Please remember that when you trade, your capital is at risk. More than 65% of retail-investor accounts lose money when trading CFDs with most of the providers below. You should consider whether you can afford to take the high risk of losing your money before moving forward.

Best CFD Trading Platforms

Updated On: Nov 26, 2022
Best CFD Trading Platform UK

Contents:

Best CFD Trading Platforms in the UK

We’ve compiled a list of some of the best CFD trading platforms in the UK. These are investment apps, websites and platforms that allow you to trade a wide variety of instruments, including forex, indices, stocks, ETFs, and commodities, using contracts for differences (CFDs) or leverage.

Please remember that when you trade, your capital is at risk. More than 65% of retail investor accounts lose money when trading CFDs with most of the providers below. You should consider whether you can afford to take the high risk of losing your money before moving forward.

All the providers listed below are authorised and regulated by the UK’s financial watchdog, the Financial Conduct Authority (FCA).

Here are some of the best CFD trading platforms in the UK:

Pepperstone - Trade stock and ETF CFDs from 0.10% commission

Pepperstone logo
Minimum Deposit
£0
Market Spread
From 0.10% (UK Stock CFDs)
From 0.6 pips (Forex)
Overnight Fees
Green check mark indicating yes

Pepperstone is a CFD and forex broker that allows you to trade a wide variety of instruments, including forex, indices, stocks, ETFs, commodities and other assets via contracts for differences (CFDs). The Pepperstone platform boasts low-cost spreads, fast execution speeds and access to over 1,200 trading instruments. The Pepperstone CFD trading accounts allow a minimum trading size of 0.01 lots and a maximum of 100 lots. Retail traders can access leverage of up to 30:1 and 60+ currency pairs. Professional traders can access much higher leverage and even more exclusive features. Pepperstone also allows scalping, expert advisors, hedging, news trading and social trading. With Pepperstone, you can trade and enjoy the seamless creation of advanced trading strategies via some of the most popular and powerful trading software, including TradingView, MetaTrader 4 (MT4), MetaTrader 5 (MT5), CTrader, DupliTrade (for social and copy trading), and Capitalise.ai (for code-free trading automation). The Pepperstone platform is suitable for both beginners and advanced traders. It is especially suitable for professional traders who want to take advantage of higher leverage. Pepperstone also has a suite of educational materials to help traders at every level.

It is entirely free to open an account with Pepperstone, and all registered users gain access to a free demo account which you can use to practise CFD trading until you become confident. On Pepperstone, the spreads, which function as trading fees for CFD brokers, start at 0.6 pips for forex CFDs, 0.4 for index CFDs, 0.05 for commodity CFDs, and 0.10% per side for UK share CFDs. Pepperstone also charges a swap rate (overnight fee) for holding CFD positions overnight. Other fees apply. Pepperstone does not offer an ISA or SIPP.

Please note: When you invest, your capital is at risk. 77.6% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and can afford to take the high risk of losing your money.

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FinecoBank - Trade stock CFDs from 0% commission

FinecoBank Logo
Minimum Deposit
£0
Market Spread
£0 (Stock CFDs)
From 0.8 pips (Forex)
Overnight Fees
Green check mark indicating yes

FinecoBank is one of Europe’s largest banks, with 20+ years of leadership history in brokerage and over 30 million orders processed every year. Its core mission is to make online trading simple by providing direct access to the markets in just one click. With Fineco, you can access 26 global markets and trade over 20,000 financial instruments worldwide on a single account, including forex CFDs, UK and overseas shares, ETFs, funds and bonds. With FinecoBank CFDs, you can trade indices, stocks, forex, commodities, and futures on government bonds. FinecoBank users also enjoy advanced tools, interactive charts and automatic orders via the website, app or PowerDesk platform. In-house training to improve your trading abilities and acquire specific skills for CFD trading is also available to all FinecoBank customers.

