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To help you find the best forex brokers for beginners in Cuba in 2021, we went ahead and did the research for you. First, we selected 91 quality online brokers, then we checked and compared fees, currency pairs, charting tools and educational materials. We dug deep, so you won't have to. And now, without further ado...

Our top 5 picks for the best forex brokers for beginners in Cuba in 2021:

  1. ActivTrades is the winner, the best forex broker for beginners in Cuba in 2021. Low trading fees. Excellent account opening. Free deposit and withdrawal.
  2. AvaTrade takes second place. Easy and fast account opening. Free deposit and withdrawal options. Great research tools.
  3. XTB rounds out the top three. Low forex fees. Free and fast deposit and withdrawal. Easy and fast account opening.
  4. Swissquote is ranked fourth. Access to many markets and products. No inactivity fee. Rock-solid background.
  5. Capital.com just made it on the list, taking the number five spot. Low forex and stock CFD fees. Great account opening experience. Excellent customer support.
Best forex brokers for beginners in 2021 for Cuban citizens
Broker Info Forex fee score
#1 ActivTrades Global CFD and forex broker 4.1 stars
#2 AvaTrade Global CFD and forex broker 3.1 stars
#3 XTB Global CFD and forex broker 4.0 stars
#4 Swissquote Swiss investment bank 3.5 stars
#5 Capital.com Global CFD and forex broker 4.5 stars

What makes a top forex broker for beginners? First of all, fair forex fees. They should also offer a lot of currency pairs and a great platform with advanced charting. Educational tools to help you start investing also matter.

These features may sound obvious and easy to list, but they're hard to figure out. We test brokers based on close to 500 criteria, using real accounts and real money. We know what we are talking about.

If you are a beginner, be careful with forex trading. Forex products are complex and very risky, therefore not suitable for everyone. You can easily lose all your invested money. If you don't have a clue how forex trading works, start with our forex trading 101.

Not sure which broker to choose? For a tailored recommendation, check out our broker finder tool. Just enter the name of your country and it will show you only the relevant brokers. Want more details? Compare brokers with the help of this detailed comparison table.

Want to see the overall rank of brokers for this topic, not just the country specific one? Head to this link here.

And now, let's see the top forex brokers in 2021 for Cuban citizens one by one, starting with the winner, ActivTrades.

ActivTrades Logo

#1 Best forex brokers for beginners
ActivTrades

4.5

ActivTrades is a global forex broker founded in 2001. It is regulated by the UK's Financial Conduct Authority (FCA) and the Securities Commission of the Bahamas (SCB). 

ActivTrades is considered safe because it has a long track record and it is regulated by the FCA, a top-tier financial authority.

Disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Recommended for forex and cfd traders looking for low fees and great deposit/withdrawal conditions

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60% of retail CFD accounts lose money

#1 ActivTrades
Fees

ActivTrades has low fees when it comes to buying and selling currency pairs.

To have a clear picture of forex fees, we calculated a forex benchmark fee for major currency pairs. This catch-all benchmark includes commissions, spreads and financing costs for all brokers.

ActivTrades trading fees
ActivTrades AvaTrade XTB Swissquote Capital.com
EURUSD benchmark fee $8.1 $10.3 $8.5 $10.1 $6.4
GBPUSD benchmark fee $5.2 $9.0 $5.8 $6.8 $4.1
AUDUSD benchmark fee $6.6 $9.6 $5.8 $7.7 $6.4
EURCHF benchmark fee $4.9 $10.2 $9.1 $6.3 $4.3
EURGBP benchmark fee $9.4 $12.1 $8.2 $10.0 $8.3

All spreads, commissions and financing rates for opening a position, holding for a week, and closing.

