CFD Stock Trading

Many British investors use CFD stock trading to derive benefit from the price movements in various companies’ values. When trading CFDs, investors do not own the underlying stocks in question and can leverage positions. This 2024 guide covers everything that you need to know about CFD stock trading, including a detailed analysis of the most popular equities in the UK market. Read on for a list of the best online brokers and tips for implementing a CFD stock trading strategy.

Top CFD Stock Trading Brokers

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    AvaTrade is a leading forex and CFD broker, established in 2006 and regulated across 9 jurisdictions. Over 400,000 users have signed up with the broker which processes over 2 million trades each month. The firm offers multiple trading platforms, including MT4, MT5, and a proprietary WebTrader. 1250+ financial instruments are available for trading, from CFDs to AvaOptions and now AvaFutures, alongside a comprehensive education center and multilingual customer support.

  2. XTB

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    Founded in 2002 in Poland, XTB now serves more than 935,000 clients. The forex and CFD broker combines a heavily regulated trading environment with an extensive selection of 5,600+ assets and a commitment to trader satisfaction, featuring an intuitive in-house platform with superb tools to support aspiring traders.

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    Established in 1989, CMC Markets is a respected broker listed on the London Stock Exchange and authorized by several tier-one regulators, including the FCA, ASIC and CIRO. More than 1 million traders from around the world have signed up with the multi-award winning brokerage.

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    Eightcap is an award-winning, FCA-regulated broker offering industry-low trading fees. They are also the highest-rated brand by TradingView’s 50 million-strong users, who can trade directly on the platform. UK traders can sign up for a live account with an accessible £100 minimum deposit.

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    FXCC is an established broker that’s been offering low-cost online trading since 2010. Registered in Nevis and regulated by the CySEC, it stands out for its ECN trading conditions, no minimum deposit and smooth account opening that takes less than 5 minutes.

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    Spreadex is an FCA-regulated broker that offers spread betting opportunities on an impressive 10,000+ CFD instruments including 60 forex pairs. Traders can also take short-term positions on sporting events. The brand has been around for over 20 years and has won multiple awards.

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    Established in Australia in 2010, Pepperstone is a top-rated forex and CFD broker with over 400,000 clients worldwide. It offers access to 1,300+ instruments on leading platforms MT4, MT5, cTrader and TradingView, maintaining low, transparent fees. Pepperstone is also regulated by trusted authorities like the FCA, ASIC, and CySEC, ensuring a secure environment for traders at all levels.

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    Interactive Brokers (IBKR) is a premier brokerage, providing access to 150 markets in 33 countries, along with a suite of comprehensive investment services. With over 40 years of experience, this Nasdaq-listed firm adheres to stringent regulations by the SEC, FCA, CIRO, and SFC, amongst others, and is one of the most trusted brokers for trading around the globe.

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    IC Markets is a globally recognized forex and CFD broker known for its excellent pricing, comprehensive range of trading instruments, and premium trading technology. Founded in 2007 and headquartered in Australia, the brokerage is regulated by the ASIC, CySEC and FSA, and has attracted more than 180,000 clients from over 200 countries.

  10. XM

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    XM is a globally recognized forex and CFD broker with 10+ million clients in 190+ countries. Since 2009, this trusted broker has been known for its low fees on 1000+ instruments. XM is regulated by multiple financial bodies, including the ASIC and CySEC.

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    City Index is an established and award-winning forex, CFD and spread betting broker with top-tier global regulation, including in the UK (FCA) and Australia (ASIC). With 30+ years in the industry, 13,500+ instruments and 24/5 customer support, City Index is a solid pick for aspiring traders.

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    DNA Markets is a forex and CFD broker established in 2020. The broker operates two entities in Australia and the offshore jurisdiction, St Vincent and the Grenadines. Traders can access 250+ markets, with a Standard account for beginners and a Raw account for experienced traders. The reliable MetaTrader 4 and MetaTrader 5 platforms are available, alongside Signal Start.

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    Founded in 1999, FOREX.com is now part of StoneX, a financial services organization serving over one million customers worldwide. Regulated in the US, UK, EU, Australia and beyond, the broker offers thousands of markets, not just forex, and provides excellent pricing on cutting-edge platforms.

