Forex brokers who offer 5 digit (5 decimal) pricing
95% of all Forex brokers offer 5 digits pricing nowadays.
The trend from Dealing desk to No-Dealing desk trading has clearly dictated the outcome.
Now 4 digits brokers are a visible minority, with 5 digit pricing brokers dominating the market.
|Looking for 4 & 5 digits Forex Brokers? Try our Forex Broker Comparison and select the field called “decimal pricing”.|
5 digit vs 4 digit broker
Not so long ago the 5th digit in Forex pricing was rare, now it is a normal fact – a result of growing competition for clients among Forex brokers. Quotes with 5 decimal places allow better transparency and better fills for investors. Banks have been using the system of fractional quotes for centuries. When large money is involved, the smallest variation in quotes makes a significant impact.
For traders the 5th digit means better transparency and ability to catch better deals. Forex brokers call it “precision pricing”.
For example, instead of 2 pips spread (1.5030 Bid 1.5032 Ask), a trader can get a 1.7 pip spread (1.50301 Bid 1.50318 Ask)
Trading with 5 decimal pricing
Adding 5th decimal to the price quotes requires traders to adjust own pip calculations, such as profit and stop values, trailing stops, limit orders etc.
For example, when trading with 4 decimal quotes, if a trader wants to capture 30 pips of Profit, he sets a Profit target value to 30.
With 5 digit quotes a trader would need to input 300 to be able to exit with 30 pips Profit. The last digit “0” is a fractional pip.
Expert Advisors trading with 5 digit brokers
Be sure to check if your Expert Advisor supports 5 decimal pricing. Not every EA does this, and you can get in trouble, or most likely will be unable to take any trades with such EA.
A simple demo test of your robot with 5 digit broker will tell if any adjustments are needed.
Do you know another Forex broker with 5 decimal pricing?
Please suggest by adding a comment below.