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- 1. Compare the best forex spread betting brokers in 2023
- 2. Best fx spread betting brokers overall for 2023
- 3. What are the best forex spread betting platforms?
- 4. Top 5 fx spread betting platforms, reviewed
- 5. What are forex spread betting platforms?
- 6. What is spread betting in forex trading?
- 7. How do forex spread betting brokers work?
- 8. So I don’t own the assets I’m trading?
- 9. What should I look for in a broker?
- 10. How to choose a forex spread betting broker
- 11. Quick answers to key questions
- 12. What are the advantages of using an spread betting service to trade forex?
- 13. Should I use a forex spread betting platform?
- 14. Methodology: How we chose the best spread betting brokers
- 15. FAQs
Compare the best forex spread betting brokers in 2023
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82% of retail CFD accounts lose money.
We compare all the top forex brokers, providing the information and guidance you need to make the right decisions when it comes to spread betting. Our guide takes you through all the key criteria you need to know when picking the best account to spread bet the forex market, with a focus on regulation, design, and spreads.
Best fx spread betting brokers overall for 2023Copy link to section
What are the best forex spread betting platforms?Copy link to section
You can find a list of the best brokers below. Sign up by clicking the links in the table or read on to find out more about how spread bets work.
77% of retail CFD accounts lose money.
Top 5 fx spread betting platforms, reviewedCopy link to section
1. eToro. Best for beginners, copy-trading & demo-account
Pros & Cons
We love eToro because it’s a great trading platform for beginners, with an interface that’s easy to use via app or desktop. A safe and trustworthy broker used by millions of traders worldwide, eToro boasts a zero-to-low fee structure that won’t gobble up your money in charges.
There are more than 5,000 crypto, stock, etf, forex, and commodity assets available to trade on eToro. You can dive straight in to trade or dip your toe in gently with one of the best demo accounts in the business. We like to switch to virtual mode and use its unique CopyTrader feature to get trade ideas, test out strategies, and learn from the pros.
The fees: All stock and ETF trading is commission fee. All crypto trades are charged a 1% fee. Currency spreads are 1 pip, for commodities it’s 2 pips. Stock CFDs have a 0.15% spread. All deposits are free, withdrawals cost $5. There’s an inactivity fee of $10 per month that kicks in if you don’t log in to your account for 12 months.
77% of retail CFD accounts lose money.
2. Public. Best for sharing beginner trading ideas
Pros & Cons
We love Public because it’s a social platform where you can share trading tips and get ideas from other people. Public offers 9,000+ financial instruments, including cryptocurrencies and stocks from around the world.
Alongside a community of other investors all sharing their ideas, Public offers real time news and information so that you can see the full picture before you invest. And the assets don’t just include your run-of-the-mill assets; you can make alternative investments in things like handbags and comic books as well.
The fees: There are no fees for investing in stocks during regular trading hours in the US – 9.30am-4pm EST. There is a $2.99 fee for trades outside of regular hours. Alternative investments, including cryptocurrency, are charged a 2.5% fee per transaction.
What are forex spread betting platforms?Copy link to section
Forex spread betting platforms are companies that provide retail traders with access to online platforms that allow them to bet on the price movement of currency pairs. The best forex platforms are easy to use, well regulated, and carry strong reputations acquired through years of steady operation and stellar customer service.
What is spread betting in forex trading?Copy link to section
Spread betting is an investment vehicle that lets you speculate on the movement of currency pairs, without actually transacting in the forex market. The practice, which can be done for forex or other markets, consists of three main components:
- The spread of the instrument
- The direction of the trade, up or down
- The size of the bet
In its most simple terms, a forex spread bet is when you decide which way the price of a currency pair is going to move and place a bet on the outcome.
How do forex spread betting brokers work?Copy link to section
These platforms enable clients to bet on the price of assets online or via a mobile app. Simply open your account, deposit funds, and you can start spread betting on the forex markets.
A broker offering usually provides two price quotes for a currency pair, the bid and the ask. The gap between the bid price and the ask price is called ‘the spread’. Traders bet on whether the price of the currency pair will be lower than the bid price, or higher than the ask price.
For spread bettors, the narrower the spread is, the more attractive the currency pair becomes. That’s because narrower spreads mean lower transaction costs for those wanting to enter and exit a trade.
Let’s use an example to illustrate how it works when you place a forex spread bet on a currency pair:
Say a broker quotes you an ask price of 1.1155 on the EUR/USD (Euro/U.S. Dollar) pair, with a bid price of 1.1150. If you think the Euro will strengthen compared to the Dollar, you could bet €0.5 for every point (also known as a “pip”) the euro rises above 1.1155.
- If the EUR/USD pair climbs to 1.1165, you would earn a profit of €5 (€0.5 x 10 pips).