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    eToro is a top-rated multi-asset platform which offers trading services in thousands of CFDs, stocks and cryptoassets. Launched in 2007, the brand has millions of active traders globally and is authorized by tier one regulators, including the FCA and CySEC. The brand is particularly popular for its comprehensive social trading platform. Cryptoasset investing is highly volatile and unregulated in the UK and some EU countries. No consumer protection. Tax on profits may apply. 76% of retail CFD accounts lose money.

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    RoboForex is an online broker, established in 2009 and registered with the IFSC in Belize. Traders can choose from five accounts (Prime, ECN, R StocksTrader, ProCent, Pro) catering to different needs with trades from 0.01 lots and spreads from 0 pips. RoboForex has also enhanced its offering over the years, adding CFD instruments and launching its stock trading platform, plus the CopyFX system.

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    InstaForex is a forex and CFD broker founded in 2010. The broker offers diverse market coverage to millions of clients, spanning traditional assets like currencies and shares, as well as other interesting opportunities such as IPOs.

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    Trade Nation is a top FX and CFD broker regulated in multiple jurisdictions including the UK and Australia. The firm offers low-cost fixed and variable spreads on 1000+ assets with robust trading platforms and training materials. The Signal Centre can also be used for trade ideas.

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    Founded in 1974, IG is part of IG Group Holdings Plc, a publicly traded (LSE: IGG) brokerage. The brand offers spread betting, CFD and forex trading across an almost unrivalled selection of 17,000+ markets, with a range of user-friendly platforms and investing apps. For 50 years, IG has maintained its position as an industry leader, excelling in all key areas for traders.

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    BlackBull is a New Zealand-based CFD broker with trading opportunities on forex, stocks, indices, commodities and cryptos. The broker supports the MetaTrader 4 and 5 platforms as well as TradingView, cTrader and a proprietary mobile app. Clients can trade with high leverage and tight spreads from 0 pips on the broker's ECN accounts.

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    Founded in 2009, Vantage offers trading on 1000+ short-term CFD products to over 900,000 clients. You can trade Forex CFDs from 0.0 pips on the RAW account through TradingView, MT4 or MT5. Vantage is ASIC-regulated and client funds are segregated. Copy traders will also appreciate the range of social trading tools.

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    Founded in 2006, FxPro is an established forex, CFD and spread betting broker offering 2100+ assets to over 2 million clients worldwide. The broker is regulated in 4 jurisdictions and offers reliable 24/5 customer support, earning it a high trust and safety score. FxPro has also picked up more than 100 industry accolades for its competitive trading conditions, including fast execution and deep liquidity.

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    Established in 2008 and headquartered in Israel, Plus500 is a prominent brokerage that boasts over 25 million registered traders in over 50 countries. Specializing in CFD trading, the company offers an intuitive, proprietary platform and mobile app. It maintains competitive spreads and does not charge commissions or deposit or withdrawal fees. Plus500 also continues to shine as one of the most trusted brokers with licenses from reputable regulators, including the FCA, ASIC and CySEC.

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    Fusion Markets is an online broker established in 2017 and regulated by the ASIC, VFSC and FSA. It is best known for its low-cost forex and CFD trading, although its multiple account types and copy trading solutions cater to a range of traders. New clients can sign up and start trading in 3 easy steps.

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    Founded in 2001, easyMarkets is a multi-regulated forex broker offering leveraged trading opportunities on forex, stocks, indices, commodities and crypto. With fixed spreads, an affordable initial deposit, regulation from several reputable bodies and a diverse selection of account currencies, this broker provides simple and straightforward trading solutions to a diverse range of traders.

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    GO Markets is an established forex and CFD broker with multiple industry awards and accolades. The ECN/STP broker is popular with budding traders, offering competitive accounts in multiple base currencies and a range of flexible payment methods. With top-tier regulation from CySEC and ASIC, GO Markets is a trusted broker.

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    Founded in 2008, NordFX is an offshore CFD broker offering forex, stock, commodities, indices and crypto trading to over 1.7 million clients in 190 countries. Traders access markets through the MT4 and MT5 platforms and benefit from low commissions, spreads from zero and decent extra features. Minimum deposits start from just $10 and very high leverage is available up to 1:1000.

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    Markets.com is a respected broker, offering multi-asset trading opportunities through CFDs or spread betting (UK only). Established in 2008, the brand has an impressive 4.3 million registered customers and is overseen by trusted regulators, including the FCA, ASIC and CySEC. 79.1% of retail accounts lose money.

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    Axi is a global forex and CFD trading firm, founded in 2007 in Sydney, Australia. Highly leveraged trading opportunities plus a $0 minimum deposit make it a popular choice among 60,000+ traders worldwide. Axi also stands out for its resources, including copy trading and Autochartist.