ActivTrades non-trading fees
ActivTrades AvaTrade XTB Swissquote Capital.com
Account fee No No No No No
Inactivity fee Yes Yes Yes No No
Withdrawal fee $0 $0 $0 $10 $0

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60% of retail CFD accounts lose money

#1 ActivTrades
Markets and products

ActivTrades gives access to 48 currency pairs.
ActivTrades currency pairs
ActivTrades AvaTrade XTB Swissquote Capital.com
Currency pairs (#) 48 55 49 80 142
ActivTrades available products besides forex
ActivTrades AvaTrade XTB Swissquote Capital.com
Stock No No Yes Yes No
ETF No No Yes Yes No
Fund No No No Yes No
Bond No No No Yes No
Options No No No Yes No
Futures No No No Yes No
CFD Yes Yes Yes Yes Yes
Crypto No Yes Yes Yes Yes

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60% of retail CFD accounts lose money

#1 ActivTrades
Customer service
4.5

ActivTrades offers several customer service channels and we found the live chat to be the fastest and most relevant. Emails are typically answered within 24 hours and the answers were relevant. The only thing we missed is the 24/7 availability.
Pros Cons
Phone support No 24/7 support
Live chat
Fast response time

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60% of retail CFD accounts lose money

#1 ActivTrades
Research
3.0

ActivTrades' selection of research tools is average, but the tools are user-friendly. Charting and other technical tools, like APIs, are great. On the flip side, there are no trading ideas, fundamental data, and news.
Pros Cons
Good interactive chart No trading ideas
User-friendly No fundamental data available
Good set of analytical tools No/poor quality news flow

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60% of retail CFD accounts lose money

#1 ActivTrades
Account opening
5.0

Account opening at ActivTrades is seamless and fully digital, taking just a few minutes to complete and verified within one business day.
Pros Cons
Fast None
Fully digital
User-friendly
ActivTrades minimum deposit and time to open an account
ActivTrades AvaTrade XTB Swissquote Capital.com
Minimum deposit $500 $100 $0 $0 $20
Time to open account 1 day 1 day 1 day 1 day 1 day

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60% of retail CFD accounts lose money

#1 ActivTrades
Verdict

All in all, ActivTrades is a good CFD/forex broker.

ActivTrades has low trading fees. The account opening is excellent and the deposits and withdrawals are free.

On the downside, its product portfolio is limited to just a few products, as it offers mainly CFDs and forex instruments. Research tools are basic, and there are no trading ideas or fundamental data. There is an inactivity fee.

As trading fees are low and your account will be ready quickly, we encourage you to try ActivTrades.

 

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60% of retail CFD accounts lose money

AvaTrade Logo

#2 Best forex brokers for beginners
AvaTrade

4.5

AvaTrade is a global CFD and forex broker founded in 2006. It is regulated by several financial authorities, such as the Central Bank of Ireland.

Disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Recommended for forex and cfd traders looking for an option to use metatrader platforms

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71% of retail CFD accounts lose money

#2 AvaTrade
Fees

AvaTrade has average fees when it comes to buying and selling currency pairs.

To have a clear picture of forex fees, we calculated a forex benchmark fee for major currency pairs. This catch-all benchmark includes commissions, spreads and financing costs for all brokers.

AvaTrade trading fees
ActivTrades AvaTrade XTB Swissquote Capital.com
EURUSD benchmark fee $8.1 $10.3 $8.5 $10.1 $6.4
GBPUSD benchmark fee $5.2 $9.0 $5.8 $6.8 $4.1
AUDUSD benchmark fee $6.6 $9.6 $5.8 $7.7 $6.4
EURCHF benchmark fee $4.9 $10.2 $9.1 $6.3 $4.3
EURGBP benchmark fee $9.4 $12.1 $8.2 $10.0 $8.3

All spreads, commissions and financing rates for opening a position, holding for a week, and closing.

AvaTrade non-trading fees
ActivTrades AvaTrade XTB Swissquote Capital.com
Account fee No No No No No
Inactivity fee Yes Yes Yes No No
Withdrawal fee $0 $0 $0 $10 $0

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71% of retail CFD accounts lose money

#2 AvaTrade
Markets and products

AvaTrade gives access to 55 currency pairs.
AvaTrade currency pairs
ActivTrades AvaTrade XTB Swissquote Capital.com
Currency pairs (#) 48 55 49 80 142
AvaTrade available products besides forex
ActivTrades AvaTrade XTB Swissquote Capital.com
Stock No No Yes Yes No
ETF No No Yes Yes No
Fund No No No Yes No
Bond No No No Yes No
Options No No No Yes No
Futures No No No Yes No
CFD Yes Yes Yes Yes Yes
Crypto No Yes Yes Yes Yes

