Brokers with low leverage rates offer investors the opportunity to magnify the scale of their profits without exposing themselves to excessive risk. This supports sensible risk management and is well suited to beginner traders.
Dig into our list of the best UK brokers for low leverage, with insights into the size of margin trading opportunities and account safeguards.
Top Brokers For Low Leverage Trading
Investing involves risk. Asset prices can move rapidly and you may lose some or all money invested. Never invest more than you can afford to lose.Advertising disclosure
Our picks at a glance
- 1 Pepperstone Top score: Platforms 4.8 Info Visit Pepperstone
- 2 XTB Top score: Trust 4.8 Info Visit XTB
- 3 Spreadex Top score: Mobile 4.5 Info Visit Spreadex
- 4 Interactive Brokers Top score: Assets 4.3 Info Visit Interactive Brokers
- 5 IG Top score: Fees 4.5 Info Visit IG
- 6 Trade Nation Top score: Support 4.4 Info Visit Trade Nation
- 7 Eightcap Top score: Mobile 4.6 Info Visit Eightcap
-
Our top pick
Founded in Australia in 2010, Pepperstone is a leading forex and CFD broker serving over 830,000 clients globally. It provides access to 1,400+ instruments through MT4, MT5, cTrader and TradingView, with low, transparent pricing. Regulated by the FCA, ASIC and CySEC, Pepperstone offers a secure trading environment for all experience levels.
- Instruments
- CFDs, Forex, Currency Indices, Stocks, Indices, Commodities, ETFs, Crypto CFDs (only Pro clients), Spread Betting
- Regulator
- FCA, ASIC, CySEC, BaFin, DFSA, SCA, SCB, CMA-Kenya
- Platforms
- Pepperstone Trading Platform, MT4, MT5, cTrader, TradingView
- Min. Deposit
- $0
- Min. Trade
- 0.01 Lots
- Leverage
- 1:30 (Retail - UK, EU, Australia), 1:500 (Pro), 1:200 (Offshore), 1:400 (Kenya)
CFDs and FX are complex instruments and come with a high risk of losing money rapidly due to leverage. 73-89% of retail investor accounts lose money when trading CFDs.
-
Established in Poland in 2002, XTB caters to over a million clients worldwide. This forex and CFD broker offers a robust regulatory framework, a diverse range of assets, and prioritises trader satisfaction. It provides an intuitive proprietary platform equipped with excellent tools to support aspiring traders.
- Instruments
- CFDs on shares, Indices, ETFs, Raw Materials, Forex currencies, cryptocurrencies, Real shares, Real ETFs
- Regulator
- FCA, CySEC, KNF, DFSA, FSC, SCA, CMF, Bappebti
- Platforms
- xStation
- Min. Deposit
- $0
- Min. Trade
- 0.01 Lots
- Leverage
- 1:30
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 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
-
Spreadex, regulated by the FCA, provides spread betting across 10,000+ CFD instruments, including 60 forex pairs. Traders have the option to engage in short-term positions on sporting events as well. With a history exceeding 20 years, the company has earned numerous accolades.
- Instruments
- Forex, CFDs, Indices, Commodities, Stocks, Crypto, Bonds, Interest Rates, ETFs, Options, Spread Betting
- Regulator
- FCA
- Platforms
- Spreadex Platform, TradingView, AutoChartist
- Min. Deposit
- £0 (but £5 minimum for standard payment methods)
- Min. Trade
- £0.01
- Leverage
- 1:30
-
Interactive Brokers (IBKR) stands as a leading brokerage, offering access to 170+ markets in 40 nations alongside extensive investment services. With 40+ years in finance, this Nasdaq-listed entity complies with regulations from the SEC, FCA, CIRO, and SFC, ensuring global trustworthiness in trading.
- Instruments
- Stocks, Options, Futures, Forex, Funds, Bonds, ETFs, Mutual Funds, Cryptocurrencies, CFDs
- Regulator
- SEC, FINRA, CFTC, NFA, CIRO, FCA, CBI, ASIC, SFC, SEBI, JFSA, MAS
- Platforms
- Trader Workstation (TWS), IBKR Desktop, GlobalTrader, Mobile, Client Portal, AlgoTrader, OmniTrader, TradingView, eSignal, TradingCentral, ProRealTime, Quantower
- Min. Deposit
- $0
- Min. Trade
- $1
- Leverage
- 1:30
-
Established in 1974, IG is a unit of IG Group Holdings Plc, listed on the LSE as IGG. It provides access to over 17,000 markets through intuitive platforms and apps. For half a century, IG has remained an industry leader, excelling in all vital aspects for traders.
