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Best CFD Trading Platforms in Australia (2021)
With CFDs, traders can speculate on price movements of different kinds of markets, including stocks, commodities, market indices, and even cryptocurrencies.
In some cases, there are even options to trade on currencies, though they tend to be trickier to get into and not worth the risk.
CFD trading is not like other types of trading, which involves the trader owning a portion of an asset. It’s because of this that buying, selling, and trading CFDs can result in profits and/or losses, regardless of fluctuations in price.
The ability to spot trends and speculate about what may happen in the near future is a trade that comes with time, a level that many investors will eventually get to.
Below, we have an in-depth look at all of the best CFD platforms in Australia, tested and researched by us!
Our Top 5 CFD Platforms in Australia
- eToro – Best CFD Broker for Beginners
- CMC Markets – Best CFD Broker with Low Fees
- ActivTrades – Best CFD Broker Platform
- Trading 212 – CFD Broker with The Easiest Account Opening
- VantageFX – Best Variety for CFD Broker
1. eToro – Best Overall CFD Platform
- Regulators: Financial Conduct Authority (FCA) and Australian Securities and Investments Commission (ASIC)
- Minimum Deposit: $200
- Deposit Fees: $0
- Withdrawal Fee: Yes, $5. Minimum withdrawal $30
- Inactivity Fee: Yes. Kicks in after 12 months of inactivity, $10 /month
eToro is home to one of the most successful online trading platforms across the globe. Traders from more than 140 countries use their services, with options to trade in many US markets including crypto, indices, stocks, and bonds. The commission-free fees structure is one of the biggest perks that traders can enjoy, getting more of a return on their trade instead of losing it to fees.
- Zero commissions on trades
- Copy-trading option perfect for beginners
- Website and app that’s easy to use
- Lots of tools and educational resources
- Option to learn the ropes with a demo account
- Option to purchase fractional shares
- Market availability is limited
- All transactions in USD
- Spread fees vary across different markets and can add up
Optional Demo Account
One of the main reasons why this platform is perfect for beginners is the optional demo account. Though it’s great for beginners, traders of all levels and backgrounds can try it out, getting a glimpse of how the market works and practicing without any of the risks.
A demo account with eToro comes with $100,000 free virtual cash, all of which traders can practice with buying and trading in multiple markets. The demo account offers real-time access to reports and information and the demo platform is just like the normal, making it as close to the real thing as possible. Traders can practice buying and trading and even execute orders like stop loss and take profits.
There are many successful traders out there, some of which have been in the trading game for some time now. eToro members can browse through available pro profiles, taking a peek at their success and choosing to follow them and copy their investment activities. With copy trading, eToro investors can get a glimpse of how top traders are performing in the market, copying their every move to reap the same benefits.
Investors can either get an alert when top traders that they follow make a move or automate their accounts to get the job done for them without having to log in or click any buttons.
49 Forex Pairs Available
Due to eToro’s extended reach within the market, traders have access to more than 49 forex pairs, including USD, EUR, AUD, and GBP. Though these trades come with great rewards, they also come with high risk, which is why newer traders are advised to take some time to learn before dabbling in CFD trading. Higher leverage always means higher risk, even though it’s usually highly profitable.
2. CMC Markets – Best CFD Broker with Low Fees
- Regulators: Financial Conduct Authority (FCA) and Australian Securities and Investments Commission (ASIC)
- Deposit Fees: No.
- Withdrawal Fee: No.
- Integrations: MT4 and Next-Generation trading platform
- Inactivity Fee: Yes. $15 per month if no activity
CMC Markets has been around since 1989, delivering global CFD and forex options to its customers. It is regulated by Financial Conduct Authority (FCA) and has a long-standing of providing safe and fair services to investors in Australia. The fee structure is low, and the platform comes with an easy-to-use design that’s perfect on both PC and mobile devices. While the fees are some of the lowest around, the trading fees tend to fall on the higher side, though it’s one of the only downfalls when using this platform.
- Low forex fees
- Access to advanced research tools and integrations
- Customizable dashboard
- Fast account opening
- High stock CFD fees
- Lacking additional layers of account security
The platform features a modern design that’s filled with all the things traders need and then some! Luckily, there is a convenient search bar right at the top to help traders find exactly what they need and facilitate the research and trading process. CMC Markets comes with the possibility to integrate with MT4, an innovative and advanced analytics platform.