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    EagleFX is a forex and CFD broker, established in 2019. The broker uses STP execution on the MT4 platform, offering tight spreads and low commissions. With leverage up to 1:500 and no restrictions on hedging or scalping, EagleFX is an attractive option for short-term traders.

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    Founded in 2015, VT Markets maintains its position as a top Australian multi-asset CFD broker. With 1000+ tradeable instruments and support for the MetaTrader 4 and MetaTrader 5 platforms, this broker delivers a wide range of trading opportunities to over 200,000 clients worldwide. VT Markets is regulated by the ASIC, FSCA, and SVGFSA.

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    Tradeview is an offshore forex and CFD broker based in the Cayman Islands and regulated by CIMA. Traders can access over 5000 instruments with a minimum deposit of $100. There are several third-party platforms on offer, including MetaTrader 4 (MT4) and cTrader.

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    PrimeXBT is a multi-asset platform offering highly leveraged trading in forex, indices, commodities and cryptocurrencies. The company launched in 2018 and now has over 1 million users from more than 150 countries. With no minimum deposit, copy trading features and low commissions, the broker remains a popular option among crypto trading novices.

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    FXDD is an established forex and CFD broker founded in 2002. Regulated in Malta, Mauritius, Peru and Malaysia, the broker provides secure trading platforms, competitive ECN spreads and reliable 24/7 customer support. Competitive pricing and ultra-low latency is also offered via the broker's Direct Market Access execution model and tier 1 aggregated liquidity.

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    FXTrading.com is global broker offering highly leveraged CFDs on 10,000+ assets, including forex, stocks, indices, commodities and cryptocurrencies. Competitive prices with raw spreads and low to zero commissions are available. Traders can use the popular MetaTrader 4 platform and will have access to a suite of additional analytical tools and other resources. The multi-regulated brokerage is authorized by the ASIC and VFSC.

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    Founded in 2010, ThinkMarkets is a reputable CFD and forex broker with regulation from several top-tier bodies including the FCA and ASIC. The broker provides services to over 450,000 accounts from 11 global offices. Traders can use a bespoke platform, MT4 or MT5 to access a wide variety of assets including 3500+ stocks and ETFs, 46 forex pairs and over 20 cryptocurrencies.

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    M4Markets is an award-winning broker regulated by the CySEC, FSA and DFSA. Although relatively new, the broker continues to improve its offering with a range of innovative tools, platforms and accounts. Beginners can start with just $5, whilst experienced investors can access leverage up to 1:5000.

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    Trade.com is a trustworthy online broker with a global presence. The broker offers 2,100+ CFDs in major markets, as well as futures, options and more. The broker offers best-in-class platforms and superior analysis tools for experienced traders. The broker is also regulated by top-tier authorities including the FCA and CySEC.

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    Grand Capital is a MetaTrader broker with welcome bonuses, trading competitions and an intuitive copy trading service. Several account types and 400+ assets provide trading opportunities for various types of investors and strategies. New users can also open an account and start trading in a matter of minutes.

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    IronFX is a multi-regulated forex and CFD broker founded in 2010. This award-winning firm offers 500+ markets to over 1.5 million clients across 180 countries. Traders can access various account types with competitive pricing on the MT4 platform, as well as 24/5 customer support in 30 languages.

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    Ingot Brokers is a multi-regulated brokerage established in 2006. The broker offers CFD trading opportunities on 1000+ instruments including forex, stocks, indices, commodities and cryptocurrencies. The broker supports the MetaTrader 4 and MetaTrader 5 platforms and offers both raw spreads and commission-free account options.

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    FXCM is a respected forex and CFD broker, established since 1999. The British-headquartered broker has won multiple awards and operates in various jurisdictions, including the UK and Australia. With zero commissions, over 400 assets, and a range of analysis tools, FXCM remains a popular choice for traders. The broker is also regulated by top-tier authorities including the FCA and ASIC.

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    Scope Markets offers trading and investing in multiple spot and CFD instruments. The group of brokers is regulated in several locations, including Belize, Kenya and South Africa. Users get competitive trading conditions, a range of payment methods, strong support and can get started in a few straightforward steps.