- Instruments
- CFDs (not in US), Forex, Stocks, Indices, Commodities, ETFs, Futures, Options, Crypto, Spread Betting (UK only)
- Regulator
- CFTC, NFA, FCA, BaFin, ASIC, FINMA, MAS, JFSA, FMA, DFSA, BMA, CONSOB
- Platforms
- Web, L2 Dealer, MT4, TradingView, AutoChartist, TradingCentral, ProRealTime
- Min. Deposit
- $0
- Min. Trade
- 0.01 Lots
- Leverage
- 1:30 (Retail), 1:222 (Pro)
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
-
Trade Nation is a leading FX and CFD broker regulated in the UK and Australia, among other places. The company provides competitively priced fixed and variable spreads on over 1,000 assets. Traders benefit from advanced platforms and comprehensive training materials. Additionally, the Signal Centre offers valuable trade ideas.
- Instruments
- CFDs, Forex, Indices, Shares, Commodities, Futures, Bonds, Spread Betting (UK and Ireland only), Cryptos (Bahamas entity only)
- Regulator
- FCA, ASIC, CMVM , FSCA, SCB, FSA
- Platforms
- TN Trader, MT4, TradingView
- Min. Deposit
- $0
- Min. Trade
- 0.1 Lots
- Leverage
- 1:30
67.3% of retail investor accounts lose money when trading CFDs with this provider.
-
Eightcap, an acclaimed broker regulated by the FCA, offers exceptionally low trading costs. Recognised as the top-rated brand by TradingView's vast user base of 100 million, traders can directly access the platform. UK traders can open a live account with a minimum deposit of just £100.
- Instruments
- CFDs in Forex, Stocks, Indices, Commodities
- Regulator
- FCA, ASIC, CySEC, FSC, SCB, FSA
- Platforms
- MT4, MT5, TradingView, TradeLocker
- Min. Deposit
- £100
- Min. Trade
- 0.01 Lots
- Leverage
- 1:30
Services are provided subject to applicable laws and regulations. Certain products, services, instruments, platforms or payment methods may not be available to residents of certain jurisdictions.
Compare
Safety Comparison
Compare how safe the Best Brokers With Low Leverage 2026 are and what features they offer to protect traders.
| Broker | Trust Rating | FCA Regulated | Negative Balance Protection | Guaranteed Stop Loss | Segregated Accounts |
|---|---|---|---|---|---|
 |
4.6 | ||||
 |
4.6 | ||||
 |
4.0 | ||||
 |
4.5 | ||||
 |
4.4 | ||||
 |
4.3 | ||||
 |
4.3 |
Payments Comparison
Compare which popular payment methods the Best Brokers With Low Leverage 2026 support and whether they have trading accounts denominated in British Pounds (GBP).
| Broker | GBP Account | Debit Card | Credit Card | Neteller | Skrill | Apple Pay |
|---|---|---|---|---|---|---|
|
||||||
|
||||||
|
||||||
|
||||||
|
||||||
|
||||||
|
Mobile Trading Comparison
How good are the Best Brokers With Low Leverage 2026 at mobile trading using apps or other mobile interfaces.
| Broker | Mobile Apps | iOS Rating | Android Rating | Smart Watch App |
|---|---|---|---|---|
|
iOS & Android | 4.4 | 4.1 | |
|
iOS & Android | 4.7 | 4.1 | |
|
iOS & Android | 4.5 | 4.5 | |
|
iOS & Android | 4.3 | 4.5 | |
|
iOS & Android | 4.6 | 4.0 | |
|
iOS & Android | 4.5 | 4.5 | |
|
iOS & Android | 4.8 | 4.4 |
Beginners Comparison
Are the Best Brokers With Low Leverage 2026 good for beginner traders, that might want an affordable setup to get started, along with good support and educational resources?
| Broker | Demo Account | Minimum Deposit | Minimum Trade | Support Rating | Education Rating |
|---|---|---|---|---|---|
|
$0 | 0.01 Lots | 4.6 | 4.0 | |
|
$0 | 0.01 Lots | 4.3 | 3.8 | |
|
£0 (but £5 minimum for standard payment methods) | £0.01 | 4.3 | 4.0 | |
|
$0 | $1 | 3.0 | 4.3 | |
|
$0 | 0.01 Lots | 4.5 | 4.8 | |
|
$0 | 0.1 Lots | 4.9 | 4.2 | |
|
£100 | 0.01 Lots | 4.0 | 3.5 |
Advanced Trading Comparison
Do the Best Brokers With Low Leverage 2026 offer features that allow for more advanced trading strategies?
