When it comes to choosing the best CFD brokers, a lot can depend on your specific needs as an investor or trader. As we all have different styles and preferences, we have made sure to select CFD brokers that offer a range of products and services for everyone, regardless of your experience level or investment size.
IG are made for the traders who want to take advantage of rising and falling markets. They offer one of the best web-based platforms and mobile trading apps. Open a position for a fraction of the cost with competitive margin rates. React to breaking news with custom price alerts and become a better trader with free trading courses on IG Academy. Get spreads from just 0.6 points on pairs like EUR/USD. Deal on global stock indices, with more 24-hour markets than any other provider. Choose from over 16,000 international shares and exchange traded funds. Trade metals, energies and soft commodities, with spreads from 0.3 points. Discover options markets, interest rates, bonds, sectors and more.
- 17,000+ markets
- Advanced web based and mobile platforms
- Manage risk effectively
- Get support when you need it
- Take your capital further
- Keep your finger on the pulse
- Get an interactive education
AvaTrade have a great range of trading products and services. You can take your pick from a huge selection of Forex, Commodities, Stocks and Indices with some really competitive conditions and dedicated support. This allows you to diversify and to move on trending markets quickly and easily. Choose from a selection of powerful trading platforms including MetaTrader 4/5 platforms for desktop, tablet & mobile. Open either short or long positions according to the market conditions and your trading strategy. There are no commission and spreads are very competitive.
- Trade leading US, European & Asian Stocks as CFDs
- Go long or short – trade your view on the market
- Powerful trading platforms
- Trade on the move with the AvaTradeGO app
- Unique risk-limiting tool AvaProtect
- Both manual and automated trading platforms available
- Professional Execution with No Fees
- No Day Trading Requirements
- Variety of Trading Opportunities
IC Markets offers flexible trading conditions across a broad range of CFDs covering Indices, Energies, Metals, Commodities and more. IC Markets mission is to create the best trading experience for retail and institutional clients alike allowing traders to focus more on their trading. Built by traders for trader’s IC Markets is dedicated to offering superior spreads, execution and service. IC Markets’ carefully selected range of products gives you access to the most popular and liquid markets across the world for the best trading opportunities 24/7.
- Spreads from 0.0 pips
- Fast order execution
- Institutional grade trading
- Global markets at your fingertips
- Powerful trading terminals
- Instant deposit and fast withdrawal
- Transfer your funds securely with 0% Commission
- Instant account opening and funding
Discover opportunity on a generous selection of over 1000+ instruments and trade an extensive range of CFDs and Spread Bets on FX, Commodities, Shares, ETFs and more. Pepperstone have low costs and deep liquidity for excellent pricing and trade execution speeds. Access the popular and reliable MT4, MT5 or cTrader platforms on desktop, tablet and phone. Trade FX from 0.0 pip spreads on 14 pairs with the Razor account, deep liquidity and no requotes. It’s quick and easy to get started – even with a small deposit. Apply in minutes with the simple application process.
- 1000+ instruments
- Razor sharp spreads
- Fast and reliable
- Powerful trading platforms
- Regulated brokerage firm
XM Group let you trade over 1000+ CFD Instruments, anywhere and anytime. Trade Forex, CFDs on Stock Indices, Commodities, Stocks, Metals and Energies. You get more than a Forex and CFD trading account at XM. They are a licensed and regulated broker that are client focused, transparent and fair. Starting from the account opening procedure, to managing your account, depositing or withdrawing funds and finally trading, it’s all straightforward simple and easy to use for XM clients.
- 55+ global currency Pairs
- Major global indices
- Sugar, cocoa, wheat and more
- Over 600 listed companies
- Gold, Silver, Palladium and more
- Oil, Gas and all major energies
A contract for difference (CFD for short) is a financial derivative product that pays the difference in settlement price between the opening and closing of a trade. A CFD is a contract between a trader and a trading broker, usually in the short-term. At the end of the contract, the parties exchange the difference between the opening and closing prices of a specified financial instrument.
Trading CFDs means that you can either make a profit or loss, depending on which direction your chosen asset moves in. Some advantages of CFDs include access to the underlying asset at a lower cost than buying the asset outright, ease of execution, and the ability to go long or short.
