Are you looking for the best online broker to trade CFDs, the stocks of companies listed on the stock exchange or to operate on the Forex market, buying and selling currency pairs from around the world? If so, you have come to the right website. After having studied dozens of online brokers and after having analyzed their commissions, their offerings and all of their other important characteristics, we have established the following ranking of what we consider to be the best and most inexpensive online brokers in 2021 (remember that CFDs are a leverage product and can result in the loss of your entire capital. Please ensure you fully understand the risks involved).
As you will see, in our opinion, one of the main online brokers at the moment is Plus500. This broker is not only known for sponsoring the “Atlético de Madrid”, but also for offering up to a 1:30 leverage of service in conjunction with low spreads and a high degree of security thanks to its rigorous regulation. All of these factors combine to explain why the majority of comments about this broker on online forums are very positive. Before continuing with our analysis of the best online brokers, if you like, you can go directly to Plus500’s official website to obtain more information by clicking this link (76,4% 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).
If you intend to stay with us for a while longer in order to read the rest of this review, we would first like to remind you that CFDs are somewhat difficult products to understand, the CNMV considers them not to be suitable for retail investors due to their complexity and associated risk. Furthermore, we would like to explain the reasons why we rank this broker as being one of the most famous. Do you want to know what factors we based this ranking on? Great, on this same page we will go over the key factors that determine whether or not a broker is reliable, of good quality and inexpensive. We will also analyze other important factors such as a broker’s demo account and investment platform. The first factor that we will be looking at is also the most important: a broker’s security.
Is the broker reliable?
In our opinion, the reliability and security of a broker are essential factors – they are of sufficient importance to disqualify a potential broker. That is to say, if we think that there is even the slightest risk that a particular broker is a scam, we will immediately disregard it. How do we do this? By analyzing a broker’s regulation. Any broker that is not supervised by a regulatory body from the European Union is immediately disqualified from our ranking. This is one requirement that we are not prepared to be lenient about. If there is clear evidence that a particular broker cannot be trusted or is a scam, we will eliminate it without hesitation.
Plus500UK Ltd is authorized & regulated by the FCA (#509909). In addition, Plus500CY Ltd is authorized & regulated by CySEC (#250/14). Plus500AU Pty Ltd (ACN 153301681), licensed by: ASIC in Australia, AFSL #417727, FMA in New Zealand, FSP #486026; Authorised Financial Services Provider in South Africa, FSP #47546.
Another reason for our confidence in this company is that Plus500 Ltd is listed on the Main Market of the London Stock Exchange. Why does its being traded on the stock market necessarily translate into more reliability? Because it implies a dual supervision. In addition to being regulated as a broker, it is also supervised as a traded entity – an added layer of oversight. Moreover, companies with traded stocks need to make their accounts and fiscal results public and need to subject this information to independent audits. All of these factors result in higher client security.
These factors do not a guarantee a broker’s security, but they do vastly increase the probability of a broker being serious and reliable. That is why conducting a full review of Plus500, or any other broker for that matter, is a prerequisite for getting a sense of its level of regulation and seriousness. The best broker not only has to be inexpensive, but also serious and reliable.
Fees: which is the cheapest?
Undoubtedly, the second most important characteristic that needs to be analyzed before dealing with a broker are the commissions and fees that it charges. In terms of commissions, we are very strict as we are constantly looking for the brokers that provide their traders with the most profit. When choosing what we consider to be the best brokers, we only choose those that do not charge any commissions to their users for trading. While trading will never be entirely free, it is possible to save a lot of money by choosing the most inexpensive broker. Regarding commissions, we will be making a distinction between the most actively traded assets, beginning with the Forex market. If we have chosen Plus500, it is because, as a general rule, it is less expensive than Markets.com, iForex, UFX, AvaTrade, eToro, DeGiro, Libertex, Hanseatic Brokerhouse, Xtrade, XM.com, CMC Markets, BDSwiss, Trading 212. If you would like to go directly to the broker’s website, click here to visit Plus500 (76,4% of retail CFD accounts lose money).