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71% of retail CFD accounts lose money

#2 AvaTrade
Customer service
4.5

AvaTrade has great customer support, giving fast and relevant answers in many local languages. On the negative side, support is not available 24/7, only 24/5.
Pros Cons
Phone support No 24/7 support
Live chat
Fast response time
Best forex brokers for beginners - AvaTrade customer service

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71% of retail CFD accounts lose money

#2 AvaTrade
Research
4.6

AvaTrade has user-friendly research tools, from trading ideas to an upgraded newsfeed. The only thing we missed was fundamental data on stocks.
Pros Cons
Good interactive chart No fundamental data on stocks
Trading ideas
User-friendly
Best forex brokers for beginners - AvaTrade charting

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71% of retail CFD accounts lose money

#2 AvaTrade
Account opening
5.0

Account opening at AvaTrade is seamless and fully digital. You can start trading literally in minutes.
Pros Cons
Fast None
Fully digital
Low minimum deposit
AvaTrade minimum deposit and time to open an account
ActivTrades AvaTrade XTB Swissquote Capital.com
Minimum deposit $500 $100 $0 $0 $20
Time to open account 1 day 1 day 1 day 1 day 1 day

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71% of retail CFD accounts lose money

#2 AvaTrade
Verdict

AvaTrade is regulated by several authorities globally, including the top-tier Central Bank of Ireland and the Australian Securities and Investments Commission (ASIC), therefore it is considered safe.

We liked the seamless and hassle-free account opening. You can use a lot of deposit and withdrawal options, all free of charge. We also liked that you can use many user-friendly tools for research.

AvaTrade has some drawbacks though. The product range is limited to forex, CFDs, and cryptos, and there is a high fee charged for inactivity. Lastly, there are better alternatives if forex trading fees are your main concern.

As there is only a small minimum deposit, and your account will be ready for trading quickly, feel free to try AvaTrade.

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71% of retail CFD accounts lose money

XTB Logo

#3 Best forex brokers for beginners
XTB

4.7

XTB is a global CFD and forex broker with headquarters in London and Warsaw, founded in 2002. The company is regulated by several financial authorities worldwide, including the top-tier UK Financial Conduct Authority (FCA). In addition, XTB is listed on the Warsaw Stock Exchange, and as such is required to disclose its financials.

XTB is considered safe because it has a long track record, is listed on a stock exchange, and publishes its financial statements transparently.

Disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Recommended for forex and cfd traders looking for low fees and great deposit/withdrawal service

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77% of retail CFD accounts lose money

#3 XTB
Fees

XTB has low fees when it comes to buying and selling currency pairs.

To have a clear picture of forex fees, we calculated a forex benchmark fee for major currency pairs. This catch-all benchmark includes commissions, spreads and financing costs for all brokers.

XTB trading fees
ActivTrades AvaTrade XTB Swissquote Capital.com
EURUSD benchmark fee $8.1 $10.3 $8.5 $10.1 $6.4
GBPUSD benchmark fee $5.2 $9.0 $5.8 $6.8 $4.1
AUDUSD benchmark fee $6.6 $9.6 $5.8 $7.7 $6.4
EURCHF benchmark fee $4.9 $10.2 $9.1 $6.3 $4.3
EURGBP benchmark fee $9.4 $12.1 $8.2 $10.0 $8.3

All spreads, commissions and financing rates for opening a position, holding for a week, and closing.

XTB non-trading fees
ActivTrades AvaTrade XTB Swissquote Capital.com
Account fee No No No No No
Inactivity fee Yes Yes Yes No No
Withdrawal fee $0 $0 $0 $10 $0

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77% of retail CFD accounts lose money

#3 XTB
Markets and products

XTB gives access to 49 currency pairs.
XTB currency pairs
ActivTrades AvaTrade XTB Swissquote Capital.com
Currency pairs (#) 48 55 49 80 142
XTB available products besides forex
ActivTrades AvaTrade XTB Swissquote Capital.com
Stock No No Yes Yes No
ETF No No Yes Yes No
Fund No No No Yes No
Bond No No No Yes No
Options No No No Yes No
Futures No No No Yes No
CFD Yes Yes Yes Yes Yes
Crypto No Yes Yes Yes Yes

