We found 11 online brokers that are appropriate for Trading CFD.
In this CFD vs stock guide, we will discuss the two trading tools separately to know in detail what each is and which fits the best to an individual trader's investment strategy.
CFDs are complex instruments contingent on underlying financial markets. CFD is somewhat similar to the trading of shares but with a difference and this is simply a contract for difference and not owning the underlying asset. For traders, it is a great trading alternative.
In simple terms, CFD is buying a contract with the CFD provider via retail investor accounts and the entry like Short Sell or buy depends on the position of an individual trader while the exit price is the equal opposite position.
One of the key differences between CFD trading and trading stocks is that the contracts can be leveraged while trading a security asset cannot. CFD trade is traded on margin. This means only a small portion of capital is required and not the full value of the position.
Features | CFD | Real Stocks |
Own Underlying Assets | No, CFD trading is a deal on price movement between the trader and Stock CFD broker | Yes |
Leveraged Trading | Yes | No |
Risk Level | High | Medium |
Losses | Loss may exceed deposited amount | loss will not exceed invested amount |
Outlay | CFD leverage allows depositing of a fraction of the exposure to the markets | Full amount has to be paid for stocks upfront |
Direct Market Access | Yes | Yes |
Tradable Assets | CFD Stocks, CFD Commodities, CFD Forex, CFD Cryptocurrency, CFD ETF, CFD Indices | Stocks, Indices, ETFs |
Fees | Spreads, Overnight fees | Commission on buy or sale |
Market Hours | 24 hours a day 7 days a week | 24 Hours, 5 days a week |
Shareholder Privilages | No | Yes |
Right To Vote | No | Yes, if you own enough stock in that company |
Dividend Rights | No | Yes, if you own enough stock in that company |
Short Or Long | CFDs can be trades on rising and falling prices on a specific financial instrument with the CFD broker | Trade stocks on rising prices |
Expire Dates | No | No |
Suitable For | Day trading, Short term trading | Long term trading |
Below are the advantages related to CFDs vs stocks:
Trading stock CFDs with leverage can be quite useful. However, during this type of trade, the stock CFD broker is lending you the required capital to open a larger trading position. A stock CFD with leverage can incur interest charges if it remains open overnight.
This particular charge is referred to as a 'swap' dee. It is reliant on the full market value of the open trading position as well as the rate set by your chosen broker.
Intrinsically, if you bought shares with your own capital, you would not have to pay this fee. Hence, if you are interested in buying shares to hold onto them for the long-term, doing such a thing using stock CFDs will attract significant fees.
Another significant disadvantage of stock CFD trading comes from not owning the underlying shares. Company shareholders normally enjoy added perks such as the right to vote when the company makes any key decisions. Stock CFD trading means that the trader will not be able to take advantage of this right since they do not have the shareholder privileges regular shareholders have.
Leverage tends to add more risk since price moves in the global markets you are conducting trade in will make for a larger margin percentage that you have deposited than if you decided to pay the complete amount.
For instance, if a trader has deposited 10 percent collateral for an equity trade, the share price will have to fall 10 percent for them to lose their full deposit.
However, traders can still add more funds to cover margin calls, thereby providing some flexibility provided it is used carefully. In some cases, the losses occurring on a trade can go beyond the funds that were initially deposited, leading to a high risk of losing money rapidly for the trader.
With CFD trading one can trade stocks with leverage to increase exposure to the underlying asset. This means only a small percentage of capital is to be deposited for opening a position. The remaining capital is borrowed from the broker. The deposit money here is called a margin and it varies depending on the position value.
It is understood that leverage adds gains, but the financial markets need to be in favourable condition. In an adverse stock market, the result can be very different. It leads to increased losses. Hence, experts suggest undergoing risk management and remaining assured about the risks involved in the trade.
There is no leverage in shares. If the price of one unit of share is £100 and 10 units are purchased, £1,000 would need to be paid.There is a benefit to stock trading over CFD trading. In adverse conditions, the loss is limited compared to what a trade may lose in CFD trading for the same units of the same shares at the same time.
The primary disadvantage of stock trading is that the capital required is comparatively more as no borrowing in the name of leverage is possible from a broker.
