Here Are the 10 Pros and Cons

XM Fact sheet

When choosing a broker to trade with, one of the important factors to keep in mind is the safety and security of the broker. There are several things that can define the safety and security of the broker you choose to use. 

One of the main things to focus on is the regulatory guidelines that a certain broker follows. While working on the XM broker review, we found that they are regulated in five different jurisdictions. Here is the list of licenses held by XM: 

• Cyprus Securities and Exchange Commission;
• Australian Securities & Investments Commission;
• Dubai Financial Services Authority;
• Financial Conduct Authority, UK;
• International Financial Services Commission, Belize.

These licenses allow XM to offer services to traders in different parts of the world. Thanks to the CySEC license, this broker has access to the whole European market, while the license from Belize allows it to offer services to numerous jurisdictions around the world.

Policies that XM follows

To guarantee the safety and security of its clients, XM has adopted numerous regulatory guidelines over the past few years. These regulations are aimed at ensuring that every single client of the broker has the opportunity to ensure the safety and security of their funds, while also enjoying high-quality trading services.

One of the policies that XM follows is negative balance protection, which is specifically important for those who use leverage when trading. Leverage is quite a useful thing for Forex traders, as it can amplify the profits made during trading. 

However, in addition to increasing the prospective profits made during Forex trading, high leverage can also increase the possible losses. To ensure traders are not able to lose more money than they have in their accounts, negative balance protection is adopted. This means that the broker will automatically close all of your positions in order to avoid your balance going into a negative.

Apart from this, XM also keeps the funds of its clients in separate bank accounts. This means that no matter what goes wrong, traders will be able to access their funds. Even if the broker goes bankrupt, you won’t have to worry about the balance you had with the broker disappearing overnight.

By following these policies, the broker ensures that their client's funds are kept safe at all times.

There are over 1,200 assets available for traders to choose from on XM. While this might not sound like much, especially compared to other leading brokerages in the market, it should still be enough to give traders the opportunity to easily find the kind of trades they might be looking for.

Traders can have access to all of these available assets with any account. However, keep in mind that shares can only be traded with the special Shares account. As for CFD shares, they can be traded with other accounts as well.

Forex

XM offers clients access to all types of Forex currency pairs, including major, minor, and exotic currency pairs. There is a total of over 55 currency pairs available for trading on XM. The XM leverage for FX trading is up to 1:1000, however, keep in mind that there might be some restrictions on the maximum leverage based on your location. 

For example, for traders from the EU, the maximum leverage is 1:30 due to the local regulations in this region. Similar laws are in place in Australia and several other jurisdictions around the world. 

Traders from many other parts of the world, including some Asian and African countries, have access to leverage of up to 1:1000. It should be noted that using such high leverage is not the safest thing to do, as it is associated with numerous risks for traders.

The spreads on major pairs are very competitive and low, usually, they start around 0.6, depending on the account used by the trader.

Shares

When it comes to trading markets, investing in stocks is the way to go for many people. Thus, it is quite important for brokers to ensure they offer these assets to their clients. There are two ways for individuals to trade shares on XM.

The first option is very common for brokers in the market today, namely, trading stocks as CFDs. This method includes traders making certain predictions about the possible direction prices could take and then opening contracts according to their predictions. 

While this is a very common way of trading stocks today, not everyone is really into this strategy. For those who prefer not trading CFDs, XM offers a special “Share Account”, which allows traders to buy and sell shares of leading companies directly. 

Indices

On XM, traders can have access to numerous indices. The total number of indices available on XM is 14. This includes the largest and best-known indices around the world, representing industries of countries like the US.

Indices offered by XM give you the opportunity to have cost-effective and direct access to global markets. 

Among the indices available on XM are AUS200Cash, SWI20Cash, US500Cash, and many others. Indices such as S&P 500 and Nikkei 225 can also be traded.

Commodities

There are 8 different commodities available on XM. This includes soft and hard commodities such as cocoa, coffee, copper, and many others. Trading commodities can be done using CFDs. 

This means that rather than buying the commodities directly, the clients of XM simply speculate on the possible price movements of these assets. Commodities can play a huge role when it comes to portfolio diversification.

Cryptocurrencies

Digital currencies are some of the most popular assets today. On XM, they can be traded as CFDs. There are five crypto assets available for clients of XM. For these XM allows traders to use leverage of up to 1:250, which is quite high. 

The crypto market can be accessed 24 hours a day, 7 days a week. Among the crypto assets that can be traded on XM are BTC, BCH, ETH, LTC, and XRP. Digital assets can be great for investors to diversify their portfolios.

To match the interests of different traders, XM has worked very hard to offer a diverse array of account types. Thus, the broker is able to offer traders services that work perfectly for their trading needs. 