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77% of retail CFD accounts lose money

#3 XTB
Customer service
4.4

XTB's phone and live chat support are reliable, fast, and available in many languages. On the down side, customer service is available only 24/5 for European clients.
Pros Cons
Phone support No 24/7 support
Live chat
Fast response time
Best forex brokers for beginners - XTB customer service

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77% of retail CFD accounts lose money

#3 XTB
Research
4.1

XTB's research tools are user-friendly and helpful, including a news flow with some trading ideas. However, detailed fundamental data is not available.
Pros Cons
Good interactive chart Limited fundamental data
Quality news flow
User-friendly
Best forex brokers for beginners - XTB charting

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77% of retail CFD accounts lose money

#3 XTB
Account opening
5.0

XTB's account opening process is hassle-free, straightforward and fully digital. Your account will be ready for trading on the same day.
Pros Cons
Fast None
Fully digital
No minimum deposit
XTB minimum deposit and time to open an account
ActivTrades AvaTrade XTB Swissquote Capital.com
Minimum deposit $500 $100 $0 $0 $20
Time to open account 1 day 1 day 1 day 1 day 1 day

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77% of retail CFD accounts lose money

#3 XTB
Verdict

XTB is a great CFD and forex broker. It is regulated by several financial authorities globally, including the UK's FCA. The company is listed on the Warsaw Stock Exchange.

On the plus side, its forex fees are low, and the deposit and withdrawal process is fast and mostly free. We also liked the seamless and hassle-free account opening process.

XTB has some drawbacks, though. Stock CFD fees are high. The product range is mainly limited to FX and CFDs, although real stock and ETF trading is available in some European countries. Fundamental data offered by XTB covers only a few basics such as P/E.

We recommend XTB for clients who prefer forex or CFD trading, and also want to enjoy great deposit and withdrawal options along with fast account opening. Feel free to test it using a demo account.

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77% of retail CFD accounts lose money

Swissquote Logo

#4 Best forex brokers for beginners
Swissquote

4.7

Swissquote is a Swiss investment bank established in 1996. It has two main trading arms: a Swiss unit for trading stocks, funds, options and futures, and a company in the UK for CFDs and forex.

Formally, Swissquote Bank Ltd is based in Switzerland and is regulated by the Swiss Financial Market Supervisory Authority (FINMA), the country's financial regulator.

The other entity, Swissquote Ltd, is Luxembourg and offers CFDs and forex trading. It is regulated by the Commission de Surveillance du Secteur Financier (CSSF), Luxembourg's regulator. The purpose of this entity is to grant access to the European markets after Brexit. The UK entity remained only for UK clients

Swissquote is considered safe because Swissquote Bank Ltd has a banking license, it is listed on the Swiss stock exchange, discloses detailed financials regularly and has a long track record.

Here, we focus mainly on the Swiss entity, sometimes referred to as "Swissquote (CH)". Throughout our content, we will refer to the Luxembourg-based entity as "Swissquote Europe (LUX)".

Recommended for affluent investors who value safety and are ok with higher fees

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#4 Swissquote
Fees

Swissquote has low fees when it comes to buying and selling currency pairs.

To have a clear picture of forex fees, we calculated a forex benchmark fee for major currency pairs. This catch-all benchmark includes commissions, spreads and financing costs for all brokers.

Swissquote trading fees
ActivTrades AvaTrade XTB Swissquote Capital.com
EURUSD benchmark fee $8.1 $10.3 $8.5 $10.1 $6.4
GBPUSD benchmark fee $5.2 $9.0 $5.8 $6.8 $4.1
AUDUSD benchmark fee $6.6 $9.6 $5.8 $7.7 $6.4
EURCHF benchmark fee $4.9 $10.2 $9.1 $6.3 $4.3
EURGBP benchmark fee $9.4 $12.1 $8.2 $10.0 $8.3

All spreads, commissions and financing rates for opening a position, holding for a week, and closing.