With FinecoBank, the spreads, which function as trading fees for CFD brokers, start as low as 0.8 pips for forex CFDs, 0.4 points for index CFDs, and £0 for share CFDs. Overnight position charges also apply based on the value and duration of your trade. FinecoBank’s products include a Trading Account and Stocks and Shares ISA.

Please note: When you invest, your capital is at risk. 72% of retail investors lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and can afford to take the high risk of losing your money.

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eToro - Trade stock and ETF CFDs from 0.15% market spread

eToro Logo
Minimum Deposit
£0
Market Spread
0.15% (Stock and ETF CFDs)
From 1 pip (Forex)
Overnight Fees
Green check mark indicating yes

eToro is a multi-asset brokerage that allows you to invest and trade in stocks, forex, ETFs, indices and commodities. Users can trade directly in the underlying assets or via contracts for differences (CFDs). eToro CFDs allow you to apply leverage to your trades, giving you greater exposure to the market with less capital. eToro also offers customised risk management tools such as Trailing Stop Loss and Take Profit parameters, advanced analysis tools and professional charts, amongst other features, to help protect your investments. The CopyTrader feature makes it possible for investors at all levels to copy the actions of experienced traders with proportional accuracy, automatically and in real-time.

It is entirely free to open an account with eToro, and all registered users receive a US$100,000 demo account for free, which you can use to practise trading until you become confident. On eToro, the spreads, which function as trading fees for CFD brokers, start at 1 pip for forex CFDs, 2 pips for commodity CFDs, 0.75 points for index CFDs and 0.15% for stock and ETF CFDs. eToro also charges overnight fees relative to the value of your positions. Withdrawals incur a fee of US$5, and FX rates apply to non-USD deposits and withdrawals. eToro does not offer an ISA or SIPP.

Please note: When you invest, your capital is at risk. 79% 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.

Other fees apply. For more information, visit eToro.

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XTB - Trade stock and ETF CFDs from 0% commission

XTB logo
Minimum Deposit
£0
Market Spread
0% (Stock and ETF CFDs)
From 0.1 pips (Forex)
Overnight Fees
Green check mark indicating yes

XTB is an easy-to-use, fully customisable European trading platform and one of the largest stock exchange-listed FX & CFD brokers in the world. It provides retail traders instant access to hundreds of global markets. With XTB, you can trade a variety of markets using CFDs, including forex, stocks, ETFs, indices and commodities. XTB also has an extensive library of educational materials containing videos, webinars and courses suitable for both beginners and experienced investors. When you sign up, you will have access to a dedicated account officer who will work with you to help you better understand your needs and how XTB works.

It is free to open a trading account with XTB. Deposits in GBP and EUR are free of charge, but withdrawals below £60 have a £12 processing fee. Inactive accounts also attract a monthly fee of €10. On XTB, the spreads, which function as trading fees for CFD brokers, start at 0.1 pip for forex CFDs, 0.004 points for commodity CFDs, and 0.04 points for index CFDs. Trading stock and ETF CFDs are commission-free on XTB. However, overnight fees apply relative to the value of your positions. XTB has offices in over 13 countries, including the UK, Germany and France, and over 450,000 customers worldwide. XTB does not offer an ISA or SIPP.

Please note: Contracts for Differences (CFDs) are leveraged products and carry a significant risk of loss to your capital, as prices may move rapidly against you, and you may be required to make further payments to keep any trades open. Between 74 and 89% of retail investor accounts lose money when trading CFDs. These products are not suitable for all clients. Please ensure you fully understand the risks and seek independent advice.

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Saxo Markets - Trade stock and ETF CFDs from 0.10% commission

Saxo Markets logo
Minimum Deposit
£0
Market Spread
From 0.10% (UK Stock and ETF CFDs)
From 0.4 pips (Forex)
Overnight Fees
Green check mark indicating yes

Saxo Markets is the UK division of Saxo Bank, a large European bank and investment platform that allows you to invest in over 60,000 financial products from stock markets around the world. With Saxo Markets, you can trade over 9,000 CFDs on a variety of assets, including stocks, ETFs, indices, forex, bonds, commodities and index options. Saxo Markets traders also benefit from extensive charting with 50+ technical indicators, integrated trade signals, news feeds and risk-management features via the SaxoTraderGO platform, which is available on desktop, tablet or smartphone. Advanced traders can access even more sophisticated trading features on SaxoTraderPRO, Saxo Bank’s desktop-only advanced trading platform.

