10 Best regulated brokers for CFDs trading?

A CFD is a contract of difference between two parties; a buyer and a seller. The contract agreement stipulates that the buyer will pay the seller the difference between the current value of the underlying asset when the position is opened and its value when the position is closed. The seller pays the buyer if the difference is negative.

In this in-depth guide you’ll learn:

  • best brokers for CFD trading
  • How do CFDs work?
  • Why trade CFDs?
  • What assets can you trade as CFDs?
  • What are CFD risks?
  • How much does it cost to trade CFDs?

And lots more…

Let’s dive right in…

 

10 Best Forex Brokers in South Africa for 2022

Rank

Broker

Review

Regulators

Min Deposit

Official Site

#1

4.8/5

User Score

#2

4.7/5

User Score

#3

4.5/5

User Score

#4

4.4/5

User Score

#5

4.7/5

User Score

#6

4.6/5

User Score

#7

4.7/5

User Score

#8

4.8/5

User Score

#9

4.7/5

User Score

#10

4.7/5

User Score

 

🌐 Broker⚖️ Regulation🔎 CFD Trading👉 Open an account
AvaTradeASIC, BVI, CBI, CySEC, FSA(JP), FSC, FSCAYes✔️👉 Open Account
CM TradingFSCA, FSPYes✔️👉 Open Account
ExnessCySEC, FCA, FSA(SC), FSCAYes✔️👉 Open Account
FxProCySEC, FCA, FSCA, SCBYes✔️👉 Open Account
HFM / HotForexCySEC, DFSA, FCA, FSA(SC), FSCAYes✔️👉 Open Account
IC MarketsASIC, CySEC, FSA(SC)Yes✔️👉 Open Account
NAGAFCA, CySEC CyprusYes✔️👉 Open Account
OANDAASIC, FCA, IIROC, MFS, FIBO, BVIFSC, NFA and MAS.Yes✔️👉 Open Account
PepperstoneASIC, BaFin, CySEC, DFSA, FCA, SCBYes✔️👉 Open Account
TickmillCySEC, FCA, FSA(SC), FSCA, Labuan FSAYes✔️👉 Open Account

CFDs are a popular trading instrument for retail traders because they allow you to see live prices and conveniently trade in real-time on online trading platforms. CFDs are also commonly used by hedge fund managers and asset managers as an alternative to physical short selling on listed equities.

AvaTrade

Overall Rating

4.8/5

Rated #1 of
Recommended FX Brokers

💰Minimum Deposit

USD 100

🌐 Regulators

ASIC, FSA

📱 Trading Desk

MetaTrader 4, MetaTrader 5

Crypto

Yes

📈 Total Pairs

60

☪️ Islamic Account

Yes

📊 Trading Fees

Low

🕒 Account Activation Time

24 Hours

🏛️ Visit Broker

AvaTrade is an award-winning global forex and CFDs broker who accepts traders in Africa. AvaTrade offers access to various financial instruments on various trading platforms, including MT4, MT5 and different proprietary trading platforms. AvaTrade is licensed and regulated by top-tier regulatory authorities across all six continents.

CM Trading

Overall Rating

4.8/5

Rated #7 of
Recommended FX Brokers

💰Minimum Deposit

USD 100

🌐 Regulators

FSA

📱 Trading Desk

MetaTrader 4

Crypto

Yes

📈 Total Pairs

154

☪️ Islamic Account

Yes

📊 Trading Fees

Low

🕒 Account Activation Time

24 Hours

🏛️ Visit Broker

CM Trading is a South African-based forex and CFDs broker that was founded in 2012. CM Trading is the trading name of Global Capital Markets Trading (GCMT). The brokerage offers access to multiple financial assets on the global markets on the MT4 trading platform. CM Trading is an award-winning company and is licensed and regulated by the Financial Sector Conduct Authority (FSCA). CM Trading recently received the Best Financial Broker Africa 2020 and the Fastest Growing Online Broker Middle East 2019.

Exness

Overall Rating

4.9/5

Rated #2 of 
Recommended FX Brokers

💰Minimum Deposit

USD 10.00

🌐 Regulators

FSCA, FSA, CySEC, FCA, CBCS, FSC (BVI), FSC (Mauritius)

📱 Trading Desk

MetaTrader 4, MetaTrader 5

Crypto

Yes

📈 Total Pairs

107

☪️ Islamic Account

Yes

📊 Trading Fees

Low

🕒 Account Activation Time

24 Hours

🏛️ Visit Broker

Exness is a leading forex and CFDs broker that accepts traders in Africa. The award-winning fintech company was founded in 2008 and is licensed and regulated by top-tier authorities, including the FCA, CySEC, FSCA and FSA. Exness is a Market Maker and NDD forex broker and provides online to multiple asset classes on the MT4 and MT5 trading platforms and a proprietary Web Terminal.