Swissquote non-trading fees
ActivTrades AvaTrade XTB Swissquote Capital.com
Account fee No No No No No
Inactivity fee Yes Yes Yes No No
Withdrawal fee $0 $0 $0 $10 $0

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#4 Swissquote
Markets and products

Swissquote gives access to 80 currency pairs.
Swissquote currency pairs
ActivTrades AvaTrade XTB Swissquote Capital.com
Currency pairs (#) 48 55 49 80 142
Swissquote available products besides forex
ActivTrades AvaTrade XTB Swissquote Capital.com
Stock No No Yes Yes No
ETF No No Yes Yes No
Fund No No No Yes No
Bond No No No Yes No
Options No No No Yes No
Futures No No No Yes No
CFD Yes Yes Yes Yes Yes
Crypto No Yes Yes Yes Yes

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#4 Swissquote
Customer service
4.4

Swissquote has fast phone, email and live chat support. On the other hand, the email replies were not always relevant.
Pros Cons
Phone support No 24/7 support
Live chat Email answers are not always relevant
Fast response time
Best forex brokers for beginners - Swissquote customer service

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#4 Swissquote
Research
3.3

Swissquote offers a good interactive chart and lots of news from various sources in different languages. Some research services are only available for a fee, which is a big drawback as the free ones are mostly basic.
Pros Cons
Good interactive chart Limited fundamental data
Trading ideas Recommendations are not structured
Quality news flow
Best forex brokers for beginners - Swissquote charting

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#4 Swissquote
Account opening
4.0

Swissquote offers a fully digital account opening process, although we encountered wait times. There is no minimum deposit for trading accounts, but a high minimum for forex and robo-advisory accounts.
Pros Cons
Fully digital Long wait times
No minimum deposit for trading account Forex and robo-advisor accounts have high minimum deposit
Swissquote minimum deposit and time to open an account
ActivTrades AvaTrade XTB Swissquote Capital.com
Minimum deposit $500 $100 $0 $0 $20
Time to open account 1 day 1 day 1 day 1 day 1 day

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#4 Swissquote
Verdict

Swissquote is an investment bank with a rock-solid background:

  • It is Swiss,
  • it is listed on an exchange
  • and it is a bank

It has two main entities, one in the UK and one in Switzerland. If you open an account at the London-based entity you can trade forex and CFDs, while the Swiss entity gives you access to assets ranging from stocks to options.

Swissquote offers a broad range of products across many markets. There are many stocks, mutual funds, and a lot of different other types of products, from bonds to cryptos.

However, nothing is free: Swissquote's trading fees are relatively high

All in all, Swissquote is a great stockbroker. As you can trade many products and no inactivity fee is charged, feel free to give it a try.

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Capital.com Logo

#5 Best forex brokers for beginners
Capital.com

4.6

Capital.com is a global CFD and forex broker that was founded in 2016, with offices in London, Cyprus and Belarus. It is regulated by the UK's Financial Conduct Authority (FCA), the Cyprus Securities and Exchange Commission (CySEC), and the National Bank of the Republic of Belarus (NBRB).

Capital.com is considered safe because it is regulated by the top-tier FCA.

Disclaimer: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67.7% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Recommended for forex and cfd traders looking for great trading platform and customer service

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67.7% of retail CFD accounts lose money

#5 Capital.com
Fees

Capital.com has low fees when it comes to buying and selling currency pairs.

To have a clear picture of forex fees, we calculated a forex benchmark fee for major currency pairs. This catch-all benchmark includes commissions, spreads and financing costs for all brokers.

Capital.com trading fees
ActivTrades AvaTrade XTB Swissquote Capital.com
EURUSD benchmark fee $8.1 $10.3 $8.5 $10.1 $6.4
GBPUSD benchmark fee $5.2 $9.0 $5.8 $6.8 $4.1
AUDUSD benchmark fee $6.6 $9.6 $5.8 $7.7 $6.4
EURCHF benchmark fee $4.9 $10.2 $9.1 $6.3 $4.3
EURGBP benchmark fee $9.4 $12.1 $8.2 $10.0 $8.3

All spreads, commissions and financing rates for opening a position, holding for a week, and closing.

