Oanda Review 2021 – Pros, Cons, and Key Points

James Harrison
oanda-review

OANDA is one of the oldest brands and has gained a substantial reputation over the years. It provides Forex and CFD offerings to the traders along with remarkable market research. Founded by Dr. Stumm and Dr. Olsen in 1996, OANDA is a global brand that offers a wide array of services such as currency conversion, FX data services for businesses, online brokerage for individuals globally, and retail FX and CFD markets to traders. It is regulated in six tier-1 jurisdictions, making it one of the safest brokers for Forex and CFDs. 

For the global user base, OANDA offers standard and premium accounts along with a product catalogue with a variety of asset classes that vary on the basis of region. It further includes Forex, indices, metals, commodities, and bonds. 

The type of protection provided to account holders also varies on the basis of region. OANDA Europe Limited offers ESMA-mandated negative balance protection, while OANDA Asia Pacific Pte Ltd. offers guaranteed stop-loss orders. However, the US clients of OANDA are void of such protections as OANDA does not offer these accounts facilities in the US. But, despite the absence of account protection, OANDA ranks as the number 2 FX broker in the US, according to the CFTC Retail Forex Obligation report which “represents the total amount of funds at an FCM, RFED, or FCMRFD that would be obtained by combining all money, securities and property deposited by a retail forex customer into a retail forex account or accounts, adjusted for the realized and unrealized net profit or loss.”

Apart from the trading opportunities, the research tools, news, and market analysis available at OANDA are best-in-class. In addition to this, it offers unmatched options for algorithmic trading. 

Pricing

In the aspect of pricing, OANDA is just slightly better than the industry standard. The spreads at OANDA are quite competitive to the top players in the market. The bid/ask spreads ( fees paid by the clients to trade) are almost identical to those offered by FOREX.com and FxPro. However, the minimum spread cost available or the lowest advertised rate is a little above the industry average. For instance, where the competitors list a sub-pip spread which is less than 1.0 pip, OANDA non-core pricing(on average) was 1.2 pips on the EUR/USD pair during Q1 2019.

In the case of micro lots, while one micro lot is the most common smallest contract size for trading Forex, OANDA provides a unique offering. At OANDA, the minimum size of the trade is brought down to 0.001 micro lot which is three orders of magnitude to 1 unit. 

When it comes to transparency, OANDA satisfies the traders. A trailing average spread across nearly all the timeframes is frequently published which provides greater transparency in terms of pricing. But, an accurate comparison is not easily derived as OANDA does not publish a specific number for the average spread over a fixed period. 

Features

The trading platform suite offered by OANDA is called fxTrade. It provides extensive services when it comes to charting, research, and news. However, the platform can not be deemed as a comprehensive solution as it lacks some significant features which make it a satisfactory platform but not the best. 

The fxTrade platform is the flagship of OANDA. It is available for web, desktop, as well as mobile users. When it comes to charting offers, OANDA provides one of the best available services. It provides more than 80 indicators and several additional features such as advanced comparison through overlaying multiple currency pairs within a single chart for comparison. This advanced functionality is powered by TradingView. Furthermore, these functionalities are identical across the web and the desktop-based platform which makes the transitioning between the two, quite easy. 

In terms of algorithmic trading, OANDA marketplace provisions some additional platforms that are available from third-party developers. This includes the Seer Trading Platform that supports algorithmic trading system development, including back-testing and forward-testing automated trading systems. In addition to these, OANDA also offers trading connectivity to other charting platforms. For a trader who feels comfortable with the charting platform such as NinjaTrader or MultiCharts, OANDA is the best option. Taking this flexibility to a higher level is the availability of Quant Connect in OANDA’s Algo Labs page. This allows the users to develop their own applications in a language of their choice that is supported by the platform such as Python and C#. 

The actions related to accounts such as transferring money between accounts or accessing the statement is relatively easier in OANDA due to the fact that it leverages several services to provide comprehensive account management through its online portal. 

With a primary focus on Forex, OANDA provides the following options to its users:

  • Forex
  • Bonds
  • Precious metals
  • Indices
  • Commodities

Oanda also provides API possibilities for exchanges – it might come in handy if you’d like to develop your own platform.

Research

If you are a Forex or CFD trader and want to experience unmatched navigation of the markets, OANDA will cater to all your needs as it provides extensive research for these trades. 

The research consists of high-quality content which makes it very valuable. This content includes advanced technical analysis, macroeconomic news, research from USB, access to AutoChartist and much more. At a monthly fee, a trader can also get Dow Jones Select on the platform. 

