Best CFD Trading Platforms in 2022 • CFD Brokers - Benzinga

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Quick Look at the Best CFD Trading Platforms:

• Best Overall: Interactive Brokers
• Best for Research Tools: XTB
• Best for Social Trading: eToro
• Best for Cryptocurrency CFDs: Capital.com
• Best for Canadian CFD traders: CMC Markets

Adding a contract for difference (CFD) to your portfolio could reduce your risk and increase your returns through diversification. A typical CFD trading platform lets you trade thousands of financial instruments and commodities, with no obligation to own the underlying asset. 

CFDs let you speculate on a price movement of an asset, whether stocks, cryptocurrencies, commodities or forex, giving you the ability to diversify your trading over a wide range of assets. Keep in mind that trading in CFD contracts cannot be traded by U.S. residents. 

In the following article, Benzinga reviews the best CFD trading platforms currently available, taking into account key features like commissions, markets, payments and regulation. 

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Best Overall: Interactive Brokers

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  Sophisticated Investors

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Interactive Brokers placed second on Benzinga's list for its research tools, excellent trading platform and access to a wide variety of tradable assets.

• Forex: Trade over 80 currency pair CFDs through Interactive Brokers with access to real-time data from 14 of the world's leading forex-dealing banks. This feature along with a transparent low commission avoids conflicts of interest such as those that occur with brokers that deal for their accounts. Interactive Brokers's order book lets you place orders away from or between the prevailing market in an electronic communications network (ECN) structure. You can also access FXTrader, an exclusive optimized interface that provides specially designed tools to trade the forex market.  
• Indices: Trade all major world equity indices in lots as small as 1X the index level. CFDs on indices do not expire, unlike the underlying futures contracts, which can save you rollover and other costs.  
• Metals: Trade CFDs on London gold and silver. The quoted CFD price comes from quote streams of approximately 10 major banks. The IB SmartRouting system then obtains the best price, which becomes the reference price for the CFD trade. Gold has a 0.015% per trade fee, while silver trades have a 0.03% fee, both with a minimum $2.00 charge.   
• Share CFDs: Trade approximately 8,000 different share CFDs from principal markets in the U.S., Europe and Asia. Share CFDs reflect the exchange quoted price for the underlying shares with IB SmartRouting technology used to determine the CFD reference price. Retail clients are subject to an initial 20% margin requirement, although commissions start at just 0.05% with lower commissions available for active traders. 

Pros 

• Trade CFDs and underlying assets in the same account and screen
• Low margins and fees
• Trader Workstation desktop trading platform
• Fundamental and technical analysis resources

Cons 

• Limited CFD selection
• High initial deposit amount
• CFD trading not available to U.S.-based traders

Interactive Brokers offers some of the lowest commissions and fees for retail traders, as well as some of the highest quality features, research and services available for traders. Interactive Brokers is also one of the most professional and versatile online brokers currently available to retail traders who can afford its substantial initial deposit of $10,000 or the equivalent.

Interactive Brokers operates in 150 markets in 33 countries and you can open an account in 25 different currencies. Interactive Brokers is represented on all major world markets and exchanges, plus most regional stock, options and commodities exchanges. The broker is overseen by all major regulators around the world. While the broker is U.S.-based, its CFD trading operation is based in the U.K. 

Best for Research Tools: XTB

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  Small Account Forex

With over 15 years of experience and 24/7 customer service, XTB gets Benzinga's best overall pick for its 2,100 tradable CFDs, including stock CFDs, exchange-traded fund (ETF) CFDs, commodities, forex, indices and cryptocurrencies. 

• Forex: Trade 48 currency pairs, with dealing spreads as low as 0.01 pip. You can trade micro-lots, there's no minimum deposit for forex trading, and deposits and withdrawals are fast.
• Indices: Trade indices using leverage of up to 500:1 for non-U.K. residents, including 20 of the world's largest indices. XTB offers competitive dealing spreads, transparent rollovers visible directly from the chart and trading apps for each type of device you use. 
• Commodities: Trade commodity CFDs on gold, silver, oil, natural gas, cocoa and corn with up to 500:1 leverage for non-U.K. residents. Rely on 24-hour trading via web, desktop and mobile devices. XTB offers competitive dealing spreads and transparent rollovers visible directly on the chart. 
• Stock CFDs: Trade stock CFDs on over 2,100 different equities with a leverage ratio of 10:1. The XTB platform provides ultra-fast execution and allows you to establish both long and short positions for 0% commissions.
• ETF CFDs: Trade in 60 ETF CFDs with leverage of 10:1. The broker provides negative balance protection for ETF CFD trades and charges 0% commission. 
• Crypto CFDs: Trade 10+ crypto CFDs that include Bitcoin (BTC), Ethereum (ETH), Stellar (XLM) and Dogecoin (DOGE). Crypto CFDs can be traded from the mobile app 24/7 with trading costs starting from 0.22%. 

