OANDA’s a great forex and crypto broker for both new traders and those with more experience. The firm offers forex and cryptos in the US and Japan and CFDs too in other jurisdictions, plus it recently started offering stocks and ETFs in the EU.It’s a US-based company and therefore regulated by the relatively strict US authorities and one of the few global online forex firms available to US clients, plus it’s regulated in seven other jurisdictions too. The company’s been in business since 1996, making it one of the longest-established brokers in the industry.
Yes, it’s one of the biggest and best forex brokers in the business. It offers a wide range of forex pairs and cryptos to US and Japanese clients, CFDs on stock markets, precious metals, commodities, and bonds elsewhere, and has recently broadened out its offering range in the EU to include stocks and ETFs. Its proprietary fxTrade trading platform is excellent, but you can use MT4 if you prefer. It’s regulated in the most rigorous jurisdictions around. Moreover, it has a reputation for sticking with its clients when the going gets tough (like when the Swiss National Bank pulls a fast one on the market).
The name OANDA is an acronym for “Olsen and Associates”. It was founded by economist Dr. Richard Olsen and computer scientist Prof. Michael Stumm in 1996. Olsen is a serial entrepreneur who’s founded several companies, including Olsen Ltd., a quantitative asset manager, and Lykke Corp., a crypto exchange. He described the purpose and underlying philosophy of OANDA in an early paper, “The democratization of the foreign exchange market.” The last paragraph was prophetic:
In closing, we expect that the foreign exchange market will become a model for what will happen in the other financial markets in the future: There will be an ongoing democratization process, with everyone gaining access to an extremely efficient market place open for trades in any size and with microscopic spreads.
That’s exactly what happened.
Yes, as far as we can tell (this is our standard disclaimer). OANDA is regulated by eight different regulators, an unusually high number, including the US, UK, and Japan, probably the three strictest regulators anywhere. It’s been in business for many years without much of a hitch.
Indeed, it performed admirably when the Swiss National Bank pulled the rug out from under the forex market in 2015 and removed the EUR/CHF floor without warning, sending EUR/CHF crashing 2,000 pips in seconds. Thousands of clients lost money and several firms went under: retail broker Alpari UK filed for insolvency, New Zealand foreign exchange dealer Global Brokers NZ Ltd closed, and FXCM had to arrange a bail-out from Leucadia National Corp., the parent of investment bank Jeffries, among other casualties. But OANDA said at the time that it “will pardon our clients’ negative account balances associated with this market event” and would not “re-quote or amend” clients’ trades on the Swiss currency.
Yes, the company is regulated in eight different countries, including five Tier I (US, Canada, UK, Australia, and Japan), two Tier II (Singapore and Malta) and one Tier III (British Virgin Islands). The US, UK, and Japan are probably the three strictest regulators around, so having all three watching a company is probably as good a sign as you can get. Note though that it’s not a 100% guarantee – Bernie Madoff’s fund was regulated in the US, too.
Yes, it’s a US-based company and one of the few global online forex brokers to accept US clients. Note though that it still can’t offer CFDs to US clients, thanks to US government regulations.
The US headquarters is in New York City, the European headquarters is in Krakow, Poland. They also have offices in Toronto; London, Frankfurt, and Malta; and Tokyo, Sydney, and Singapore.
In 2018 OANDA was acquired by CVC Capital Partners, a private equity firm with EUR 123bn under management that owns more than 120 companies. Since a private equity firm is by definition private, Oanda isn’t listed anywhere and there’s no financial information available about it.
Yes, as mentioned above it’s regulated by eight regulators, including the toughest three on the planet. It says it’s the largest foreign broker in Japan, where the regulators are notoriously strict. Moreover it has a history of standing by its clients even when it doesn’t have to – it certainly went the extra mile in 2015 when the Swiss National Bank dropped the CHF bomb on the market.
Plus there’s no question about it manipulating its data to its advantage. On the contrary, it has a nice little side business providing foreign exchange market data on some 38,000 FX pairs to companies, tax authorities, academics, and even the Fed and NATO.
Leverage on FX pairs in the US ranges from 4:1 for the extremely volatile TYR to 50:1 on EUR/USD and some CAD pairs (USD/CAD and EUR/CAD). Most are around 20:1.
Leverage is not available for cryptos.
OANDA has two pricing models: spread-only and core pricing plus commission. For spread-only, the spreads range from 1.4 pips (EUR/USD, USD/JPY, AUD/USD) to 3.1 pips (GBP/JPY).
For core pricing, those spreads fall to 0.4 pips for EUR/USD and AUD/USD, 0. 3 pips for USD/JPY, and 1.0 pip for GBP/USD. But there’s also a fixed commission, which varies depending on your base currency. If you’re interested in the details you can find them in the price sheet.
The firm charges a 0.25% fee on crypto trades.
There are no deposit fees. For withdrawals, there are bank transfer fees but no fees for withdrawals made by PayPal.
An inactivity fee kicks in after 12 months.
For conversions, the firm charges 0.5%, which seems to be standard.