The app is user-friendly and accessing research tools and educational resources is a breeze. The one downside is the security, which lacks two-factor authentication. It’s recommended to log in using a safe browser to prevent access to sensitive data.
Traders in Australia want more than just a few options when it comes to their portfolio, which is why available markets are extremely important. CMC Markets offers ASX, CFD, and Forex. Access to all of these markets includes stocks, indices, cryptos, and more within them, giving Australians a chance to diversify their portfolio without having to use multiple platforms.
CMC Markets doesn’t offer support around the clock but, they have extended hours that investors can access when they need to. They have fast response times and options of contact include phone support, live chat, and email. Traders can access agents that speak multiple languages and get a knowledgeable rep to walk them through any issue they run into.
While customer care is limited for CMC Markets, there were no outstanding complaints on the web, and we couldn’t find any instances with unsatisfied members.
3. ActivTrades – Best CFD Platform with Lowest Fees
- Regulators: Financial Conduct Authority (FCA) and Securities Commission of the Bahamas (SCB)
- Minimum Deposit: $500
- Deposit Fees: No
- Withdrawal Fee: No
- Integrations: MT4
- Inactivity Fee: Yes. $10/month after 6 months of inactivity
From the low trading fees to the opportunity to access markets across the globe, ActivTrades is considered one of the best platforms on the web. It’s safe and reliable, offering traders all kinds of market orders to set up their trades as they wish and keep their finances from plummeting. CFDs are complex markets, requiring advanced market knowledge that traders can access directly from the platform via the website or the app.
- Simple account opening without a complicated process
- No charges for deposit or withdrawal
- Low fees across the board
- Advanced order types
- Inactivity fee, charged after 6 months
- No available price alerts with platform
Simple Account Opening
Creating an account is a breeze. Traders that are interested in creating an account simply have to visit the website and sign up before verifying their identity. Some trading platforms on the web make verification long and drawn-out process, the opposite of what takes place with ActivTrades. It’s 100% online and will have investors in the platform and ready to trade in little to no time at all.
Basic Market Orders
Market orders are an important part of the trading process, allowing investors to have more control over their trades. An account with ActivTrades comes with basic order types, including:
- Trailing Stop
The platform also offers order time limits, which include Good ‘til Cancelled (GTC) and Good ‘til Time (GTT). To make the most out of each order and get the most out of each trade, investors are encouraged to add market orders when they can, reducing the risk and/or loss that they experience from a day trading within an unpredictable market.
Funding and Withdrawals
To fund their account with ActivTrades, traders can use a number of options, including e-wallets like PayPal and Skrill. Apart from that, funding the account can be done via bank transfer and credit or debit card.
There are no fees for withdrawals, and options are the same as mentioned for deposits. While deposits are instant, some withdrawals are subject to a processing time, of which could take up to 3 days. All e-wallets are processed instantly, something to keep in mind when processing a withdrawal.
4. Trading 212 – CFD Broker with The Easiest Account Opening
- Regulators: Financial Conduct Authority (FCA) and Bulgarian Financial Supervision Commission (FSC)
- Minimum Deposit: $1
- Deposit Fees: No
- Withdrawal Fee: $0
- Inactivity Fee: No
Trading 212 has a phenomenal fee structure that is perfect for frequent traders. There are no fees on trade stocks and EFTs, as well as top forex and CFDs available. Additionally, withdrawals are free and there is no fee tacked onto your account for inactivity. Though it’s fairly new on the list of trading platforms in Australia, it’s gotten a lot of attention due to its amazing platform as well as its access to in-depth market analysis information.
- Lots of market options commission-free
- Low CFD trading fees
- Access to in-depth market analysis tools
- Quick account opening and verification
- High forex fees
- Limited for diversification
- Limited access to customer care
Seamless Account Opening
When you visit Trading 212’s website, sign up is simple and verifying your account takes max one day. New traders can set up their accounts online and have the process up and ready to go, making their first deposit and scoring access to the platform and the analysis tools.
To make the process run smoothly, make sure to have your tax information and tax ID handy. Also, be prepared to answer questions about your finances, including your employment status and your experience, if any, with trading.
If you’re not one to sit around and monitor the market all day (you’re not alone!), automation is your best friend. Trading 212 offers options to automate trades and set up notifications for alerts like price drops and important announcements from the stocks that you follow.
The web trading platform is available via desktop and via mobile with the trading app, available for both Android and iOS. From the dashboard on the app, traders can browse stocks, check the market, and even execute orders and trades, all from the push of a button.