CFDs enable you to stretch your investment capital further, as you only have to deposit a fraction of your trade’s full value to open a position. The deposit you’ll have to put down is called a margin. While this lowers the cost of opening a trade, it can also amplify your losses. This is because CFD profits and losses are calculated on the full size of your trade.
What is CFD Trading?
CFD trading is a financial derivative product that allows traders to speculate on short-term price movements. CFD trading enables you to speculate on the rising or falling prices of fast-moving global financial markets, such as forex, indices, commodities, stocks and cryptos. This means that they derive their value from the movement of an underlying asset.
The price of any CFD is based on the price of the underlying instrument. The first price quoted on the trading ticket is the sell price (the bid), and the second price is the buy price (the offer). The difference between the two is known as the spread.
If you believe a market price will go up, you buy that market (known as going long). If you believe it will fall, you sell the market (going short). If you correctly anticipate the market movement, you would make a profit minus any brokerage fees when you close the CFD position. On the other hand, if you close the position on the wrong side of a trade, you will make a lose plus any fees.
CFDs allow traders to trade price movements without actually owning the underlying asset. By not owning the underlying asset, CFD traders can avoid some of the disadvantages and costs of traditional trading.
How to Trade CFDs?
Trading CFDs with an online broker is a simple process. Once you have opened your trading account, you’re just a few steps away from selecting your instrument and starting to trade. You can even practice trading CFDs using a demo account and virtual funds to ensure that you’re comfortable with trading your chosen instruments before you enter the live markets.
There are so many CFD brokers located all over the globe, some better than others. If you are unsure what you should look for, we have compiled a list of the most important features to look for when choosing the best CFD broker for you.
Perhaps the most important thing on our list is the brokers regulatory status. We always check to ensure that a broker is regulated by a top-tier regulator. This can give traders the peace of mind that they are using an honest broker that must comply with strict rules and regulations put in place to protect investors. Without regulation, if something was to go wrong then you could be left out in the dark.
Common examples of derivative instruments include Forex, Shares, Commodities, Metals, Indices and Cryptocurrencies. You should check to be sure that the broker you are considering has the instruments you are planning to trade.
If you are interested in specific financial instruments, we have the following guides:
A CFD brokerage will typically charge a small commission fee and/or spread for each CFD contract you execute with them. Generally speaking, the lower the combined commission fee and spread, the more you can save in trading costs over the long term. If you are a day trader, you may need the lowest spreads possible for scalping the markets. On the contrary, if you are an investor that plans to hold positions for a long time, you may not be so concerned with spread but prefer lower commission fees. Other fees to be aware of are inactivity fees, account funding fees and overnight fees.
CFD brokers provide you with a trading platform where you can analyse the various financial markets, place and manage trades. Of course, you will want to use a platform that you feel comfortable with. If you are already familiar with a particular trading platform, check to see if the broker has it. Otherwise, the MetaTrader platform is one of the best when it comes to Forex and CFD trading. It is a popular choice for beginners and you can even try it out for free with a demo account.
If you are looking for an investment platform, please feel free to check out these free guides:
Most CFD traders have their favourite tools that they use to help them analyse the markets and trade. Have a look and see what trading tools are available in the brokers platform and if they have any additional standalone tools such as Autochartist and Trading Central.
CFDs are complex instruments that come with a lot of risk, especially if you don’t know what you are doing. It is imperative that you learn as much as possible about CFDs and the risks involved before you start trading online. For that reason, we always like to see a broker provide traders with an ample amount of educational content including tutorials, guides and webinars.
Consider how you would like to fund your CFD trading account. Most brokers support bank transfer and card payments but we like to see some alternative options such as e-wallets and cryptocurrency. Some payments options will incur fees and take days to clear. Others won’t cost anything and can be instantaneous.
We consider broker support to be one of the most important things to check before opening an account. It can be extremely frustrating to try and contact a broker on numerous occasions and not get any response. That’s without considering the quality of the response if it does come. The best CFD brokers should always be on hand to help, in a positive manner.
For experienced investors, CFD trading offers plenty of opportunity to diversify their portfolio and profit from the movement of prices in the financial markets. But it also comes with its own risks, just like any investment, so should be researched and compared to the more traditional ways of investing in the market.
To trade CFDs, you will need to choose an account with a CFD broker. Things to consider when looking for a broker include regulation, platforms, tools, education, fees, funding and support. Whilst we have included our best CFD brokers here, the final decision is yours to make.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. A large % of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.