FxPro

Overall Rating

4.7/5

Rated #202 of
Recommended FX Brokers

💰Minimum Deposit

🌐 Regulators

📱 Trading Desk

Crypto

Yes

📈 Total Pairs

☪️ Islamic Account

Yes

📊 Trading Fees

Low

🕒 Account Activation Time

24 Hours

🏛️ Visit Broker

FxPro is a global, multi-regulated forex and CFDs broker that accepts traders in Africa. FxPro is a No Dealer Desk (NDD) broker and offers access to many asset classes on the MT4, MT5 and cTrader platforms. FxPro also has its own award-winning proprietary trading platform. FxPro offers the Micro, Premium, VIP and No Commission account, which supports commission-free trading. The FxPro Zero Fixed and Zero Spread accounts support commission-based trading. FxPro offers a mixture of live floating spread accounts and real-time fixed spread accounts.

HotForex

Overall Rating

4.8/5

Rated #6 of
Recommended FX Brokers

💰Minimum Deposit

USD 5

🌐 Regulators

CySEC, FSC, FSCA

📱 Trading Desk

MetaTrader 4 and MetaTrader 5

Crypto

No

📈 Total Pairs

50+

☪️ Islamic Account

Yes

📊 Trading Fees

Low

🕒 Account Activation Time

24 Hours

🏛️ Visit Broker

HotForex is a global, multi-regulated forex and CFDs broker that accepts traders in Africa. Founded in 2010, HotForex and HF Markets fall under the HF Markets Groups, which operates in multiple jurisdictions. The brokerage offers access to a wide range of asset classes on the MT4 and MT5 trading platforms with six trading accounts.

IC Markets

Overall Rating

4.7/5

Rated #37 of
Recommended FX Brokers

💰Minimum Deposit

USD 200

🌐 Regulators

ASIC 

📱 Trading Desk

MetaTrader 4

Crypto

Yes

📈 Total Pairs

65

☪️ Islamic Account

Yes

📊 Trading Fees

Low

🕒 Account Activation Time

24 Hours

🏛️ Visit Broker

IC Markets is a well-established Australian-based forex and CFDs broker, offering access to a wide range of financial markets on the MT4 and MT5 for retail traders and cTrader for institutional clients. IC Markets is the preferred forex broker in Australia for high-volume traders and scalpers due to their New York Equinix NY4 data centre, which processes about 500 000 trades per day.

NAGA

Overall Rating

4.7/5

Rated #208 of
Recommended FX Brokers

💰Minimum Deposit

USD 50

🌐 Regulators

CySEC, FCA

📱 Trading Desk

Dealing Desk with DMA and STP

📱Platforms

NAGA Web Trader, MT4, MT5, iSO and Android Apps

Crypto

Yes

📈 Total Pairs

45+

📈 Max. leverage

1:1000

☪️ Islamic Account

No

📊 Trading Fees

Low

🕒 Account Activation Time

24 Hours

🏛️ Visit Broker

NAGA is a global fintech company that was established in 2015. NAGA provides a user-friendly Super App with a simple interface to access the global markets and trade forex and CFDs on stocks, commodities and ETFs. NAGA’s core focus is on social trading and offers AutoCopy and NAGA Feed, central hubs for traders and investors to share trading experiences and strategies. NAGA is the trade name for NAGA Group AG, based in Germany and publicly listed on the Frankfurt Stock Exchange (FSE). NAGA is authorised and regulated by the FCA in the United Kingdom and CySEC in Cyprus.

OANDA

Overall Rating

4.9/5

Rated #194 of
Recommended FX Brokers

💰Minimum Deposit

USD 0

🌐 Regulators

FCA, CFTC, ASIC, FSC, BVI and IIROC

📱 Trading Desk

MetaTrader 4 (MT4); 

MetaTrader 5 (MT5)

Crypto

Yes

📈 Total Pairs

45

☪️ Islamic Account

Yes

📊 Trading Fees

Low

🕒 Account Activation Time

24 Hours

🏛️ Visit Broker

OANDA is a well-established forex and CFDs broker that accepts traders in Africa. Founded in 1996, OANDA is regulated by the FCA, which is regarded as the leading regulatory authority in the world. It has individual entities which are regulated in the US, Canada, Australia, Singapore and Japan. OANDA provides access to many asset classes on the MT4 trading platform and its proprietary OANDA fxTrade mobile trading app.