Below, we will talk a bit more about the account types offered by XM and discuss them one by one. 

Demo account of XM

Every client of XM is entitled to have a demo account. This type of account is very popular in the Forex trading market and is widely used by both beginner and experienced traders. 

Beginner traders can use a demo account as a way to learn more about the Forex trading market. Experienced traders can find a demo account useful for testing out new trading styles and finding out what works best for them.

When creating a demo account, the broker will provide you with a certain amount of virtual cash, which can be used for trading. You can use this virtual cash for as long as you want to and if you run out of virtual money, you can always contact the customer support of XM and ask them to provide more.

Micro account of XM

Once you are comfortable with the knowledge that you have received through the demo account, you can start moving on to trading with your actual money. XM offers a special account for beginners to practice more and gain higher experience and expertise in the market. 

The Micro account of XM can be a great choice for beginners to learn to trade in actual market conditions without having to risk too much. The contract size for this account is 1,000 units of the asset. Compared to the standard lot size it is quite low, as the standard lot equals 100,000 units of an asset. 

The leverage for positions between $5 and $20,000 is 1:1000, for positions over $20,000 and below $100,000 is 1:200, and for positions over $100,000, it is 1:100.

The Micro account can be especially useful for those who have just finished training with the demo account. While an XM demo account can be a great choice for traders to learn more about the market, it can’t be used to learn how to control your emotions when trading. By slowly transitioning to using real money, you will be able to learn more about how to control your emotions.

Standard account of XM

The Standard account offered by XM can be a perfect match for traders of all different interests. To put it simply, this account was created with different types of traders in mind. Whether you are looking for ways to start trading with huge amounts of money, or you want to find a way to limit your losses, the standard account can be a great fit.

In general, the standard account was created with intermediate-level traders in mind. Those using this account will deal with standard lots, which equal 100,000 units of the assets being traded. The leverage is the same as it was for the micro account and can go up to 1:888, depending on the size of your positions. 

However, traders should also keep in mind that if they are from Europe, the available leverage will be limited to 1:30. The same regulation also applies to traders from Australia and several other parts of the world due to local regulatory standards. The minimum amount of money that you have to deposit to open the live account is $5. This is the case for the Micro account as well. 

The Standard account is pretty much a great choice for traders of all interests. It offers you access to almost everything that other account types do, except the fact that you can’t trade real stocks with this account, rather, you will have access to CFDs. 

Ultra-low account of XM

This XM account type is a great option for traders who wish to limit the costs of Forex trading. Unlike other accounts, where the base currency options are 9, for the holders of XMs Ultra-low accounts, there are only six base currency options. 

They are, USD, EUR, GBP, AUD, ZAR, and SGD. As for the contract sizes, there are two options available for traders. First, it is the standard ultra, for which, 1 lot equals 100,000 units of the asset traded. 

As for the micro ultra, the lot equals 1,000 units of the asset traded. The leverage is pretty much the same, depending on the location as well as the amount traded. Spreads are very low with this account, which makes it truly special. 

For the major pairs, the spread can get as low as 0.6 pips. This account is basically a combination of the Standard and Micro accounts, offering traders the best of both worlds.

Shares account of XM

If you are a trader looking for the opportunity to directly invest in stocks, there is a great offer waiting for you at XM. For stock investors, XM has created a special account type called a Shares account. 

This account offers you the opportunity to directly invest in some of the leading stocks around the world. However, there are some conditions that should be kept in mind by traders. First, there is only one base currency option for this type of account - USD. The contract size is 1 share, and there is no leverage available for share account holders. 

The spreads are greatly variable and depend on the underlying exchange. In addition to this, in order to create this account, you will be required to deposit at least $10,000. This is unlike any other account type offered by the broker, where the minimum deposit to open the account is just $5.

Islamic account of XM

When working on the XM rating, we kept in mind that this broker also offers clients an Islamic account option. This account type is designed and created specifically for those who follow the beliefs of Islam. Every type of account is available in the Islamic version. 

This account is a perfect fit for those who follow strict sharia law and they pay a fixed fee instead of swaps. This type of fee is not an interest payment and fully depends on the direction of your order. Because of the way it works, it is also sometimes referred to as a swap-free account. 

Getting started on XM - Main steps

Taking your first steps at XM is a very easy and user-friendly experience. This process should not take you longer than a day as the broker has adopted modern technology to ensure the verification of their clients is timely and comfortable.

Let’s go through each step that you will have to take when getting started on XM. 

Step 1: Choose & create your account

The first step that you will have to take is to sit back and think about which account you want to create. For this, you will first have to understand what your interests are in the Forex trading market and choose the account that fits these interests best.

