Compare the best CFD brokers for trading

On this page, we compare all the top-rated CFD trading platforms, looking at the details that really matter, including price, leverage, spreads and trading conditions.
By: Harry Atkins
Harry Atkins
Harry joined us in 2019, drawing on more than a decade writing, editing and managing high-profile content for blue… read more.
Updated: Jun 4, 2021
Tip: our preferred broker is, eToro: visit & create account

This guide and our course take you through all the key criteria and explains the terms you need to know before you get started.

Where can I find the best CFD trading platforms?

You can find them right here. Our website enables you to search for CFD providers, listing all the most important selection criteria at a glance.

1
Min. Deposit
$50
Exclusive promotion
Our score
10
Trade/invest in stocks with just $50
Invest for dividends and get payout on stocks on Ex-Dividend day
Over 11 payment methods, including PayPal
Start Trading
Description:
eToro is a multi-asset investment platform with more than 2000 assets, including FX, stocks, ETF’s, indices and commodities. eToro users can connect with, learn from, and copy or get copied by other users. Buying stocks on eToro is free and you can invest with as little as $50.
Payment Methods
Wire Transfer, Bank Transfer
Full regulations list:
CySEC, FCA
eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilizing publicly available non-entity specific information about eToro. Your capital is at risk.
2
Min. Deposit
$1
Exclusive promotion
Our score
9.3
0 Commissions and no deposit minimums
Registered with and regulated by SEC and FINRA
Loss of cash protection
Start Trading
Description:
Financial company driven by technology and offering all-in-one self-directed investment platform that provides excellent user experience.
Payment Methods
Full regulations list:

What are CFD brokers?

They are companies that provide platforms for their clients to trade financial assets, on the basis of a ‘contract for difference’. In other words, brokers provide platforms that allow you to trade CFD assets such as stocks and shares, indices, commodities, currencies and cryptocurrencies without the need for the physical delivery or exchange of the underlying asset. 

Essentially, they bring together the buyers and sellers of such assets so that they can trade freely in a transparent and regulated environment.

What is CFD trading?

This is the online trading of financial assets in which traders aim to profit from the difference in the price of the underlying asset, without physical delivery or exchange of that asset taking place between buyer and seller. 

The assets in question are the regular financial instruments that are traded in the underlying financial markets. The trader takes a long position with the expectation that prices will rise, or a short position if they expect the prices to fall. 

“CFD” stands for “Contract for Difference”, which means that the trade is made on the basis of taking out a contract with the counterparty, in which you set up the transaction with a certain amount of capital. Your profit is the price differential between the price you paid on commencement of the agreement and the price of the asset at the time it is terminated. 

So if you purchase an asset for, say, £1.50 per unit and you purchase 100 units of the asset, the entry price would cost you £150. If the price rises to £2.10 per unit, the position would be worth £210. Therefore, your profit (as per the contractual difference between the entry and exit price) would be 210 – 150 = £60. 

Usually, long trades entail purchasing an asset from the counterparty and reselling it at a higher price to the same, or a different, counterparty.

Similarly, if you sell an asset for £400 and the price falls to £230, your profit would be the difference between 400 and 230, which is £170. Usually, selling a CFD asset using a short trade involves borrowing the asset from the broker and selling at a high price (£400 in this example), then purchasing the asset once more at a lower price (£230), then returning the asset to the broker and pocketing the difference between the contract prices. This is why contract-for-difference trading is all about trading the price differences of the assets being traded. 

How does a broker work?

The principal aspect of using CFDs is that no exchange of the underlying asset takes place. The participants in the trades are only trading the difference in prices of the contracts. These contracts are based on the prices of the underlying assets themselves. 

For instance, the contracts on gold are based on the actual trading values of gold on the primary exchange where it is traded, which is the COMEX exchange in London. 

If someone is trading crude oil, there is no exchange or delivery of crude oil. Rather, the platform establishes the CFD contract on crude oil based on the price of crude oil on the New York Mercantile Exchange (NYMEX) or the Intercontinental Exchange (ICE).

The function of the platform is therefore to provide the trader with access to the market where the assets are listed, with prices drawn from the underlying exchanges. They can then place various types of orders for the asset classes listed on their chosen platform. 

Whenever an order is placed, the order is matched by the broker using a dealing desk to ensure speedy execution, using a counter-order in the same quantity as the trader’s request. 

So if a trader places an order for an asset, it is transmitted through the front-end of the engine (such as the MT4 desktop or mobile client). It gets transmitted to the back-end of the software at the dealer’s dealing desk, where it is matched with a SELL order of the same quantity. Once executed, the execution order is transmitted back to the front-end, where it shows the trader that the order has been executed. The whole process lasts just milliseconds. 

So I don’t technically ‘own’ the assets I’m trading?

Technically speaking, no assets are owned by any trader via their account. So, you do not own gold, silver, platinum, stocks, or any assets on the CFD platform.

Therefore, you don’t have to bother with the logistics of transporting your assets to a point of exchange or worry about the safety and security of the assets. You only trade on the underlying price changes of each asset so you can perform trades faster and take advantage of price fluctuations much quicker.

Trades on CFD platforms are also leveraged, so you don’t need a large capital outlay to get involved with CFDs, as opposed to futures trades where you need to own the asset and pay the full amount required for such contracts. 

What should I look for in a broker?