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    Dukascopy is an online broker operated by a Swiss-regulated banking group. It offers a good selection of 500+ markets, with forex, stocks, gold, ETFs, indices, bonds and cryptocurrencies available. It also offers flexible trading opportunities through the choice of CFDs or binary options. Traders will use MetaTrader 4 or a proprietary platform that is well-suited to automated trading.

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    FinPros is an offshore broker that provides CFD trading on 400+ instruments with high leverage up to 1:500. This is a reliable bet for traders seeking offshore options, with strong security measures, negative balance protection and segregated client funds. The extra features including trading tools and commission-free stocks make this a good choice for beginners, and experienced traders will appreciate tight spreads.

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    4xCube is an online forex and CFD broker registered and licensed in the Cook Islands. Clients can trade on popular financial markets and choose between three accounts based on their capital and trading strategy.

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    AZAforex is a multi-asset broker founded in 2016. The brand offers a sophisticated proprietary platform, ECN trading and 40+ deposit methods. The brokerage has 120,000+ registered customers with copy trading and a VPS.

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    Launched in 2017, Videforex offers access to stock, index, crypto, forex and commodities markets via binary options and CFDs. The proprietary platform, mobile app and integrated copy trading are user-friendly and will suit new and casual traders, and the market analysis tools and trading contests provide good ways to improve your trading skills.

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    RockGlobal is a New Zealand based and regulated CFD broker. They offer competitive spreads from 0.1 pips and a large range of trading assets, trading platforms and educational services, with up to 1:500 leverage. Operating in a Tier 1 regulated environment, RockGlobal offers peace of mind and excellent customer support.

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    FXTM is a top-rated forex and CFD broker established in 2011 and operating across 4 continents. The company is secure and regulated by leading authorities, including the FCA and CySEC. Offering 1000+ trading markets and three account types, they cater to all levels of trader.

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    ForexChief is a foreign exchange and CFD broker, established in 2014. The company is based offshore and registered with the VFSC and FMA. Users can choose between a wide selection of accounts and base currencies, making ForexChief accessible to global traders. The brand also stands out for its no deposit bonus and fee rebates for high-volume traders.

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    Kwakol Markets is a Nigerian headquartered broker with strong regulatory oversight in Australia and Canada. A great selection of trading assets are available, including synthetic products that simulate realistic market activity. Clients can trade on the MT4, MT5 and cTrader platforms, as well as a copy trading solution whereby a fee is only paid on profitable trades.

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    GoFX is an unregulated CFD and forex broker that covers instruments from currency, stock, index, commodity and crypto markets. Traders can sign up to a variety of account types with deposits as low as $1 and will trade using the popular MetaTrader 4 platform. Exceptionally high leverage up to 1:3000 is offered on the standard account, while traders with the low-spread account can access leverage up to 1:1000.

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    Axofa is a forex and CFD broker registered in St Vincent and the Grenadines. The broker offers three account types with access to forex, commodities and indices. With ECN processing, low minimum deposits and no commissions, Axofa remains an attractive option, although the broker does not hold a reputable license.

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    Focus Option is an offshore broker that specializes in binary options as well as CFDs. Binary options trading on forex, cryptos and three commodities is done through the broker's simple web-based platform with average payouts between 70% and 95%. The broker also offers a mobile app for trading CFDs, with 300+ tradeable instruments.

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    SageFX is an offshore, unregulated CFD broker that offers highly leveraged trading on forex, stocks, commodities, indices and crypto via the TradeLocker platform. Traders can access commission-free trading or an ECN account with tight spreads. While the broker's regulatory status is weak, it does provide segregated accounts and two-factor authentication.

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    MultiBank FX is an established broker offering forex and CFD products since 2005. With 20,000+ instruments, plenty of local payment methods and 24/7 multilingual customer support, the broker is a popular choice among traders globally. New clients can also access a variety of bonus offers and access the hugely popular MT4 and MT5 trading platforms.

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    Pacific Union Prime is an FSCA and offshore-regulated multi-asset broker offering competitive fees and direct market access on forex, commodities, stocks, bonds and indices. The broker supports the popular MetaTrader 4 and MetaTrader 5 platforms and a proprietary mobile app. Fees vary by account type with no commission and spreads from 1.9 pips on the Standard account and $7 commission per lot and spreads from 0.4 pips on the Prime account.

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    SimpleFX is an online broker specializing in CFD and cryptocurrency trading, with multi-currency accounts, STP execution, low pricing and no minimum deposit. Bringing innovation and gaining recognition at numerous industry events since 2014, SimpleFX now caters to retail traders from over 190 countries, boasting a client base exceeding 200,000 active users.

