IQ Option fees and how to avoid them

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minutes read/Updated: 03.10.2018

Depending on how much cash an investor has to splash, brokerage fees can be a deciding factor in which online platform a potential customer will choose after making their online broker comparison. Online brokerages are having to be increasingly competitive as new players enter the market on a regular basis. This means that customers see the benefit of this competition in the form of an increase in quality as well as a drop in fees. There have been estimates of trading fee decreases up to 24% in the past four years. There are several ways in which brokers collect fees:

  • Wide spreads
  • Commissions on trades
  • Withdrawal fees
  • Account maintenance and inactivity fees

What Causes Variation?

The basic cost of making trades is a component that all traders need to factor in when choosing who is the best online broker to fit their needs. The good news is that as time progresses, online broker fees are constantly falling, as companies change and rearrange their fee structures. There are a variety of factors that can influence the amount a broker will charge in fees, usually based on the client's investing habits, particularly the size and frequency of investments made. Casual investors will not have to pay any ongoing fees, they will be charged in other ways. Regular traders may be charged ongoing usage fees which can be high, due to the fact engagement with the platform can be frequent with a considerable volume of individual trades being placed over a month. In such an instance, flat fees can be preferable to commissions.

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Many brokerages have different account tiers depending on how much capital is invested. Higher level accounts tend to have higher minimum deposit rates, bringing the expectation of higher value trades from such clients. In return for trading larger sums and higher volumes, higher level account holders are provided with more support, training and educational options, and in many cases lower or even waived fees, for example, some brokers will charge a withdrawal fee on lower level accounts and allow fee-free withdrawals on the higher-level accounts.

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Comparing IQ Option

Prospective traders doing a broker comparison will find IQ Option is a relative newcomer to the market, having first started in 2013. The company touts itself as being one of the world's fastest growing online trading platforms in the world, trading in stocks, ETFs, forex and cryptocurrencies. The company claims to have over 25 million customers. The have come up with a diverse product range to stay competitive in what is a crowded market, and they are aiming to build and maintain a solid reputation based on the products they choose to offer. IQ Option has already built a reputation for easy-access trading and a user-friendly environment in which to trade. They have kept minimum deposits low and at a time when their opposition was insisting on $200 minimum deposits, IQ Option was offering accounts for as little as a $10 minimum deposit. Using such tactics, IQ Option was able to put on considerable growth in a relatively short time frame. In 2014, they had about 950,000 accounts registered, and this grew to over 14 million accounts in 2016. In 2014 the company was handling around 200,000 trades each day and this has grown to a current level of over three million trades per day. Monthly trading volumes have gone from $10 million in 2014 to over $11 billion per month today.

  • A relatively new platform set up in 2013
  • Fastest growing online trading platform
  • Deal in stocks, EFTs, Forex and cryptocurrencies
  • Diversify your trading portfolio

Taking on the World

Among the most spectacular elements of IQ Option's rise over the past five years is their global coverage. They have gone from only operating in a few countries to their current position of operating in 178 countries worldwide. An unusual factor in this rise is that it has been done without the assistance of mainstream trading software such as MetaTrader 4. IQ Option has their own platform which they developed in-house. It certainly covers all the bases when it comes to being a good, practical trading tool, attracting only minor criticism about its charting and analytics being somewhat lacking. Otherwise, it has a functional, easy-to-use interface and comes as both a downloadable program and in a web-based format which is an exact replica of the app. It has useful features, such as being able to trade directly from a chart and up to nine charts can be displayed at one time. While IQ Option may not be the optimum choice for charting, the bottom line is that it is functional and attractively designed, which is the most important aspect of an online trading platform.

As well as features designed to open and close trading positions, IQ Option's trading platform gives an overview of open trades and a trading history. In addition to this, there are blogs and a chat feature where traders can share opinions with their peers.

Focus on Cryptocurrencies

In recent years, IQ Options has expanded its range of offerings and they are placing a strong focus on cryptocurrency markets. At the moment, the only crypto trading that can be done on the platform is in the form of CFDs, which is not unusual. What sets IQ Option apart from its peers in the crypto world is how many altcoins are available to be traded. The site supports Bitcoin, Ethereum, Ripple, Bitcoin Cash, EOS, Litecoin, Tron, Dash, Ethereum Classic, Qtum, OmiseGo, Zcash, and Bitcoin Gold. The CFD section of IQ Option is heavily focused on crypto trading, crypto pairs are available with US dollars and also cryptocurrencies are paired with other cryptocurrencies such as Litecoin with Bitcoin and Bitcoin with Ethereum. As crypto becomes more of a mainstream instrument, this early uptake should stand IQ Option in good stead. The company's website also mentions that it is possible to store cryptocurrency there, although it is not clear if this means when crypto purchase orders are made, a trade for actual crypto tokens is executed or if the broker acts as a counterparty. The largest product category is, however, forex. There are 22 currency pairs listed. There are all the usual features available, including long and short selling.