With Saxo Markets, the spreads, which function as trading fees for CFD brokers, start as low as 0.4 pips for forex, 0.10% for UK share and ETF CFDs, 0.05 points for commodity CFDs, and 0.25 points for index CFDs. Overnight interest rates and charges also apply based on the value and duration of your trade. Saxo Markets’ suite of products includes a Trading Account, Stocks and Shares ISA and SIPP.

Please note: When you invest, your capital is at risk. 74% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and can afford to take the high risk of losing your money.

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CMC Markets - Trade stock and ETF CFDs from 1 point market spread

CMC Markets logo
Minimum Deposit
£0
Market Spread
From 1 point (Stock and ETF CFDs)
From 0.7 pips (Forex)
Overnight Fees
Green check mark indicating yes

CMC Markets is a UK trading platform that gives you access to over 12,000 financial instruments across a wide range of global financial markets, including forex, indices, commodities, shares, ETFs and treasuries. CMC Markets offers more forex pairs than any other broker listed here on Koody with fully automated, lightning-fast execution. CMC Markets also provides a superior charting experience where you can choose from more than 115 technical indicators and drawing tools, more than 70 patterns, and 12 in-built chart types. Premium members enjoy an even more holistic service, including benefits such as savings of more than 28% on spreads, free Financial Times subscription and priority customer service.

With CMC Markets, the spreads, which function as trading fees for CFD brokers, start as low as 0.7 pips for forex CFDs, 1 point for stock and ETF CFDs, 0.3 points for commodity CFDs and 0.5 for index CFDs. Holding costs (for trades held overnight, which is essentially a fee for the funds you borrow to cover the leveraged portion of the trade) also apply based on the value and duration of your trade. CMC Markets does not offer an ISA or SIPP.

Please note: When you invest, your capital is at risk. 77% of retail investors lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and can afford to take the high risk of losing your money.

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What Is a Contract for Difference (CFD)?

A Contract for Difference, or CFD, is a financial contract based on the movement of the price of an asset. In simple terms, it is a bet on whether an asset will move up or down. A CFD is not an asset on its own, but you can purchase it based on a large number of other assets such as shares, ETFs, indices, forex, or even commodities like gold and oil.

As the name suggests, a Contract for Difference is a contract between two parties. One side believes the price of the underlying asset will go up, and the other side believes that the price of the asset will go down.

If you believe the price is going to go up, you will buy a CFD. If another person believes the price will go down, they will sell it.

Whoever gets the prediction right in this situation will make a profit based on the price when the original contract was created and the new market price. We will get into the specifics of this, but for now, the key point is that a CFD is a bet on the movement of an underlying asset.

A simple way to understand the concept is to think about a tennis match. Imagine a Wimbledon final between Roger Federer and Rafael Nadal. You and your friend decide to place a bet with each other on who will win the match and agree on a £10 wager. 

This is effectively a contract based on the outcome of the match. Neither of you will win any of the Wimbledon prize money if you are correct. You have no ‘skin in the game’ of the underlying asset (the prize money), but you can still generate a profit if your prediction is correct.

A CFD is the same. 

Another key component of CFD trading is leverage. Almost all CFD trading uses some leverage, which is another word for borrowing. It means that a percentage of the funds you are trading with is not your own money, but is a form of debt called a margin loan.

Are CFDs risky? Yes, CFD trading can be very risky. You can make big returns if you get it right, but if you get it wrong, you can lose everything you invested. 

How Does CFD Trading Work?

