With the rise of online trading platforms and mobile apps, it has never been easier for individuals to participate in the stock market. In fact, there is no shortage of online brokers eager to welcome stock traders, regardless of whether they are beginners looking to dip their toes into stock trading or seasoned traders seeking to maximize their profits. However, with so many options available, it can be overwhelming to choose the right one. Since one of the most critical decisions a trader will make is selecting a broker, our team has prepared a comprehensive overview of the various factors that can show if a given stock broker is worth a try.
Below you can find a list with regulated and trustworthy Stock trading brokers:
Top 20 Stock Brokers
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Fusion Markets
- Australia regulated broker
- MT4, MT5, TradingView, Ctrader
- Leverage up to 500
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Axi
- Raw spreads start from 0.0 pips
- Offers order execution faster than standard ECN model
- Axi Select Funded Trader Program offers funding up to $1 million
Trading Instruments- Forex
- Stocks
- IPOs
- Indices
- Commodities
- Cryptocurrencies
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FP Markets
- Australia & CySEC regulated broker
- MT4/MT5, TradingView, Ctrader, Iress
- EUR/USD spread from 0.0 pips
Trading Instruments- Forex CFDs
- Shares CFDs
- Metals CFDs
- Commodities CFDs
- Indices CFDs
- Crypto CFDs
- ETF CFDs
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Pepperstone
- Australia & CySEC regulated broker
- MT4/MT5, TradingView, Ctrader, Iress
- EUR/USD spread from 0.0 pips
Trading Instruments- Forex
- Indices
- Commodities
- Cryptocurrencies
- Share CFDs
- ETFs
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Global Prime
- Australia regulated broker
- Advanced MT4
- $0 Minimum Account Size
Trading Instruments- Forex
- Cryptocurrencies
- Indices
- Commodities
- Bonds
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BlackBull Markets
- Broker boasting lightning-fast execution speed
- ECN brokers with tight spreads from 0.0 pips
- $0 minimum deposit requirement
Trading Instruments- Forex
- Commodities
- Futures
- Indices
- Stocks
- Cryptocurrencies
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IC Markets
- Offers 2,200+ tradable markets, including 61 currency pairs
- Leverage of up to 1:1000 in select jurisdictions
- EUR/USD spreads from 0.8 pips for standard accounts
Trading Instruments- CFDs on Forex
- Commodities
- Index
- Bond
- Cryptocurrencies
- Stock
- Futures
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Markets.com
- Featuring a wide range of CFD assets across 7 markets
- Supports popular platforms like MT4 and MT5
- Social trading app enables smooth trading alongside proven signal providers
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AvaTrade
- Minimum deposits from $100
- Licensed by 11 regulatory bodies
- Retail forex leverage of up to 1:400
Trading Instruments- Forex
- Major stock indices
- Cryptocurrencies
- Commodities
- Bonds
- Individual Shares
- ETFs
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HF Markets
- Up to 1:2000 leverage in specific countries
- Supports trading in micro lots (1,000 units
- A $6 round-turn commission per standard lot for Zero accounts
Trading Instruments- Forex
- Metals
- Energies
- Soft commodities
- Indices
- Stocks
- Cryptocurrencies
- Bonds
- ETFs
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eToro
- Popular broker for social trading
- Trading is conducted on innovative in-house platform
- Offers both investing and trading products
Trading Instruments- Crypto
- CFDs on Forex
- Stocks
- Commodities
- Crypto
- ETFs
- and Indices
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Eightcap
- Traders can enjoy competitive trading conditions through different account types
- Offers access to over 800 CFD markets through TradingView
- Platforms like MT4 and MT5 enable multi-device trading
Trading Instruments- Forex CFDs
- Commodity CFDs
- Shares CFD's
- Index CFDs
- Crypto CFD's
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CMC Markets
- Provides a choice of 10,000+ trading instruments
- Supports MT4 and Next Generation (proprietary platform
- Spreads for EUR/USD from 0.5 pips
Trading Instruments- CFDs on Forex
- Indices
- Shares
- Commodities
- Treasuries
- Cryptocurrencies
- Share baskets Investments on ETFs
- Shares
- Managed funds
- Options
- and more
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Plus500
- Multi-Level Regulated Broker
- Proprietary trading platforms
- Easy to use mobile app
Trading Instruments- CFDs on: Forex
- Crypto
- Indices
- Commodities
- Stocks
- Options
- ETFs
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FxPro
- NDD broker offering deep liquidity and ultra-fast execution
- Over 99% instant order executions with no requotes
- Supports MT4, MT5, cTrader, and a proprietary platform
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Admirals