There is nothing to deliver in a short sale as a trader does not own the underlying asset. In the United Kingdom, the CFD is exempt from 0.5% stamp duty. However, traders trading CFDs may have to pay capital gains tax. The taxation part is not the same in all the countries.
A CFD trader does not own the underlying asset but enters a conceptual agreement with a broker. A trader in CFD is only concerned about the price movement of a company’s shares and nothing else.
CFD is not traded with 100% capital of the asset value but with a margin, minimum deposit and buying and selling are also based on marginal computations.
The margin is somewhat between 5% and 25%. This means a trader can get the exposure of twenty times if the margin is 5%. If he opts to trade in shares instead of CFD, he needs to invest the entire value of the asset.
Let us understand with an example. Assume a trader buys 5 shares of Company X at £400. His invested capital would be £2,000. Now, if he buys CFD of the same share and the same number of units with a 5% margin, his investment would be just £100.
In CFD the gains are potentially several folds more than stock, but losses are also similarly inflated, meaning retail investor accounts lose money as a result of uninformed decisions. So, if a trader lacks sound knowledge about the market and is new to the industry they may lose more money than they have deposited this cannot happen with the traditional stock trading as you have to pay upfront for the stock you are buying. You are buying ownership of the underlying stock asset. With CFD trading you own no assets; you are merely speculating the movement of the real assets price.
If an investor trades on a CFD of Google or Toyota, he is in fact trading the price difference of his entry and exit. He does not own the company's shares. He just speculates the price movement of the shares in one direction, either upward or downward. His concern is only the price movements and contracts struck with his broker.
CFD and stock are more or less the same, but the only difference is the leverage. In stock, a trader needs more capital than trading in CFD even if the CFD is the trading of the same stocks.
CFD is best for experienced traders who can rightly predict the price movement of shares. If the price moves accordingly, it means profit. If the price goes against the prediction, it leads to loss.
Experts suggest opting for less leverage in CFD if the market is tough to predict. Less leverage means less loss while more means the loss percentage could go up several folds. It is also suggested to go with brokers licensed by reputable regulatory bodies such as the Commodity Futures Trading Commission.
Besides this, with CFD vs stock trading, it can be wrapped up that both have pros and cons and hence both are required in a portfolio to spread or minimize the loss. Do not put all your eggs in one basket, always opt for diversifying your portfolio.
If you are researching CFDs make sure to read through the below CFD related guides. You will find something useful.
We have conducted extensive research and analysis on over multiple data points on Cfd Vs Stock to present you with a comprehensive guide that can help you find the most suitable Cfd Vs Stock. Below is a list of what we consider to be the best CFD brokers after careful consideration and evaluation. We hope this list will assist you in making an informed decision when researching Cfd Vs Stock.
Selecting a reliable and reputable online CFD trading brokerage involves assessing their track record, regulatory status, customer support, processing times, international presence, and language capabilities. Considering these factors, you can make an informed decision and trade CFD more confidently.
Selecting the right online CFD trading brokerage requires careful consideration of several critical factors. Here are some essential points to keep in mind:
Our team have listed brokers that match your criteria for you below. All brokerage data has been summarised into a comparison table. Scroll down.
When choosing a broker for CFD trading, it's essential to compare the different options available to you. Our CFD brokerage comparison table below allows you to compare several important features side by side, making it easier to make an informed choice.
By comparing these essential features, you can choose a CFD broker that best suits your needs and preferences for CFD. Our CFD broker comparison table simplifies the process, allowing you to make a more informed decision.
Here are the top CFD Brokers.
Compare CFD brokers for min deposits, funding, used by, benefits, account types, platforms, and support levels. When searching for a CFD broker, it's crucial to compare several factors to choose the right one for your CFD needs. Our comparison tool allows you to compare the essential features side by side.
All brokers below are CFD brokers. Learn more about what they offer below.
You can scroll left and right on the comparison table below to see more CFD brokers that accept CFD clients.