Once you know which account you want to create, simply click "Open An Account" on the right side of the broker's website. As you see below, you will be required to provide detailed information about yourself, which includes your first name, last name, phone number, location, email, etc. 

Once you are done with the first step of registration, you will have to provide a bit more detailed information about yourself. The second step requires you to provide information such as your address and date of birth, as well as details relating to your account, such as the base currency, leverage, and so on. 

You will also provide the purpose of creating the account, and the experience that you have in trading. After this, you will create an account password and confirm the registration.

The second step also includes a little test to check your knowledge and experience in the market. The answers to the questions provided can impact whether you will be able to create an account or not.

Step 2: Verify your account

Once you are done with the registration process, you will be required to verify your identity, your phone number, the email address you provided, and your location. This process will look something like this:

The broker has adopted modern technology to ensure that the clients are able to start trading in a short time after registration. It should not take more than a day to verify your account and get started with your trading activities.

Step 3: Choose and download the trading platform

During the registration process, one of the questions is which trading platform you want to use. But, in case you have changed your mind, you can contact the representatives of the broker and use a different one. 

XM provides both web-based and downloadable trading platforms to their clients. Once you download the platform, you can simply log in using your account credentials.

Step 4: Deposit funds

Once your XM login is done, you can deposit your funds. Keep in mind that the minimum deposit that you can make is $5. There are numerous options for depositing funds available and it is completely free to make these transactions, there are no hidden fees charged by the broker. 

If you are using the shares account, keep in mind that you will be required to deposit at least $10,000 as your first deposit. 

Step 5: Start analysis & trading

Once you have downloaded the trading platform and you have deposited funds, it is time for you to start the market analysis. XM offers some of the best trading platforms available in the market, all of which allow you to do a very extensive and detailed market analysis. This is an important factor in making it in the Forex trading market. 

Once you are done with the market analysis, you can continue by opening and closing positions according to your views of the possible market direction. 

The fees and commissions charged by the broker are quite competitive when compared to other Forex brokers. While the Forex spreads might be a bit higher when compared to other brokerages, everything is still very much in line with general market standards. 

The fees that you might have to pay mostly depend on the account type you are using, as well as the asset you are trading. All in all, the fees are very regular and not too high. 

Inactivity fee

It is a very common practice for Forex brokers to charge an inactivity fee. This type of fee on XM is charged when your account remains inactive for a certain amount of time. This means that if there has not been any trading activity recorded on your account for over a year, you will be liable to pay this fee. 

The inactivity fee is just $15, and for every month that your account remains inactive after that, you will be charged an additional $5 per month. So, if you decide that you do not want to trade anymore, for whatever reason, ensure that you contact customer support and ask them to deactivate your account.

Comparing XM fees with other brokers

As we have already mentioned, there are some fees charged by XM. But, how do you know whether these fees are standard for the market or too much? To help you better understand the fees associated with XM, we have decided to compare it with some of the biggest players in the market. Let’s see what XM fees look like compared to other brokers.

XM fees compared to Interactive Brokers fees

*Inactivity fee was eliminated by IB in 2021, it used to be $20/m

XM fees compared to eToro fees

XM fees compared to IG fees

When we worked on this XM review, we focused on many different factors. One of the biggest concerns that many traders have when deciding on which broker to use is the available trading platforms. 

The list of XM trading platforms is very diverse. Here, you can find the most popular trading platforms such as MetaTrader 4 and MetaTrader 5, or go with the custom-made trading platform of XM. 

The broker also offers a web-based trading platform, which can be quite comfortable for many traders. Especially those who do not want to download additional applications to their computers. 

There is also a mobile application available for the trading platforms offered by the broker. This makes it very user-friendly and ensures that no matter where you go, you will always be able to keep in touch with the Forex trading market. 

There is a wide array of educational material available on XM. The broker offers everything from simple Forex guides to different types of educational courses and videos that provide beginners with very detailed information about the market. 

There are numerous research tools available for traders, to ensure that they are able to understand price movements in greater detail. The broker also offers daily analysis and news articles, to keep you in touch with the most important events happening in the market. 

One of the biggest advantages of XM is that it has a highly skilled and professional team of customer support agents. These specialists are always able to provide traders with accurate and timely information about the questions they might face. 

There are several options to contact the customer support team of XM. First, you can do so through the live chat available on the website of the broker. The second option is to send the customer support team an email, and the third option is directly calling the customer support hotline.

After some thorough and detailed analyses of everything that XM has to offer, we are very glad to say that this broker can easily be trusted by traders around the world. XM has done its absolute best to ensure that every single customer finds something they might be looking for in this broker. 

Established in 2009, XM has managed to become one of the leading Forex brokers in the world in just a decade. The broker offers traders safe, secure, and diverse trading opportunities that can fit the interests of traders with different levels of expertise and knowledge of the market.