- Offers a great range of investment and trading products
- Multi-device trading available through MT4 and MT5
- Offers over 4,000 CFD instruments
Trading Instruments- CFDs on Forex
- Indices
- Stocks
- Commodities
- Bonds
- ETFs
- Cryptocurrencies
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Saxo Bank
- Holds a banking license
- Offers forex options and spot trading
- Minimum EUR/USD spreads from 0.9 pips
Trading Instruments- Stocks
- ETFs
- Bonds
- Mutual funds
- Crypto ETPs
- Options
- Futures
- Forex
- Forex options
- Crypto FX
- CFDs
- Commodities
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IG
- Offers different account types, including DMA (Direct Market Access) one
- Offers turbo warrants on forex pairs, commodities, indices, and equities
- Supports popular platforms like MT4 and TradingView as well as ProRealTime, L2, and more
Trading Instruments- CFDs on Indices
- Forex
- Shares
- Crypto
- Futures
- Commodities
- Options
- Interest Rates
- Sectors
- Bonds
- Knock-out trading
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Vantage FX
- Broker offering some of the lowest spreads from 0.0 pips
- Operating in multiple markets under licenses from tier-1 regulators
- Provides a range of account types with great trading conditions
Trading Instruments- Forex
- Indices
- Commodities
- Shares CFD
- ETFs
- Bonds
-
XM Group
- Registered for outward passporting with multiple EU regulators
- 99.7% order fill rates and low minimum deposit requirements ($5)
- Supports MT4 and MT5
Trading Instruments- Forex
- Stocks
- Indices
- Commodities
- Thematic Indices
What is Stock Trading
Stock trading offers two primary ways to participate in the financial markets: trading via ownership and contracts for difference (CFDs). The former involves buying and selling actual shares of publicly traded companies. Individuals can trade stocks on a daily basis, hence the term day trading, or aim toward long-term growth by maintaining ownership of a stock for months or even years until it appreciates in value and they decide to sell.
On the other hand, CFDs are derivatives that allow investors to speculate on the price movements of shares without actually owning the underlying stocks. This approach enables traders to take advantage of market fluctuations and profit from price changes. We should also note that CFDs do not expire. Do note, however, that holding CFDs will result in overnight fees.
Both approaches have their advantages. Purchasing shares outright provides a direct stake in a company’s performance, while CFD trading offers greater flexibility. CFDs also allow investors to access a wider range of markets and instruments, including commodities and indices. Moreover, with CFDs, traders can take advantage of leverage, which can eliminate the need to use significant capital.
Ultimately, the choice between the two depends on an investor’s individual goals, risk tolerance, and the trading strategies they plan on using. Online brokers often offer stock and derivative trading services, providing investors with freedom of choice. These platforms typically provide real-time market data, advanced charting tools, and mobile trading capabilities, enabling traders to stay connected to the markets at all times.
Regulation and Security
The global stock trading industry is subject to a complex web of regulations designed to protect investors and maintain market integrity. Regulators play a crucial role in overseeing the activities of stock trading platforms, ensuring that they operate in a fair and transparent manner. Supervisory entities also monitor the activities of stock trading platforms to prevent market manipulation, insider trading, and other forms of financial misconduct. They work closely with law enforcement agencies to investigate and prosecute any wrongdoing.
If you go with a regulated stock trading broker, it is far more likely that you will enjoy a safe and fair trading environment. Here are examples of the entities that oversee the offering of stock and indices trading:
- Financial Conduct Authority or FCA (United Kingdom)
- Australian Securities and Investments Commission (ASIC)
- Cyprus Securities and Exchange Commission (CySEC)
- Vanuatu Financial Services Commission (VFSC)
- Federal Financial Supervisory Authority or BaFin (Germany)
- Commodity Futures Trading Commission or CFTC (USA)
- Financial Services Agency or FSA (Japan)
In short, making sure that you stick with regulated brokers will spare you the headache of falling victim to unfair practices. In the UK, for example, stock traders should use only brokers that have been issued a license by the Financial Conduct Authority (FCA). The FCA sets and enforces rules for stock trading platforms, including requirements for capital adequacy, risk management, and client protection. As for the US, the Securities and Exchange Commission (SEC) plays a key role in regulating the stock trading industry. Europe’s markets are overseen by a range of local regulators as well as the European Securities and Markets Authority (ESMA).
