Our Review of OANDA Corporation
Oanda Broker Review
The Oanda corporation is a Market Maker Forex brokerage that traces its origins to 1996, when it was incorporated in the state of Delaware. It began offering retail forex trading in 2001 when it launched its trading platform, fxTrade, becoming the first broker to offer fully automated online currency trading. Oanda claims to have completed over 1.5 billion forex transactions. It has offices in the U.S., Canada, Europe, Asia, Australia and Japan.
A refreshingly simple fact greets anyone interested in opening a trading account with Oanda. Traders can deposit any amount and trades of as little as one currency unit are accepted. There is no need for a trader to figure out whether to establish a standard, mini or micro account. There are no commissions, since Oanda is a Market Maker.
Commissions and Spreads
Along with zero commissions, Oanda has very tight spreads. Since they are a Market Maker, the spreads do fluctuate constantly. They will get considerably higher than average in the last 15 seconds or so leading up to a major economic event, but spreads quickly return to normal. A trader of the EUR/USD will often encounter spreads of 1.2-1.5 pips, sometimes going as low as .7 pips during slow trading periods. Other pairs have higher spreads, but most of the major pairs can typically be traded for a little under two pips during trading sessions where banks in the countries of the currencies involved are in normal business hours.
FxTrade is the proprietary Oanda trading platform. It is available online and also as a Java app that does not require downloading any software. These platforms offer excellent charting and analysis tools, but only market and limit orders are available and they do not support automated trading. The platform is extremely stable and seldom experiences any connection issues.
Oanda also offers MetaTrader 4.
In addition, they have mobile apps for iPhone, iPad and Android devices.
Deposits and Withdrawals
Regarding account funding methods, Oanda accepts credit cards, bank transfers, PayPal with the restriction of USD only, and bank checks, which must also be drawn on the USD. There is a small fee for PayPal deposits of $0.15 plus 1.8 percent for U.S. accounts and 2.8 percent for non-U.S. accounts. There are no deposit limits on verified PayPal accounts.
Fees for credit card deposits and wire transfers will depend upon the card issuer or the wiring bank. Checks have no fees whatsoever associated with them, but it will typically take seven business days for the funds deposited by check to be available for trading.
The stipulations regarding withdrawals are mainly that they will be processed using the same method that was used for funding. If multiple funding methods were used, withdrawals will first be applied to credit cards, then PayPal, check and bank transfer. Transfer times are typically from one to five business days and one withdrawal per month will not be assessed a fee. Additional withdrawals will have fees that vary according to the currency withdrawn.
Oanda is one of the top forex brokers when it comes to customer support. It is possible to contact them via telephone, but most traders will find the live help feature built into the fxTrade platform and the Oanda website to be extremely adequate. Wait times for chat support are seldom over one minute and the chat specialists are highly trained, knowledgeable forex specialists who also possess superior communication skills. Support is offered in multiple languages that will accommodate just about anyone in the world.
The Oanda website offers enough webinars, videos, articles and technical trading instruction to satisfy traders of every experience level. They also offer comprehensive news and trader forums.
One area for which they deserve special mention is that their support pages are written in clear, concise language.
Regulators and Safety
No one need fear for the safety of their fund deposits with Oanda. They are registered as a Retail Foreign Exchange Dealer and also with the U.S. Commodity Futures Trading Commission (CFTC). They are also members in good standing with similar regulatory bodies around the world.
In compliance with U.S. regulations, Oanda offers maximum leverage of 50:1, with a minimum of 10:1. Customers are free to adjust leverage between those levels at their own discretion. This can be easily done through the trading platform. The exception is for metal pairs traded through the U.S. division, where regulations mandate a 1:1 level.
Sign Up Bonuses
Oanda does not offer any incentives of any kind to attract new clients. They do not need to, as they have a long reputation for straight dealing.
The combination of great spreads, competitive quotes, reliable trading platforms and superior customer service makes it easy for Oanda to overcome any possible stigma that could be attached to a Market Maker forex broker. This is a great broker for established traders, as well as those who would like to test their trading skills in the forex market without committing anxiety-inducing levels of investment capital.