The simplest way to explain how CFD trading works is to work through the two sides of the trade. Let’s use gold as an example. Say you believe that with all the economic uncertainty around and high rates of inflation, the price of gold will go up.

You could buy a Contract for Difference, in a trade known as ‘going long’. If you are correct and the price goes up, your profit will be the difference between the current price and the price when you purchased the CFD.

If you get this wrong and the price goes down, your loss will be the difference between the current price and the price you purchased the CFD.

The other side of the trade is the same but reversed. If you believe that the price of gold is going to drop, you can sell (or ‘short’) an opening price. If gold drops, your opening price will be higher than the current one, and the difference is your profit.

If the price goes up, your opening price will be lower, and the difference will be your loss.

How Leverage Works for CFDs

Effectively all CFD trading involves the use of leverage (also called “margin”). The amount of money you put into a CFD investment will not be the full amount that is invested but will instead represent a deposit used to calculate the total position size.

In practice, it is similar to how we use a mortgage to buy a house. If you have £20,000 in cash, you can use this to purchase a property worth £200,000. Any gains or losses on the property are not based on your deposit but on the full £200,000 value.

The difference with CFDs is that the prices are much more volatile, which makes the leverage much riskier, and you may need to close out your position even if the value has dropped.

CFD providers offer different leverage amounts based on how risky the investment is. A CFD for the S&P 500 might only need a 5% deposit, but an individual stock like Tesla might require a 20% deposit.

Say you decide to take a CFD position in Tesla and have £5,000 to invest. That money will be used to open a position in Tesla worth £25,000 because £5,000 is 20% of £25,000.

Now, if you are correct in your CFD bet, it means you will make a gain based on the entire £25,000. Say you take a long position, and Tesla’s stock gains 10%. That means your profit is £2,500 (£25,000 x 10%), which actually represents a 50% return on your £5,000 investment.

That’s the power of leverage.

The problem is that it goes both ways. If Tesla stock instead goes down by 10%, that equates to a 50% loss on your initial investment. Even worse, what if Tesla stock goes down 30%?

That would mean the total position has dropped £7,500. Now in the UK, there are protections for investors, which means you cannot lose more than you have invested, but that still means you can lose everything you put into CFDs.

How to Trade CFDs

To trade CFDs in the UK, you need to open a brokerage account with an investment platform such as eToro, Pepperstone or XTB.

Once you’ve opened an account, you will need to fund it. 

After funding your account, you will then be able to open a long or short position on your chosen CFD. The brokerage app or platform will provide you with the level of margin on the trade and the total position that you will be creating. In the UK, you can access an amount of leverage between 30:1 and 2:1, per the FCA’s requirements.

Most CFD trading platforms will also allow you to set stop losses or limit orders, which can help protect your trades and limit your losses.

There are also two different CFDs markets, the spot market and the futures market. The spot market is for short-term trading and is based on the current, real-time pricing of the underlying asset. The futures market is for longer-term trades, as it is based on the price of an asset on a specific date in the future.

Advantages of CFD Trading

Here are some of the advantages of CFD trading:

  1. CFDs allow investors to profit off an asset’s movement without having to purchase the asset directly.
  2. CFDs give access to leverage, which means that winning trades can generate outsized returns. In the best-case scenario, traders can get significant profits from a modest initial starting capital.
  3. CFDs help you avoid restrictions or bans on short selling of stocks. In certain circumstances, bans or restrictions will be implemented in a bid to limit market volatility. CFDs can create a way around these restrictions, as there is no ownership of the underlying asset.

Disadvantages of CFD Trading

Here are some of the disadvantages of CFD trading:

  1. Risk of total loss of capital: As outlined in the examples above, traders can lose all of their initial investments. This can happen quickly as both gains and losses are magnified by leverage.
  2. Limited regulation: There are much lower levels of regulation imposed on the CFD market in the UK compared to the stock and bond markets.
  3. The ability to receive a margin call: If a trader’s position goes against them, the CFD provider may request additional funds as security. If the trader does not have the cash to hand over, the broker can close out the position for a loss, even if the trade ends up eventually becoming profitable.
  4. Overnight fees: Daily interest (or overnight fee) is charged on the loan amount.

