IC Markets Forex Broker Review

Overall Conclusion:

IC Markets is a recommended forex broker. They operate in ASIC’s strict regulatory environment, and have no known regulatory violations. They also score very well on other key evaluation criteria. In particular, they offer some of the lowest transaction costs in the retail forex industry. They also offer permanent demo accounts, which is of particular importance for new traders.

Brief Background:

IC Markets is an Australian forex broker founded in 2007. The IC Markets brand is owned by International Capital Markets PTY. LTD, a privately held company located in Sydney, Australia. They primarily offer online brokerage services for forex trading, with some choices of futures, indices and commodities.

 Summary Of Regulatory Status

IC Markets is regulated by the Australian Securities & Investments Commission (ASIC). They are registered with license number 335692 as of July 2009. ASIC is among the most strict forex regulatory bodies, ensuring a high level of fraud protection for traders. As required by ASIC regulation, IC Markets publishes a Product Disclosure Statement and Financial Services guide. These should be read carefully before signing up for their service. IC Markets advise that they engage the services of external auditors to supplement their own business processes to ensure regulatory compliance. IC Markets has no known regulatory violations.

IC Markets is also a member of the Financial Ombudsman Service (FOS). The FOS is an independent body available to consumers at no cost to resolve complaints with member companies. If you have a complaint about IC Markets, they have an internal dispute resolution process that includes escalation to their compliance department. If this does not produce a satisfactory outcome, the FOS can be engaged for an independent assessment of the complaint. The FOS will issue a decision on the complaint, which is binding on IC Markets should you accept the decision. This mechanism provides excellent protection against broker fraud vs other forex brokers.

There have been some unfavorable users reviews on Forex Peace Army. Though there has been no regulatory action taken against this broker, potential new clients may wish to consider the experiences documented on Forex Peace Army. However, user reviews need to be taken in context because many novice traders like to blame their broker when things go wrong, and don’t take the time to understand the terms and conditions under which they are trading.

 Counterparty Risk:

IC Markets is required to keep minimum capital reserves to stay compliant with ASIC’s regulatory requirements. They advise that they keep capital reserves well in excess of those requirements.

During the SNB Swiss franc event of January 2015, it was business as usual for IC Markets. It even elected to forgive negative account balances for 90% of its clients. They did this even though there was no obligation to do so, as forex traders are generally responsible for their negative account balances. We believe this reflects the effectiveness of their risk management policies as well as the value they place on their clients.

While IC Markets advertise that client funds are deposited into a segregated trust account, your account balance available for trading only reflects what has been withdrawn from that account by IC Markets. In the event of IC Markets bankruptcy, retail clients are treated as unsecured creditors. This is not an unusual arrangement for forex brokers. IC Markets main protections against bankruptcy are to hedge all client orders with a liquidity provider and not engaging in proprietary trading (see broker type below).

 Broker Type:

IC Markets uses the ECN / straight through processing model with no dealer intervention. While it should be noted that IC Markets is the counterparty to client trades, they hedge all client orders against the many liquidity providers that make up their ECN environment. This broker model is similar to the straight through processing model used in the USA, where all brokers are the counterparty, even when the broker is not a market maker. As such, Forex Scam Alerts takes no issue with IC Market’s business model in this regard.

 Spreads:

IC Markets offers some of the best spreads in the retail forex industry. They offer a choice of pricing models: a standard account with an all-in spread and no commissions, or the ECN account type with a lower spread and a commission added on. We focus on the ECN account as it offers the more favorable trading terms. The ECN spreads float based on market conditions, and can widen briefly during big news events or unusual conditions. IC Markets advise that their typical spreads on some of the major pairs are as follows:

As evidenced in the table above, the average spreads are very low.

IC Markets charges a commission of $3.50 per lot per side. This is reasonable, making overall transaction costs low considering how tight the spreads are.

 Accounts and Funding

Clients of IC Markets can open and fund new accounts via a wide variety of payment options. These include:

  • wire transfers
  • credit and debit cards
  • local bank transfers
  • broker to broker transfers
  • Payment services such as Webmoney, Neteller, BPAY, FasaPay, China Union Pay

Care should be taken in the selection of payment option, as some may carry higher transaction fees than others. Credit and Debit card transactions typically require a fee as a percentage of the money being transferred, so this should only be used for funding the lowest amounts.

IC Markets allows you to use any of 8 different base currencies, including USD, AUD, GBP, JPY, EUR, NZD, CHF, SGD.

Of particular importance to new traders is that IC Markets offers demo accounts that do not expire. This is an unusual and important feature, as it can take months or years for a new trader to learn how to trade profitably. It is very important to have a chance to do this before risking real money. Please see our article on How To Start Trading Forex Safely to find out more about the importance of this.

 User Interface:

IC Markets offers a good choice of trading platforms for forex traders including:

  1. MetaTrader 4. This version of MT4 used by IC Markets includes some customizations for market depth and one click trading. Servers are located in the NY4 data center in New York.
  2. MetaTrader 5, with all of its upgrades vs MT4.
  3. The cTrader platform, with servers in the LD5 IBX Equinix Data Center in London
  4. ​A web based platform, which can be accessed from anywhere with an internet connection.
  5. MT 4 mobile trading apps for either Android or iOS.

The following is an example of IC Market’s cTrader user interface.

With such a wide choice of options, especially well known options such as MT4 and cTrader, all traders should be able to find a solution to suit their needs.

IC Markets Review

IC Markets is an established player in the Australian Forex industry, trusted since 2007.

Rating: 5 Stars