Silver is an important precious metal to both industry and speculators. It is more volatile than even exotic Forex currency crosses. Almost all Forex / CFD brokers offer CFD trading in Silver. I have created a shortlist for you of the best Forex / CFD brokers offering trading in Silver. Read on to view my shortlist and to learn how to choose the best Silver broker.
- FXTM, Best all-around broker with high floating leverage and fast execution.
- FP Markets, ECN trading with leverage up to 1:500.
- Eightcap, Competitive pricing + excellent daily videos.
- BlackBull Markets, Best ECN trading environment, with scalping and hedging.
- AvaTrade, Highly regulated, choice of fixed or floating spreads.
FXTM
In Summary Best all-around broker with high floating leverage and fast executionSilver traders get a choice of two assets at FXTM, the XAG/USD and the XAG/EUR. The former is the most traded contract, while demand for the latter continues to rise. Having both allows traders to benefit from pricing discrepancies between Silver quoted in the US Dollar and the Euro. The minimum spread for the XAG/USD in the FXTM MT4 Advantage Account is $0.09, with an average of $0.22. While the XAG/EUR shows a lower minimum mark-up at $0.07, the average spread is notably higher at $0.79. The contract size is 5,000 units per lot.
The MT4 Advantage Account requires a minimum deposit of $500 or currency equivalent but offers traders the lowest spreads. Commissions range between $0.80 and $4.00 per round lot, dependent on the monthly trading volume, and Silver traders benefit from maximum leverage of 1:500 and an upgraded MT4 trading platform.
Pros & Cons
- Excellent commission-based Forex pricing environment and transparency
- Upgraded MT4/MT5 trading platforms plus proprietary mobile trading app
- Quality market research and educational content for beginner traders
- A highly regulated broker with a tier-1 license
- No cryptocurrencies and limited choice of commodities
FP Markets
In Summary ECN trading with leverage up to 1:500FP Markets is another competitive broker for Silver traders. Besides high-speed trade execution, traders get a low-cost trading environment and a choice of three Silver crosses. The XAG/USD and the XAG/AUD show a minimum spread of $0.01 and an average of $0.02, with XAG/EUR slightly higher at $0.015 for the minimum, but an equal average cost of $0.020. The commission at FP Markets is $6.00 per round lot, the maximum leverage 1:500, and the minimum deposit is $100.
The commission-free account shows an average spread of $0.03 for the XAG/USD and the XAG/AUD and $0.22 for the XAG/EUR. Depending on the strategy, some traders may achieve lower trading costs in the commission-free account, which can be a unique opportunity. Diversified portfolios should opt for the ECN alternative, as overall costs remain lower. The twelve MT4/MT5 add-ons offer another advantage, together with quality trading services like VPS, MAM/PAMM accounts, and Autochartist.
Pros & Cons
- Choice of trading platforms and auxiliary trading tools
- Very competitive cost structure and excellent asset selection
- Low minimum deposit requirement and leverage of up to 1:500
- Well-regulated and trustworthy
- Availability of Iress geographically restricted
Eightcap
In Summary Competitive pricing + excellent daily videosSilver traders get the XAG/USD at Eightcap, which shows a minimum spread of $0.01 for a commission of $7.00 per round lot. A commission-free alternative is available with an average mark-up of $0.05. Eightcap also provides beginner traders with an introduction to Silver with tips to get started. Another benefit is the transparency and honesty at Eightcap, and the minimum deposit of $100 ensures most traders can afford an account.
Eightcap offers traders the MT4/MT5 trading platforms, upgraded via the FX Blue Labs package consisting of eleven add-ons, transforming the sub-standard core versions into competitive solutions. The excellent execution statistics make Eightcap an ideal broker for algorithmic Silver trading and scalping. Traders can also benefit from Capitalise AI, supporting automated trading without learning how to code. Eightcap additionally maintains quality partnership programs, where its MAM/PAMM service stands out for retail account management.