| Broker | Automated Trading | Pro Account | Leverage | VPS | AI | Low Latency | Extended Hours |
|---|---|---|---|---|---|---|---|
|
Expert Advisors (EAs) on MetaTrader, cBots on cTrader | 1:30 (Retail - UK, EU, Australia), 1:500 (Pro), 1:200 (Offshore), 1:400 (Kenya) | |||||
|
- | 1:30 | |||||
|
1:30 | ||||||
|
TWS API | 1:30 | |||||
|
Expert Advisors (EAs) on MetaTrader, build your own on ProRealTime | 1:30 (Retail), 1:222 (Pro) | |||||
|
Expert Advisors (EAs) on MetaTrader | 1:30 | |||||
|
TradingView Bots | 1:30 |
Detailed Rating Comparison
Use this heatmap to compare our detailed ratings for all of the Best Brokers With Low Leverage 2026.
| Broker | Trust | Platforms | Mobile | Assets | Fees | Accounts | Support | Research | Education |
|---|---|---|---|---|---|---|---|---|---|
|
4.6 | 4.8 | 4.3 | 4.6 | 4.5 | 4.0 | 4.6 | 4.3 | 4.0 |
|
4.6 | 4.0 | 4.4 | 4.6 | 3.9 | 4.0 | 4.3 | 4.1 | 3.8 |
|
4.0 | 4.3 | 4.5 | 4.5 | 4.0 | 3.8 | 4.3 | 4.3 | 4.0 |
|
4.5 | 3.3 | 4.4 | 4.7 | 4.3 | 3.5 | 3.0 | 4.4 | 4.3 |
|
4.4 | 4.8 | 4.3 | 4.5 | 5.0 | 4.0 | 4.5 | 4.9 | 4.8 |
|
4.3 | 3.9 | 4.5 | 3.7 | 4.3 | 4.2 | 4.9 | 3.9 | 4.2 |
|
4.3 | 4.3 | 4.6 | 3.6 | 3.8 | 4.0 | 4.0 | 3.5 | 3.5 |
Our Take On Pepperstone
Pepperstone excels in trading with tight spreads, swift execution, and advanced charting for seasoned traders. Beginners enjoy zero minimum deposit, comprehensive educational materials, and outstanding 24/5 support, including 18-hour weekend assistance.
Tobias Robinson Reviewer
Pros
- Support for top-tier charting platforms such as MT4, MT5, TradingView, and cTrader. These tools accommodate different short-term trading methods, including algorithmic trading.
- Pepperstone offers pre-IPO perpetual futures, adding Anthropic in October 2026, enabling 24/7 speculation on expected share prices through cash-settled CFDs.
- In recent years, Pepperstone has significantly enhanced the deposit and withdrawal process. By 2025, clients can use Apple Pay and Google Pay, while 2024 saw the introduction of PIX and SPEI for customers in Brazil and Mexico.
Cons
- Overnight holding fees exceed those of some Market Maker brokers (typically Benchmark + 2.5%). Pepperstone suits traders and forex scalpers well but is less ideal for swing traders who keep positions open overnight.
- Execution might not appear as dependable in rapid markets as headline speeds imply. Our tests showed swift execution at targeted prices. However, community feedback highlights concerns over slippage, stop-loss fills, and order triggers sensitive to spreads amid volatility.
- Although the market range has expanded, crypto CFD options remain somewhat restricted, especially when compared to specialised brokers like Eightcap. Additionally, there is no facility to invest in actual cryptocurrencies.
73-89% of retail investor accounts lose money when trading CFDs
Our Take On XTB
XTB excels for novice traders with its superb xStation platform, minimal trading costs, no required deposit, and outstanding educational resources, many of which are fully integrated into the platform.
William Berg Reviewer
Pros
- In 2026, XTB expanded its asset offerings and markets. It introduced options trading in Spain and Germany, launched spot cryptocurrencies in select regions, and unveiled Investment Plans 2.0. These enhanced plans now feature more pre-built options, including sectors like Defence, a user-friendly interface, and increased flexibility to mix stocks and ETFs within individual plans.
- The xStation platform stands out with its user-friendly design and intuitive tools, such as adaptable news feeds, sentiment heatmaps, and a trader calculator. These features streamline the learning process for new traders.