Broker |
IC Markets
![]() |
Roboforex
![]() |
Pepperstone
![]() |
XM
![]() |
AvaTrade
![]() |
XTB
![]() |
eToro
![]() |
NordFX
![]() |
Trading212
![]() |
FP Markets
![]() |
EasyMarkets
![]() |
Rating | |||||||||||
Regulation | Australian Securities and Investments Commission (ASIC), Financial Services Authority (FSA), Cyprus Securities and Exchange Commission (CySEC) | RoboForex Ltd is regulated by the FSC, license 000138/437, reg. number 128.572. RoboForex Ltd, which is an (A category) member of The Financial Commission, also is a participant of its Compensation Fund | Financial Conduct Authority (FCA), Australian Securities and Investments Commission (ASIC), Cyprus Securities and Exchange Commission (CySEC), Federal Financial Supervisory Authority (BaFin), Dubai Financial Services Authority (DFSA), Capital Markets Authority of Kenya (CMA), Pepperstone Markets Limited is incorporated in The Bahamas (number 177174 B), Licensed by the Securities Commission of the Bahamas (SCB) number SIA-F217 | Financial Services Commission (FSC), Cyprus Securities and Exchange Commission (CySEC), Australian Securities and Investments Commission (ASIC) | Australian Securities and Investments Commission (ASIC), ASIC (406684), Financial Services Authority (FSA), South African Financial Sector Conduct Authority (FSCA), Financial Stability Board (FSB), The Financial Services Agency (JAPAN FSA), Financial Futures Association of Japan (FFAJ), Abu Dhabi Global Markets (ADGM), Financial Regulatory Services Authority (FRSA), Polish Financial Supervision Authority (KNF), Israel Securities Association (ISA), British Virgin Islands Financial Services Commission (BVI), BVI (SIBA/L/13/1049), Central Bank of Ireland | FCA (Financial Conduct Authority reference 522157), CySEC (Cyprus Securities and Exchange Commission reference 169/12), FSCA (Financial Sector Conduct Authority), XTB AFRICA (PTY) LTD licensed to operate in South Africa, KPWiG (Polish Securities and Exchange Commission), DFSA (Dubai Financial Services Authority), DIFC (Dubai International Financial Center), CNMV (Comisión Nacional del Mercado de Valores), KNF (Komisja Nadzoru Finansowego), IFSC (Belize International Financial Services Commission license number IFSC/60/413/TS/19) | FCA (Financial Conduct Authority) Etoro (Europe) Limited FCA reference 523775, eToro (UK) Ltd FCA reference 583263, ASIC (Australian Securities and Investments Commission) eToro AUS Capital Limited ASIC license 491139, CySec (Cyprus Securities and Exchange Commission under the license 109/10), MiFID (Markets In Financial Instruments Directive), FSAS (Financial Services Authority Seychelles) eToro (Seychelles) Ltd license SD076 | Cyprus Securities and Exchange Commission (CySEC), License No: 209/13, VFSC registration number 15008 | Financial Conduct Authority (FCA), Financial Supervision Commission (FSC) | Australian Securities and Investments Commission (ASIC), Cyprus Securities and Exchange Commission (CySEC), FSCA (FSP Number 50926) | Cyprus Securities and Exchange Commission (CySEC), Australian Securities and Investments Commission (ASIC), Financial Services Authority (FSA), British Virgin Islands Financial Services Commission (BVI) |
Min Deposit | 200 | 10 | 200 | 5 | 100 | No minimum deposit | 50 | 1 | 1 | 100 | 100 |
Funding |
|
|
|
|
|
|
|
|
|
|
|
Used By | 180,000+ | 1,000,000+ | 400,000+ | 3,500,000+ | 300,000+ | 581,000+ | 30,000,000+ | 10,000+ | 15,000,000+ | 10,000+ | 142,500+ |
Benefits |
|
|
|
|
|
|
|
|
|
|
|
Accounts |
|
|
|
|
|
|
|
|
|
|
|
