Oanda Broker Review

All Indian clients will be trading with OANDA Global Markets Ltd, which is registered in the British Virgin Islands (No. 2026433), authorised and regulated by the BVI Financial Services Commission, number: SIBA/L/20/1130. Unfortunately, the BVI FSC has a light touch when it comes to regulating forex brokers, and consumers are not afforded the same protection as that of reputable regulatory bodies such as the FCA.  For example, brokers are not required to keep minimum levels of capital, segregate client funds, contribute towards compensation schemes, or outline their policy execution.  

However, OANDA’s Indian clients can be sure that their funds will be kept in segregated bank accounts, but OANDA Global Markets Ltd does not offer negative balance protection, so Indian traders may lose more than they invest.  Additionally, OANDA offers leverage of up to 800:1 on its account types and has no minimum deposit requirements, which in combination makes it difficult to hold a substantial trading position without getting stopped out and losing the money in your trading account or even incurring a negative balance. On the whole, this is an irresponsible move on the part of the broker.  

That said, OANDA’s other subsidiaries are regulated by top-tier regulators, including the FCA from the UK, IIROC from Canada, and MAS from Singapore, and as such, OANDA offers its clients account statements that are regularly audited by external audit firms. 

The account opening process at OANDA is fully digital, fast, and hassle-free compared to other brokers. 

All Indian traders are eligible to open an account at OANDA. 

Creating an account is straightforward, the process is fully digital, and accounts are usually ready within one day. OANDA offers corporate and individual accounts, but we will focus on opening an individual account:

How to open an account at OANDA:

1. New traders will have to click on the “Start Trading” button at the top of the page where they will be directed to register an account.    
2. OANDA’s intake form requires clients to fill in their country of residence, personal details,  (including name, country of residence, and telephone number). 
3. Next clients must confirm their citizenship, filling in their identity or tax number.
4. The fourth step requires traders to confirm their home address.
5. Lastly, traders are required to fill in their employment status and financial details. 
6. Note that verification documents are not needed for traders who deposit less than 9,000 USD. 
7. For clients that deposit more than 9,000 USD, OANDA needs at least two documents to accept you as an individual client:

1. 1. Proof of Identification – OANDA accepts all government-issued identification documents such as Passport, national ID card, driving license, or other government-issued ID. The document must be valid and must contain a trader’s full name, date of birth, a clear photograph, issue date, and if it has to have an expiry date, that should be visible as well.
   2. Proof of Address – Proof of residence/address document must be issued in the name of the OANDA account holder within the last 3 months and must contain a trader’s full name, current residential address, issue date, and issuing authority.

After the application is approved, traders can log in and fund their accounts.  We advise you to read OANDA’s risk disclosure, customer agreement, and terms of business before you start trading. 

Overall, OANDA’s account-opening process is quick, efficient, and accounts are generally ready for trading within one business day. 

Spreads on the Standard and Swap-Free accounts are wider than average. The average cost for trading one lot of EUR/USD among similar brokers is about 9 USD per lot. Additionally, even though spreads are tighter on the Core Account, it is prohibitively expensive for traders, with a minimum deposit requirement of 5,000 USD.  Traders should also note that spreads are variable at OANDA, meaning that they will get wider or tighter depending on trade volume and market volatility. 

Swap Fees

OANDA charges swap fees for positions that are held overnight.  Interest is paid (or received) for each night a position is held.  In the case of Forex instruments, the amount charged depends on both the positions taken (i.e. long or short) and the rate differentials between the two currencies traded.  Rates are based on a blend of underlying liquidity providers’ tom-next SWAP rates, adjusted by the instrument-specific admin fee, and annualised.

Account Trading Costs:

In line with Anti-Money Laundering policies, deposits and withdrawals at OANDA cannot be made to/from third-party accounts. While no fees are charged for deposits, OANDA charges fees for withdrawals by bank transfer. 

See below for a list of funding methods, charges, and processing times:

OANDA offers four base currencies, which is limited compared to other brokers.  Indian traders will also be disappointed that there is no INR trading account option.

At OANDA, traders can only choose from four base currencies: USD, SGD, HKD, and EUR. This is limited compared to most other international brokers, and is disappointing for Indians who will likely have bank accounts denominated in INR and will have to pay conversion fees on all deposits and withdrawals.  Conversion fees can make trading expensive, and are usually not presented on the fee report, but affect profitability.

However, it should be noted that for traders that trade in large volumes (more than 10 lots a month), it is better to open an account denominated in USD at a digital currency bank, especially for trading on assets such as the EUR/USD. This is because when trading a USD quoted currency pair with another currency account, there will be a small conversion fee for every trade made.

OANDA offers support for the MT4 and MT5 mobile trading apps for Android and iOS. Traders should be aware that there is some loss in functionality when compared to the desktop trading platforms, including reduced time frames and fewer charting options, but traders can close and modify existing orders, calculate profit and loss, and trade on the charts.  