Capital.com non-trading fees
ActivTrades AvaTrade XTB Swissquote Capital.com
Account fee No No No No No
Inactivity fee Yes Yes Yes No No
Withdrawal fee $0 $0 $0 $10 $0

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67.7% of retail CFD accounts lose money

#5 Capital.com
Markets and products

Capital.com gives access to 142 currency pairs.
Capital.com currency pairs
ActivTrades AvaTrade XTB Swissquote Capital.com
Currency pairs (#) 48 55 49 80 142
Capital.com available products besides forex
ActivTrades AvaTrade XTB Swissquote Capital.com
Stock No No Yes Yes No
ETF No No Yes Yes No
Fund No No No Yes No
Bond No No No Yes No
Options No No No Yes No
Futures No No No Yes No
CFD Yes Yes Yes Yes Yes
Crypto No Yes Yes Yes Yes

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67.7% of retail CFD accounts lose money

#5 Capital.com
Customer service
5.0

Capital.com's customer service is exemplary, one of the best in the business. We received fast and comprehensive answers on every channel, and support is available 24/7.
Pros Cons
Phone support None
Live chat
Fast response time
Best forex brokers for beginners - Capital.com customer service

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67.7% of retail CFD accounts lose money

#5 Capital.com
Research
5.0

Capital.com has great research services. Its charting tool is easy to edit and it has a quality news flow. There are also great fundamental data and trading ideas.
Pros Cons
Good interactive chart None
Trading ideas
Data on asset fundamentals
Best forex brokers for beginners - Capital.com charting

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67.7% of retail CFD accounts lose money

#5 Capital.com
Account opening
5.0

Capital.com has one of the best account opening processes we've seen: it is simple, quick, well-designed and intuitive. We were impressed.
Pros Cons
Fast None
Fully digital
Low minimum deposit
Capital.com minimum deposit and time to open an account
ActivTrades AvaTrade XTB Swissquote Capital.com
Minimum deposit $500 $100 $0 $0 $20
Time to open account 1 day 1 day 1 day 1 day 1 day

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67.7% of retail CFD accounts lose money

#5 Capital.com
Verdict

Capital.com is a great CFD and forex broker, regulated by the FCA, a top-tier authority.

On the plus side, the stock CFD and forex fees are low, the account opening is very user-friendly, and customer support is exceptional.

On the other hand, Capital.com offers only CFD, forex, and crypto asset classes. Minor account base currencies and price alerts are missing from the web platform.

As there is no inactivity fee and account opening is quick, feel free to try Capital.com.

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67.7% of retail CFD accounts lose money

Best forex brokers for beginners
What makes a top forex broker for beginners?

Forex trading has become really popular over the last decade. Looking at important criteria like fees will help you find the forex broker most suitable for you.

At BrokerChooser, we test online brokers based on close to 500 criteria, using a real account and real money.

The most important factors to consider when selecting the top forex brokers are the fees of forex trading. Besides trading fees, you should also look at the range and quality of educational tools and the number of available currency pairs. Also make sure if the broker provides great research and advanced charting functions.

Best forex brokers for beginners
Forex broker fees

Fees, fees, fees. We bet this is always on your mind when you're looking for the best forex broker. It can be complicated. Let's see how we sorted it out.

It is not easy to compare forex broker fees, but we are here to help. Forex brokers can charge commissions, spreads and financing fees.

When it comes to commissions, there are two different fee structures forex brokers normally use:

  1. All trading fees are included in the spread except the financing rate. Basically, think of it as the broker giving you a wider spread than it gets from the market.
  2. You get the market spread, but you pay a commission based on the traded amount. This model is usually used by ECN brokers.

The second version is more transparent, but this doesn't always mean it's more expensive.

When you trade forex on leverage and hold your position overnight, a fee will be charged. This is called financing cost. Financing costs change daily, and can add up if you hold your positions for a longer period.

To make your life easier, we calculated what your overall fee would be if you took a $20,000 position, held it for a week then closed it. We used a 30:1 leverage, the maximum available leverage for major currency pairs at many brokers.

Best forex brokers for beginners
Forex trading 101

Forex trading looks simple, but it comes with serious risks. Before trading, try to understand the basics and ask yourself: is this for me?

Understanding the forex market

Forex, FX, foreign exchange or currency market: you have probably already heard one of these expressions. They all mean the same: a market where you can exchange currencies or bet on the price movement of currency pairs.