Authorized brokers tend to be secure as well, ensuring client fund segregation and the utilization of encryption technology. In many regions, licensed brokers are also obligated to offer negative balance protection to retail clients. This is especially important when you trade stock CFDs with leverage.
Of course, just because brokers claim that they are regulated does not mean you should take their word for it. In the past, some brokers have gotten in trouble with authorities for faking legitimacy. Thus, traders are advised to look up a given broker’s name or license number in the register of its respective regulator.
Range of Markets
Taking a look at a broker’s market selection is recommended if you plan on trading stocks or any type of instrument. Market variety is a good indicator of the quality of a given broker.
Stock shares come in various forms, including established companies, emerging growth stocks, and dividend-paying shares. Investors can also trade in shares of companies from different sectors, such as technology, healthcare, and finance, offering a range of options to suit individual traders’ preferences. Additionally, popular stocks that can be bought or traded via CFDs include Apple Inc., Alphabet Inc., and NVIDIA Corp, to name a few. Another factor of note is that international CFD brokers facilitate the trading of stocks from US, UK, and German exchanges, among many others.
While stocks are the highlight of many CFD brokers, they are rarely the only instruments available. Index CFDs, for instance, track the performance of specific market indices, such as the S&P 500. Next, we have commodity CFDs. They enable trading on the prices of goods like gold, oil, and agricultural products. Forex CFDs provide exposure to the foreign exchange market, allowing individuals to trade major, minor, and exotic pairs. Examples include currency pairs like EUR/USD, USD/CHF, GBP/JPY, AUD/USD, and dozens more. If cryptocurrencies are more to your taste, trading CFDs on coins is also an option.
Spreads and Other Costs
When engaging in stock trading, investors should be aware of the various fees associated with buying and selling shares and choose a broker whose fees are reasonable. One of the primary costs is the spread, which is the difference between the bid and ask price. This spread can vary depending on the broker and the specific stock CFD being traded.
In addition to spreads, many brokers charge commissions on stock trades. These costs can be substantial, especially for day traders. If you are not interested in paying commissions and do not mind higher spreads, you could go for an account type that guarantees that all trading costs are built into the spread.
As established, CFDs also lack expiration dates, making them an option for long-term trading. This practice is uncommon, however, since holding a position overnight will lead to rollover fees.
One often overlooked fee is the inactivity fee, which is charged to accounts that remain dormant for a specified period. This can be a significant expense for investors who do not trade frequently. Another fee to consider is the withdrawal fee, which may be charged when one withdraws funds from their account. This can be a flat fee or a percentage of the withdrawal amount, depending on the broker. Some brokers also attach fees to deposit transactions, but retail traders tend to avoid using such brokers. Last but not least, if you are considering copy trading, you may also be charged performance fees from the signal providers.
Deposits and Withdrawals
There are stock brokers that aim to accommodate numerous traders by supporting plenty of deposit and withdrawal solutions. Such platforms make great candidates for one’s broker of choice, seeing as variety makes it highly likely that the trader’s preferred payment methods will be accepted.
One common method is the traditional wire transfer, which is a secure and reliable way to transfer funds. Many brokerages also accept electronic bank transfers, allowing investors to easily transfer funds from their bank accounts using online banking platforms.
In addition, some brokerages have integrated digital payment platforms, enabling investors to deposit funds using popular services like PayPal, Neteller, or Skrill. These options are convenient and widely available. Mobile payment apps like Apple Pay have become popular as well, and this trend towards digital payments has made it easier for investors to manage their accounts and deposit funds on the go. Cryptocurrencies (Bitcoin, Ethereum, etc.) and local payment solutions like Canada’s Interac are often considered viable options as well.
Leverage Limits
Leverage allows investors to amplify their potential gains by borrowing money from their brokerage firm. The capital that serves as the collateral required to open a leveraged position is the margin.
This can be a powerful tool for experienced traders who want to maximize their returns, but it also comes with significant risks. When using leverage, even small price movements can result in substantial losses, making it essential for investors to carefully manage their risk exposure.
What leverage you will be able to use is dependent on the broker as well as the entity that regulates your local financial market. Brokers licensed by European regulators, for instance, can offer retail leverage of no more than 1:5 when it comes to stock CFDs as per MiFID II guidelines. The Australian Securities and Investments Commission imposes the same cap. Traders who trade at Vanuatu-licensed brokers, on the other hand, can take advantage of up to 1:100 leverage.
