What is a Raw Spread Account? A Complete Guide for Singapore Traders (2026)

What Exactly Is a Raw Spread Account?

A raw spread account, also known as an ECN (Electronic Communication Network) or STP (Straight Through Processing) account, provides traders with direct access to the interbank market. The broker does not add any markup to the spread; instead, they charge a fixed commission per lot traded. This means the spread you see is the actual spread from liquidity providers, which can be as low as 0.0 pips for major currency pairs like EUR/USD or USD/JPY.

How Does It Work for Singapore Traders?

When you open a raw spread account with a MAS-regulated broker, you deposit SGD via PayNow or bank transfer. Then, when you trade, you pay a commission—typically SGD 5 to SGD 10 per lot—plus the raw spread. For example, if the raw spread on EUR/SGD is 0.2 pips, your total cost is 0.2 pips plus the commission. This is much lower than a standard account where the spread might be 1.5 pips with no commission.

Why Singapore Traders Prefer Raw Spread Accounts

Singapore is a global forex hub with many professional and institutional traders. Raw spread accounts are popular because they offer transparency and lower costs for frequent traders. With MAS oversight, brokers must disclose all fees clearly, so Singapore traders can calculate exact costs. Additionally, raw accounts are ideal for scalping and high-frequency trading strategies commonly used here.

Cost Comparison: Raw vs. Standard Account

Consider a trade of 1 lot (100,000 units) on EUR/USD. With a standard account, the spread might be 1.5 pips, costing you SGD 15 (assuming 1 pip = SGD 10). With a raw spread account, the spread is 0.1 pips plus a commission of SGD 5, totaling just SGD 6. This saving of SGD 9 per trade adds up significantly for active traders.

Singapore traders benefit from the country's position as a leading financial center with access to global liquidity. When using a raw spread account, you can fund your account instantly using PayNow, which is unique to Singapore and offers real-time transfers. Bank transfers and credit cards are also widely accepted. MAS regulation ensures that your funds are segregated and that brokers adhere to strict capital adequacy requirements. This is particularly important for raw spread accounts because they involve higher trading volumes and more frequent transactions. Additionally, many Singapore brokers offer raw spread accounts with no minimum deposit, making them accessible to retail traders. However, you should always verify that the broker is licensed by MAS and check the commission structure carefully, as some brokers may charge hidden fees. The raw spread model aligns well with Singapore's sophisticated trading environment, where cost efficiency and transparency are paramount.

1. Choose a MAS-Regulated Broker
   Select a broker that offers raw spread accounts and is licensed by the Monetary Authority of Singapore. Check their commission rates and ensure they accept SGD deposits via PayNow or bank transfer.
2. Open and Fund Your Account
   Complete the online application, verify your identity, and fund your account using PayNow (fastest), bank transfer, or credit card. Deposit at least the minimum amount required, often as low as SGD 100.
3. Understand the Commission Structure
   Review the broker's commission per lot for each instrument. For example, EUR/USD might cost SGD 5 per lot, while gold might cost SGD 7. Factor this into your trading costs.
4. Start Trading with Tight Spreads
   Place your trades using the raw spread account. Monitor the live spreads and ensure you are getting the advertised low spreads. Use a demo account first to test the execution speed and costs.

Raw spread accounts are often compared to standard accounts and zero-spread accounts. Standard accounts have wider spreads but no commission, making them suitable for beginners or infrequent traders. Zero-spread accounts offer 0.0 pip spreads but may have higher commissions or other fees. For Singapore traders, raw spread accounts offer the best balance of low spreads and transparent commissions. They are particularly advantageous for scalping, algorithmic trading, and trading during high liquidity hours like the London-New York overlap. However, if you trade only a few times a month, a standard account might be more cost-effective.

When you open a raw spread account, your trades are sent directly to the interbank market via an ECN or STP system. The broker aggregates prices from multiple liquidity providers (banks, hedge funds) and presents the best bid and ask prices to you. The spread you see is the raw spread from these providers—often 0.0 to 0.3 pips for major pairs. Instead of adding a markup, the broker charges a fixed commission per lot. For example, trading 1 lot of USD/SGD might cost SGD 5 commission plus a 0.1 pip spread. In Singapore, this model is popular because it provides transparency and lower costs for active traders. You can fund your account via PayNow for instant availability, and all transactions are processed under MAS oversight, ensuring fair execution.

Let's say you are a Singapore trader who wants to trade EUR/USD. With a raw spread account, the spread is 0.1 pips and the commission is SGD 5 per lot. You decide to buy 1 lot at 1.1000. The total cost is 0.1 pips (SGD 1) plus SGD 5 commission = SGD 6. If you had used a standard account with a 1.2 pip spread, the cost would be SGD 12. Over 100 trades, you save SGD 600. Another example: trading gold (XAU/USD) with a raw spread account might have a spread of 0.2 pips and a commission of SGD 7 per lot. If gold moves 10 pips in your favor, your net profit is 9.8 pips minus commission. These examples show how raw spread accounts benefit high-frequency traders in Singapore.

The Monetary Authority of Singapore (MAS) regulates all forex brokers operating in Singapore. MAS requires brokers to hold a Capital Markets Services (CMS) license and to segregate client funds from company funds. This is crucial for raw spread account holders because it ensures your money is protected if the broker becomes insolvent. MAS also mandates transparent pricing and disclosure of all fees, so Singapore traders can trust that the raw spread they see is genuine. Always check the broker's license number on the MAS Financial Institutions Directory. Trading with an unregulated broker puts your funds at risk and offers no recourse in case of disputes.

• Compare Commission Rates: Different brokers charge different commissions. For example, Broker A might charge SGD 5 per lot for EUR/USD, while Broker B charges SGD 8. Even small differences matter for high-volume traders.
• Use PayNow for Instant Funding: PayNow is the fastest way to fund your raw spread account in Singapore. It reflects within minutes, allowing you to take advantage of market opportunities immediately.
• Check Spreads During Volatile Times: Raw spreads can widen during major news events. Test your broker's spreads during high volatility to ensure they remain competitive.
• Beware of Hidden Fees: Some brokers charge inactivity fees or withdrawal fees. Always read the fine print before opening a raw spread account.
• Start with a Demo Account: Practice with a demo raw spread account to understand the cost structure and execution speed before trading with real SGD.

A raw spread account is a powerful tool for Singapore traders who want the lowest possible trading costs and direct market access. By understanding how commissions and spreads work, and by choosing a MAS-regulated broker, you can optimize your trading strategy. Start by comparing brokers that accept PayNow funding and offer competitive commission rates. Open a demo account to test the waters, then fund with a small amount of SGD to experience live trading. Remember to always prioritize risk management and regulatory compliance. For more insights, explore our other guides on forex trading in Singapore.