Opening a CFD Account

Opening an account is relatively straightforward with many companies offering an online application process. The majority of new applicants choose to use the online method as many firms will be able to process your application very quickly - allowing successful applicants to gain access to the market almost immediately.

Account types

Account types will differ across the various trading products but the most important thing is to think about your requirements before making a decision.

Demo accounts

Demo accounts will allow you to get used to the trading platform (and broker) before you commit to opening an account but some brokers allow you to trade with real money but in very small size so that you get used to trading with your hard-earned cash and to the emotions that go with it!
View all CFD brokers offering demo accounts 

Direct Market Access (DMA)

CFD brokers can offer Direct Market Access (DMA) accounts but it will cost you to receive this service so consider whether you really need this before signing up.
Read more about Direct Market Access 

Market maker

Some CFD providers have moved away from the DMA trading model and have instead become market-makers: where the broker makes the price and takes all orders onto their own book.

Market making companies will act as a counter-party to your trades (Spread betting and CFDs) so if you're comfortable with this relationship these are cost effective accounts to look at as they rarely come with the data charges associated with DMA trading accounts.

In these circumstances you (the trader) may find that the price being offered by the market-maker (the broker) differs slightly from the actual market price. However, it is unlikely the price will differ too much as this would create opportunities for 'arbitrageurs' to trade with both the exchange and the market-maker at prices guaranteeing a profit!

Account opening requirements

The information required by the CFD Broker is fairly standard although you will be expected to answer questions about your knowledge and previous experience of trading.

Even if you have little or no experience of CFD trading it is important that you answer these questions truthfully as it will help the broker to correctly categorise you as a client.

Minimum account opening balance

Most retail brokers have minimum account opening balances: how much you'll need to deposit with them before you may start trading. Most brokers accept payments via a bank transfer or a debit or credit card payment but forget cheques, as they just aren't practical when markets are volatile and you need to move money quickly.

TIP: Always ensure you have access to liquid funds in case you need to top up your account at short notice and whilst many of the brokers will offer you attractive leverage rates don't make the mistake of overtrading as you'll end up risking too much of your account balance on one trade.

TIP: Familiarising yourself with their depositing procedures is important if you intend trading on markets that could be volatile. This will ensure you are able to meet any further funding requirements should your open trades move against you.

All CFD brokers are FSA regulated and, as with other areas of financial trading, have a duty of care to their customers to ensure that the product is suitable for them. If the CFD broker decides that the product is unsuitable for you they will notify you at the time of your application with them.

Further resources on CFD trading

 

Comparing CFD brokers

Below is a table of CFD brokers with a few key account-opening criteria that we believe should be considered when you are deciding which broker to open an account with. It's not always about price; finding a broker that suits your style of trading and your technical requirements is as, if not more, important than shaving a few pence off of your dealing costs.

Start comparingCFD brokers

 

 

BrokerCommission Rates (UK Equities)DMA TradingBroker FeaturesApply
IG Group
0.1%
true
  • News
  • Mobile Trading
  • Phone Trading
  • Demo Account
  • Charting
  • Research
  • Account Opening Online
  • Account Opening Download
  • Account Opening Brochure Available
  • DMA Trading
  • Market Maker Trading
  • Execution Service
  • API/FIX Connectivity
Applyfor accountDemo unavailableLearn more about IG Group
 
Gekko Global Markets
0.075%
false
  • Demo Account
  • Charting
  • Research
  • Market Maker Trading
  • API/FIX Connectivity
Applyfor accountDemo unavailableLearn more about Gekko Global Markets
 
Markets.com
0.1%
false
  • News
  • Mobile Trading
  • Demo Account
  • Charting
  • Research
  • Account Opening Online
  • Market Maker Trading
  • Execution Service
  • API/FIX Connectivity
Applyfor accountDemo unavailableLearn more about Markets.com
 

 

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