IQ Option fees and costs for traders
IQ Option fees and costs? If you will be using the broker, you have to know its associated fees and costs. But first, you need to know that to be able to trade, you need a trading platform. You cannot create one yourself, so you have to sign up for a service that has created one for you. Such a service or company is called an online broker.
When you sign up with the broker, you are given a trading account from which you make trades. You fund the account and then trade with the broker’s Platform. Due to the ever-growing popularity of binary options trading, there are many brokers that have come into space. They are presenting traders with diverse opportunities to access binary options trading.
The following fees can occur with IQ Option:
- Withdrawal fee
- Inactivity fee
- Spread fee
- Overnight fee
(Risk Warning: 84% of retail investor accounts lose money)
Introduction to IQ Option
IQ Option is a leading online trading platform that provides you with services to trade a variety of instruments listed on financial markets. These instruments include stocks, forex, commodities, ETFs, and crypto coins. Based in Cyprus, it has offered online trading services for several years.
IQ Option possesses several remarkable features. One of these is its low minimum deposit requirement. At $10, that is one of the lowest you will find amongst credible binary options brokers. Some brokers go as far as pegging their minimum deposits at $250.
Beyond all the amazing features and services, IQ Option is legitimate. It is registered under the Cyprus Securities and Exchange Commission (CySEC), a credible regulator of financial derivatives platforms.
One of the features of a good Binary Options Broker is available across multiple channels. This gives traders the freedom of access from anywhere. IQ Option provides a proprietary standard trading platform designed to cater to the needs of clients that sign up with it. The platform serves both CFDs and binary options traders and is well designed to be user-friendly with a number of features that help improve your trading.
There are readable charts, along with trading tools that enable better market analysis. Above all, there is the demo account that allows you to trade without any risk coming to you. The good thing about the demo account provided by IQ Option is that you can refill it anytime you deplete the account.
IQ Option trading fees and commission explained
We should note that the broker that provides you with a platform upon which you get to trade binary options is also a business. Thus, they have to make revenue themselves from which they pay their employees and continue to provide you with the brokerage services that you enjoy. They also aim to turn a profit for themselves.
As mentioned earlier, IQ Option is one of the best binary options brokers you can find out there. And this reflects in how it charges traders for transactions they make. Here, we will examine the above types of fees and charges and outline what IQ Option charges for each.
The major way your broker earns money is by charging fees on your activities. These fees come in various forms, depending on the activity you carry out. They include:
Before you can trade binary options, you have to commit your capital to trade, unless you want to trade with the demo account. However, when you make deposits into your trading account, some brokers charge some fees.
When you make deposits into your trading account, IQ Option does not charge any fees. However, the minimum amount you are allowed to deposit into your live account is $10. We should mention that this is one of the lowest required minimum deposits you can ever find amongst Binary Options Brokers.
Trading and transactions fees
Anytime you make any trades on your trading account, you are charged by most brokers.
Furthermore, IQ Options charges almost no fees for transactions you make. This is unlike many other brokers who take a cut of your profits in the name of charging a ‘spread’ – that is, the difference between the price when you buy or sell an instrument.
However, if you open a ‘long’ position on cryptocurrencies, IQ Option will charge you 2.9% of the capital you commit to the particular position. Thus, if you go ‘long’ (that is, buy) on Ripple (XRP) risking $100 capital, IQ Option will charge $2.9.
See the spread fees in the table below. They are depending on the market hours and market situation:
|EUR/USD:||From 0.0 – 0.3 pips||Max. 1:1000|
|AUD/USD||From 0.0 – 0.3 pips||Max. 1:1000|
|GBP/USD||From 0.2 – 1.0 pips||Max. 1:1000|
|USD/JPY||From 0.0 – 0.8 pips||Max. 1:1000|
|BITCOIN||$10 – $100||Max. 1:100|
|GOLD||0.44 – 0.78||Max. 1:100|
When you trade using derivatives such as CFDs, you are required to pay some overnight fee if you do not close your trade before the market closes for a day and leave it overnight. This is otherwise known as a swap.
The reason you are required to pay this fee is because of the concept of leverage. Whenever you trade with CFDs, you trade with leverage. That is, you trade with ‘borrowed’ money. Here, you borrow money from the broker in order to maximize or boost the value and size of your trading capital. This enables you to take larger positions in the market, thereby maximizing your profits – that is, if your trades go in your direction.
Thus, this overnight fee functions like “interest” paid on the leverage or loan. This is just like the normal, everyday loan or leverage where you are charged an interest per period. Most brokers do not bill you any interest on the capital you borrow so far it is repaid within the same day. However, if you keep your position till the following day, they start to charge you every day until you close the trade.
IQ Option is a comprehensive derivatives broker. That means that it allows you to trade the markets using different derivatives methods – for instance, you can trade binary options, CFDs, amongst others
For the CFDs, it does charge an overnight fee or “swap fee”. This fee is put at between 0.001% and 0.5% of whatever position you take in the market. This affects CFDs on forex, crypto coins, commodities, ETFs, amongst others.
However, as a credit broker, IQ Option is very much transparent about this. It lets you know how much it charges for each instrument. You can check this right on your dashboard. All you have to do is check the instrument and then check the information listed next to it.
After you have made profits in the markets, you will want to withdraw them. However, some brokers charge you a sum for doing so. This is usually a percentage of the amount you want to withdraw.
Unlike other brokers, IQ Option does not charge you if you make withdrawals from your account especially when you make the withdrawals to E-wallets like Skrill, Neteller, WebMoney, WorldPay, and others. However, when you make withdrawals through bank transfer, you will be charged $31.
Although there are no minimums required for withdrawals, IQ Option cannot process withdrawals below €2.
Only a few brokers charge this. It is otherwise known as the “Dormant Fee.” If you don’t trade for a while, your account becomes inactive or dormant. Some brokers may charge you for that.
IQ Options will levy a fee on your account if your account becomes dormant for 90 days. This fee is €10. However, after 90 days, if your account continually remains dormant, you will be charged €10 every month.
Other Minor Fees
There are also some other non-major fees such as maintenance fee, verification account closure fee, and underage account closure fee that IQ Option charges. Those fees are levied mostly at the broker’s discretion but can also charged as its legitimate entitlements. You should, therefore, also look out for those fees when you trade with this broker.
Conclusion on the IQ Option fees: Very cheap broker
In conclusion, the fees are very low with IQ Option. Especially for forex trading, you do not pay any fees sometimes because the spread is 0.0 pips and there are no commissions. Adding the overnight fee here, you will be surprised how cheap it is to trade leveraged positions.
There are no hidden fees or any special fees with IQ Option. From our, experiences we can say that this broker is one of the cheapest. You should definitely give it a try. Also, read our full IQ Option review.
(Risk Warning: 84% of retail investor accounts lose money)