Table of contents:
- 1 1. Regulation and license of the CFD Broker
- 2 2. Broad range of markets and assets
- 3 3. professional support and service
- 4 4. Error-free trading platform with many possibilities/functions
- 5 5. Fast execution of trades/orders
- 6 6. No requotes & high liquidity
- 7 7. Low trading fees
- 8 8. No hidden costs
- 9 9. Fast account opening
- 10 10. Fast deposit and withdrawal
If you are looking for a serious and good CFD broker, you should take a look at our criteria before you make your choice. What should you pay attention to before registration? How do I find a secure trading platform for my investments? Will my profits also be paid out? – All these questions are asked by traders and investors. On this page we would like to shed light on and explain all these points. Use these criteria to rule out fraud.
Overview of our 10 criteria for a serious CFD broker:
- Official regulation and license
- Wide range of markets
- Professional support
- Error-free trading platform with many possibilities
- Fast execution of trades
- No Requotes & High Liquidity
- Favorable trading fees
- No hidden costs
- Fast account opening
- Fast deposit and withdrawal
1. Regulation and license of the CFD Broker
The first criterion in this checklist is the most important point. Before you make an investment with a CFD broker you should check the regulation and license. On the Internet, there are many dubious websites and providers that defraud customers with various methods. It can happen that customer funds are not paid out or are misused for speculation. It is not advisable to trade with unregulated providers.
Through financial regulation and licensing, trading fraud can be 99% excluded. European CFD brokers require a license to sell derivatives or other financial products. But also trading with brokers outside the EU can be safe if they have a corresponding license. Many European CFD providers have a license in Cyprus (CySEC). Once the provider is regulated in the EU, he can sell his products in any European country.
Information about the regulation of your CFD brokers can be found on their website. In the lower part of the website, the license number and regulation are displayed. European regulated providers are considered safe and fraud can be excluded here.
2. Broad range of markets and assets
Most CFD traders want to have a wide range of assets and markets at their CFD brokers. That’s why this criterion was added to our list. We think it is very important that a trader can build a diversified portfolio. From our experience, many brokers offer a selection of over 200 markets. Bigger and better-known brokers often have a selection of over 1,000 markets or more.
Popular and well-known market categories for CFDs:
- Forex (currencies)
- Indices (Dax, S&P500 & more)
- Raw materials
- Crypto Currencies
Before registering with a broker, you should consider which markets or assets you wish to trade. This makes it easier to choose a provider. You can find out about the markets offered on the broker’s website.
3. professional support and service
Good support and service for each customer is absolutely necessary for financial transactions. Dubious providers usually have no or very difficult to reach support. It is especially important that the provider is always available. For example, if your internet is down and you want to close a position, you must count on your broker and call him.
Many CFD brokers offer multilingual 24-hour support for each client. This includes chat, telephone, or email support. Providers with an office in Germany offer the best support for traders from our experience, but international CFD brokers also employ German staff. Besides regular support, additional services are usually offered. Webinars, videos, tutorials, or knowledge articles can be used for further education. The offer here is very different and depends on the CFD broker.
A good CFD Broker should have the following support features:
- Active telephone support
- Direct chat support
- Email/ticket support
- Further training opportunities (not absolutely necessary and depending on the customer)
4. Error-free trading platform with many possibilities/functions
The trading platform is the most important tool of a trader. CFD brokers offer their own developed trading platform or use an open-source or license for the software. For example, MetaTrader 4/5 is one of the most popular trading platforms, which is represented by almost 80% of CFD brokers.
The software should work smoothly and without errors. A broker should not allow himself to make mistakes, because a lot of money is involved. The trader must have full control over his portfolio at all times. In addition to simple operation, professional analysis of the markets should also be possible. Mostly indicators, tools, order books, and chart types are offered for this purpose. In general, however, we can say from our experience that the current trading platforms offered by online brokers are 90% professional and mature. A modern CFD broker cannot afford bad software.
Also available are the trading platforms for the computer, smartphone, or tablet. You can access the markets with any device. Further additional points of a good platform are for example also news, analysis, and direct support.
Features of a good trading platform:
- Simple and fast opening of the Oder
- Full control over your own portfolio
- Sufficient analysis possibilities
- Chart types, indicators and more
- Built-in alarms and message functions
- Extended search functions for the markets
- Available for any device
5. Fast execution of trades/orders
Not every CFD broker offers good execution of trades or orders. This may be due to the broker’s server or your internet connection. Make sure that you have a fast Internet connection when you want to start trading CFDs. The order execution should take place immediately in a few milliseconds. With a free demo account, you can first test the Or execution with virtual money. For real money trading, it is recommended to take a small amount of money for testing first.
6. No requotes & high liquidity
Requotes are orders which are not executed. For example, you want to buy the Dax30 and are not let into the market. The order is canceled. This can happen with smaller or bad CFD brokers because they do not have enough liquidity. In general, large positions can quickly lead to requests.
However, many providers guarantee that there are no requests and that you will be executed at the next best price. So check with your CFD broker to see if they offer “no requests”. A Requote can very quickly screw up a trade.
7. Low trading fees
The cheaper the trading fees are the higher your profit. All CFD trading fees are deducted from your account balance. Especially for day traders or traders with many orders per day, it can come to high costs. In general, however, we can reassure you and inform you that the costs have decreased overall due to the enormous competitive pressure. However, it is worth taking a closer look at the choice of a broker to save costs.
The CFD broker may charge the following trading fees:
- Spread (the difference between buying and selling price)
- Commission per trade
- Swap (financing fee overnight, as leveraged derivative)
Hidden costs can be a very bad experience. Make sure you know what costs may be involved before you register. From our experience, 99% of the costs are clearly communicated to the trader. However, you should still be well informed about all details. In addition to the trading costs, there may be account management fees, inactivity fees, or deposit and withdrawal fees. Many CFD brokers currently waive these fees.
Hidden costs generally only exist on unregulated and fraudulent platforms. So be sure to check the company’s license. From our experience, the fees are clearly communicated on the websites. A simple request to the support can also help you. A good CFD broker should have no hidden costs.
9. Fast account opening
How easy is it to open an account? – Nobody wants to have problems opening an account. A quick account opening is a part of being a good CFD broker. Enter your personal data and start the registration. A free demo account is very easy to get with only one email address. However, if you want to trade with real money, you need to verify yourself with various documents. In most cases, the broker will show you a complete guide for this. Again, we can say that nowadays opening an account is very easy and fast. It belongs to a good provider.
10. Fast deposit and withdrawal
How do I deposit funds into my trading account with a CFD broker? – There are usually many different payment methods for this. A fast deposit and withdrawal are one of them for a serious CFD broker. Thanks to the regulation, the funds are kept in separate bank accounts and can be accessed at any time.
A deposit can be made with a good CFD broker in real-time. You can use for example a credit card, online wallet, or online banking. But also the classic bank transfer is usually available. A withdrawal must be processed within a few days according to the standards of the regulations. Many CFD brokers often payout the funds after a few hours. Before a payout, however, the provider may require further verification documents for security, and the process is extended.
Many good CFD brokers offer:
- Free deposits and withdrawals
- Different methods
- Bank transfer
- Credit cards
- Online Wallets
- Online banking
- Crypto Currencies
- Fast processing of payouts
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