Pros & Cons
- Low minimum deposit and high leverage of up to 1:500
- Competitive cost structure
- Excellent technology infrastructure and seasoned management team
- Daily research and quality educational content
- Limited leverage in some areas
BlackBull Markets
In Summary Best ECN trading environment, with scalping and hedgingBlackBull Markets was founded in 2014 in New Zealand. Like many antipodean Forex brokers, BlackBull Markets is an ECN broker, offering raw spreads and commissions. They are regulated in New Zealand by the Financial Services Providers Register (FSPR) and offer a maximum leverage on some Forex currency pairs as high as 500 to 1. In addition to their global headquarters in New Zealand, BlackBull Markets also has presences in the form of branch offices in New York and Malaysia. BlackBull Markets offers a relatively tight range of tradable assets: 27 Forex currency pairs and crosses, gold, silver, crude oil, natural gas, and 6 major equity indices. That should be sufficient for those traders with more focused strategies not requiring wide diversification.
Pros & Cons
- ECN/NDD execution model with deep liquidity
- Institution-grade pricing for retail traders via proprietary price aggregation
- ZuluTrade and Myfxbook for social trading
- Leverage of up to 1:500
- Limited deposit options
AvaTrade
In Summary Highly regulated, choice of fixed or floating spreadsAvaTrade offers beginner traders a brief but quality introduction to Silver, making it an ideal broker for them. While it only offers the XAG/USD pair, with a maximum leverage of 1:50, the commission-free spread is a competitive $0.029. Traders should also consider the choice of trading platforms for Silver trading. Besides the out-of-the-box MT4/MT5, AvaTrade deploys its proprietary web-based alternative for manual traders. Its mobile app, AvaTradeGO, caters to millennial and GenZ traders who prefer mobile trading.
The minimum deposit at AvaTrade is $100, and three copy trading services cater to passive Silver traders. A hidden gem is its spun-out SharpTrader business unit, one of the best educational resources available, featuring 40+ lessons and 200+ videos. New traders qualify for a bonus, dependent on their jurisdiction, and AvaTrade maintains a lucrative partnership program.
Pros & Cons
- High-quality educational offering via SharpTrader
- Excellent choice of trading platforms catering to various trading needs
- Broad asset selection and cross-asset diversification opportunities
- Well-regulated and trusted broker with oversight from a central bank
- Trading costs competitive but nothing special
Best Silver Brokers Comparison
| | | | | |
Regulators | CMA, CySEC, FCA, FSC Mauritius, FSCA | ASIC, CySEC, FSCA | ASIC, CySEC, FCA, SCB | FMA, FSA | ASIC, BVI, Central Bank of Ireland, FFAJ, FSCA, KNF, MiFID |
Year Established | 2011 | 2005 | 2009 | 2014 | 2006 |
Execution Type(s) | ECN/STP, Market Maker | ECN/STP | ECN/STP, Market Maker | ECN/STP, No Dealing Desk | Market Maker |
Minimum Deposit | |||||
Average Trading Cost EUR/USD | 0.1 pips | 1.1 pips | 1.0 pips | 1.3 pips | 0.9 pips |
Average Trading Cost GBP/USD | 0.2 pips | 1.4 pips | 1.2 pips | 2.0 pips | 1.5 pips |
Average Trading Cost Gold | $0.18 | $0.21 | $0.12 | $0.90 | $0.29 |
Trading Platform(s) | MetaTrader 4, MetaTrader 5, Proprietary platform | MetaTrader 4, MetaTrader 5, cTrader, Proprietary platform, Web-based | MetaTrader 4, MetaTrader 5, Trading View | MetaTrader 4, MetaTrader 5, Trading View | Other, MetaTrader 4, MetaTrader 5, Web-based+ |
Islamic Account | |||||
Negative Balance Protection | |||||
| Visit Website | Visit Website | Visit Website | Visit Website | Visit Website |
How Do I Start Trading Silver?
Education is the first step which creates the foundation for successful silver trading. It will reveal the core aspects of developing profitable silver trading strategies, including its close relationship to gold. While both are safe-haven assets, inflation hedges, and portfolio hedges, learning how to use the gold-silver ratio to identify buying and selling opportunities remains useful.