The instruments available for trading vary depending on which entity you’re dealing with.
In the US, the company offers 70 currency pairs, from AUD/CAD to ZAR/JPY, and 10 cryptos (Bitcoin, Ethereum, Litecoin, Bitcoin Cash, PAX Gold, Chainlink, Matic, Aave, Solana, and Uniswap). The cryptos are actually being traded with Paxos Trust Company via the OANDA trading platform.
Outside the US, OANDA offers gold and silver in 10 currencies each; and 35 other instruments, including 19 stock market indices, 10 commodities (eg oil, copper, wheat, etc.), and US, UK, and German bonds. There are no single stocks and no cryptos. This isn’t the most complete listing I’ve ever seen but it should satisfy most people.
In addition, within the EU, the firm recently (March 2023) started offering over 3,000 financial instruments, including CFDS on 1,700 stocks from all over Europe, CFDs on 41 exchange traded funds (ETFs), and CFDs on 18 cryptos (including the dreaded Dogecoin). It also offers 1,600 US stocks (not CFDs).
As usual, you can open an account with a credit/debit card, bank transfer, or PayPal. They also offer Trustly and SEPA for EUR payments, Bacs and CHAPS in the UK. OANDA does not levy any fees for deposits made using credit/debit cards or bank transfers.
Accounts are available with base currency USD, EUR, GBP, JPY, AUD, CAD, CHF, , HDK, and SGD.
Withdrawals are subject to the firm’s hierarchy rule. That is, money deposited by credit/debit card will be withdrawn first, then money deposited by bank transfer. As usual, money has to be withdrawn in the same way it was deposited.
The company has its own trading platform, OANDA Trade, which is available for use in a browser, Android, or iOS device. Or you can use the well-known MT4 platform and TradingView.
OANDA Trade is a well-designed platform that allows clients to trade with a large number of complex order types. It offers some of its own proprietary charts along with others from TradingView, and you can trade directly from the charts. It also integrates MarketPulse and Autochartist. You can set up watchlists and customize your news feeds and research as you like.
Oanda offers guaranteed stop-loss orders(GSLOs). What this means is that the company guarantees that you’ll be able to get out of your trade at the exact price you specify regardless of market conditions. Imagine if you had had this in place when the Swiss National Bank decided to screw over the FX market and withdraw the EUR/CHF floor in 2015. The GSLO incurs a fee if it’s triggered, so it’s more accurate to say that it guarantees you a maximum amount of slippage on your stop-loss.)
This feature is not available to US or UK clients however.
In addition to its proprietary charts, the firm’s platform integrates advanced charts from TradingView and AutoChartist as well as news from Dow Jones FX Select.
One small point: OANDA’s data are first-rate. The company’s API (Application Programming Interface) supplies data on over 200 currencies to thousands of global companies, governments, and other organizations (including the Fed, apparently) and can provide you with up to 25 years of historical exchange rates, in case you’re dying to know what happened to USD/JPY during the Russian debt crisis of 1998 (spoiler alert: it fell 2 yen a day every day for a week! One of the most dramatic moves ever in FX.)
There’s a social investment program called FxManager. This allows you to follow other traders if you think they can trade better than you. On the other hand, if you think you’ve got the chops you can allow other people to follow you and maybe make some passive income from it.
I put a lot of emphasis on a firm’s analysis because of course that’s what I do for a living. I think the resources a company spends on analysis show its philosophy: does it want its clients to succeed in trading or is it trying to milk them for as much money as possible before they go broke?
OANDA also offers live trading webinars on top of their large library of pre-recorded webinars to teach trading. And there are a number of trading tools from external suppliers, such as charts from TradingView, technical analysis from AutoChartist, and news from Dow Jones FX Select.
I commend OANDA’s commitment to educating their clients!
The firm offers 24-hour support “when the markets are open,” which translates roughly from 2100 GMT Sunday (0900 Wellington, NZ time Monday) to 2300 GMT Friday (1500 Los Angeles time). This means you won’t be able to reach anyone if for some reason you’re having a problem on a Sunday morning. I don’t think that’s too much of a problem because frankly you shouldn’t be spending all your time trading anyway. Get a life. But if you do need someone on a Sunday, they have an automated chatbot in English, Chinese, Spanish, German, French, and Italian. And there’s always email.
For US traders wanting to dive into forex, OANDA is among the best of a limited number of choices. Execution is excellent, you can choose from either the firm’s great proprietary platform or two commonly used external ones, and there’s plenty of educational material to learn from, including the OANDA classroom series of live trading webinars (although the material could be organized better). However the lack of negative account protection for US clients could be a problem -- newbies could find themselves underwater at some point if they’re not careful. More experienced traders on the other hand will appreciate the firm’s superior trading platform and its wide range of research and analysis, plus its excellent trade execution.
Regardless of how or what you trade, the broker you choose should be safe to use, affordable, and offer everything you need to trade at your best. That’s why we’re highly selective. We only feature brokers regulated by a trusted authority and we make it easy to compare their fees & features, so that you can make an informed choice.