Broker account types explained: standard, raw, swap-free, cent and professional

A broker's account types are different pricing and service packages on the same underlying business. The main differences are how you pay for trading (a wider spread with no commission, or a tighter spread plus a commission), the minimum trade size, how overnight financing is charged, which platform you use, and whether you are classified as a retail or professional client. Names such as "Standard", "Raw", "ECN", "Pro" or "Zero" vary from firm to firm and do not have a fixed meaning, so read the contract specifications rather than the label.

This guide goes through the common account types, what actually differs between them, a worked comparison of costs, and the questions that tell you which features matter for the way you trade.

The five things that actually differ

Before looking at the names, it helps to know what can vary underneath them.

1. The cost model. Spread only, or spread plus commission. Some accounts also differ in swap rates or mark-ups.
2. Trade size. Minimum and maximum lot sizes, and the units in which the balance is shown.
3. Overnight financing. Normal swaps, or a swap-free arrangement with other charges.
4. Platform. Many brokers open a separate account for each platform: MetaTrader 4, MetaTrader 5, cTrader, a proprietary web platform. The same broker may price them differently.
5. Client classification. Retail or professional, which changes your leverage limits and the protections you are entitled to.

Everything else, such as the minimum deposit, the instruments available or access to extra tools, is usually secondary.

Standard accounts

The standard account is the default at most brokers. You pay through the spread, the gap between the bid and ask prices, and there is usually no separate commission on forex. The broker's revenue for each trade is built into a spread that is wider than the underlying market price.

What to know:

• The spread you see is the whole trading cost before swaps. That makes it easy to understand. Our guide to reading a forex quote explains bid, ask and spread, and what is a pip explains the unit it is measured in.
• Spreads are usually variable, wider at quiet times and around news. Some brokers advertise fixed spreads on certain accounts, but fixed spreads can still come with requotes or be suspended in fast markets. See why spreads widen.
• Minimum deposits tend to be lower than on raw accounts.

Standard accounts suit people who trade occasionally, who want one simple number to compare, or who trade small sizes where a fixed commission per lot would be proportionally heavy.

Raw spread, ECN-style and commission accounts

These accounts show spreads much closer to the underlying market price, sometimes near zero on the most liquid pairs, and charge a separate commission per lot traded. Brokers call them Raw, Razor, ECN, Pro, Zero, Prime and many other names.

What to know:

• The commission is usually quoted per lot, either per side or per round turn. A round turn means opening and closing. "3.50 per lot per side" is 7.00 per round turn. Always convert to one basis before comparing.
• The commission may be charged in your account currency or in the base currency of the pair, which matters if you trade many crosses.
• "Zero spread" accounts usually mean a near-zero spread on a few major pairs at liquid times, with a commission, and wider spreads on everything else.
• The account label is not an execution model. An account called ECN may be priced on the raw spread from liquidity providers but still have some orders internalised by the broker. Execution models are explained in our guide to ECN, STP and market maker execution, and the business side in how forex brokers make money.

Raw accounts tend to suit people who trade frequently or in larger size, and strategies with small targets, where every fraction of a pip matters. They are also where most automated strategies end up; see Expert Advisors and trading bots.

Worked example: standard versus raw

Illustrative numbers, not any particular broker. You trade EUR/USD in a US dollar account, where one pip on one standard lot (100,000 units) is worth 10 dollars. Our pip value calculator works this out for other pairs and account currencies.

• Standard account: typical EUR/USD spread of 1.2 pips, no commission. Cost per round-turn lot: 1.2 × 10 = 12 dollars.
• Raw account: typical EUR/USD spread of 0.2 pips, commission of 3.50 dollars per lot per side (7.00 per round turn). Cost per round-turn lot: 0.2 × 10 + 7 = 9 dollars.

On these numbers the raw account is cheaper by 3 dollars per lot. Now change the pair. Suppose that on GBP/JPY the standard account's typical spread is 3.0 pips and the raw account's is 2.3 pips, with the same commission, and that one pip on GBP/JPY is worth about 6.50 dollars per lot at the current exchange rate (illustrative).

• Standard: 3.0 × 6.50 = 19.50 dollars.
• Raw: 2.3 × 6.50 + 7 = 21.95 dollars.

Now the standard account is cheaper. The gap between the two accounts' spreads is not the same on every instrument, and the commission is the same in money terms whatever the pip value. The account that is cheaper overall depends on what you trade.