Pros 

• Wide range of CFD assets
• Award-winning trading platform
• Fast account opening process
• Low forex and stock index CFD fees

Cons 

• Limited to CFD trading
• Charges an inactivity fee of €10 per month after 12 months of no account activity
• Not available to U.S.-based traders

Founded in 2002 and operated by XTB Group, XTB SA has its headquarters in London and Warsaw. You can open a free demo account and can trade in a live account with whatever initial deposit you decide to make. 

XTB is a publicly held company listed on the Warsaw Stock Exchange, which obligates XTB to disclose its financial data periodically. XTB International Limited is authorized and regulated by the International Financial Services Commission in Belize. The company also has oversight from the Polish Komisja Nadzoru Finansowego (KNF), the U.K. Financial Conduct Authority (FCA) and the Spanish Comisión Nacional del Mercado de Valores.

XTB's proprietary trading platform xStation 5 is available in web-based and desktop versions, plus its xStation Mobile app. All feature an intuitive, easy-to-use interface with integrated graphics. The platforms provide fast execution, market insights and numerous technical indicators.  

Best for Social Trading: eToro

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  Copy Traders

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  eToro USA LLC; Investments are subject to market risk, including the possible loss of principal.

eToro helped pioneer the social trading phenomenon by providing an intuitive and easy-to-navigate copy trading platform to access its impressive social trading community, so it gets Benzinga's top spot for social trading. 

• Forex: Trade 49 forex pair CFDs with a leverage ratio of up to 30:1 on major currency pairs such as EUR/USD and 20:1 leverage for non-major currency pairs. Dealing spreads are typically quite narrow, although they differ depending on liquidity.
• Stock Indices: Trade CFDs in 15 major indices with a leverage ratio of up to 10:1. 
• Stock CFDs: Trade up to 44 different major stock CFDs using a leverage ratio of up to 5:1.  
• Commodities: Trade 32 different commodity CFDs with a leverage ratio of 10:1 through eToro. Gold has a maximum leverage ratio of 20:1.  
• Crypto CFDs: Trade CFDs on 12 cryptocurrencies with a maximum leverage ratio of 2:1.

Pros 

• Excellent educational resources
• Wide range of tradable assets in addition to CFDs
• Hosts the world's largest social trading community
• Negative balance protection

Cons 

• Not available to U.S.-based traders
• Inactivity fee after 12 months of no login activity
• A $5 fee for withdrawals

In addition to CFDs, you can also trade a wide range of financial instruments via this multi-regulated broker's excellent trading platform. eToro also provides excellent educational resources for novices.

eToro has a relatively low minimum deposit to begin trading for clients residing in the U.K., the EU and most other countries, although certain countries have higher requirements. Additional deposits need to be at least $50, and the minimum amount for a wire transfer deposit is $500. 

Experienced traders or investors based in the EU or U.K. might qualify for an eToro Professional account if they execute more than 10 significant transactions per quarter and have an investment portfolio in excess of €500,000.  

Best for Crypto CFD Traders: Capital.com

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  Market-leading Spreads

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  79.17% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Capital.com comes out on top for its large selection of cryptocurrency CFDs that do not require a key or wallet for taking possession of the cryptocurrency. You can trade CFDs on over 6,100 underlying assets through this broker.