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    Errante is a Cyprus-based and regulated forex and CFD broker with leveraged trading on multiple assets, tiered accounts including a zero-spread option, and copy trading support. The broker offers leveraged trading up to 1:30 under its CySEC-regulated branch and 1:500 from an offshore branch, and supports the MetaTrader 4 and MetaTrader 5 platforms. Errante's asset list is relatively limited but it does offer fast execution and low latency, and it is a trustworthy brand.

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    ActivTrades is a UK-headquartered CFD and forex broker established in 2001. The brokerage is heavily regulated with licenses from the FCA, SCB, CSSF, BACEN & CVM and CMVM. Over 1000 CFDs are available spanning 7 asset classes. Over 93.60% of orders are executed at the requested price. ActivTraders also offers a selection of leading trading platforms, including MT4, MT5, TradingView and ActivTrader platforms.

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    Swissquote is a Switzerland-based bank and broker that offers online trading and investing. The company has a high safety score and is listed on the Swiss stock exchange. The firm offers a huge range of products, from stocks, ETFs, bonds and futures to 400+ forex and CFD assets. Hundreds of thousands of traders have opened an account with the multi-regulated brokerage. Clients can get started in three easy steps while 24/7 customer support is available to assist new users.

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    FXPrimus is an award-winning CySEC-regulated brokerage offering CFD trading on 200+ instruments via the MetaTrader 4, MetaTrader 5 and cTrader platforms. The choice between a competitive commission-free account and two affordable raw spread options make this an accessible broker for anyone seeking forex, stocks, indices and commodities with high leverage.

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    Established in 2005 in Australia, FP Markets is an ASIC- and CySEC-regulated broker boasting an extensive suite of tradable assets. Its Standard and Raw accounts cater to traders at every level, while it packs a punch in the tooling department, from the MetaTrader suite and intuitive TradingView to actionable trading ideas from Trading Central and AutoChartist.

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    Core Spreads is an FCA-licensed broker offering CFD and spread betting opportunities on a proprietary platform or MetaTrader 4. Traders can access more than 1000 instruments, including company shares, commodities, indices and forex. Spread bets have fixed spreads that start from 0.4 with no commission, while CFDs start from 1 pip plus a $1.50 charge per lot.

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    Anzo Capital is an offshore broker that offers leveraged CFDs on 100+ instruments including forex, stocks, indices and metals. The MetaTrader 4 and MetaTrader 5 platforms are supported, and traders can choose between an STP account with spreads starting from 1.4 pips and zero commission, or an ECN account with a $4 round-turn commission and spreads from zero. A decent range of payment methods are accepted, including crypto deposits.

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    HYCM is an online broker with authorization from four international bodies including the FCA and CySEC. The broker offers short-term CFD trading on forex, shares, commodities, indices, ETFs and Bitcoin, and supports the MT4 and MT5 platforms, as well as Trading Central analysis.

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    Global Prime is a multi-regulated trading broker offering 150+ markets. Traders can get started with a $200 minimum deposit and trade with leverage up to 1:100. The firm also has a high trust score and a good reputation with a license from the ASIC.

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    Fortrade is a multi-asset, multi-regulated broker with branches regulated by the FCA, CySEC and ASIC among others. The brand offers trading opportunities on a wide range of instruments including stocks, bonds, commodities, forex, indices, cryptocurrencies and ETFs, with competitive fees and support for MetaTrader 4 and a proprietary platform.

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    Hantec Markets was established in Hong Kong in 1990. Initially, the company concentrated solely on the Chinese and Taiwanese markets. In 2008, the broker rebranded and expanded its presence in the UK, Australia, Japan, and various other countries, before enhancing its footprint in Latin America in 2022. Hantec now stands as a multinational brokerage with 18 offices across Europe and Asia.

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    FXOpen is a multi-asset broker with regulation from several trustworthy bodies including the UK's FCA. The broker offers CFD trading on forex, stocks, commodities, indices, cryptocurrencies and ETFs via the MetaTrader 4 & 5 and TradingView platforms.

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    Libertex is a well-known broker, established in 2012. The regulated brand has served numerous clients and is regulated by the Cyprus Securities and Exchange Commission with license number 164/12. Libertex offers CFD trading on 250+ underlying assets, including through an innovative and user-friendly proprietary web trader platform. Choose between CFDs on forex, cryptocurrencies, commodities, stocks, indices and ETFs, which are available with tight spreads and low commissions.

