What is a Raw Spread Account? A Complete Guide for Malta Traders

How a Raw Spread Account Works

In a raw spread account, the broker provides the exact spread it receives from liquidity providers — typically 0.0 to 0.3 pips for major currency pairs like EUR/USD. Instead of widening the spread to make a profit, the broker charges a separate commission, usually $3 to $7 per standard lot per side (round turn). For example, if you trade 1 lot of EUR/USD in Malta, you might pay a $7 commission total, while the spread remains at 0.1 pips. This structure is ideal for high-frequency traders who need tight pricing.

Why It Matters for Malta Traders

Malta traders often face higher costs with standard accounts due to wider spreads, especially during volatile market hours. A raw spread account eliminates this hidden cost, making it easier to execute strategies like scalping or news trading. For instance, if you deposit $1,000 via Skrill and trade 0.1 lots multiple times a day, the savings from raw spreads can significantly boost your net profitability. Additionally, brokers regulated by the Malta Financial Services Authority (MFSA) often offer raw spread accounts with full transparency.

Practical Example in USD

Imagine you are a Malta trader using a raw spread account with a $500 deposit funded via Bank Transfer. You trade 1 standard lot of EUR/USD with a spread of 0.1 pips and a commission of $7 per round turn. In a standard account, the spread might be 1.2 pips, costing you $12 per trade. With the raw spread account, you save $5 per trade. Over 100 trades, that’s $500 in savings — enough to double your account. This example shows how raw spread accounts can transform your trading results.

For Malta traders, raw spread accounts align well with the local retail forex trading environment. Many Maltese traders use platforms like MetaTrader 4 or 5, which support raw spread accounts with low latency execution. Local payment methods such as Bank Transfer are popular for larger deposits, while Skrill offers instant funding for smaller amounts. USDT (Tether) is also gaining traction among Malta traders who prefer cryptocurrency transactions due to their speed and lower fees. The Malta Financial Services Authority (MFSA) oversees brokers offering these accounts, ensuring compliance with EU financial regulations. This means your funds are protected, and the broker must disclose all costs upfront. For Malta traders, choosing a raw spread account with a regulated broker can lead to more predictable trading costs and better overall performance.

1. Choose a regulated broker
   Select a broker licensed by the Malta Financial Services Authority (MFSA) that offers raw spread accounts. Verify their license on the MFSA website to ensure legitimacy.
2. Open a trading account
   Complete the online application form, providing your ID and proof of address. Choose the raw spread account type during registration.
3. Fund your account
   Deposit funds using your preferred local method: Bank Transfer for larger amounts, Skrill for quick deposits, or USDT for crypto-based funding. Minimum deposits usually start at $100.
4. Start trading with raw spreads
   Log in to your trading platform, set your risk parameters, and execute trades. Monitor your commission costs and spread to ensure you're getting the advertised rates.

Raw spread accounts are often compared to standard accounts and ECN accounts. Standard accounts have wider spreads but no commission, making them suitable for infrequent traders. ECN accounts are similar to raw spread accounts but may have higher minimum deposits and variable spreads. For Malta traders, raw spread accounts offer the best balance of low spreads and fixed commissions. For instance, a standard account might cost $15 per trade for EUR/USD, while a raw spread account costs $7. This difference is significant for Malta traders who trade multiple times daily.

A raw spread account works by connecting you directly to interbank liquidity providers, offering spreads as low as 0.0 pips. The broker does not mark up the spread but instead charges a fixed commission per lot. For example, when you trade 1 lot of EUR/USD in Malta, the broker might charge a $7 commission, while the spread remains at 0.1 pips. This structure is transparent because you see exactly what the market is offering. Brokers regulated by the Malta Financial Services Authority (MFSA) must disclose these costs upfront, ensuring no hidden fees. This model is particularly beneficial for Malta traders using high-frequency strategies.

Consider a Malta trader named Maria who deposits $1,000 via Skrill into a raw spread account. She trades 0.5 lots of GBP/USD with a spread of 0.2 pips and a commission of $3.5 per round turn. In a standard account, the spread might be 1.5 pips, costing $7.5 per trade. With the raw spread account, her cost is only $3.5 + $1 (spread cost) = $4.5 per trade. Over 200 trades, she saves $600. Another example: a Malta trader using USDT to fund $500 and trading EUR/JPY with a 0.1 pip spread saves significantly compared to a standard account. These examples show how raw spread accounts reduce costs for active traders.

The Malta Financial Services Authority (MFSA) is the primary regulator for forex brokers operating in Malta. Brokers offering raw spread accounts must comply with MFSA rules on transparency, client fund segregation, and leverage limits (up to 30:1 for retail traders). For Malta traders, this means your funds are protected if the broker becomes insolvent, and you have access to dispute resolution through the MFSA. Always confirm a broker's MFSA license number on the official register before depositing funds. This regulatory framework ensures that raw spread accounts in Malta are fair and transparent.

• Compare commission structures: Different brokers charge varying commissions per lot. For Malta traders, look for brokers offering $3–$7 per round turn to maximize savings.
• Use Skrill for small deposits: Skrill offers instant deposits with low fees, ideal for funding a raw spread account with $100–$500.
• Test with a demo account: Before depositing real USD, use a demo account to experience raw spreads and understand commission costs.
• Monitor spreads during news events: Raw spreads can widen during high volatility. Plan your trades around economic news releases to avoid unexpected costs.
• Check for inactivity fees: Some brokers charge fees if you don't trade for a period. Choose one with no inactivity fees for Malta accounts.

Raw spread accounts are an excellent choice for Malta retail forex traders who want to minimize trading costs and maximize transparency. By offering ultra-tight spreads and a fixed commission, these accounts suit active trading strategies like scalping and day trading. To get started, choose an MFSA-regulated broker, fund your account via Bank Transfer, Skrill, or USDT, and practice with a demo account. Remember to compare commission rates and always verify the broker's license. For more educational content tailored to Malta traders, explore our other guides on comparebroker.io.