CFD trading has seen massive gains in popularity in recent years and this surge in demand for trading products has led to the creation of a great selection of CFD brokers that are currently offering access to the markets. A certain amount of research must be done, however, before real money deposits are made into a trading account, as there are advantages and disadvantages to all of these brokers that must be understood in advance.
Given that no two trading styles are alike, proper broker research can make all the difference once real trades are placed. Some traders are looking for low trading costs while others are in greater need of superior trading execution. For technical traders, charting software that is advanced and up to date will be a requirement, where news based or fundamental traders will rely more heavily on sophisticated market research and accurate news feeds. In this article, we look at some of the major brokers in the CFD trading industry.
Capital CFDs started as a Spread Betting company but is still a long established player in the CFD business. Capital CFDs offers low trading costs (0.1% on equity CFDs) and high leverage levels of 250:1. Trading markets include CFDs, Forex and Futures so the company is clearly committed to offering a wide product selection for its traders.
Disadvantages in the Capital CFDs approach come from potential problems in its trading platform, which is only web based. There is also no mobile trading platform, so this will not be viewed as ideal for traders with shorter term time frame trades. In addition to this, the company’s customer service is only offered in English, so this could pose some problems for international traders.
City Index is one of the most well-known companies in the retail trading business and their offering in the CFD space relies largely on its daily market analysis that is made available for free to its clients. In addition to this, the company has a large product offering (CFDs, Forex, Futures, and Options) and the platform can also be web based, mobile or downloaded onto your home computer. This helps to ensure trade execution efficiency, which is excellent at City Index.
The disadvantages at City Index are seen with higher trading costs relative to some of its peers (0.2% for equity CFDs) and lower leverage levels at 150:1. Customer service is offered only in English, so City Index is not advisable in some cases for inexperienced traders that will need assistance later.
IG Markets is thought by many to be the leader in the retail trading industry and its offerings in CFD trading are superior even to what is seen in its Spread Betting products. In CFDs, IG offers some of the lowest trading costs in the industry (with equity CFDs at 0.1%) and given the company’s reputation for superior trading execution, there is a great deal of value here for trading styles of all types.
Given its other strengths, IG will often avoid using promotional offerings to attract new clients. Without this incentive, the company is expecting traders to focus on the longer term benefits of the trading products that are offered. Also, some technical traders have suggested that the chart offerings at IG are not up to par with some of their competitors.
Plus 500 has made its offerings available in the CFD trading space and in addition to providing traders with incentive offerings when new accounts are opened, trading costs are also kept relatively low, with equity CFDs at 0.15%.
This UK company is one of the newer players in the industry, however, and because of this some of their research offerings are surpassed by the competition. In addition to this, Plus 500 has strict leverage limits (150:1) and multi language customer support is not provided.