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    Admirals is an FCA- and ASIC-regulated broker with an excellent range of leveraged instruments, including forex, stocks, indices, ETFs, commodities, cryptos and more. The broker supports the MetaTrader 4, MetaTrader 5 and TradingCentral platforms. With both spread betting and CFDs available and thousands of instruments, this broker provides more flexibility than most rivals.

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    TMGM is an ASIC-regulated forex and CFD broker with a vast range of tradeable assets covering forex, stock, index, crypto and commodity markets. The account types on offer provide a flexible choice between no commission or zero spreads, with competitive pricing all-round.

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    Infinox is a UK-based and FCA-regulated broker that offers diverse trading products thanks to its STP and ECN account types and support for MetaTrader 4, MetaTrader 5 and a proprietary platform. Clients can also benefit from a free VPS that can support automated strategies and a social trading platform, catering to both beginner and seasoned traders.

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    Baxia Markets is an offshore CFD broker that offers trading on forex, commodities and indices with tight spreads on a straight-through processing model with ultra-low latency. Trade on MetaTrader 4 or MetaTrader 5 with leverage up to 1:500 and no restrictions to scalping or hedging strategies. Users also benefit from third-party copy trading services.

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    OspreyFX is an ECN broker headquartered in St. Vincent and the Grenadines. Established in 2019, the firm offers 120+ forex and CFD assets with high leverage up to 1:500, tight spreads from 0.1 pips and round-the-clock customer support. OspreyFX also stands out for its funded trading accounts where traders can keep up to 70% of profits.

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    LonghornFX is a forex and CFD broker offering over 150 instruments with leverage up to 1:500. The firm is registered in Saint Vincent and the Grenadines and was launched in 2020. Clients can access a strong selection of cryptos, alongside forex, indices, commodities and stocks. With ECN/STP processing, this offshore broker promises tight spreads and fast execution.

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    RoboMarkets is a Cyprus-based forex, CFD and stock broker aimed at traders from Europe. The broker offers thousands of instruments across six asset classes and provides access to four leading platforms, including MetaTrader 4. With ECN pricing, Cent accounts and algorithmic trading tools, RoboMarkets caters to a range of trading strategies and investing styles.

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    AdroFx is an offshore ECN/STP broker that has offered CFD trading since 2018. The firm supports 100+ tradable assets on the popular MetaTrader 4 platform as well as a web trader, Allpips. Eight live accounts are available with no restrictions on trading strategies.

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    Coinexx is an unregulated broker that provides leverage up to 1:500 on forex, commodities, indices and cryptocurrencies with deep liquidity, pure ECN spreads and negative balance protection. The broker uses crypto as base currencies and has low minimum deposit requirements of 0.001 BTC.

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    EZ Invest is a CySEC-licensed broker, launched in 2008, that offers trading on popular financial markets through leveraged CFDs. Traders can choose between multiple respected platforms, including MetaTrader software and a user-friendly in-house app. The reliable multilingual customer support team are also on-hand to support new users.

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    Saxo Markets is a multi-award-winning trading brokerage, investment firm and regulated bank. With a huge 72,000+ trading instruments, plus investment products and managed portfolios, clients have no shortage of opportunities. The trusted brand also offers transparent pricing and top-tier regulatory protection from 10+ agencies including FINMA, FCA & ASIC.

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    Established in 2013, SuperForex is an offshore CFD and forex broker offering highly leveraged trades on 400+ instruments via the popular MetaTrader 4 platform. The broker has gained clients in over 150 countries and is regulated by the Belize IFSC. With a range of STP/ECN account types, including swap-free, micro and zero spread, this broker continues to suit traders with different styles and setups. SuperForex also offers a range of welcome bonuses and trading contests.

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    OANDA is an award-winning global broker, established in 1996. The hugely respected brand offers competitive trading accounts and serves clients from 196 countries. It remains a popular option with both beginners and experienced traders thanks to its user-friendly and sophisticated web platform, no minimum deposit and premium currency products and services. The company is also overseen by reputable regulators, including the FCA, ASIC and CIRO.

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    Amega is an offshore STP broker offering CFD trading on forex, stocks, indices and commodities with very high leverage up to 1:1000 and a zero-commission pricing structure. Traders access markets through the MT5 platform and can test the broker's services through a demo account.