• Indices: Trade 17 of the world's largest stock indices. Leverage ratios are typically 20:1 for FCA and ASIC/CySEC regulated accounts.  
• Shares: Trade up to 1,700 different share CFDs on the world's major stock exchanges. You can trade major stocks from global exchanges with leverage ratios typically 5:1 for FCA and ASIC/CySEC regulated accounts.  
• Commodities: Trade CFDs on energy, precious metal and agricultural commodities using typical leverage ratios of 10:1, except for gold which is 20:1 for FCA and ASIC/CySEC regulated accounts.  
• Forex: Trade CFDs on 7 major, 5 minor and 6 exotic currency pairs with leverage typically 30:1 for FCA and ASIC/CySEC regulated accounts.  
• Cryptocurrencies: Trade 25 cryptocurrencies and 450 crypto pair CFDs with leverage of 2:1 in an ASIC/CySEC regulated account.

Pros 

• Customer service in 24 languages
• Easy account opening process
• Over 450 crypto CFDs available for trading
• Negative balance and client fund protection
• Low minimum deposit
• U.K. clients can place spread bets 

Cons 

• Only CFDs and real stock are available for trading
• CFD trading not available to U.S.-based traders

Capital.com is a global company with seven offices in the U.K. and elsewhere. The broker is overseen by the FCA, CySEC, ASIC, Seychelles' FSA and the Belarus NBRB. The minimum deposit to open an account at Capital.com is only $20, but bank transfer deposits must be at least $250. NBRB-regulated accounts let you leverage cryptos, commodities, forex currency pairs and indices at a ratio of 100:1, while shares can be leveraged at 20:1.  

Best for Canadian CFD traders: CMC Markets 

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  CFD Trading

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CMC Markets provides access to trade over 11,500 global instruments with competitive spreads and rates. Trading leverage varies from 30:1 for forex pairs to 2:1 for cryptocurrencies. 

• Forex: Trade over 330 different currency pairs with dealing spreads starting at 0.07 pips. Margin rates for forex are the lowest at 3.3%. CMC combines eight feeds from tier-one banks to obtain the best exchange rates for your trading. You can get fully automated executions in as little as 0.0045 seconds on most forex trades with minimal slippage.  
• Indices: Trade over 80 indices can be traded with a minimum spread of 0.3 points with 6.667:1 leverage. No dealer intervention regardless of your trading size means no partial fills, and you can trade 24 hours a day 5 days a week. 
• Cryptocurrencies: Trade up to 14 crypto CFDs with a minimum spread of 3.8 points and leverage of 2:1. CMC guarantees a 99.9% fill rate with fully automated lightning-fast executions. Also, if you're in Canada or the U.K., you pay no capital gains tax on profits from cryptocurrency spread bets. 
• Commodities: Trade over 100 cash and forward commodities with spreads as low as 0.3 points with 20:1 leverage. Some commodities trade up to 23 hours a day, and you trade "cash" markets with tighter spreads and no rollovers. 
• Shares: Over 9,000 U.S. and Canadian listed shares CFDs are available to trade with a minimum spread of just 0.10% or 0.02 per share on many U.S. and Canadian shares with 5:1 leverage. 
• Treasuries: Trade CFDs on more than 50 global interest rate and government debt instruments with 5:1 leverage. You get fully automated, fast executions with no dealer intervention and no partial fills. 

Pros 

• Most currency pairs of any forex broker
• Fully automated trading
• U.K.-based 24/5 customer support
• Proprietary commodity and cryptocurrency indices

Cons 

• No U.S. clients

CMC Markets has won numerous awards, and its competitive pricing and easy-to-navigate mobile and desktop platform make it an excellent choice for Canadians and U.K. residents. CMC Markets is regulated in the U.K. by the FCA and its stock is listed on the London Stock Exchange. Accounts held by CMC Markets Germany GmbH are regulated by the Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin).  

Features to Look for in CFD Trading Platforms

Keep these things in mind when looking for a suitable CFD trading platform:

#1- Trading Costs:  

The less you pay out to your CFD broker in trading costs, the more money you will have in your trading account. Trading costs include trading commissions and fees, dealing spreads and account management fees. 

#2 - Tradable Assets: 

You will want to select a CFD trading partner that offers CFDs on all the underlying assets you wish to trade. 

#3 - Customer Support: 

How easily and quickly you can access your broker in case a problem arises and how well they respond to queries and resolve issues can make a substantial difference to your success as a CFD trader. Also, novice traders may require more customer support and educational materials while they learn the ropes of CFD trading. 

#4 - Mobile App:

Many CFD traders want to be able to watch asset markets, check their CFD trade executions, enter trades and perform market analysis using their smartphones or tablets while away from their desktop computers. A CFD broker having a mobile app suitable for your device can therefore become a priority feature. 