Two lessons follow. First, compare the typical spread, not the minimum the broker advertises, because the minimum may occur only briefly. Second, work out the cost on your own instruments, sizes and number of trades. Our guide to how to compare trading costs shows how to build an all-in monthly figure including swaps and fees, and spreads and commissions covers the basics.

Swap-free accounts

Holding a leveraged forex or CFD position past the daily rollover normally means paying or receiving a swap, reflecting the interest rate difference between the two currencies plus the broker's mark-up. Our guide to swap and overnight financing explains how it is calculated.

Swap-free accounts, often called Islamic accounts, do not charge or credit swaps, so that they can be used by traders whose religious beliefs prohibit interest. They are not free of overnight costs. Brokers typically replace swaps with one or more of:

• An administration or holding fee per lot per night, sometimes starting only after a number of days.
• Wider spreads or higher commissions on the account.
• A time limit, after which positions are charged or closed.
• A narrower instrument list, often excluding pairs with large interest rate differentials.

Brokers usually ask for a declaration of eligibility and reserve the right to remove swap-free status if the account appears to be used to avoid swaps for financial reasons, such as holding carry positions. Read the terms before you rely on one. The glossary entry on swap-free accounts gives the short version.

Cent and micro accounts

These accounts are designed for very small trade sizes.

• Micro accounts usually allow a minimum trade of 0.01 lots (1,000 units of the base currency), which many standard accounts also allow, and sometimes have a lower minimum deposit.
• Cent accounts show the balance in cents rather than dollars or euros. A deposit of 10 dollars appears as 1,000 cents. Contract sizes are scaled down so that the money per pip is very small. Conventions vary by broker, so check the contract specification to see how many units of currency one "lot" represents on that account.

Worked example, illustrative: on EUR/USD, a position of 1,000 units is worth about 0.10 dollars per pip. A 20-pip stop-loss risks about 2 dollars. On a cent account the same risk shows as about 200 cents, which looks larger on screen but is the same money. Use lot sizes and position sizing to translate any size into money per pip.

Small accounts have a genuine use: testing a strategy, an Expert Advisor or the broker's live execution with real fills while risking very little. They have downsides too:

• Costs are proportionally similar or higher, and spreads on cent accounts are sometimes wider than on standard accounts.
• Small sums can encourage careless trading. If you would not take the trade with larger money, the cent account is not teaching you anything useful.
• Cent accounts are more common with offshore entities. Check which legal entity and licence your account would sit under; see how to check a broker licence.

Demo accounts

A demo account uses virtual money on live or near-live prices. It is the right place to learn the platform, practise order entry and check how a strategy behaves. It is not a reliable guide to live results: demo fills are often better than live fills, there is no slippage or requote in many demo environments, and the psychology of real money is absent. Some demos expire after a set number of days. Our guide to moving from demo account to live trading covers what a demo hides and how to bridge the gap.

Platform-specific accounts

At many brokers, choosing an account type also means choosing a platform. A MetaTrader 4 raw account and a MetaTrader 5 raw account are separate accounts on separate servers, with separate logins and sometimes different pricing or instrument lists. The platforms themselves are compared in MetaTrader 4 vs MetaTrader 5 and cTrader and TradingView.

On MetaTrader 5, accounts are also set up in either hedging mode, where you can hold several positions on the same instrument including opposite ones, or netting mode, where new orders add to or reduce one position. Most retail forex accounts use hedging mode, but check.

Some brokers also offer copy trading or managed-account features only on particular account types. If you are considering that route, read copy trading explained first.

Account base currency

When you open an account you usually choose a base currency, often from US dollars, euros, sterling and a few others. Your balance, margin and profit or loss are shown in that currency. If you deposit in a different currency, or trade instruments whose profit is calculated in another currency, conversion takes place and may carry a fee. Our guide to currency conversion and account base currency explains how to choose, and hidden broker fees covers the other charges to look for.

Retail and professional clients

In the EU and UK, every client is classified by the broker. The classification changes your protections more than any other account choice.

Retail clients

Almost everyone starts as a retail client and most traders stay one. Retail CFD clients in the EU and UK have:

• Leverage caps, from 30:1 on major currency pairs down to 2:1 on cryptocurrencies.
• A 50% margin close-out rule per account.
• Negative balance protection, so you cannot lose more than the money in your account.
• A ban on trading-related incentives such as deposit-linked offers.
• A standardised risk warning showing the percentage of the firm's retail accounts that lose money.

These are explained in detail in our guide to ESMA leverage limits and negative balance protection, and the mechanics of leverage in leverage and margin.