The fees are not the lowest on the web but, for what you get, they make it worth your while. CFD fees start at $4.3 for S&P 500 and can extend up to $18.3 (Apple CFD). Still, most other trades are offered for zero commission. As far as other fees, Trading 212 doesn’t tack any onto accounts, doing away with deposit, withdrawal, and inactivity fees. For that reason, the platform is great for both investing and trading, as it won’t cost you to hold onto your stocks like it would with other platforms.
5. VantageFX – Best Variety for CFD Broker
- Regulators: Australian Securities and Investments Commission (ASIC) and the Vanuatu Financial Services Commission (VFSC)
- Minimum Deposit: $200
- Deposit Fees: No
- Withdrawal Fee: $0
- Integrations: MT4
- Inactivity Fee: No
VantageFX is a bit more limited than the competition, though they have a lot of other good things to offer that put them on the list. Signup is quick and the process to add funds and withdraw earnings is seamless, with a long list of accepted payment methods to accommodate all types of traders. The integrations include Meta Trader 4 (MT4), which helps investors take their market analysis up a notch and includes access to automated orders and alerts to buy and trade more efficiently.
Investors and traders of all levels benefit from access to educational materials. VantageFX has a ton of them, including access to a demo account and tutorials. The demo account gives new account members access to virtual money, of which they can use in a simulator to get a feel for how trading really goes. In addition to demos and tutorials, members can access videos with a ton of useful information and even access webinars to interact with the pros.
There is a set of tools to help investors access more useful information, helping them get and stay away from what’s happening in the market at all times. Included along with configurable analysis tools is a feature called ‘Trading Ideas,’ which investors can use to check out tips for stocks and other markets to look out for based on professional analysis. Members also have the option to add the MT4 platform along with VantageFX, scoring even more automated features and accessing alerts and notifications for price drops and more.
Plenty of Payment Options
The last thing traders want is limited payment options, making it hassle-free to get their hands on the money they’ve earned. VantageFX offers traditional payment methods like debit and credit cards, along with others like PayPal, Skrill, Neteller, and even cryptocurrencies. There are no fees for either adding or withdrawing funds, and, in the case of e-wallets, processing times are instant.
Deciding if CFDs are Right for You
Now that you know what some of the best platforms look like, you might be left wondering if CFD trading is for you. Before looking into how to trade CFDs, find out if they are the right choice for you. CFDs are best for:
- Experienced traders
- Investors with a strong understanding of the market and its fluctuations
- Investors that have a bit of legal expertise and can understand the complexity of CFDs
- Traders not interested in owning assets
- Investors that know how to research and can get results fast
- Investors that understand the risk and how to minimize their probability of experiencing it
How to Trade CFDs
If you made it here, you must be ready to take the plunge. Getting in on the CFD trading is exciting and comes with a lot of opportunities, which is why several investors are giving it a try. If you’re one of them, here is how you can start trading CFDs.
Step 1. Choose your Platform
Before you start trading, you’ll have to have a place to trade, which is why picking your platform is critical. To choose your platform, take a look at our top 5 and think about some of the key features that you want from your trading experience, going with the one that gets the closest. Make a list of your top choices and be sure to consider your goals, finding a platform that fits your preferred trading style and offers you the features you need.
Step 2. Choose your Market
With CFDs, you have the option to focus on a market, including shares, Forex, indices, commodities, and much more. Before you trade CFDs, it’s good to know which market you’d like to focus on, getting a better grip on the type of research you need to do.
Step 3. Long or Short?
Before you do anything, you should take a look at the current price of the asset you’re interested in investing in. Take a look at both the bid and the offer, using them as indicators as to whether it’s worth it or not based on the spread.
Then, it’s time to decide whether you want to go long or short. Long investments usually bank on the idea that, over time, the value of the asset will increase. On the contrary, the short term takes the other route and sells the market based on speculation that the value is going to fall.
Step 4. Pick your Price
With the market and the asset that you would like to trade, now’s the time to get to the more serious stuff. At this time, you’ll need to decide how much of an asset you’d like to buy. Depending on which market you chose, you may have different structures for buying and trading, all of which you should check out and understand beforehand.
One thing to note is that CFD trades go off of leverage, which means your initial investment is much lower than the actual price of the assets you’re purchasing. That can be a great thing if the asset does increase in value when you decide to sell but could mean that you own quite a bit back if it doesn’t work out in your favor.