  • Explore the exciting opportunities of cryptocurrencies
  • Diverse range of digital currencies available to trade
  • Crypto pairs are available with USD
  • Dynamic platform always on the lookout for emerging currencies

IQ Option Fees

There are no IQ Option withdrawal fees charged when traders use one of the standard payment providers to withdraw funds. The company's system is however limited to being able to process only amounts higher than €2 or the equivalent value of alternative currencies. Smaller withdrawals can be made, but customers have to approach customer services to do so. The fact that there are no IQ Option withdrawal fees makes this a very attractive trading platform, as anyone searching for a provider will be looking at what IQ Option charges for services and no fee on withdrawal can be a major, if not deciding, factor in many potential customers' decision-making process. If a customer decides to use a bank transfer option, and not a payment provider, the IQ Option withdrawal fees take a sharp turn upwards, coming in at €50 of the equivalent in any other currency for each and every withdrawal. There are no IQ Option fees on deposits and the minimum deposit amount is $10, well below the amount required by some comparable trading platforms. There are IQ Option fees levied on unleveraged cryptocurrency trades in the form of IQ Option commission, this varies between 1% and 2.5% per transaction. There is also what is known as a “swap fee” charged on positions that are left open overnight. This fee is set at 0.03% of the trade's face value. This is low in comparison to other companies that levy a swap fee.

Other Fees That Might be Incurred

This broker is also one which has a “dormant account fee”. Some companies only require that you log in to your account to keep it counted as active, but IQ Option fees are charged, and an account is considered “dormant” once 90 days passes with no trades being opened, pending, or executed. In other words, your account will be flagged for the €50 fee, or the remainder of the account balance if that balance is less than €50 unless you are actively trading. The dormant account fee can be recharged monthly, but the wording is vague, making it sound like it is at the company's discretion: “The Company reserves the right to charge a fixed administration fee of €50 (fifty Euros or the relevant amount in another currency on the day of deduction of the fee) every month in order to maintain the account, on the condition that the Client account has the available funds. The administration fee shall be deducted from the Client’s account on the 90th calendar day of inactivity when the account is considered dormant. Further to this, each month the Company will consider the activity over the past 90 days in determining if the administrative fee will be charged again.”

  • Keep an eye on what you are paying
  • Account considered dormant if no trades have been made for 90 days
  • Dormant accounts incur a €50 fee
  • Consider whether this is too stringent for the trades you intend to make

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Is it Legitimate?

There is no IQ Option review that raises an alert that this website is a scam. This is a broker with a good level of transparency and it has been in business for several years without any significant incidents reported. In addition to this, IQ Option maintains high traffic volumes to its website domains and on a regular basis, an indication that the company is in good health and carrying out ongoing business operations.

  • IQ Option has a reliable reputation
  • Registered with several regulatory bodies
  • Available to trade across all EU countries
  • Subjected to scrutiny by independent authorities

IQ Option is and has always been registered with and regulated by multiple financial regulatory authorities. They gained a CySEC license with the Cyprus Securities and Exchange Commission in 2014 with the license number 247/14. That means that the company has been compliant with the Markets in Financial Instruments Directive since that licence was issued. Having a licence with an EU regulator means that the company has been free to trade throughout all EU countries and the European Economic Area. IQ Option is also registered with several regulatory bodies in major EU countries, including the FCA in the UK, Germanys BaFIN, France’s Regafi, and Consob in Italy. Being covered by these major regulatory bodies means that if a conflict arises and it can't be resolved between the client and the company, the client has recourse to approach the regulator and take action with an independent authority.

The Bottom Line on IQ Option

Most complaints about IQ Option trading fees concern issues such as suspected alterations to spreads during unstable markets. Some reliability complaints are recorded about the trading platform freezing, but no more than other operators and in most cases the company responds with a fix suggesting the customer ensure they are using an up-to-date browser. The usual concerns flagged about online brokers are present regarding delays with withdrawals, but there are also positive reviews about the service, suggesting that there are no major reliability issues with IQ Option and the company should provide the same level of service as any other major player. With a minimum deposit of $10 and spreads of 0.03%, this company is in many ways one that carries very low service fees and having no withdrawal fees on the most common payment options makes it one of the better value online trading sites. Commission on cryptocurrency trades is not very high and considering the relatively large number of cryptocurrencies on offer, it is not unreasonable that they would charge for this premium service. Finally, the dormant account fee is high, but avoidable provided the trader keeps active or shuts down unwanted accounts. Considering the diversity of products on offer, the fees being charged are quite reasonable, and a trader who remains mindful of the fees can avoid being overcharged by IQ Option.