The forex market has several outlets, from currency exchange booths on the street to the currency trading desks of big banks.

For a non-professional trader like you, the easiest and safest way to trade forex is by opening an account at a reliable online broker.

The vast majority of currency transactions are conducted on OTC (over-the-counter) markets. An OTC market is a non-regulated market, where you have to assess for yourself how safe your counterparty is. When you travel abroad to an exotic country and you need to exchange some money, you would probably go to a bank branch rather than changing money on the street, right? This is how you minimize your counterparty risk. You have to do the same when you select your online broker for trading forex. You should always choose a reliable broker.

Forex trading is tempting for the following reasons:

  • everybody has an opinion on where currencies are going

  • at first sight, the forex market is relatively easy to understand compared with other markets, like the stock market

  • by using leverage, traders can easily trade with a 100 times more money than what they actually have on their trading account and thus magnify profits (or losses!)

  • the market is open 24 hours a day, 5 days a week

  • it is the most liquid market in the world, meaning there are lots of transactions every second and you don't have to worry about finding a partner to trade with

Although it looks easy, trading forex can be risky if you don't know what you're doing. By using high leverage carelessly, you can easily lose all your money within a couple of seconds. So you better start off slow, learn and open a demo account first. If you want to learn more, check out our article about the best free trading apps.

Forex market trading hours

The forex market is open from 11:00 PM Sunday until 11:00 PM Friday, London time.

Trading activity is usually at its highest when London and New York are both open.

Top forex brokers - market trading hours

It is important to note that there is a difference between currency conversion and forex trading.

The end result of a conversion is basically changing one currency into another. Imagine that you receive your salary in euros (EUR), but you want to spend it in British pounds (GBP). In this case, you exchange euros to pounds.

When you trade currency pairs there is no physical conversion. Imagine that you have an online broker account in US dollars and you want to bet on the price movements in EURUSD. In this case, you never convert your dollars to euros. If your bet was correct, the profit from your trade will be booked to your account in US dollars. If you were wrong, the loss will be deducted from your account in dollars as well.

Breaking down forex trading jargon

When you trade forex, you bet on the price change of a currency pair, for example, the EURUSD.

EURUSD bid price EURUSD ask price
1.1700 1.1705

First of all, you need to understand what bid and ask prices mean. Let's take the EURUSD again as an example. The 'bid' is the price at which you can sell the EURUSD, or in other words to go short in it. If the price goes lower, you will generate a profit. The 'ask' price is the opposite. If you want to bet on the price moving up, you can open a trade at the 'ask' price. The mid-price is usually halfway between the two, but this is just a theoretical price that is not used for trading.

The actual bid and ask prices together are called the quote.

A long position is when you bet on the price moving up, while a short position is when you profit from the price going down.

The spread is the difference between the ask and the bid price. In the example above, the spread is 0.0005, which is calculated as 1.1705-1.1700.

The pip is the smallest amount of a currency pair. One pip is equal to 0.0001 for most currency pairs. In case of our example, the spread is 5 pips, or 5 times 0.0001, equalling 0.0005. For some currency pairs like the USDJPY, one pip is 0.01.

Leverage allows you to take bigger positions than the amount of money on your account. Imagine this as a multiplier of your profit or your loss. This can be as high as 300. Imagine you have $1,000 on your account and your applied leverage is 100. If you open a long position by using all your $1000, this means you open a trade for $1,000*100, or $100,000. If the price drops 1%, you will lose $1,000 (1%*$100,000), that is, all the money on your account. And the price of a currency pair can very easily drop by 1%. In case of EURUSD, this would mean a price decrease from 1.1705 to 1.1588.

A lot is the standard number of units of a forex contract. It is usually 100,000 units of the base currency. The base currency is the first currency in a currency pair. For EURUSD, the base currency is the EUR and one lot is €100,000. A mini lot is 10,000, a micro is 1,000 and a nano is 100 units of the base currency.

In forex trading, you can encounter different types of contracts: spot, CFD, forward and futures. Spot and CFD contracts are the most commonly traded.