As we have just explained, if you are interested in trading CFDs on the Forex market or on assets such as stocks, stock indexes and commodities, you are in luck. There are a several brokers that do not charge any commissions in order to perform these types of trades. This means that you will not have to worry about leaving a certain amount of money in your account to cover the costs of buying and selling assets. This can be a serious advantage in terms of profitability.
However, nothing is ever entirely free, and of course, there will always be costs associated with trading. When trading CFDs, these costs are known as the spread, but don’t worry, as we explained before you will not need to keep a certain amount of money in your account to cover this cost. The spread is the difference in price required to open and close an asset trading position. This concept is easier to understand through an example. In the image below you can see the price of the Euro/Dollar currency pair as well as the price required to open or to close a position with Plus500.
As you can see, the price on the Forex market was 1.1405 at the moment that this image was captured. This is the price that you would have to pay to buy the currency pair, but if you were to sell the pair, you would receive 1.1403. This means that the spread is very low – Plus500’s spreads are currently among the lowest on the market.
Stocks and stock indexes
CFDs allow you to trade virtually any asset. Of course this includes shares of the stocks of listed companies, stock indexes of the most important markets in the world such as those of the United States and European countries such as Spain, France and Germany.
Among the stocks available on Plus 500 – which we consider to be the best currently available online broker – you will find stocks from practically any company that you can think of. Among those from Spain, are stocks from companies listed on the Ibex 35 such as “Banco Santander”, “Gas Natural”, “BBVA” and “Telefónica”, but also from smaller capitalization companies such as “CAF” or “Catalana Occidente”. However, you are not limited to Spanish companies when trading with CFDs, you can also trade in the stocks of such wide ranging companies as Facebook, Intel, Microsoft, Twitter or Amazon.
Of course, you can also trade stock indexes, among which can be found Spanish indexes, the main American indexes, French and German indexes, and many more.
Whether trading CFDs on underlying financial instruments such conventional currencies or cryptocurrencies such as Ethereum, Bitcoin Cash, Bitcoin Gold, Ripple, or Litecoin, you do not pay any commissions for each operation that you perform, rather you pay the fees in the form of a spread or differential. Each spread depends on the particular asset or index being traded, but generally speaking, these spreads are always low.
It is also possible to trade commodities by means of CFDs. The variety of commodities it is possible to trade is vast, among which can be found gold, wheat, silver and oil. In the following image you will be able to see the spread involved in trading oil with Plus500.
As you can see, in general, the spreads are low, which means greater profitability for traders. This is key, since brokers that charge commissions or which have high spreads ultimately require that their users pay much more money to trade, which has a negative impact on their personal profits. For this reason, if you would like to find out how to trade without paying any commissions with Plus500, click here for more information (76,4% of retail CFD accounts lose money).
Trading is not easy. Therefore, it is necessary to gain experience in order to be able to consistently earn steady profits – especially since the risks associated with trading can be high. For this reason, if you are a total novice, you have the option of learning how to trade by using a trading simulator which provides you with a virtual currency – any earnings or losses will also be virtual. These simulators have the advantage of reproducing the exact same market conditions (as those of the real money marketplace) of stocks, currencies and other instruments, allowing you to practice trading under the same conditions as you would if you were using real money.
For our comparison of brokers, the availability of a trading simulator – or demo account – was an important consideration. Unfortunately, not all brokers offer one, and we have only selected those brokers that make a trading simulator available to their users. If Plus500 holds the first position in our ranking, it is in part because it offers a trading simulator. Furthermore, Plus500’s demo account is free and available in English (76,4% of retail CFD accounts lose money).