There are many things to look out for, we recommend these as your core focus when picking the best CFD provider:

  • Use a regulated platform – All of your trading activity in the United Kingdom is regulated by the Financial Conduct Authority (FCA). Regulation provides safety for market participants and ensures that those involved in the UK are protected. 
  • Payment Method Variety – Variation in payment methods allows the user of the CFD platform a great variety of choice in deciding how to fund or withdraw from the account. No longer are users stuck with the old methods that are slow and cumbersome. When using CFDs, you typically get convenient deposit methods such as credit/debit cards and e-wallets such as Skrill, Neteller and PayPal.
  • Large Asset Selection – The best CFD provider will have a large number of assets, providing you with flexibility in terms of what you can trade. Is the currency market in a slow march? You can switch over to stocks or indices. Choose brokers with a large asset selection such as stocks, bonds and more and you won’t get stuck in non-performing markets. 
  • Good reputation – Certain platforms may have a good offering, but if their user experience leaves something to be desired, they’re probably best avoided. Always check for online reviews provided by real, verified users. This step can save you a lot of trouble in the long run. 
  • Ease of use – The top services are well-designed and pleasing to the eye. Badly designed ones can be counterintuitive to use and induce visual fatigue over long periods of use. Speed and ease of use are vital factors when you’re trading.
  • Demo account – Many brokers offer demo accounts to test your skills in a ‘false’ market environment. It mimics the real world, but your balance is essentially fake. Start with £100 or £100,000 and get started!

Will I have to verify my account?

Yes. International financial regulations require that all services must verify the identity and residence of all clients on their platforms. Some may go a step further to ask you for statements of accounts from where your funds will come from. In this age where there is a concerted global effort to curb terrorist financing and laundering of illicit funds, it is imperative that you prove you are not engaged in any actions associated with both. CFD is a regulated industry, and providing your identity with and residence with a government-issued ID such as an international passport/drivers’’ license or a utility bill/bank statement will suffice to verify your account. 

Is online CFD trading secure?

It is very secure. Many brokers have implemented a segregated accounting system for their clients where the primary capital is lodged in the members’ area and only deployed on the trader’s express requests. Some of these processes are now protected using 2-factor authentication (via SMS or email). Furthermore, many platforms use very high-grade encryption protocols to protect all user information entered on their websites.

What if I forget my password?

Password recovery for accounts on most services goes beyond a simple request to reset your password. A multi-step authentication process is typically used to ensure that it is the account owner, and not a hacker, who is trying to recover a lost or forgotten password. 

When changing or recovering a lost password, make the password as complex as possible, using a combination of upper and lower case letters, numbers and special symbols to increase the strength of those passwords. Never use your date of birth, simple number sequences or letter sequences (such as “12345678” or “qwerty” from your PC keyboard) or easily guessable characters as passwords. 

Can I trade multiple assets?

This is the very essence of this type of platform: the ability to trade multiple assets from at least four different asset classes that span stocks, indices, commodities and currencies. Some platforms even add bonds and interest rate-based assets to the mix to give you the choice of multiple assets.

Will I be charged a fee to trade?

There are no commission fees but a rollover fee will be applied for keeping your trades open overnight or over the weekend. Sometimes flat-rate withdrawal fees are applied.

What are the advantages of using a CFD broker?

They provide users wih a number of advantages:

  • Exposure to almost any popular asset without having to own or physically deliver that asset. 
  • Trades can be leveraged, allowing you to use a small amount of collateral to control large positions. 
  • Spreads are usually low and trades are commission-free.

And what are the drawbacks?

CFDs have recently come under severe leverage restrictions from the European Securities and Markets Authority (ESMA), of which the FCA is a member. Therefore, services of this type in the UK have started to apply restrictions, reducing leverage – which used to be as high as 1:500 – to 1:10 for stocks and 1:5 for cryptocurrency CFDs.

Should I use a CFD broker platform?

A brokerage is the best way to seek exposure to assets from multiple different asset classes on one platform. So, rather than opening accounts all over the place in an attempt to broaden your base, you can easily use a platform to harness all the assets you want to be involved with within one account. This makes it easier and more manageable to handle. 

Furthermore, all trading platforms in the UK are regulated and you’ll be enrolled into the Financial Services Compensation Scheme (FSCS) when you open an account. This is a form of trader insurance contributed by the broker on your behalf. The scheme provides for a maximum compensation of £50,000 to traders whose monies are lost as a result of broker insolvency or liquidation.

FAQs

ℹ Can I use a CFD platform on my mobile phone?
ℹ Is it possible to short with CFDs?
ℹ Are CFD brokers regulated?
ℹ Is trading CFDs the best way to buy and sell assets?
ℹ Is online CFD trading legal?
ℹ Can I transfer from a CFD provider into my PayPal account?
ℹ What if my chosen broker platform closes down while I have open trades?
Can I remain anonymous?
ℹ Are there minimum and maximum deposit/withdrawal amounts?
ℹ Are there trading limits?
ℹ Can I access my full trading history?
ℹ Is it easy to switch brokers?
ℹ Can deposits be made in cryptocurrency or just fiat currencies?
ℹ Do I have to pay tax on any profits made through CFD trading?

Fact-checking & references

Our editors fact-check all content to ensure compliance with our strict editorial policy. The information in this article is supported by the following reliable sources.

Risk disclaimer

Invezz is a place where people can find reliable, unbiased information about finance, trading, and investing – but we do not offer financial advice and users should always carry out their own research. The assets covered on this website, including stocks, cryptocurrencies, and commodities can be highly volatile and new investors often lose money. Success in the financial markets is not guaranteed, and users should never invest more than they can afford to lose. You should consider your own personal circumstances and take the time to explore all your options before making any investment. Read our risk disclaimer >

Harry Atkins
Financial Writer
Harry joined us in 2019, drawing on more than a decade writing, editing and managing high-profile content for blue chip companies, Harry’s considerable experience in the… read more.