#5 - Trading from Charts:

If you plan on doing technical analysis and then quickly entering a trade when you spot an opportunity, you will probably want to trade directly from price charts. Most decent CFD trading platforms will offer this important feature. 

#6 - Fast Execution:

Since CFD trading opportunities are often fleeting, transactions need to be executed quickly. Make sure a broker you are considering has quick transaction times for clients based in your locale and that issues like order slippage and requotes are minimal. You can test execution speeds by making small transactions in a live account. 

How to Trade CFDs 

If you're thinking of CFD investing or trading CFDs, remember that this activity is more like calculated gambling than investing, so only use risk capital that you can afford to lose completely as margin. Just follow the steps below to get started:

#1 - Select a CFD Trading Partner and Open an Account

Retail traders will probably need to use an online CFD broker and its supported platform to execute CFD transactions. Check out the selection of trading platforms listed above if you'd like help deciding which broker might suit you best as a trading partner. Visit your chosen broker's website to open and fund a CFD trading account.

#2 - Develop and Test a CFD Trading Plan in a Demo Account

Trading with a plan helps avoid many pitfalls CFD trading novices can fall into. If you are new to trading, first educate yourself about what moves the markets you'll be trading and how to analyze them. You can test trading ideas and strategies without risking real money in a practice account that most brokers let you open without obligation or funds. 

#3 - Fund Account and use Your Plan to Identify Trading Opportunities

Once you have developed and tested a winning trading plan, you can fund a live trading account with risk capital and use your plan to identify potentially profitable trades. 

#4 - Use Broker's Trading Platform to Execute Trades

When your plan identifies a good CFD trade, open up your broker's trading platform that is connected to your live trading account and enter the trade. Once a position has been established, you can enter a stop loss and limit order to close out the position automatically.

#5 - Close a CFD Trade out

Depending on how you decide to manage your CFD position and how the underlying asset performs, you might close out your CFD trade for a net gain or loss. That amount is then either added to or deducted from your trading account balance less any transaction fees. 

How You Can Improve Your Finances

Improving your finances puts you in a better position from which you can then enjoy life as well as possible given your unique financial circumstances. Here's some tips on how you can improve your finances: 

#1 - Understand your Debt-to-Income Ratio

Your debt-to-income ratio (DTI) is the total of your debt payments each month divided by your total monthly income. Lenders use this metric to measure your ability to repay the money you apply to borrow from them. Each lender and loan product might have different maximum DTI criteria.

#2 - Pay off Your Interest-bearing Debts

Interest-bearing debts are those that involve you paying interest on money you were loaned.  Examples might include loans from banks, mortgages, car loans, credit card balances and student loans. Paying off debts with higher interest rates can help improve your finances. Also, since some debts are secured, such as a mortgage or car loan, while others are unsecured, such as credit card debt, avoid exchanging unsecured debt for secured debt, even if you might get an interest rate advantage.  

#3 - Set up Automatic Payments

To help you save money and reduce the time spent making routine payments, you can set up automatic payments from the account where your income is deposited to your savings account, to debt repayment plans and to utility companies. 

#4 - Invest for the Future

Remember to set money aside for your future needs, the higher education of your children and your retirement. Investing generally involves putting money into assets that you expect will grow in value over time and that will help offset your money's value reduction over time because of inflation. For example, you can invest in stocks, bonds, certificates of deposit, real estate and collectibles, but make sure your investment horizon fits that of the asset you invest in. 

#5 - Save Money for Emergencies and Major Purchases

Prudent financial planning involves saving emergency money of up to six months of necessary expenses. You can also save money for large purchases, such as a home, car or boat, but if you cannot buy such an item with cash, you can instead save money for a deposit so you can finance the purchase.

Frequently Asked Questions 

Q

Are CFDs good for trading?

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Those traders who wish to use leverage tend to find CFDs attractive, and CFDs are typically simpler to trade than the underlying asset. Still, trading CFDs involves special risks that include minimal broker regulation, possible low liquidity and the need to maintain enough margin to cover possible leveraged losses.  

Q

Is CFD trading profitable?

A

If you have a sound trading plan, then CFD trading might be profitable for you, and some people have reported making substantial sums of money trading CFDs. You can also profit from both upwards and downwards trending markets when trading CFDs.