Plus500 Forex Broker Review
Plus500 forex broker offers a single account type with eleverage up to 1:200, fixed spreads and the opportunity to trade in micro lots for better risk management,
What Is Plus500 Forex Broker?
Plus 500 specializes in Contracts for Difference (CFDs), delivering trading facilities on shares, forex, commodities, ETFs, options and indices. It is a UK-based broker authorised and regulated by one of the most reliable financial authorities – the Financial Conduct Authority. Except for the capital requirement of EUR 730 000, which is common for EU countries, FCA-licensed brokerages are required to comply with a number of standards and procedures – for reporting to the commission, keeping client money in segregated accounts, etc. What is more important, clients of UK regulated brokers are protected by a compensation sceme – the Financial Services Compensation Scheme (FSCS) – up to GBP 50 000, in case a licensed company goes bankrupt.
In addition, Plus500UK Ltd. is listed on the London Stock Exchange and is, in fact, one of the largest retail FX broker by market cap. Publicly listed companies have to meet strict requirements and are subject to strict rules and regulations. They must regularly disclose certain financial and business information which makes them extremely reliable.
The Plus 500 group also has subsidiaries operating and duly regulated in Cyprus and Australia, Israel, Singapore, South Africa and New Zealand .
Currently Plus 500 offers its portfolio of over 2000 instruments. Contracts for Differences allow customers to profit from a stock, index, ETF, forex or commodity position without the need to actually own the underlying asset. Besides, the company is the main sponsor of famous Spanish football team, Atletico Madrid.
Minimum deposit required from Plus500’s clients is £100, which is average. Other UK brokers require $500 (FxPro) or $50 (FXCM). There are even brokers, who don’t require any initial deposit from traders, such as CMC Markets.
The maximum level of leverage also it varies depending on the instrument types:
Forex – up to 1:200 leverage;
Indices – up to 1:294 leverage;
Commodities – up to 1:150 leverage;
ETFs – up to 1:100 leverage.
Such leverage rates may also be considered average, as FxPro, for instance, offers leverage up to 1:500 and FXCM – up to 1:200 and XM – up to 1:888. Traders, however, should be mindful of higher leverage, for it may both multiply their profits and lead to heavy losses. That is why limitations on leverage rates are set in several jurisdictions: 1:50 in the USA, 1:25 in Japan, 1:100 in Poland.
Spreads & Commission
The spreads offered by Plus500 they are fixed, the typical spread on the EUR/USD amounting to 2 pips. For purposes of comparison, FxPro’s typical spread on EUR/USD is around 1.8 pips and XM offers variable spreads from 1 pip on EUR/USD.
Unlike many other CFD brokers, Plus500 does not charge commissions on trading CFDs (CMC Markets for instance requires a commission fee of 0.10 % of the volume traded). Instead, the broker is compensated for its services through the “market spread”.
Risk Management Options
Since CFD trades are carried out on a leveraged basis, potential profits and losses can both be magnified, so the higher the leverage level, the higher the risk for a trader to incur heavy losses.
Other risk management tools offered by this broker include the stop loss (“Close at loss”) and the limit (“Close at profit”) options as well as a guaranteed stop, which is available for specified instruments only. What is more, traders can set Price alerts and Trailing stops (automatically protecting a position’s downside while locking in the upside).
Negative Balance Protection
In order to ensure that their clients do not lose more money than they have deposited, Plus500 provides the so called Negative Balance Protection (stated in a risk disclosure notice on their website). This means that your account will be brought to a zero balance if it goes into negative as a result of the fast-pacing volatile market.
Unlike most brokers, Plus500 offers just one trading platform to their clients. FxPro, for instance, offers as many as 4 platforms – MetaTrader4, MetaTrader5, cTrader and SuperTrader.
Plus500’ s proprietary trading platform is available in more than 30 different languages. It offers desktop and web-based versions (WebTrader), mobile versions (for iPhone, iPad & Apple), as well as Windows (10 & Phone) and Android versions.
Although MetaTrader 4 is established as the industry standard platform for CFDs and spot forex trading, Plus500 manages to capture a sizeable market due to the fact that they keep things simple, so traders won’t experience information overload while operating on the platform. Keeping in line with the clutter-free style, the broker offers only two account types – demo and live account, the demo account being of course free-of-charge.
Plus500’s clients can make deposits and withdrawals from and to their accounts via Credit/Debit Cards (Visa, Master Card & Maestro), PayPal, Skrill and Wire Transfer.
Plus500 (LON:PLUS) is a well-regulated publicly held and reputable CFDs broker, offering more than 2000 instruments through its uncluttered user-friendly proprietary platform.
Plus500 Forex Broker Review Conclusion
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