- XTB offers a superb array of educational resources, such as training videos and articles, embedded within the platform to assist traders of all experience levels.
Cons
- XTB lacks a raw spread account, a feature increasingly offered by competitors such as Pepperstone. This omission might not satisfy traders seeking the most competitive spreads.
- The demo account lasts only four weeks, posing a challenge for traders wanting to fully explore the xStation platform and refine short-term strategies before investing actual money.
- XTB has stopped supporting MT4, restricting traders to its own platform, xStation. This decision may discourage experienced traders accustomed to using the MetaTrader suite.
74% of accounts lose money when trading CFDs with this provider.
Our Take On Spreadex
Spreadex attracts UK traders keen on spread betting in financial markets and traditional sports wagers. It offers low fees for short trades, and spread bet profits are tax-free. With a robust charting platform and no minimum deposit, it's easy to begin.
Tobias Robinson Reviewer
Pros
- Spreadex has integrated Autochartist-powered trading signals into its desktop platform. This offers real-time, pattern-based insights aimed at assisting active traders in spotting potential opportunities.
- During live trials near London, Spreadex exhibited 120–200ms round-trip latency across over 50 FTSE and EUR/USD trades. There were no requotes, and slippage remained largely controlled under normal market conditions.
- Over 10,000 instruments and superior access to AIM small-caps are available, including exclusive offerings not found with larger brokers. This provides UK-centric traders with enhanced opportunities in niche small-cap configurations.
Cons
- Spreadex requires real funds initially, offering no demo accounts. Few spread betting brokers neglect to accommodate new traders in this manner.
- CFDs, financial spread bets, sports, and casino activities are combined in one account balance. For serious traders, this means non-trading losses can immediately decrease the margin for trading positions.
- Execution is satisfactory, though not top-tier. Tests showed 0.2–0.4 pip slippage in stable liquid markets, but news-induced volatility increased some fills to around 1 pip. Thinner AIM stocks often experienced 2–4 point slippage.
Our Take On Interactive Brokers
Interactive Brokers ranks highly for seasoned traders due to its robust charting platforms, live data, and bespoke layouts via the new IBKR Desktop app. Its competitive pricing and sophisticated order choices appeal to traders, and its wide equity options are industry-leading.
Tobias Robinson Reviewer
Pros
- IBKR is a highly respected brokerage, regulated by top-tier authorities, ensuring the integrity and security of your trading account.
- Interactive Brokers has introduced a single platform linking prediction markets on Kalshi, CME Group, and ForecastEx. Users can trade yes/no contracts on political, economic, and climate events, with fixed $1 payouts. Enjoy 24/6 market access and earn interest on eligible positions.
- The TWS platform is tailored for intermediate and advanced traders, featuring over 100 order types and a dependable real-time market data feed with exceptional uptime.
Cons
- TWS has a steep learning curve, making it difficult for newcomers to navigate and grasp its features.
- IBKR offers a variety of research tools, but their inconsistent placement across trading platforms and the 'Account Management' webpage creates a confusing experience for users.
- Support can be sluggish and frustrating. Tests reveal that you may face challenges reaching customer service quickly, which could result in delays in issue resolution.
Our Take On IG
IG offers a complete package: an easy-to-use web platform, top-tier beginner education, enhanced charting via TradingView, up-to-date data, and strong trade execution for seasoned traders.
Tobias Robinson Reviewer
Pros
- IG excels with its diverse instruments, offering stocks, forex, indices, commodities, and cryptocurrencies. Additionally, it provides US-listed futures, options, and an AI Index, ensuring varied diversification opportunities.
- IG secured a crypto asset license from the FCA, enabling its return to the UK market. It now offers buying, selling, and storage services for over 55 digital tokens with fees starting at 1.49%, all under FCA regulation.
- The web-based platform supports traders at every level, offering advanced charting tools and real-time market data vital for trading. Additionally, IG now includes TradingView integration.
Cons
- Beginners may find IG's fees complicated, as they vary depending on the trades or services. This could cause confusion and unexpected costs.
- IG has ended its swap-free account, diminishing its attractiveness to Islamic traders.
- IG imposes a monthly inactivity fee of $12 to $18 after two years, discouraging occasional investors.
70% 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.
Our Take On Trade Nation
Trade Nation caters to discretionary traders aiming to speculate on major indices like the US 500 or liquid FX pairs, with the certainty of fixed spreads. Our tests revealed the TN Trader's fixed spreads to be advantageous, especially during economic announcements, thanks to its dependable charting and capped spreads.