- If the price of the Euro instead falls to 1.1145, you would lose €5.
The better you get at spread betting, the more you might consider using leverage. This allows you to borrow money from the broker to place bigger bets than you would normally be able to make using your own money alone.
So I don’t own the assets I’m trading?Copy link to section
Technically, no, you don’t own the assets; however, this is normal when trading forex. In the same way that trading commodities doesn’t require you to actually own any of the commodities whose price movement you’re betting on, doing so with forex doesn’t require you to own any of the currency pairs whose price movement you’re betting on.
Most forex trading is done using CFDs, which is a very similar process to spread betting. Rarely do you ever want to or need to own any of the individual currencies yourself. Spread bets are just a variation on the theme and allow you to bet on how you think forex markets are going to perform.
You will, however, have to have money in your account in order to execute transactions. The currency you need usually corresponds to wherever the spread betting platform you’re using is located. For instance, a site in the United Kingdom would require British Pounds (GBP) as capital.
What should I look for in a broker?Copy link to section
The best spread betting forex websites are regulated by legally recognised agencies, provide an intuitive design that makes it easy to open an account, simple to deposit funds, and helpful in its educational content. It pays to do your homework and find the best platform that checks as many of the boxes below as possible:
- Look for regulated platforms. The Financial Conduct Authority (FCA) regulates forex brokers in the United Kingdom. Make sure any platform you forex spread bet on is regulated with the FCA.
- Good reputation. The best brokers should come with positive user reviews regarding such key criteria as opening trading accounts and seamless funds withdrawal. Awards, accolades, and positive publicity can also be useful markers when gauging a platform’s reputation.
- Design and ease of use. You want a platform that makes the process of placing a bet as quick and easy as possible. Firstly, because you don’t want to get confused and make the wrong move. And secondly, because you’re betting on the very narrow windows between the bid and ask prices of currency pairs, making pinpoint accuracy essential.
- Analysis tools. Trading forex practice requires diligent analysis and tremendous discipline. Even with spread betting, the price changes are relatively small and it requires a lot of expertise to understand what moves the forex markets. The best trading platforms will offer advanced technical analysis tools to assist in key areas such as pattern recognition.
- Customer service. You want to be sure you’re well taken care of on whichever platform you choose. That means insisting on live-chat capabilities 24 hours a day, seven days a week, and longer queries taking no more than one business day to produce a reply. Testing the broker’s customer service before depositing a large sum of money is a good idea.
- Fees. This one is simple: The lower the spread-based transaction fees you have to pay, the better off you’ll be.
How to choose a forex spread betting brokerCopy link to section
These features were unanimously chosen by our experts as features a beginner should look for in order to get the best and safest experience.
1. Check spread betting is legal where you liveCopy link to section
Spread betting is only legal in parts of Europe, most notably the UK and Ireland. It is not permitted in most of the rest of the world, so you can’t spread bet as a United States resident, for example.
This is obviously a hugely important consideration when choosing a broker. If spread betting is illegal where you live, then you need to find another way to trade. A good option is to trade CFDs instead. There are a lot of similarities between spread betting and CFDs, so it’s a good alternative.
2. Look for a broker with low spreadsCopy link to section
If you are able to spread bet where you live, then low spreads are the next most important thing to look for. The spread refers to the difference between the ‘bid’ and ‘ask’ price for an asset. If a broker offers a bid (buy) price of $51 and an ask (sell) price of $50, then the difference – $1 – is the spread.
Spreads are effectively the trading fees for spread betting. The difference between the two prices is the broker’s fee. A broker where the spread is $1 is better value than one where the spread is $5. But be aware that you might not have much choice in the matter if there are only a handful of brokers that let you spread bet certain assets, like cryptocurrency or commodities.
3. Find the assets you want to bet onCopy link to section
As there are strict limits on where spread betting is allowed, you need to spend more time researching which brokers offer betting on which assets. As a general rule, it’s easier to find platforms that offer spread betting on the stock market and forex compared to commodities.
Cryptocurrency is a different matter altogether, where the limits on spread betting are extremely strict, even in the United Kingdom. You may have to prove you are a professional client to be able to bet.
4. Learn how a point is measuredCopy link to section
Spread betting price changes are measured in points and a point may mean different things depending on which asset you are betting on. For instance, in forex betting a price change is usually measured in pips – 0.0001 of movement. While in the stock market and gold betting a point normally refers to a price change of $0.1.
When you place a bet, payouts are based on the number of points of movement in the price. If you place a $5 bet on the price of gold, and the price increases by $0.5, you would earn $25. A $5 bet multiplied by 5 points of movement (0.1 x 0.5). It’s crucial to understand this so you know what needs to happen to be successful.