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    Just2Trade is a reliable multi-regulated broker registered with FINRA, NFA and CySEC. The company has 155,000 clients from 130 countries and stands out for its huge suite of instruments and additional features, including a social network, robo advisors and a funded trader programme.

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    BinaryCent is an unregulated binary options broker that offers 24/7 trading on forex, cryptos and stocks with payouts up to 95%. Despite its lack of regulation, this broker takes client security seriously and stores client funds in European banks. The broker also offers CFDs with very high leverage up to 1:500.

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    World Forex is an offshore broker registered in St Vincent and the Grenadines, offering commission-free trading with a $1 minimum deposit and 1:1000 leverage. Digital contracts are also available, offering beginners a straightforward way to speculate on popular financial markets.

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    RaceOption is a binary options broker operating from the Marshall Islands. With over 1,500 clients, the broker aims to offer fast funding, low fees and a secure trading environment. Traders can access over 100 binary options and CFDs, plus copy trading and weekly prizes.

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    FXCentrum is an offshore broker that offers highly leveraged, commission-free trading on diverse instruments with tight spreads. Traders can access forex, equity and commodities markets via MetaTrader 5 or the proprietary FXC platform and use the award-winning ZuluTrade platform for copy trading.

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    Vault Markets is an award-winning brokerage headquartered in Namibia. It is an accessible direct-market-access CFD broker with affordable minimum deposits, flexible funding methods and high leverage. This broker offers a very large range of forex pairs as well as commodities and indices through MetaTrader 4 or MetaTrader 5.

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    LegacyFX is a multi-asset broker offering an MT5 download & free signals.

CFD Stock Trading Explained

A Contract for Difference or ‘CFD’ is a product that stipulates that the buyer will either pay or be paid the difference between the original price of the asset at the time of purchase, and the price at the time the contract is closed. With CFD stock trading, traders can go long or short. This means that they can make a profit based on whether they think the value of the stock in question will rise or fall.

When trading CFDs, investors do not own the underlying asset. For example, if you purchase a CFD relating to the value of National Grid shares, you do not actually own any of the stock: the CFD merely tracks and mimics its value. This means that the trader can speculate on short-term price movements of an asset without the hassle of having to hold or sell the actual stocks later on.

When a CFD is purchased and closed, the profit or loss is calculated from the difference between the value of the stock at the time of purchase and closing. Some brokers also choose to add a spread. This means that if a trader were to buy and close a CFD straight away, they would make a net loss. Moreover, most CFD brokers charge some form of commission when both opening and closing the contract, which is usually around 0.1%.

Best CFD stock trading brokers

Trade Example

CFD stock trading is best explained through an example…

In this scenario, a trader is looking at the Vodafone Group which has stock currently trading at a sell/buy price of £1.19/1.20. They believe that the price is going to rise in the short term and therefore they decide to invest in CFDs. As they think the price is going to rise, they purchase 10,000 units going long on the Vodafone Group. The broker offers a 5% margin rate, so the trader must put down a deposit of £600 (5% x (10,000 units x £1.20)).

When the trader checks the value four hours later, they notice that Vodafone Group is now trading at a sell/buy price of £1.25/1.26. The trader makes a quick decision to close the trade at this point and lock in some profit. This is calculated by taking the difference between the price at purchase and closing, in this case, £0.05 (£1.25 – £1.20) and multiplying it by the number of units, 10,000, to give a gross profit of £500.00.

However, like most online brokers in the UK, there is a commission charge of 0.1% for each CFD contract opened and closed. To open the contract, the trader is charged a commission of £12.00 (0.1% x (10,000 units x £1.20 buy price at purchase)), while to close it they are charged a commission of £12.50 (0.1% x (10,000 units x £1.25 sell price at close), giving a total commission of £24.50. This leaves the investor with a net profit of £475.50.

CFD Trading VS Share Trading

CFD stock trading and spot share trading may seem similar, but there are some fundamental differences between the two. When you spot trade stocks, you directly purchase shares in a company, which means that you own a part of that company. If the company performs well, you will receive a range of benefits such as dividends. The downside of spot trading is that if the value of the company drops, you will lose money.

Spot trading is best used for long-term trading when you believe the value of a company is going to increase over a long period. If you are interested in short-term price movements, CFD stock trading is worth considering. With a CFD, you can decide whether to go long if you think the price will rise, or go short if you believe it will fall.

It is much easier to execute trades quickly when trading stock CFDs, making it perfect for anyone who is interested in day trading. CFDs also allow you to trade with leverage, so that you can borrow money from the broker and potentially boost your profits. However, as you do not own the stocks, you will not receive any dividends or voting rights.

