Can I trade forex without a broker?

Hello. I am interested in currency trading but I don't want to pay for a broker (online or offline). Is there any way I can trade forex without a broker?

Hi there,

There are a number of ways to trade currency without a broker, although these generally only make sense if you plan to buy and hold currency over longer periods or if you want to diversify your assets.

1. Open a foreign currency account. This is the preferred option because you earn interest while holding your currency.

EUR private accounts are offered by many Swiss banks, as are EUR savings accounts. Postfinance offers private accounts in 10 currencies (CHF, EUR, USD, GBP, JPY, AUD, CAD, DKK, NOK, SEK) and the monthly account fee is waived when you hold CHF 7500 or more at the bank. Private accounts have less restrictive withdrawal limitations and transfer fees than savings accounts, but pay little or no interest.

A benefit of holding foreign currency in a savings account is that Swiss banks often use a more favorable exchange rate for direct transfers between accounts than the one they use for cash exchanges. Swiss savings accounts mostly available in main currencies.

2. Use peer to peer currency exchange services to buy currency and peer to peer transfer services to transfer currency between accounts. This can, in some cases, work out cheaper than buying currency from the bank or having the bank transfer money between accounts in different currencies. Currency brokers are another good option for exchanging and transferring currency.

3. Hold foreign currency in cash. You can simply buy foreign currency and hold it in cash. The exchange rates used by Swiss banks may be unfavorable - especially for less widely used currencies. Online peer to peer cash forex exchanges which let you connect with buyers willing to purchase your currency at market rates (eliminating fees and charges all together) have appeared in recent years, although these are still in their fledgling stage.

Carefully consider the costs of exchanging currency between between private accounts in two different currencies or changing cash into a foreign currency and back again. Compare these costs - based on the number of trades you expect to make - to the costs of using a forex broker.

4. If you want to trade currency on a regular basis or take advantage of small flucutations in exchange rates, using an online forex broker is the easiest way to do it. Online brokers are quite affordable and allow you to trade currency from anywhere where you can get online. You can compare the costs of Swiss online brokers using the interactive moneyland.ch broker comparison.

Best regards from Moneyguru

More on this topic:
Euro accounts at Swiss banks explained
Online forex broker comparison
Forex Trading: Beware the Cost Traps
Forex explained
Guide to changing foreign currency in cash

thanks very helpful...

P2P currency exchange platforms and currency brokers (not forex brokers) are two more alternatives, but only for non-leveraged forex trading.

I use a P2P platform which provides accounts in multiple currencies to simply exchange currencies when rates are most favorable. I get near bank rate spreads and the platform's commission is low - but no leverage.

For low amounts of leverage for short-term trades you can always use a credit card and repay the balance at the end of the month to avoid interest charges.

You won’t have leverage if you trade without a broker.

This means that you need to invest say considerably large money in order to reap good profits but the upside of this is you can avert big losses.

Are you ready for it?

No, individuals do not have direct access to the financial markets. You will not avoid using an intermediary for trading. But the good thing is that there are companies that allow you to open a trading account with very low deposit. It can be even 5 dollars.