5. Use a demo account to practiceCopy link to section
The best way to get to grips with spread betting is by signing up to a broker and using a demo account to try it out before you start betting real money. Most brokers offer demo accounts, where you are assigned a set amount of virtual money to bet with.
Demo accounts not only teach you the basics about how a market works, but they also give you the chance to test out certain strategies. You could try betting on a few different assets to see which one suits you best, for example, before risking any of your own money.
Quick answers to key questionsCopy link to section
Will I have to verify my account?Copy link to section
Yes. To open your online account, you’ll need to go through the verification steps to comply with financial service regulations. Verification will usually involve providing proof of identity, proof of address, and various financial proofs.
This is often an automated process that will require you to upload documents such as a valid passport or driving license, bank statement or mortgage statement. In some cases, you might be required to take and upload a selfie too, for facial recognition purposes.
Can you make money from spread betting?Copy link to section
Yes, although it isn’t easy and there is a high risk of losing money if you’re inexperienced.. You need to be disciplined in terms of how you manage the size of your bets and when to cut your losses on a losing bet. Use stop-loss limits – automatic orders to close positions at a loss – to reduce the risk from volatile markets catching you out.
The volatility and danger of losing money is why our experts recommend starting with a demo account. You will get a better appreciation for the risks and rewards on offer, and how individual markets move, by testing it out rather than going in blind.
Is spread betting tax-free?Copy link to section
Yes, it’s the biggest reason to choose spread betting over CFDs in the first place. In the UK, spread betting is exempt from a Capital Gains Tax, which means any profits you make are tax-free.
The reason for this is that spread betting is classed as a form of gambling (the clue is in the name). Gambling is tax-free, whereas profits from investments like buying stocks or real estate investment are liable to taxes. Spread betting is banned in the US for the same reason: it’s considered gambling, and betting laws are far more strict in the United States.
Should I spread bet or trade CFDs?Copy link to section
Your location might make your decision for you: if you live outside the UK and Ireland, you won’t be able to spread bet and so you should trade CFDs instead. If you live in the United Kingdom, then there are some other factors to consider.
The most important thing is what you want to bet on. If the answer is crypto, then you need to use a broker like eToro and trade it. Otherwise, you have options, and spread betting may well be the best choice given its tax-free status. Particularly if you plan on betting a lot.
Can I use leverage in spread betting?Copy link to section
Yes, the ability to use leverage is one of the things that makes it more popular than simply buying and holding assets, like shares or cryptocurrency. You can normally access leverage up to 1:30 in the UK, which is the maximum allowed under EU law.
How long are spread bets open for?Copy link to section
It varies but they can be open more or less indefinitely. Generally you can make spread bets that last until the end of the quarter, or you can make daily spread bets that keep rolling over indefinitely but are liable to overnight fees for each day you keep them open past 10pm.
Overnight fees are an important consideration because they can make spread betting much more expensive. They are charged because you use leverage and are thus borrowing the money to keep the bet open. The overnight fees are effectively an interest payment, but like all short-term loans they can be expensive: a few pounds a night even for a small bet.
Can I trade multiple currency pairs?Copy link to section
Yes. The seven major forex pairs are:
- The Euro/US Dollar Pair (EUR/USD)
- The US Dollar/Japanese Yen (USD/JPY)
- The British Pound Sterling/US Dollar (GBP/USD)
- The US Dollar/Swiss Franc (USD/CHF)
- The Australian Dollar/US Dollar (AUD/USD)
- The US Dollar/Canadian Dollar (USD/CAD)
- The New Zealand Dollar/US Dollar (NZD/USD)
However, many companies will let you bet on the price movement of 60 or more currency pairs.
Will I be charged a fee to trade?Copy link to section
Yes, although the charge is normally offered indirectly. Brokers make money through the spreads they charge clients, both when entering and exiting a trade. This is one of the main differences between spread bets and CFDs, because with CFDs you can expect to be charged a fixed fee or commission per trade.
How can I mitigate the risk of losing money rapidly due to spread betting?Copy link to section
One way to mitigate risk is to implement stop-loss orders. With a standard stop-loss order, the order will close out your position at the best available price once the set stop value has been reached. Meanwhile, a guaranteed stop-loss order guarantees to close your position at the exact value you have set, regardless of the underlying market conditions. Guaranteed stop-loss orders typically incur an additional charge from your broker.
You can also mitigate through the use of arbitrage, which is betting two ways simultaneously. Arbitrage lets investors exploit the difference in prices between two markets, specifically when two companies offer different spreads on identical currencies.