Tobias Robinson Reviewer
Pros
- Trade Nation's 2026 alliance with Volt has streamlined payments for Australian traders, enabling instant deposits and withdrawals via PayID. Faster payout features are also anticipated for UK and EU clients.
- The broker expanded into Europe by launching regulated online trading services, after securing authorization from Portugal's CVMV, enhancing safety measures for European residents.
- During tests of the TN Trader account in standard market conditions, fixed spreads remained stable. Major forex pairs experienced prompt order fills, albeit with slight entry level drift as prices fluctuated between click and execution.
Cons
- Offshore SCB and FSA firms offer retail investors leverage up to 1:200 and 1:500. In contrast, regions like the UK, Europe, and Australia cap leverage at 1:30. Thus, an FSA client can access 16 times more exposure than a UK retail client on identical trades. However, this comes with reduced oversight and no compensation schemes.
- The FCA, CMVM, and ASIC clients are ineligible for the 2–20% rebate scheme. Consequently, active traders in these areas cannot receive transaction rebates.
- There is no raw or ECN pricing tier, often favoured by traders. Regardless of your deposit or trading volume, you receive the same fixed (or variable on MT4) pricing as novices, rendering it particularly unsuitable for scalpers.
67.3% of retail investor accounts lose money when trading CFDs with this provider.
Our Take On Eightcap
Eightcap excels for traders, offering diverse charting platforms, educational Labs, and AI tools. With over 120 crypto CFDs, it stands out in crypto trading and has won our 'Best Crypto Broker' award twice consecutively.
William Berg Reviewer
Pros
- Eightcap has excelled in all essential trading areas, surpassing all rivals to clinch our 'Best Overall Broker' award for 2024. It also earned the titles of 'Best Crypto Broker' and 'Best TradingView Broker' for 2025.
- In 2026, Eightcap integrated TradeLocker in select areas, establishing itself as the premier regulated broker for this platform. It continues to offer ultra-fast execution and competitive fees for active traders using the charting software.
- Eightcap has launched GOLD247, offering 24/7 gold/USD CFD trading with up to 1:20 leverage, 0.01-lot minimums and zero commission for weekend gold traders.
Cons
- Despite the growing range of tools available, Eightcap lacks popular industry resources such as Autochartist and Trading Central. These provide advanced charting analytics, live news, and essential market insights for traders focused on short-term strategies.
- Eightcap must enhance its range of over 800 instruments to rival top competitors like Blackbull Markets, which offers 26,000+ assets, especially improving its limited commodities selection.
- The demo account is available for 30 days, after which it requires a request for extension. This is less convenient than XM's offering, which provides an unlimited demo mode.
71.28% of retail traders lose money when trading CFDs
How Investing.co.uk Chose the Top Low Leverage Trading Platforms
We only considered FCA-regulated brokers to ensure UK investor protection. We compared leverage policies on high-risk products like CFDs, recording maximum limits on major asset classes.
Platforms that offer conservative leverage options, risk tools, and transparent costs score best in our comprehensive testing process, with data verified through hands-on testing.
What To Look For In A Low Leverage Broker
Over decades of combined trading with leverage in the UK, our experts consider these to be the key features to look for in a low-leverage trading firm:
Trust
Trading with leverage means putting both your own and borrowed funds at risk, so you need to be able to rely on your broker.
Leverage trading will magnify your losses as well as gains. This leaves traders at high risk from unscrupulous brokers who use abusive or manipulative practices to their advantage.
That’s why we recommend registering with a broker that’s licensed by the FCA.
The FCA protects consumers trading on margin by:
- Requiring brokers to meet stringent standards and to submit to regular audits.
- Ensuring that brokers are registered with the Financial Services Compensation Scheme so up to £85,000 of each clients’ funds is protected in the case of business insolvency.
- Mandating consumer protections including segregated client funds and negative balance protection, which prevents traders’ losses from exceeding their account balance.
- Limiting the amount of leverage available to retail clients to a maximum of 1:30 on major forex pairs.
- Pepperstone is consistently one of the best regulated brokers we’ve tested, with licenses from several of the most respected international bodies including the FCA.
Flexible Leverage
Choose a broker that allows you to adjust the amount of leverage on offer so you will always be comfortable with your risk level.