Step 5. Protect your Investment
A lot of seasoned traders already know about certain insurances like stops, stop loses, limit orders, and more. Just like with all other investments, it’s recommended to give your investments a sense of security, adding some key insurers through limit orders. If you’re unsure what these are, take some time to understand them, as they could save your investment.
Reduce your Risk
Because of the risk imposed on traders that choose CFDs, it’s critical to find ways to reduce risk. Take a look at the suggestions below to reduce risk and start buying and selling more confidently in riskier markets like CFDs.
Monitor your Trade
One of the main reasons why trading platforms with advanced monitoring software is key is because investors can monitor their trade any time day or night. That comes with a lot of power and can seriously reduce the risk. Be sure to check out the trade and the market as a whole, taking a look at all things that could affect its current value or standing.
Have an Exit Strategy
A contract with CFDs is not set in stone. To keep from losing too much, set up an exit strategy, one that you can execute at a moment’s notice if the market all of a sudden starts slipping and doing things other than what you had in mind. Be sure that when you go out on the hunt for a trading platform, you choose one that offers a variety of orders, including those that will protect your finances like stop and loss.
Keep in mind that an exit strategy is something that you may develop over time, learning from your losses and constructing one that will suit you and your trading style.
Create a Budget (And Stick to It)
Investing and trading are both exciting and, if you’re up for the day, it’s easy to get caught up in the moment. With CFDs, the amount of leverage offered makes it tempting to bite off more than you can chew, though it’s advised to refrain. Setting a budget is a way to limit your losses and reduce your risk. Start off with a budget that is both affordable and will give you some pull in the market, accounting for both the good and the bad.
With risky investments like CFDs, you always have to think ahead and look at not only what you can gain but also what you can stand to lose.
Rules to Live by When Trading CFDs
It should come as no surprise that CFDs have exploded in popularity. The ability to take advantage of leverage and earn big is part of the appeal, though CFDs are not for the faint-hearted. Those who are interested in investing and trading CFDs would do well to take a look at these top strategies, most of them coming straight from pros that have conquered the world of CFDs.
Rule #1. Be Picky with your Platform
Because there are so many trading platforms out there, investors have options galore. Online trading platforms are constantly going head-to-head, each one trying to outdo the other. That’s a great thing for potential investors, as they can be as picky as they please when it comes to choosing the one that works best for them.
We recommend making a list of a few and comparing them side by side, finding the fee structure, market availability, and safety features that cater to you and your finances.
Rule #2. Make Safety a Priority
Though a lot of top-performing platforms take steps to help investors secure their accounts, you don’t have to stop there. Consider investing in a VPN for your trading, or make sure that you’re using password managers to keep things in order.
Your accounts are often attached to sensitive data, some of which include tax IDs and banking information. Though it’s a minor inconvenience in our fast-paced digital world, when possible, opt for two-factor authentication, adding an additional layer to your security just in case.
Rule #3. Build a Strong Foundation
Just like with most things in life, a strong foundation is a key to lasting. While CFDs are exciting, they are not something that you want to rush into. With all of the available educational tools in the best CFD platforms, we recommend taking some time to get to know CFD trading front and backward, making sure you’re prepared for whatever the market could throw your way.
Rule #4. Think Long Term
Most investors out there get into it because they want to make their money work for them. Instead of placing it in a savings account, investors can earn money from market fluctuations over time, growing their money the longer they stay in. Traders do the same, though many of them look for ways to earn money faster and trade more often.
Both options are great and, with both, thinking long-term is key. Consider investments long-term and get your mindset away from collecting quick cash, as that will increase your chances of walking away with much more and securing your finances from here and on.
Rule #5. When It’s Time, Diversify
Diversification of your portfolio is a way to: 1. reduce your risk and 2. grow your initial investment. Don’t take off and diversify too fast, as you’ll need time and secured funds to do so. While investing in CFDs, count successes as a way to invest in other strong markets.
Take a look at things like Forex and add a good variety that contrasts one another when the market starts to fluctuate. Taking time to pick and choose the best investments is how you can increase your overall investment value, not only short-term but in the long run as well.
Why Choose CFDs?
Not trying to scare you off or anything, but, CFDs take dedication and knowledge of how the market works. Apart from the opportunity to enhance your trading skills and grow your knowledge of the market, here are some reasons to choose CFDs.
- Opportunity – With CFDs, you can speculate on tons of financial products, including those within ASX and Forex markets too.
