A Comparison of Forex Broker Inactivity Fees
Finding the right forex broker for you involves looking at various factors, including inactivity fees and charges you might incur. Most online brokers will have a few ‘hidden fees’ that aren’t immediately obvious, which can often include inactivity fees. These are fees charged on accounts which are dormant for a while, with no trades being made, and depending on the broker, this could be 3 months, 6 months, 12 months, or longer.
It may well be that your broker requires you to actually place a trade to avoid the inactivity fee, but some brokers will count other activity, such as depositing funds into your account, as an action that allows you to avoid the inactivity fee. Active traders may never have to worry about incurring inactivity fees, but they are still something to be aware of, in case your circumstances change and you stop trading for a while.
Today we’re looking at three popular online brokers: XM, Pepperstone and IG. We’ll examine their inactivity fees, and look at what you need to do to avoid them.
XM Inactivity Fees
At XM, trading accounts are deemed dormant if there is no action on the account for 90 days, and at that point, an inactivity fee will be automatically applied to your account. To avoid account dormancy, you do not necessarily need to place a trade. Other actions that are counted as an activity on the account include deposits, withdrawals, internal transfers or an additional trading account registration.
The inactivity fee charged is $5 (USD) or the full amount of free balance if the free balance is less than $5. This is a monthly fee that will be charged each month until the balance is zero, unless the account becomes active again. No inactivity fees are charged once the account balance hits zero, so a dormant account cannot go into negative balance due to inactivity fees. When an account becomes dormant, all remaining bonuses and promotional credits will be automatically removed from the account.
Pepperstone Inactivity Fees
Pepperstone is potentially a good option for you if you are not an active trader, or suspect that you may be inactive for a while in the future. Pepperstone do not charge any kind of inactivity fee on dormant accounts.
IG Inactivity Fees
IG charge an inactivity fee if your account is dormant for 24 months. If there are still funds in the account the fee will be automatically deducted, at a rate of $12 (USD) per month, or £12 (GBP) in the UK. You will be notified by email before the fee is taken. If the account is empty and has been inactive for 24 months, it will be closed.
The monthly fee will continue to be deducted for as long as the account is inactive, but will stop when the account is empty, meaning your inactivity fees cannot cause you to have a negative balance. To stay active, you must open or close a position, or maintain an open position, within any account you hold under the same login details.