How do margin FX brokers make money?

It should not come as any surprise that margin FX providers are in business to make a profit. They provide traders with a service and, quite rightly, expect to be rewarded for doing so. Once again, each broker does things slightly differently. Some of the more common sources of broker revenue are outlined below.

The most obvious way for a broker to make money is to charge a commission. This method is most commonly used by ECNs, which represent a relatively small portion of the overall retail FX market. Among those that do charge a commission, this charge may be in the form of a fee per trading ticket, a fee for trades below a certain amount (say $50 000), or a fee calculated on total monthly volumes.