Is XM free?
XM does charge a commission for real stock trading on US markets, so in this sense it is not a free-to-trade broker. However, it might still be a reasonable choice for some of you, as there are many other aspects other than commissions that are important when you choose a broker. If you wish to stick with XM though, then you will find the fees they charge below. Alternatively, you could check our article detailing the best zero commission brokers and how their apps scored in our test.
We should note that the payment-for-order-flow model, which is used by some zero-commission brokers to generate income (rather than relying on commissions), could potentially create a conflict of interest between you and your broker. This could result in trade execution (like routing your orders to specific market makers) that might be unfavorable for you under certain market conditions, especially when using market orders (as opposed to limit orders, which seem to be less affected).
Overview of XM fees and charges
It's safe to say that XM's fees are low in general. They either don't charge a brokerage fee for things that other brokers do, or they only charge a small amount.
Here's a high-level overview of XM's fees
|Assets||Fee level||Fee terms|
|US stock fee||-||Available only for clients onboarded under IFSC. The commission is 0.04% with a $1 minimum.|
|EURUSD fee||Low||With Standard, Micro, and Ultra-Low accounts the fees are built into the spread. 1.7 pips is the Standard account's average spread cost during peak trading hours. With XM Zero accounts, there is a $3.5 commission per lot per trade and a small spread cost.|
|US mutual fund fees||-||Not available|
|Inactivity fee||Low||$15 one-off maintenance fee after one year of inactivity, followed by $5 per month fee if the account remains inactive.|
XM fees explained
Online brokerages in general charge much lower brokerage fees than traditional brokerages do - this is largely because online brokerages' businesses can be much better scaled: from a purely technical standpoint, it doesn't make that much of a difference for them if they have 100 or 5,000 clients.
This is not to say, however, that they don't charge any fees at all. They make money by charging you various rates for various actions or events. Usually you need to keep an eye on the following three types of fees:
- Trading fees - these are brokerage fees that you pay when you actually carry out a trade, like buying an Apple share or an ETF. What you pay is either a commission, a spread or a financing rate. Some brokers apply all of these.
- A commission is either fixed or based on the traded volume.
- A spread is the difference between the buy price and the sell price.
- Non-trading fees. These are usually related to some operations you carry out in your account, such as depositing money, withdrawing money, or not trading for an extended period.
We compare XM fees with its closest competitors, FxPro and FXTM.
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XM trading fees
XM's trading fees are low, which makes it suitable for you even if you trade often (i.e. several times a week).
Let's break down trading fees according to the different asset classes available at XM.
XM's trading fees are low.
Stock fees and ETF fees
XM has stock trading fees.
XM's forex fees are average.
|EURUSD benchmark fee||$9.5||$8.8||$8.2|
|EURGBP benchmark fee||$10.6||$10.1||$9.7|
XM has low CFD trading fees.
XM non-trading fees
Some of XM's non-trading fees are average.
Non-trading fees include various brokerage fees and charges at XM that are not related to buying or selling assets. This can be a withdrawal fee, deposit fee, inactivity fee or account fee.
XM deposit fee
Usually, brokers don't charge anything for deposits, and XM is no different.
XM withdrawal fee
XM generally doesn't charge a withdrawal fee.
|Withdrawal fee for bank transfer||$0||$0||$3|
XM inactivity fee
XM does apply an inactivity fee and it is $15 one-off maintenance fee after one year of inactivity, followed by $5 per month fee if the account remains inactive.. Keep this in mind to avoid getting charged after a longer idle period. The fact that XM charges an inactivity fee makes it less ideal for you if you are a buy-and-hold investor.
The inactivity fee charged by XM is low.
|Inactivity fee||$15 one-off maintenance fee after one year of inactivity, followed by $5 per month fee if the account remains inactive.||$15 one-off account maintenance fee and $5 monthly fee after 6 months of inactivity||$5 per month after 6 months of inactivity|