IG Spreads, Fees, and Commissions

If you are interested in trading with IG, you should familiarize yourself with the full set of trading conditions the broker offers to its clients. Trading fees and non-trading surcharges are factors to pay attention to before you engage in any real-money trading with IG or any other broker, for that matter.

In this review, we have covered spreads, commissions, overnight funding fees, and any other surcharges that may be deducted from your balance whenever you trade with IG. If you want to assess if IG offers fair and budget-friendly trading solutions, we suggest you keep reading.

IG Trading Costs

One thing we should mention is that IG is a great broker choice for traders who are looking for a way to diversify their portfolios. Depending on your country of residence and applicable local regulations, you can trade Forex instruments in the form of turbos, vanilla options, barrier options, CFDs, spread betting, or even direct market trading through a DMA platform.

With CFD trading, one can profit no matter the direction of the underlying asset’s price movement as the broker allows going both long and short with your CFD trades.

To be completely transparent with its customers, IG has adopted a simple spread-only pricing system. That means the broker charges no commissions and the entire cost of trading is attached to the spread, which is the difference between the Bid and Ask value of the asset.

If you decide to engage in spread betting or Forex turbo trades, you will still pay no commission on your orders. While spreads can change over time due to shifts in the market, we have provided the current average spread IG offers on several of the most traded and popular currency pairs.

As newly registered traders have the chance to trade with smaller contracts, we have provided the total trading cost for both standard and mini lots.

*All pairs’ trading costs are expressed in USD

The spreads at IG can be extremely competitive, starting at 0.6 pips on major Forex pairs. The broker strives to offer spreads that correspond to that minimum but sharp market movements may cause expansion of spread values.

IG Overnight Funding Costs

A particular surcharge to be aware of is the possible overnight funding fee, which is deducted whenever traders keep their positions open overnight. Also known as swaps, these fees are applicable on trades with Forex pairs, indices, and commodities. If you keep your turbo24s open overnight, there will be a small adjustment in the knock-out level instead of charging you an additional fee. Meanwhile, for barriers and CFDs, the broker will make an interest adjustment to your balance.

Swaps can be received or paid by traders, depending on the way the market is moving. To calculate the the swap rates on turbo24s, IG resorts to the following formulas:

For Forex Long Turbos: Tom-next rate + Knock-out level X (Admin fee* X [n**/365])
For Forex Shor Turbos: Tom-next rate – Knock-out level X (Admin fee* X [n**/365[)

* a flat fee of 2.5% per annum

**n = 3 on Fridays; n = 1 from Monday to Thursday

For Forex barriers, the swap rates are calculated with the formula provided below:

Number of contracts X Current tom-next rate

Additionally, traders will be charged an admin fee of 0.8% per annum for keeping barrier options open overnight.

If the tom-next rate is below zero, barrier traders will be debited interest for keeping a short position, while long positions will indicate credit of interest from traders’ balances.

A tom-next rate above zero means traders will be debited interest for keeping a long position open overnight, while a running short position in this case means that traders will be credited interest.

If you trade Forex pairs through spreads betting or CFDs, the broker will apply the following formula:

Number of nights held X (Tom-next rate* including annual admin fee**) X Trade size

*Tom-next rates are taken from the underlying market

**an admin fee of 0.8% per annum

Below, we have listed swap rates that are currently applicable to Forex trades made with an IG account. Keep in mind that swaps are not fixed and may not match the values below as the underlying market is constantly shifting.

Swap-Free Trading Costs at IG

Unfortunately, IG is no longer providing the option to open a swap-free account, even to its Muslim clients. That means interest will be credited or debited to any account that holds its positions open overnight, incurring the overnight fees we discussed earlier.

IG Non-Trading Costs

In addition to spreads and swap rates, traders should also consider additional surcharges that may be applicable to their IG accounts. Opening an account with IG is free, and so is maintaining your trading profile. Generally speaking, IG allows funding of your account and withdrawing money from it, without charging any fees for the transactions. That said, transactions with credit cards and non-UK debit cards may incur some fees, with transactions below £100 imposing a £15 fee.

If there has not been any trading activity in your IG account for over 24 consecutive months, the broker will close your trading account. There will be no inactivity fee deducted from your account but you will need to contact the IG team to reactivate your old account or withdraw the funds that have remained in your inactive account, if there are any.

To help traders elevate their experience, the broker offers an arsenal of tools and services that may improve one’s trading sessions. VPS (Virtual Private Server) is one of the advanced trading services available to members of the broker. It can reduce latency and help you boost the success rates of your algorithmic trades. You can gain free access to an MT4 VPS hosting service by maintaining an account balance of $2,000 or more or you can opt for a paid subscription of $50 per month.

If you have traded share products that may qualify you to receive dividends, you are required to submit a W-8 or W-9 form. If you fail to do that before the ex-date for the respective dividends, you will pay an account documentation fee of $50.

Advanced charts through ProRealTime may also be available to some IG clients. Those who place four or more large-volume trades per month may gain free access to advanced charts but if traders do not qualify for the free use of this tool can opt for a paid subscription of £30 per month.

Closing Thoughts on IG Fees

Trading with IG gives Forex and CFD traders the freedom to explore various options, diversify their portfolios, and enjoy great value for their trades. Through a spread-only payment system, available on most trading forms offered at IG, Forex traders can enjoy cost-effective trading, with spreads often starting as low as 0.6 pips on major Forex pairs.

There are no hidden fees, and IG is transparent about any surcharges that may be incurred after holding open positions overnight or requesting access to advanced trading tools like VPS hosting and ProRealTime charts. Nevertheless, large-volume trades can eliminate the fees even for said tools, ensuring the extremely budget-friendly trading conditions at IG.

Written by N. Nazifova