Even if your FCA-regulated broker limits leverage on, say, stock trades to the required top level of 1:5, that’s still a considerable amount and can lead to heavy losses.
Having the choice of reducing this to 1:2 gives traders a lot more flexibility and, importantly, peace of mind.
I’m a big proponent of low-leverage trading. My philosophy is to aim for consistency rather than one-off big wins, and low leverage allows me to limit my risk and ensure that losses don’t wipe out my trading funds.
- eToro allows traders to select the leverage that suits them, with several levels available on a wide range of assets.
Fees
Choose a broker with low fees so you can keep your gains from low-leverage trades.
Brokers implement a variety of charges, known as a cost model, across their services, which can quickly add up and chip away at profits.
These fees can come in many forms, but generally we’ve found that the spread – the difference between buy and sell prices – and sometimes flat-rate commissions are the most significant.
Besides these, some brokers also apply non-trading fees such as a charge on deposits and withdrawals, currency conversion fees, fees for accession data feeds and other research tools, and inactivity fees for accounts that remain idle for several months.
- IC Markets remains a market leader for pricing from our tests, with low fees from zero pips on the EUR/USD pair and a $6 round-turn commission per lot.
Deposits & Withdrawals
Consider brokers that offer convenient payment methods at competitive costs.
The most common payment forms include bank wire transfers, credit and debit payment cards and e-wallets such as PayPal. These will often come with varying fees and transaction times, but we’ve found that most good brokers provide free deposit options.
- XTB has provided affordable and convenient account options to UK traders for years, with fee-free instant deposits and withdrawals, no minimum deposit limit, and several payment methods including digital options.
Instruments
You should sign up with a broker that provides access to the instruments you want to trade, whether these are forex pairs, CFDs, options, equities, futures, cryptocurrencies or something else.
We’ve found that major forex pairs like EUR/USD are a great place to start trading with leverage. These instruments tend to have high liquidity during predictable market hours, making it easier to get in and out of positions quickly at the desired price.
Leveraged trading on some assets, such as cryptocurrencies, is banned in the UK for retail investors.
- Year after year, Interactive Brokers‘ enormous range of tradable assets draws clients seeking trades with low leverage on over a million trading products from all over the world.
How Leverage Works
Leverage trading uses an initial stake deposit, known as a margin, to provide the investor with increased exposure to an underlying asset. The broker then takes on the remainder of the trade’s risk, which can be thought of as putting up the rest of the money for the trade.
This means that in practice you are putting down a small amount of the full value of the position and the rest is loaned to you by your broker. Your total profit or loss will be calculated based on the size of the entire position, not just on your margin.
Brokers with low leverage level offers will typically present them as a leverage ratio, such as 1:10. This denotes the ratio of your stake to the total position size. In this example, your position would be magnified by a scale of 10.
Below you can find the meaning of each of the key terms surrounding leverage:
- Margin – the percentage of the total position size put down by the trader
- Leverage Rate – the ratio of the investor’s stake to the total position size
- Buying Power – the total capital an investor can trade with, including leverage
- Coverage/Risk Ratio – the ratio of the net account balance to leveraged position size
- Margin Call – the minimum coverage level required to maintain the leveraged position. If this is exceeded, the broker will inform you that you are high risk due to an exposure greater than permitted by the firm
- Stop Out – the point at which the broker automatically closes orders because the required leverage amount has not been recovered, despite the margin call warnings. If leverage is still not recovered, the firm can close the investor’s portfolio
What Counts As ‘Low’ Leverage In Trading?
What counts as ‘low’ leverage is subjective and depends on your risk tolerance, trading experience and even the asset being traded. However, with some brokers offering to boost traders’ trading capital by hundreds or even thousands of times their initial outlay, we might think of anything below 1:30 (or 30x) as ‘low’.
For retail investors in the UK, the Financial Conduct Authority (FCA) caps the amount of leverage available:
- 1:5 on individual stocks
- 1:10 on commodities except gold and non-major equity indices
- 1:20 on non-major currency pairs, major indices and gold
- 1:30 on major currency pairs
The range in leverage limits reflects differing levels of risk, with the most volatile (stocks) being afforded the lowest leverage.
Bottom Line
Choosing brokers with low leverage is important if you are looking to take advantage of margin trading without exposure to significant risk. Lower leverage can turn over larger profits than trading with just the cash you have, opening greater positions than otherwise affordable. However, it remains high-risk as you could still lose money – both gains and losses are multiplied.
See our list of the best UK brokers with low leverage to find the right provider for your needs.