the currency.
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Check before you trade
In the UK, check the broker is on the FCA Register and be wary of clones using a real firm's name. FCA rules limit leverage for retail clients on major currency pairs to 30 to 1, and most retail CFD accounts lose money, which brokers must warn you about.
Where SendPay fits
SendPay doesn't offer forex trading, CFDs or leverage. SendPay platforms let your customers hold GBP, EUR and USD and exchange between them at a fee you set, which suits people who need to pay or get paid in another currency.
How it works
Your own money app- 1Name it and pick your colours
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- 3Launch when you are ready
Why sign up
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Questions people ask
What does the spread cost me?
Turn bid and ask prices into the spread and its cost.
Forex spread calculator →What is leverage trading?
Trading with borrowed money, which magnifies gains and losses.
What is leverage trading? →Read next
Spotted a mistake or something out of date? and we'll fix it. How our guides are made
This guide is general information, not legal or financial advice. SendPay Business is a technology company, not a bank, and does not take deposits; regulated services on the platforms are provided by licensed partners. Other companies named in this guide are reference points only and are not affiliated with SendPay Business.