Trading Platform Comparison:

Metatrader 4

The MT4 trading platform is the most widely used Forex trading platform and can also be used to trade other instruments like commodities, cryptocurrency, stock index, and stock CFDs. Though it is now showing its age, MT4 is still popular for its auto trading features that enable algorithmic trading and strategy backtesting with expert advisors (trading robots).  

Other features of MT4 include:

• A built-in library of more than 50 indicators and tools to streamline the analysis process
• An impressive array of analytical tools, available in nine timeframes for each financial instrument.
• Algorithmic trading, which allows any trading strategy to be formalised and implemented as an Expert Advisor. 
• Customisable alerts
• Access to MetaTrader market and MQL4 community.

Metatrader 5

Developed in 2010, MT5 is the newer version of its predecessor, MT4.  MT5 is more powerful and faster than MT4 when it comes to back-testing functionality for automated trading algorithms.  It also has a built-in news feed, market depth indicator, economic calendar, and trades can be made on the charts.  Additional features of MT5 include:

• Depth of market display and technical indicators
• 6 pending stop order types, including Buy Stop Limit and Sell Stop Limit
• Improved strategy tester for algorithmic trading and expert advisors (EAs)
• In-built market of trading systems & apps
• Trading functions and alerts with e-mail and push notifications on mobile devices
• Improve precision in forex and CFD trading through trading robots for scalpers
• Exchange trading allowed
• Forex Signals and Copy Trading
• 21 time frames and 8 order types
• Access to comprehensive analytical tools, with over 80 technical indicators and 44 analytical objects.

Again, only the standard version of MT5 is available at OANDA.  However, support for MT5 means that OANDA can enhance its asset offering, making it more appealing to experienced traders.

The advantage of brokers offering third-party platforms such as MT4 and MT5 is that traders can take their own customised versions with them should they decide to migrate to another broker.  Additionally, there are thousands of plugins and tools available for the MetaTrader platforms.   However, these platforms are not as beginner-friendly as the proprietary platform offered by other brokers.

Autochartist

Autocharist is powerful pattern recognition tool that scans and analyses the markets to identify trading opportunities. Other features of Autochartist include:

• Continuous intraday market scanning
• Correlating signals: receive email notifications and flag trading opportunities when support/resistance levels coincide with chart pattern projections
• Spot potential trading opportunities: get automated alerts about emerging or completed charts, Fibonacci, and key level formations
• Review only the forecasts that have historically had a certain level of success probability
• Volatility analysis
• Set instrument-specific exits based on estimated market volatility
• Performance statistics
• Customisable daily market reports sent to your inbox

Autochartist is one of the best technical analysis tools on the market, and OANDA does well to offer this tool to its clients.  

MetaTrader Premium Tools

The MetaTrader Premium Tools are a host of powerful forex trading indicators, including an alarm manager, keyboard trading, mini terminal, tick chart trader, and more.  These are provided by FX Blue Labs. You can access over 15 indicators and nine expert advisors in a single download. Popular features such as Renko charts, one cancels the other (OCO) orders, keyboard trading, tick chart trading, and advanced trade management are all included free of charge to OANDA MT4 traders.

Trading Performance Portal

The Trading Performance Portal is a behavioural analysis tool that is designed to help you improve your trading patterns. Powered by Chasing Returns, OANDA’s portal analyses your trading history and helps you focus on your strengths while identifying areas you can improve.

Trading Tools Comparison:

OANDA’s analysis section is excellent compared to other brokers, curated by its in-house analysts and third-party provider, Market Pulse.

Market analysis is supplied by OANDA’s MarketPulse service. MarketPulse is an award-winning news site that delivers round-the-clock commentary on a wide range of asset classes and in-depth insights into the major economic trends and events that impact the markets. 

The 24/7 coverage at MarketPulse is provided by six expert analysts with decades of experience covering and trading the markets. All analysis is detailed, accurate, and posted within minutes of a market event.

In addition to MarketPulse’s text-based coverage, regular videos and podcasts are also published.

The education section is not easily discoverable on OANDA’s website. It is not linked from the menus across the top of the page and can only be found in the menus at the bottom of the page. Whether this is intentional or an oversight is unknown.

Once discovered, education at OANDA is split into three subsections: Getting Started, Tools and Strategies and Capital Management. Information is detailed and helpful and is presented in a mixture of video and text.

The Getting Started section covers the basic aspects of Forex CFD trading such as leverage and margin and introduces traders to the MT4 platform. The Tools and Strategies section covers analysis and explains how traders can use various technical analysis tools to better predict the markets an essential skill for successful traders. Finally, the Capital Management section covers risk management and how to apply it in real market conditions.

Alongside these tutorials, OANDA also hosts frequent webinars on all aspects of trading, including the Basics of Trading and Live Market Analysis. Past webinars are also stored in an archive and are available on demand. Webinars and the webinar archive are free but do require registration with your name and email address.

Educational Material Comparison:

For the purposes of this review, we found the customer support to be responsive but not knowledgeable of OANDA’s products and services.