UK Stock Market Key Players

The United Kingdom is home to some of the largest companies in the world, with many of them listed and traded on the London Stock Exchange. Here are the top ten companies on the FTSE 100 index along with their 2022 market cap in GBP:

  1. AstraZeneca – 170.50 billion
  2. Shell – 149.37 billion
  3. HSBC Holdings – 107.35 billion
  4. Unilever Group – 97.57 billion
  5. GlaxoSmithKline – 91.07 billion
  6. Diageo – 80.22 billion
  7. British American Tobacco – 76.27 billion
  8. BP – 73.76 billion
  9. Rio Tinto Group – 61.03 billion
  10. Glencore – 56.79 billion

Benefits Of CFD Stock Trading

  • You can use CFDs to hedge against standard stock holdings
  • You can trade CFDs with leverage
  • You can go long or short
  • Fast execution speeds

Drawbacks Of CFD Stock Trading

  • You do not own the stocks and therefore you will not have any voting rights
  • You will not receive dividends if the stock performs well
  • Leverage can lead to large losses

Best CFD share trading demo accounts

Getting Started With Trading Stock CFDs

  1. Select a broker: Before you can start, you need to choose which CFD stock trading broker to use. There are a few different things to consider before you make your decision. Check out the various fees, spreads and commissions charged by each brokerage to find the best deal. Also try to find an online broker that offers a CFD stock trading demo account, which will allow you to practise and get used to trading contracts for difference before you enter the live markets. Other things to consider include customer service hours, brand reputation and the stock markets they offer access to.
  2. Research the market: Most UK brokers will offer access to stocks listed on the FTSE as well as other popular markets from around the world. There is no perfect fit, you simply have to find an asset that suits you and that you have researched sufficiently. If you are a new trader, it could be worth opting for one of the larger companies listed in the top ten UK stocks section. Experienced traders may prefer to trade smaller but more volatile companies.
  3. Choose the direction of your trade: One of the main benefits of CFD stock trading is the ability to go long or short. This means that you can make a profit based on whether you believe the value of a stock will rise or fall. If you think it is going to increase, you should go long and purchase a buying CFD. If you believe that it will drop, purchase a selling CFD.
  4. Select the number of units: Choose the number of units you would like to purchase. If you are trading with leverage, more units will require a larger deposit. Leverage also runs the risk of building up large losses.
  5. Utilise risk management tools: To protect yourself, you should implement risk management tools. Add a stop-loss order to limit losses, as well as a take-profit order to guarantee closure at a target price.
  6. Monitor and close: Once you have placed your trade with risk management tools set up, you can monitor the price. Either close the deal when you are happy with the price, or wait for it to hit a target price and close automatically through your take-profit order.

Bottom Line On CFD Stock Trading

CFD stock trading is used by many investors as a way of speculating on and benefiting from the price movement of a company’s shares. Investors can use CFD stock trading to hedge against their stock portfolio, or they can simply use it in a bid to earn a profit. CFD stock trading can also be combined with leverage to boost earnings, but remember that leverage trading can also lead to large losses.

If you are interested in getting started with trading stock CFDs, check out our list of top brokers and follow this guide.

FAQ

What Is CFD Share Trading?

A Contract for Difference (CFD) is a derivative product that allows traders to speculate on the price movements of a stock. The investor does not own the underlying stock, and can go long or short depending on the direction they believe the price will move.

Does CFD Trading Affect Stock Price?

No, CFD trading does not typically affect the stock price. CFDs are a derivative product, where the trader does not own the underlying asset or stock. Therefore, trading this asset class will not impact the price of the actual stocks.

Is CFD Share Trading Only Available On MT5?

CFD stock trading is not only available on MetaTrader 5 (MT5). A host of other investing platforms support CFD stock trading, including cTrader, NinjaTrader and MetaTrader 4 (MT4). See our respective guides for brokers that offer each trading platform.

Which Is Better: CFD Trading Vs Spot Share Trading?

CFD trading and spot stock trading each have distinct advantages. Those wishing to benefit from price movements of stocks in either direction should opt for CFDs. Those who are seeking long-term gains should opt for spot stock trading where dividends could be earned.

Do You Own The Stock When Trading CFDs?

When trading equity CFDs, you do not own the underlying stock. CFDs are derivative products that allow traders to profit from the price movements of a stock.