Traders must also decide how they wish to trade silver, as several options exist to add this precious metal to their portfolio. Silver trading is possible via silver bullion or the physical purchase of silver bars or coins, spot silver, silver futures, silver options, silver equities, and silver ETFs. The asset choice depends on the preference of traders and the strategies they want to use.
Before trading silver, traders must know what moves price action. Besides being an inflation or portfolio hedge, silver has many industrial usages. They include industrial demand for batteries, LED chips, dentistry, water purification, medicine, and extracting other minerals. Traders must follow supply and demand from silver production and industrial demand together with price action, technical conditions, monetary policy, economic data, and geopolitical events. The often-inverse relationship between silver and the US Dollar is also important. Finally, traders must open and fund a trading account to start trading silver.
Which Instruments Should I Use to Trade Silver?
The five major Silver trading instruments are:
- Silver CFDs are a derivative contract ideal for non-US traders, granting exposure to price action without ownership of the underlying asset. It represents the most efficient form for day trading Silver and is available as a leveraged product.
- Silver futures are a legally binding contract for physical delivery of the specified amount of Silver at the contract date. Companies and traders use Silver futures to hedge their risk, locking in prices if they believe the cost of Silver will increase or decrease in the future.
- Spot Silver refers to the current price of Silver, with on-the-spot settlement and delivery, hence the name. It satisfies the immediate needs of market participants who seek ownership of the asset.
- Physical Silver suits investors with a long-term investment horizon. Silver bars are available as triangular or rectangular shapes of 995+ purity. They come in 1-ounce, 5-ounce, 10-ounce, 100-ounce, and 1-kilogram sizes. Those from reputable brands may cost more versus lesser-known competitors, while damaged Silver bars are available at a discount. Silver coins present an alternative, and holders may use them as a currency, making liquidation easier. The two dominant Silver coins are the 1-ounce 99.93% pure American Silver Eagle and the 1-ounce 99.99% pure Canadian Silver Maple Leaf.
- Silver ETFs can offer diversified exposure to Silver with a lower risk profile.
Which are the best Silver trading exchanges?
- The CME Group (US) is the largest futures exchange globally, consisting of six exchanges with offices in eleven countries.
- The National Stock Exchange of India commenced operations as an equity exchange but grew into a dominant futures exchange.
- Eurex (Europe) is the largest futures exchange in Europe and the third largest globally, owned by Deutsche Boerse.
- The Intercontinental Exchange (US) focuses on energy products, but a series of acquisitions offer expansion into other assets, including Silver.
- NASDAQ (the US and Europe) owns the NASDAQ Futures Exchanges (NFX), where Silver trading is available.
- CBOE Holdings (US) consists of four subsidiaries and established itself as an influential futures exchange.
- The Moscow Exchange (Russia) is the dominant Russian exchange, a hub for many Silver traders from the CIS, including Silver mines and supporting industry.
- The Tokyo Commodity Exchange (Japan) is one of the largest futures exchanges in Asia and sometimes is a leading global Silver exchange by volume.
- The Shanghai Futures Exchange (China) is the dominant exchange in China, where Silver is usually in demand as a precious metal.
- The Korea Exchange (South Korea) is a hub for Korean Silver traders and features notable trading volumes during the Asian trading session.
What Moves the Silver Market?
The major factors which tend to move the Silver market are:
- Silver is mined, so discovery of new deposits or their scarcity can affect the price of Silver.
- Silver is often seen as a semi-currency which holds a good store of value, so the value of Silver can rise during periods of high inflation or negative interest rates.
- Industrial demand for Silver – unlike most other precious metals, Silver has several industrial uses, and is not only in demand as a precious metal but also as an industrial metal. Silver is used in the manufacture of solar panels, electrical and thermal conductors, and other reflective products. If such materials are in demand, the price of Silver will tend to appreciate.
- Silver is used in water filtration, and as a chemical catalyst in manufacturing. As demand rises in these industries, so the price of Silver is likely to rise.
- Silver is also seen as a precious metal, offering a safe haven / store of value.