The research at OANDA is further complemented by the market news available on the platform for the forex traders. The traders can enjoy streams from popular news platforms such as Reuters, MarketPulse, MarketWatch, Mainichi, and CNBC, among other providers. This stream is available as headlines on OANDA’s MetaTrader4 (MT4) platform.

In addition to his, OANDA also has a MarketPulse site. The content available on this site is related to news, research, and analysis. Most of this content comes from the OANDA’s in-house team.

Mobile application

The mobile application of OANDA is one of the prominent reasons for its popularity. As more and more traders transition to mobile platforms, the simple, easy to use the mobile application of OANDA makes it one of the top platforms preferred by new traders. The mobile platform provides exceptional market research inclusive of unmatched charting features. However, it is void of some other essential components just as the web-based and desktop application of OANDA.

If you want to create an order from the mobile application, OANDA offers a seamless and user-friendly feature. Within the charts, there is an option to quickly shift to the trade ticket window where the users can easily modify their order. The order is created from the chart and then can be adjusted in terms of stop-loss, limits, and other options available through simple drag and drop features. 

One drawback of the mobile application is the lack of synchronization. For instance, the additions made in the watch list of the mobile application are not available on the desktop or web platform. Another example is the siloed mobile chart indicators as they do not sync with the desktop or web platform of OANDA, fxTrade.

Pros 

  • OANDA is one of the few online forex brokers that accept US traders
  • Adding funds through the mobile application is pretty straightforward. The funds are updated almost immediately after the transaction completes. 
  • Being registered with FCM and RFED with the CFTC, OANDA Europe is authorized and regulated by the FCA in the U.K. This provides additional asset protection to the clients up to £85,000 through the Financial Services Compensation Scheme (FSCS).
  • Excellent research and tools.
  • Integration of advanced financial visualisation platform, TradingView, gives a further edge to OANDA
  • Advanced data analytics and economic analysis

Cons 

  • No negative balance protection for the US traders
  • OANDA does not offer guaranteed stop-loss orders (GSLO) for U.S. or U.K. clients.
  • It offers fewer offerings for CFDs which does not include individual stocks, ETFs, industry sectors or cryptocurrencies
  • Users have to pay fees for deposits, withdrawals, bank wire transfers, debit card and ACH transactions.
  • The monthly inactivity fee is also charged by OANDA

Account types

OANDA offers only one type of trading platform apart from the demo and corporate account. 

Under this one account, a user can open up to 19 sub-accounts which allows further flexibility when you want to have different base currencies under one account. For instance, you can create a EUR account with USD and GBP sub-accounts. 

The account opening requires document verification wherein you have to send documents via mail and it might take multiple days to complete. The account opening can be summarised in four steps as mentioned below:

  • Contact details: set your username and password.
  • Personal information: submit basic personal information, like your employment status or income estimate.
  • Appropriateness Test: fill out a competence test with questions like “What are margins?”
  • Verify your identity: upload a copy of your ID/passport to verify your identity, and a bank statement/utility bill to verify your residency.

Customer Service 

OANDA offers one of the best customer support services that are available 24*7 via email. Even though the live chat and support over the phone is not available at all times, even in the official business hours, the support by the OANDA representatives is quite satisfactory as they are knowledgeable and courteous. 

In addition to this, the support website also provides sufficient services with its vast knowledge base and searchable archive that usually answers most queries. 

OANDA - Ratings

OANDA - Ratings
4 5 0 1
4.0 rating
4/5
Total Score

Pros

  • OANDA is one of the few online forex brokers that accept US traders
  • Adding funds through the mobile application is pretty straightforward. The funds are updated almost immediately after the transaction completes.
  • Being registered with FCM and RFED with the CFTC, OANDA Europe is authorized and regulated by the FCA in the U.K. This provides additional asset protection to the clients up to £85,000 through the Financial Services Compensation Scheme (FSCS).
  • Excellent research and tools.
  • Integration of advanced financial visualisation platform, TradingView, gives a further edge to OANDA
  • Advanced data analytics and economic analysis

Cons

  • No negative balance protection for the US traders
  • OANDA does not offer guaranteed stop-loss orders (GSLO) for U.S. or U.K. clients.
  • It offers fewer offerings for CFDs which does not include individual stocks, ETFs, industry sectors or cryptocurrencies
  • Users have to pay fees for deposits, withdrawals, bank wire transfers, debit card and ACH transactions.
  • The monthly inactivity fee is also charged by OANDA
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