A spot contract is settled two days after the trade. Settlement means that the counterparties are converting their currencies between each other at the price of the trade made two days earlier. Imagine the settlement as a currency conversion made at a money exchange booth on the street. The only difference is that this happens two days after the price was agreed on. However, in most cases, the settlement doesn't actually happen, because spot contracts are rolled over before the settlement. This is done because when you are betting on the direction of a currency pair, you do not actually want to convert money into the other currency, you just want to bet on the price movement. The rollover ensures that the conversion will not happen.

To learn what forex CFDs are and how you can trade them, read our CFD 101 and CFD trading tips.

When your position is rolled over, your online broker closes your current spot position and opens a new one. This process is not visible to you, but it has a fee, called the rollover or financing fee. The rollover fee is calculated from the interest rate difference between the two currencies you are trading. In some cases, you may also receive a fee payment from the broker if the interest rates you trade are in your favor.

A forward forex contract is a contract made on the OTC market. The specifics of the contract, like the term, the price and the settlement are defined by the counterparties on a case-by-case basis. Let's take as an example a company that needs $100,000 in 30 days to pay its employees, but its revenues are in euros. Since it wants to lock the exact exchange rate it gets in 30 days, it will seal a forward contract with a big bank at a fixed price, let's say at 1.1710. After 30 days, they will exchange the currencies and the company will receive €85,397 ($100,000/1.1710). In this case, there is an actual settlement.

A futures forex contract is traded on a regulated market, for example, on a commodity exchange, like the Chicago Mercantile Exchange (CME). When you trade futures, your counterparty is the exchange and the specifics of the contract are predefined by the exchange. When your counterparty is a regulated exchange, you don't need to check your counterparty risk, as this is one of the safest ways of trading. However, the exchange requires a large amount of initial money for trading, so this is not suitable for you if you have only small amounts to invest. For example, if you want to trade one EURUSD futures contract on the CME, you need to have at least $2,000 on your account.

What drives forex market prices?

As we said before, everybody has an opinion about the forex market, because it seems so simple. However, currency markets are among the most unpredictable in the world.

Everything, from monetary policies and government spending to politics and wars, can influence the prices of currency pairs. Therefore, it is difficult to predict which way they are going move.

Nevertheless, economic calendars can help, so at least you know about and can prepare for scheduled events (such as statistical data releases or central bank rate-setting meetings) that could have an impact on the forex market.

Best forex brokers for beginners
Bottom line

You saw the details, now let's zoom out. Here are the top forex brokers for beginners in 2021 for citizens in Cuba:

Top forex brokers for beginners in 2021 for Cuban citizens
ActivTrades AvaTrade XTB Swissquote Capital.com
Fees score 4.4 stars 3.5 stars 3.8 stars 2.4 stars 4.2 stars
Markets and products score 1.4 stars 2.0 stars 2.8 stars 5.0 stars 2.2 stars
Education score 5.0 stars 5.0 stars 5.0 stars 5.0 stars 4.0 stars
Charting quality High High High High High
Visit broker
60% of retail CFD accounts lose money
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71% of retail CFD accounts lose money
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77% of retail CFD accounts lose money
Visit broker Visit broker
67.7% of retail CFD accounts lose money

ActivTrades is our winner, the best forex broker for beginners for Cuban citizens in 2021. Low trading fees. Excellent account opening. Free deposit and withdrawal.

All of the brokers we highlighted are great choices. But watch out, forex trading can be risky. If you think you know enough and are good to go, pick your favourite and take the next step in your trading journey. Let us know what you think in the comments section.

Still unsure? Use our broker finder and find the best broker for you.

Author of this article

Dan Sallai

Author of this article

My goal is to help people find our resourceful content when they need the most. I combine my 10+ years online marketing experience with the team's finance knowledge to reach that every day. On the side I'm paying bowling, tennis and enjoy spending great time with my children.
My goal is to help people find our resourceful content when they need the most. I combine my 10+ years online marketing experience with the team's finance knowledge to reach that every day. On the side I'm paying bowling, tennis and enjoy spending great time with my children.

Everything you find on BrokerChooser is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback. Read more about our methodology

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Visit broker
60% of retail CFD accounts lose money
Visit broker
71% of retail CFD accounts lose money
Visit broker
77% of retail CFD accounts lose money
Visit broker
67.7% of retail CFD accounts lose money
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