Professional clients

Under MiFID II, a retail client can ask to be treated as an elective professional client if they meet at least two of three criteria: significant trading activity over the previous four quarters, a financial instrument portfolio exceeding €500,000, or at least one year working in the financial sector in a role requiring knowledge of the products. The broker must assess you, warn you in writing about the protections you will lose and receive your written confirmation.

What changes:

• Higher leverage becomes available.
• The mandatory protections above no longer apply, including negative balance protection, although some firms offer it voluntarily.
• Investor compensation coverage may change. For example, Cyprus's Investor Compensation Fund covers retail clients of member firms up to a limit of €20,000 per client and does not cover professional clients. Check the rules of the scheme that applies to your firm.
• Complaint routes may change, since some ombudsman and dispute schemes are designed for retail consumers.

For most traders, professional status offers more leverage and less protection, a trade that rarely makes sense. Be wary of any firm that pushes you to opt up or offers to help you qualify. The glossary entries on retail client and professional client give the short definitions.

Other account variations you may see

• Joint and corporate accounts. Held by two people or by a company. They involve more documentation and the same product risks.
• Spread betting accounts (UK). A different legal form of leveraged trading available to UK clients, treated differently for tax purposes. Tax treatment depends on your circumstances, so check rather than assume.
• Guaranteed stop or limited-risk accounts. Some providers offer accounts where every position must have a guaranteed stop-loss, which is filled at your price even through a gap, usually for a premium. See gap risk and weekend risk.
• Tiered accounts. Accounts whose pricing or service level depends on deposit size or trading volume. In the EU and UK, firms may not offer retail CFD clients monetary or non-monetary benefits linked to trading, so read what is actually different and whether you are being nudged to deposit more.

How to choose an account type

Start from how you trade, not from the names on the broker's comparison page.

1. How often do you trade, and in what size? Frequent trading and larger sizes make the commission model more attractive. Occasional, small trades often favour a standard account.
2. What do you trade? Work out the all-in cost on your own instruments; as the worked example shows, the cheaper account can change from pair to pair.
3. How long do you hold positions? If you hold for days or weeks, swap rates may matter more than the spread. Compare them across account types.
4. Do you need swap-free terms for religious reasons? Read the replacement charges and conditions.
5. Which platform do you need, and which account types does the broker offer on it?
6. What is your base currency, and how will deposits and withdrawals be converted?
7. Which legal entity and licence will the account be under? Different account types at the same group are sometimes offered through different entities. Use how to choose a forex broker and our list of regulator registers.

Whatever account you choose, the risk of the product is the same. Most retail CFD accounts lose money, and a cheaper account does not change that; it changes how much the costs contribute.

Common mistakes

• Comparing spreads across account types without adding commission. A tighter spread with a commission can be more or less expensive overall.
• Mixing per-side and round-turn commission figures. The difference is a factor of two.
• Using the advertised minimum spread rather than the typical spread.
• Assuming "ECN" in the name means a particular execution model.
• Choosing a swap-free account to avoid costs. The costs are moved, not removed.
• Opting up to professional status for leverage without weighing the lost protections.
• Opening an account with an offshore entity by accident because it offered a cent account or higher leverage.

Frequently asked questions

What is the difference between a standard and a raw spread account?

A standard account charges for trading through a wider spread with no separate commission. A raw spread account shows a spread close to the underlying market price and charges a commission per lot. Neither is cheaper in general; the total cost depends on the instruments you trade, your trade size and how often you trade.

Is an ECN account better?

The name alone tells you little. An account labelled ECN usually means raw pricing plus commission, which can suit frequent traders. How your orders are actually executed depends on the broker's arrangements, which are described in its order execution policy, not in the account name.

Are swap-free accounts free?

No. They do not charge or pay swaps, but brokers usually replace them with administration fees, wider spreads, higher commissions or time limits on holding positions. Compare the replacement charges with normal swaps for the way you trade.

What is a cent account?

An account that shows your balance in cents and uses very small contract sizes, so that each pip is worth a fraction of a cent or a few cents. It lets you trade live with very small amounts. Check the contract size per lot, the spreads and which legal entity offers it.

Should I become a professional client?

For most traders, no. Professional status gives access to higher leverage but removes the leverage caps, the 50% close-out rule, mandatory negative balance protection and, in some cases, investor compensation coverage. The criteria are strict for good reason.

Can I have more than one account type with the same broker?

Usually yes. Many brokers let you open several accounts, for example on different platforms or with different pricing, under one client profile, and move money between them internally. Check whether each account is under the same legal entity.