CFD Trading Fees

There are a number of different costs associated with trading CFDs. The specifics will depend on the broker you choose, but there are some standard fees that most will charge.

Most brokers will charge a commission on trades that are placed. Some will charge this as an explicit percentage, for example, 0.10% of every trade, and others will instead build this commission into the spread.

The spread is the difference between the buy and sell costs for a particular asset. So if a specific CFD is trading for a wholesale price of £1, the trading platform may charge an investor £1.01 to purchase that CFD. This may be billed as “0% Commission” when in fact, the commission is built into the price rather than separated out.

In addition to commission or spreads, there will be charges for margins held for longer than a day. Many brokers charge additional fees for features such as stop losses or limits or the ability to roll over the duration of a position.


Frequently Asked Questions

1. Which broker is best for CFDs?

The following are some of the best CFD brokers in the UK:

  1. eToro - Trade stock and ETF CFDs from 0.15% market spread
  2. FinecoBank - Trade stock CFDs from 0% commission
  3. Pepperstone - Trade stock and ETF CFDs from 0.10% commission
  4. XTB - Trade stock and ETF CFDs from 0% commission
  5. FinecoBank - Trade stock CFDs from 0% commission
  6. Saxo Markets - Trade stock and ETF CFDs from 0.10% commission

2. Can you trade CFDs from a share dealing account?

Yes, you can trade CFDs from a share dealing account if your broker allows you to. Many trading apps or platforms that offer share dealing will also offer trading in CFDs. However, these are often segregated for investors so as not to confuse the overall portfolio position.


3. What’s the difference between CFD and share trading?

With share trading, you are buying or selling the actual asset itself, i.e., the shares in the specific company. This can go up and down, but without leverage, the moves can be a bit less volatile. In contrast, with CFDs, you are not purchasing the underlying asset but instead making a bet on the movement of its price. Because of the use of leverage, you can make significant gains but also huge losses and potentially very quickly.

Yes, CFD trading is legal in the UK, throughout Europe, and much of the world. It is, however, not allowed in the United States.

5. Is CFD trading taxable in the UK?

Yes, CFD trading is taxable in the UK - any gains you make on your CFD trades will be subject to capital gains tax. One benefit of CFDs is that you do not pay stamp duty as you do on many other investment assets.


6. Is CFD trading good for beginners?

No, CFD trading is not recommended for beginner investors. CFD trading is risky and, generally speaking, should only be done by experienced traders who understand the potential risk of using high leverage in their portfolios.


7. How much money do you need to start CFD trading?

You can start CFD trading with as little or as much as you are comfortable with. Different brokers will have different minimum amounts. Some will have no minimum at all. However, you should be aware that commission amounts will often have a minimum fee. This can make trades very expensive on lower amounts.


8. Is trading CFD the same as gambling?

CFD trading is not the same as gambling, but it has much in common with sports betting. Traders can use skill and knowledge to gain an edge and better predict the outcome, but many unpredictable factors can influence the results.

9. Why do people lose money trading CFDs?

Between 60 and 80% of CFD investors lose money, and a significant factor in this is the use of leverage. Leverage magnifies losses and makes the risk of a margin call very high. This can mean traders need to exit their positions due to volatility, even if they end up being correct.

10. Which platform is best for CFD trading?

Here are some of the best platforms for CFD trading in the UK:

  1. eToro - Trade stock and ETF CFDs from 0.15% market spread
  2. FinecoBank - Trade stock CFDs from 0% commission
  3. Pepperstone - Trade stock and ETF CFDs from 0.10% commission
  4. XTB - Trade stock and ETF CFDs from 0% commission
  5. Saxo Markets - Trade stock and ETF CFDs from 0.10% commission

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