- Silver is a key ingredient in jewelry and high-end tableware, although demand for these products is quite constant so is unlikely to move the Silver market.
Unique Features of the Silver Market
How can Silver lower portfolio risk?
Silvers can act as an inflation hedge, outperforming stocks during volatile and/or bear markets, offer low-risk exposure to emerging and frontier markets with Silver production, and assist in portfolio diversification.
How does Silver perform versus other financial assets?
Silver tends to outperform the stock market during periods of crisis, inflation, or volatility, but underperform in more “normal” market conditions.
Can traders use Silver to gain exposure to developing countries?
As several developing countries are leading Silver producers, Silver can be a lower-risk entry to potential growth opportunities. Silver can provide upside exposure while limiting risk. Mexico, Peru, China, and Chile are the top four Silver producers. Other significant Silver producers are Bolivia, Argentina, Kazakhstan, Morocco, Indonesia, Uzbekistan, Papua New Guinea, and the Dominican Republic.
How to Choose a Silver Broker
Traders should check a Silver broker’s core trading environment for the following:
Regulation and Security: Traders should check if their broker has a regulatory license. While a license does not eliminate risk, it will notably decrease the risk of malpractice and fraud.
- Traders should consider the operating record of Silver brokers, not just the existence of regulatory oversight.
Trading Costs: Trading fees are extremely important. Many beginner traders wrongly dismiss minor differences in spreads.
- Another overlooked trading cost is swap rates on leveraged overnight positions. Silver trading as a leveraged derivative incurs financing costs known as swap rates. Competitively priced Silver brokers may sometimes offer a positive swap rate on a Silver position, meaning traders can get paid to hold a leveraged Silver trade overnight.
Trading Platforms: The best Silver brokers will offer a trading platform that fully supports automated trading and features API trading for advanced solutions.
Deposits & Withdrawals: Many traders ignore the importance of financial transactions, especially withdrawals. While deposits generally remain free of charge, traders must ensure the same applies to withdrawals. Third-party payment processor costs usually apply and are outside the control of brokers.
Traders should check a Silver broker’s trading environment for additional factors:
Asset Selection: Most retail traders will trade the XAU/USD CFD, available at almost every broker. A growing number of Silver brokers provide greater exposure to Silver by quoting it against other currencies, for example, XAU/EUR or XAU/GBP. This generates more trading opportunities and allows for more complex Silver trading strategies.
Research and Education: Research is for manual traders, while education remains a service geared towards beginner traders.
Unique Features: Traders should view unique features as complementary to the core trading environment but not judge Silver brokers strongly on them. They may assist traders in deciding between two brokers who offer an identical core trading environment.
Customer Support: While swift access to customer support must exist, preferably 24/5, covering Silver trading hours, the best Silver brokers explain their products and services well.
Account Types: Many brokers offer traders a multi-tier account structure, which is either based on deposits, portfolio size, or monthly trading volume, where higher tiers unlock access to improved trading conditions.
Traders should carefully evaluate any upgrades to trading conditions which are offered with each higher tier, as not all will necessarily make sense.
Account Opening Process: A final plus is a swift account opening process for access to the back office, free of unnecessary questionnaires.
Final Thoughts
Silver is one of the most traded metals, while CFDs and ETFs present the best overall financial instruments, in terms of cost and reliability, for exposure to Silver’s price movements. CFDs are generally the superior instrument for day traders and other shorter-term traders, while ETFs are usually a more suitable vehicle for longer-term investors, as most CFD providers include a negative overnight swap fee on Silver positions. However, US persons are usually unable to access Silver CFDs so will be better advised to consider Silver futures (although they can be somewhat large for many retail traders as even the Silver micro future contract has a position size of about $20,000), or spot Silver which can be hard to find.
Traders seeking the best Silver brokers should consider the Silver trading options available and the associated costs of trading those instruments, as well as evaluating the brokers’ regulatory statuses and any other protections offered such as negative balance protection.
Silver traders or investors should remain aware that Silver tends to exhibit very high price volatility, higher even than gold, and this high volatility should always be considered when sizing positions.
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