- Variety – Both long-term and short-term investments are a possibility with CFDs.
- Demos – CFDs come with access to demo accounts, where you can try out trading platforms and the process without risking your money.
- No Expiration – Other types of speculative investments come with expiration dates where you have to sell. CFDs do not, allowing you to hold on to them or sell them when you’d like.
- The Returns – Last but not least, one of the most attractive features about CFDs are their ability to result in a return. If prices go up, investors could be looking at a substantial return.
How We Choose Our Top Picks
We take our search for the best CFD trading platforms seriously, searching for those that meet our criteria.
To narrow down our list to the 5 we chose below, here is a look at what we checked for:
Who doesn’t like options? We do, and we’re sure you will too, especially when it comes to choosing how you make your investments. When we look for the best brokers on the market, we want to see variety, including opportunities to buy into gold, Forex, cryptocurrencies, indices, stock CFDs, and more.
Direct Share CFDs
Some brokers don’t offer CFD trading on shares or add lots of fees in order to access them. We like those that offer direct share CFDs so that all of the other fees that get charged get left behind and traders can enjoy access to CFDs without additional charges.
If you’re looking to stick to ASX shares, you won’t have to worry. But Forex comes with so many opportunities, which is why we check for currencies. We want to see lots of available payment options and accepted currencies from all around the globe to suit every investor.
When trading, many trading platforms will tack on a commission fee. It’s pretty common, and it’s not a bad thing, as long as it isn’t so high that it takes away from your ability to make trades and profit from them.
Access to Information
Trading CFDs takes careful attention to the market. For that reason, we look for platforms that come with access to real-time data. We take it one step further and try to sift through to find those that offer access to data for free instead of tacking on more fees.
Minimum Opening Balance
Some brokers out there come without a minimum balance, allowing you to create an account and start trading with any amount you want. We like that, but we also don’t mind smaller amounts. We like brokers to keep it low, providing access to their platforms for all levels of investors.
Integrations and Software
We cannot hit enough on the importance of market analysis, which is what you’ll have to do to trade CFDs like a pro. We look for platforms that offer access to advanced tools and integrations, giving you the freedom to analyze the market and get the most accurate look at everything before you trade.
Because opening your account comes with the need to fund it and withdraw from it, we check out the payment options. While many platforms offer debit and credit cards, we like to find those that offer other alternative forms of payment, including e-wallets. Popular e-wallets like PayPal and Skrill offer instant deposits and withdrawals, two things you’ll surely want when investing.
Common CFD Risks
Before you jump into trading CFDs, there are a few things that you should consider, including the risks. CFDs are extremely risky, which is part of their appeal. Investors like the idea of higher-risk accounts, as more risk typically comes with more opportunities to make a profit.
Before taking steps to find your broker, consider these CFD risks:
If you’re a new investor, we recommend starting off with more standard investing and trading. It takes time to learn the ropes and understand how the market changes over time. We recommend that new investors refrain from CFD trades and that seasoned investors realize what it takes to buy and sell CFDs. Even if you know the definition, that doesn’t mean you’re ready to get in on the market.
You Can Lose Quite a Bit
With most other kinds of investing or gambling, you can only lose as much as you put in. While that too is devastating, it is not quite as heartbreaking as losing more than what you came with. CFDs could cause you to have to pay way over what you initially invested, especially if the market took a turn and did the opposite of what you expected it to do. It happens and is something you have to be comfortable dealing with.
You Own Nothing
With traditional investments, you own a portion of shares. With CFDs, you’re never the owner and make a profit when there is a capital gain in value. You will first have to set up a contract with the company you wish to deal with and then, wait out the terms of the contract to see if you’re successful.
It’s Dependent on the Market
One of the main reasons why CFDs are so risky is because they depend on the market. All conditions that tip the market one way or another do the same with CFDs, which is why traders look for volatile markets. It comes with a lot of potentials to make money, and a lot to lose money too.
Practice Makes Perfect
Finding your place in the market takes time, and developing your strategy takes patience. CFDs are a hot market to invest in right now, giving investors a way to make a decent return without having to start with a large initial investment. Before creating an account and jumping into CFDs, take some time to learn about the process and get a feel for how trading CFDs works.
Once you get your first one out of the way, you can make adjustments and get closure to finding a strategy that you can stick with from here on out. Be patient and make sure to do your homework before you choose any CFD, making sure you know what you’re getting to, and you weigh the risks and the benefits to ensure it’s worth it.
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