Why do we pay so much attention to the demo account? Because, if you have never done any trading before, a demo account could be very useful for allowing you to see how the trading platform works and to perform your first practice trades without running any risk. Markets are volatile and a single news item can sometimes be enough to cause prices to change dramatically, in a matter of seconds. For this reason, practicing with a trading simulator will allow you to learn how to defend yourself against and take advantage of these sudden changes in market conditions.
Another factor to keep in mind is the analysis of data. With the demo account, you will be able to elaborate and perfect your trading strategy by studying the price charts and candlestick graphs that the platform makes available to you. Because you will be trading with a virtual currency, you will be able to perform all of the operations that you like, and see how your strategy performs.
Opening the free demo account is very easy. All you need to do is to click on the button below and then follow the link that says “start trading now”. Once you have done this, a window will open. You will need to choose “demo account”. Just fill in your personal information and you will be ready to begin trading (76,4% of retail CFD accounts lose money).
Another highly valued aspect that we take into account during our evaluation is the opinion held by other traders about a particular broker. If we see that negative comments are being made about a broker’s trading platform or its other online tools, we take this as a negative sign, one which lowers our appreciation of the broker in question. If on the other hand the majority of comments being made about a broker are positive, this increases our estimation of it. Our experience has led us to develop a clear strategy: first we determine whether or not a broker is reliable, next we ensure that its fees are reasonably low and finally we consider the opinions held by other traders before making our final decision.
As we have done from the beginning of this review, we will focus on the opinions about Plus500, since it occupies the top spot in our ranking of the best online brokers. As far as Plus500 is concerned, the opinions about its trading platform are generally very good. This is something that should be emphasized since the platform was developed by the broker with the goal of facilitating trading and in order to make trading available to the widest possible audience. This trading platform is different from MetaTrader 4. While Plus500’s proprietary platform may be lacking a few of MetaTrader 4’s tools.
Before taking a look at some of the negative comments regarding this broker, and there are some, we will first spend a moment going over the rest of the positive comments. Another favorable opinion which was expressed on many occasions concerns commissions, something that we touched upon previously. Also, some of the currency pairs – for trading in the Forex market – being traded on Plus500 have low spreads. Last but not least, Plus500’s excellent regulation is a source of confidence for many brokers who, generally speaking, consider this broker to be secure.
We mentioned a moment ago that there had also been some negative comments made with respect to this broker; this can be interpreted as a good sign since not everyone has the same tastes. In fact some of these negative comments concern the trading platform – professional traders may find it somewhat lacking in terms of trading signals and tools.
This is what stands out from our analysis of Plus500; we have also compared it to opinions made about other binary options brokers such as Anyoption, IQ Option, Top Option, 24Option, Zone Options, Optionfair and Banc de Binary.
In order to allow trading, brokers provide their users with a trading platform which displays information about the different assets (charts, prices, etc.) and through which users are able to place buy and sell orders. There is a wide range of trading platforms, each one of which has its own characteristics and conditions. For example, one of the most well-known platforms is MetaTrader 4. Several brokers use MetaTrader, such as Markets.com for example. While this platform may be the most complete in terms of the amount of information and data it supplies, it has one serious drawback: it is hard to use.
For its part, Plus500’s platform was developed entirely by the broker itself which makes it proprietary software. This allows it to be totally customized and, generally speaking, makes its trading tools much easier to use. The downside of this software is that it does not supply some of the data that more experienced traders may miss.
Before concluding this review, we would like to summarize the reasons why we consider Plus500 to be one of the most famous online broker. One reason which we have not yet mentioned is that its minimum initial deposit is lower than that of its competitors – only 100 euros. This gives its users the possibility of starting to trade with a lower initial investment of capital. Another factor in our decision is that it allows a leverage of 1:30 for certain assets. If in addition to these considerations we add its low spreads, its reliability and the positive comments made by its users across the internet, it is not hard to understand why Plus500 is considered to be a good-quality and inexpensive broker.
If you would like to learn more about Plus500’s conditions or to open an account, you can do so by clicking this link (76,4% of retail CFD accounts lose money).