Platforms | MT4, MT5, Mirror Trader, Web Trader, cTrader, Windows, Mac, iOS, Android | MT4, MT5, Mac, Web Trader, cTrader, Tablet & Mobile apps | MT4, MT5, TradingView, DupliTrade, myFXbook, Mac, Web Trader, cTrader, Tablet & Mobile apps | MT4, MT5, Mac, Web Trader, Tablet & Mobile apps | Web Trader, MT4, MT5, AvaTradeGo, AvaOptions, DupliTrade, ZuluTrade, Mobile Apps, ZuluTrade, DupliTrade, MQL5 | MT4, Mirror Trader, Web Trader, Tablet & Mobile apps | Web Trader, Tablet & Mobile apps | MT4, MT5, Tablet & Mobile apps | Web Trader, Tablet & Mobile apps | MT4, MT5, IRESS, Mac, Web Trader, Tablet & Mobile apps | MT4, MT5, Web Trader, Tablet & Mobile apps |
Support |
|
|
|
|
|
|
|
|
|
|
|
Learn More |
Sign
Up with icmarkets |
Sign
Up with roboforex |
Sign
Up with pepperstone |
Sign
Up with xm |
Sign
Up with avatrade |
Sign
Up with xtb |
Sign
Up with etoro |
Sign
Up with nordfx |
Sign
Up with trading212 |
Sign
Up with fpmarkets |
Sign
Up with easymarkets |
Risk Warning | Losses can exceed deposits | Losses can exceed deposits | 74-89 % of retail investor accounts lose money when trading CFDs | CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77.74% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. | 71% of retail investor accounts lose money when trading CFDs with this provider | 81% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. | 77% of retail investor accounts lose money when trading CFDs with this provider. | Losses can exceed deposits | CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. | Losses can exceed deposits | Your capital is at risk |
Demo |
IC Markets Demo |
Roboforex Demo |
Pepperstone Demo |
XM Demo |
AvaTrade Demo |
XTB Demo |
eToro Demo |
NordFX Demo |
Trading 212 Demo |
FP Markets Demo |
easyMarkets Demo |
Excluded Countries | US, IR, CA, NZ, JP | AU, BE, BQ, BR, CA, CW, CZ, DE, ES, EU, FM, FR, GW, ID, IR, JP, LR, MP, NL, PF, RU, SE, SJ, SS, TL, TR, US | AF, AS, AQ, AR, AM, AZ, BY, BE, BZ, BT, BA, BI, CM, CA, CF, TD, CG, CI, ER, GF, PF, GP, GU, GN, GW, GY, HT, VA, IR, IQ, JP, KZ, LB, LR, LY, ML, MQ, YT, MZ, MM, NZ, NI, KP, PS, PR, RE, KN, LC, VC, WS, SO, GS, KR, SS, SD, SR, SY, TJ, TN, TM, TC, US, UY, VU, VG, EH, YE, ZW | US, CA, IL, KR, IR, MM, CU, SD, SY | BE, BR, KP, NZ, TR, US, CA, SG | US, IN, PK, BD, NG , ID, BE, AU | ZA, ID, IR, KP, BE, CA, JP, SY, TR, IL, BY, AL, MD, MK, RS, GN, CD, SD, SA, ZW, ET, GH, TZ, LY, UG, ZM, BW, RW, TN, SO, NA, TG, SL, LR, GM, DJ, CI, PK, BN, TW, WS, NP, SG, VI, TM, TJ, UZ, LK, TT, HT, MM, BT, MH, MV, KZ, GD, FJ, PT, BB, BM, BS, AG, AI, AW, LB, SV, PY, HN, GT, PR, NI, VG, AN, CN, BZ, DZ, MY, KH, PH, VN, EG, MN, UA, JO, KR, | US, CA, EU, RU, SY, KP, CU | US, CA | US, JP, NZ | US, IL, BC, MB, QC, ON, AF, BY, BI, KH, KY, TD, KM, CG, CU, CD, GQ, ER, FJ, GN, GW, HT, IR, IQ, LA, LY, MZ, MM, NI, KP, PW, PA, RU, SO, SS, SD, SY, TT, TM, VU, VE, YE |
You can compare CFD Brokers ratings, min deposits what the the broker offers, funding methods, platforms, spread types, customer support options, regulation and account types side by side.
We also have an indepth Top CFD Brokers for 2023 article further below. You can see it now by clicking here
We have listed top CFD brokers below.
eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Past performance is not an indication of future results. Trading history presented is less than 5 complete years and may not suffice as basis for investment decision.
Copy trading is a portfolio management service, provided by eToro (Europe) Ltd., which is authorised and regulated by the Cyprus Securities and Exchange Commission.
Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
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.