What are the advantages of using an spread betting service to trade forex?Copy link to section
With spread betting you can trade forex around the clock and benefit from the fact any profits you make will be tax free. A good spread betting firm will offer all of the major and minor currency pairs, as well as some exotic currencies, so there should be a great range of ways to trade the forex markets.
However, spread betting is not available in many countries around the world. Spread betting tends to be popular in the United Kingdom and Ireland but is not available in the United States and many other places, for example. So you may have to use forex CFDs to trade the currency markets if you live outside the UK.
There are many similarities between spread bets and CFDs, such as the ability to go long or short and the fact you can use leverage. The main difference is in the cost of trading; you can place spread bets with no commission, whereas CFD trading normally comes with a trading fee.
And what are the risks of spread betting the fx market?Copy link to section
Forex spread betting typically takes experience and significant attention to detail to do well. Also, buying any asset using leverage, be it foreign currencies, commodities, stocks, or others, comes with a high risk of losing money. If you bet wrong, you’ll owe a lot more than you would have if you had only invested your own money.
Should I use a forex spread betting platform?Copy link to section
Spread betting is a great way to trade forex if you understand the vagaries of the market. The biggest incentive to use spread betting is its tax free status, which is not possible with any other method of trading currency markets.
If you live in the United Kingdom, then you can avoid a UK capital gains tax by using spread betting. If you don’t, then you may have to consider using CFD trading instead.
Methodology: How we chose the best spread betting brokersCopy link to section
Helping people make better financial decisions is at the heart of our mission at Invezz.
We periodically test more than 63 spread betting brokers to provide our users with clear, accessible guidance on the investing options available. All testing is carried out by our panel of spread betting experts, analysts, and active traders who sign up to each broker, conduct research, and score each service.
Our tests are designed to find spread betting services that offer a beginner-friendly, secure trading experience at a fair price. To supplement our practical testing and experience, we research each service to gather any further relevant information. We read online customer reviews, app reviews on the Play Store and App Store, and conduct user surveys to get feedback from real people about what works, and what doesn’t.
Each spread betting broker is awarded a final score based on [130+] data points across 8 ranking categories: cost, reliability, user experience, deposit & withdrawals, investing options, range of products/markets, research & analysis tools, and the availability of educational & learning resources.
We work closely with individual brokers to ensure all factual information displayed here is accurate. All data is then fact-checked by an independent reviewer. You can learn more about our expert panel and how we test, rate, and review platforms in our review process.
FAQsCopy link to section
That depends on where you want to do it. In the UK, it is considered to be online gambling. That means forex spread betting is tax-free in the UK, but also makes it illegal in the United States, because gambling laws are much stricter in the U.S. Make sure you review the local laws wherever you live before you start trading spread bets.
Yes, forex accounts will usually allow deposits and withdrawals to and from PayPal accounts.
Yes. Most platforms allow you to trade foreign currencies on easy-to-use mobile apps.
No. You must go through a thorough identity verification check to sign up for a spread betting account with a forex broker. Often these checks can be quite stringent, as spread betting is only available to professional clients. Retail investors may not be able to access forex spread betting services.
Many brokers allow you to start trading foreign exchange with a very low minimum deposit or even no minimum deposit. Withdrawal minimums and maximums will vary by broker, but it’s not uncommon to find minimum withdrawal amounts of £50 or the full available account balance, whichever is less.
Likewise, maximum online withdrawals are sometimes capped at around £20,000 in one transaction, though again, you’ll want to peruse the limits on different brokers to find out for sure.
Yes, it is possible to both buy and sell currency pairs depending on how you see the forex market moving. If you think the USD is going to strengthen against the EUR, for example, you might want to short the EUR by placing a spread bet on it to fall. This is a very common strategy among forex traders.
Yes. Log into the broker you use to spread bet and you will be able to see a full list of your forex trading history.
Yes. You are not contractually obligated to stay with any one platform when you spread bet forex, and you can switch as you please. If you’re trying to gauge which platform is best for you, you can even start by trading on multiple forex platforms at the same time, until you decide which one you like best.
Spread betting profits are exempt from UK Capital Gains Tax, so are not taxed in the United Kingdom. Local laws can vary by country, though, so be sure to consult with your country’s tax laws before opening an account.
In the UK, platforms of this type are regulated by the FCA. Do your research when shopping for an online spread betting platform, and try to choose regulated brokers if possible.
Yes. Reputable spread betting brokers use many of the same digital safeguards that you’ll find in a typical stock account run by a big brokerage to guard against hackers. Regulatory agencies provide further security by closely monitoring forex trading in places like the UK, as well as many smaller nations.
Just like other online platforms, most accounts allow you to reset your password using your email address and/or password recovery questions. Make sure to choose a secure password (ideally using non-common words, at least one capital letter, at least one digit, and at least one punctuation mark), so that others can’t access your account.
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