Keep in mind that even if you find a broker with generous leverage limits, exercising caution is important. Brokers offer tools like stop losses and limit orders to assist traders in managing the risks. Moreover, aim for a broker with negative balance protection since it will prevent your balance from going below $0.
Trading Platforms
The world of stock trading has evolved significantly with the advent of advanced trading platforms, offering a range of features and tools to help investors succeed in the market. The supported platforms can easily break or make a broker, which is why you should take them into consideration when browsing brokerage brands.
Among the most popular options are ProRealTime, the MetaTrader suite (MT4 and MT5), and cTrader, each with its set of capabilities. Here are some of the key features of these platforms:
• MetaTrader 4 and MetaTrader 5: Developed by MetaQuotes, these platforms are renowned for their convenient interface, robust technical analysis tools like charts and indicators, and automated trading systems. MT4 appears to see the most use at the time of writing, especially among those who enjoy trading stock CFDs. It is the platform you are most likely to see when you look for an online broker.
• ProRealTime: This platform offers advanced charting capabilities, including real-time data and customizable indicators, making it a favorite among traders who utilize technical analysis.
• cTrader: Launched in 2011, cTrader is known for its fast and reliable execution, as well as its advanced trading tools, including charting and technical analysis features.
The above platforms have revolutionized the way investors trade in the stock market, and you generally cannot go wrong with a broker that offers at least one of them. They also happen to be suitable for mobile devices, which is another perk.
Is the Broker Suitable for Novice Traders?
Those who are still novices to stock trading are advised to pick a broker with beginner-friendly features. Demo accounts, for instance, offer a risk-free environment for investors to familiarize themselves with the various ways one can trade stocks or derivatives, test strategies, and refine their skills. With virtual funds and real-time market data, demo accounts allow traders to experience the markets without committing real capital, helping them build confidence before they start trading with real funds.
At brokers suitable for beginners, traders can access a wide range of educational materials to enhance their stock trading skills. Guides, video tutorials, and e-books are common, and some brokers even host webinars. These resources cover various topics, from market fundamentals to advanced trading strategies.
Another indicator of a beginner-friendly broker is a low minimum deposit. These are brokers that allow new users to start out with a deposit of $10 or less.
Customer Support
A good broker should offer multiple channels for communication when it comes to customer support, including phone, email, and live chat. This way, it can ensure that traders can reach out for assistance through their preferred method. It is best to check when the support team is available to answer questions since plenty of brokers offer 24/5 customer service. However, finding a broker with 24/7 support will be ideal.
Traders can expect to receive prompt and knowledgeable support from a broker’s customer support team, who should be able to address a range of queries, from account setup issues to questions regarding the trading platforms. Most brokers’ live chat boxes are available to non-registered users, allowing traders to try out the customer support service before they create an account.
Other Factors to Consider
In addition to the factors outlined above, aspiring and veteran stock traders alike are advised to check what accounts a broker offers. Besides demo accounts, plenty of brands boast swap-free accounts, accounts for professionals, and accounts that boast spreads starting from 0 pips.
The availability of managed accounts is another potential perk. As the name suggests, individuals can earn passive profits from stock trading by entrusting their accounts to professionals.
Another option for those looking to capitalize on the experience of long-time traders is copy trading. Brokers that support copy trading enable their users to automatically replicate the trades of pros.
Virtual private servers are also a feature to look into. This is a service that provides faster execution speeds and a secure, dedicated environment for traders to run their Expert Advisors (EAs) and other trading software. What is more, if you are an active trader and meet the minimum trading volume requirements, you will often be exempt from paying a monthly fee for the VPS.
Why You Should Trust RationalFX
When it comes to making informed decisions about forex brokers, it’s essential to rely on trustworthy sources. Rational FX, a company with over 17 years of experience since its founding in 2005, has established itself as a credible authority in the industry. With an impressive collection of over 2500 reviews on Trustpilot, boasting a score of 4.2, it’s clear that Rational FX has built a reputation for providing reliable and unbiased information.
What sets Rational FX apart is its rigorous evaluation process, which considers over 30 different criteria when selecting forex brokers. This comprehensive approach ensures that every aspect of a broker’s service is taken in consideration, including regulation, forex spreads, trading platforms, deposit methods, and reputation. With its wealth of experience, transparent review process, and outstanding customer feedback, Rational FX is a trusted source for anyone seeking reliable information on forex brokers. You can contact us via e-mail at [email protected] or contact us through our social media accounts here: Facebook, YouTube, or leave a feedback here.