Pepperstone

Overall Rating

4.9/5

Rated #54 of
Recommended FX Brokers

💰Minimum Deposit

USD 10

🌐 Regulators

Australia, Bahamas, Cyprus, Dubai, Germany, Kenya, UK

📱 Trading Desk

MetaTrader 4, MetaTrader 5, cTrader and TradeView

Crypto

Yes

📈 Total Pairs

60+

☪️ Islamic Account

Yes

📊 Trading Fees

Low

🕒 Account Activation Time

24 Hours

🏛️ Visit Broker

Pepperstone is a global forex and CFDs brokerage that accepts beginner traders in Africa. Pepperstone was founded in 2010, its headquarters are based in Australia, and the brokerage is regulated by several Top-tier authorities, including the FCA in the UK and ASIC in Australia. Pepperstone offers clients access to various financial instruments on the MT4, MT5 and cTrader trading platforms. Clients choose three types of accounts: the Standard commission-free account, the commission-based Razor account, and the commission-free, swap-free Islamic account.

Tickmill

Overall Rating

4.7/5

Rated #3 of 
Recommended FX Brokers

💰Minimum Deposit

USD 100

🌐 Regulators

FSA

📱 Trading Desk

MetaTrader 4

Crypto

Yes

📈 Total Pairs

62

☪️ Islamic Account

Yes

📊 Trading Fees

Low

🕒 Account Activation Time

24 Hours

🏛️ Visit Broker

Tickmill is a global, multi-asset forex and CFDs broker that accepts traders in Africa. Tickmill was founded in 2014 and offers access to a wide range of asset classes on the MT4 trading platform. Tickmill is regulated by several Top-tier authorities, including the FCA, CySEC, FSCA and FSA. Tickmill is a No Dealer Desk (NDD) broker and offers four core trading accounts. Tickmill publishes a wide range of research and educational material, including video tutorials, eBooks and news articles. It also hosts regular webinars and seminars for forex training for beginner and advanced traders.

How do CFDs work?

👉 CFDs allow you to trade various financial assets and securities, including commodities, stocks, indices, futures, bonds and exchange-traded funds (ETFs). CFDs are cash-based arrangements between a buyer and seller, and you don’t take delivery of the actual asset. You speculate on price movements and earn (or lose) money on the opening and closing price difference.

👉 CFDs are traded over-the-counter through regulated brokers, using popular trading platforms like MetaTrader 4 and MetaTrader 5. CFDs were created for online trading and are not traded on the global stock exchanges.

👉 Retail traders speculate on the price of underlying assets or securities rising or falling. If you expect the price to move upwards, you will buy the CFD. If you expect asset price to fall, you will sell the CFD. The net difference is what you gain or lose on a CFD trade.

Why trade CFDs?

👉 Contracts for differences (CFDs) are made in a futures contract where the difference in the value of the financial asset is paid in cash rather than delivering the actual securities or physical goods to the investor.

👉 CFDs are an agreement between retail traders and investors and a CFDs broker to pay the difference in the asset value between the period the contract opens and closes. Traders do not own the underlying asset; they gain or lose profits depending on the price change between opening and closing a position.

👉 CFDs are leveraged products, meaning you only need a small initial investment to multiply your borrowing potential. Traders use borrowed capital to fund CFDs trading, potentially increasing their return on their initial investment with a low investment.

👉 The main advantage of CFDs for retail traders is they provide an opportunity to access financial assets on the global markets at a lower cost than securing the physical asset. CFDs are easy to access on the popular MetaTrader trading platforms, and you can go short or long on positions.

What assets can you trade as CFDs?

👉 You can trade CFDs on multiple financial assets, including currencies, commodities, stocks, indices, futures, bonds, ETFs and cryptocurrencies.

CFDs examples include:

➡️️​ Currencies: USD/EUR, GBP/EUR, USD/JPY, AUD/USD

➡️️​ Commodities: oil, natural gas, precious metals, grains, gold, beef, coffee

➡️️​ Stocks: Amazon, Apple, Facebook, Microsoft, Tesla, Netflix

➡️️​ Indices: US100, DOW30, S&P500, FTSE100, AUS200

➡️️​ Futures: equity, index, commodity, currency, interest rate and VIX futures

➡️️​ Bonds: US TBond, GER10Y, US TNote, Gilt10Y

➡️️​ ETFs: XLF, QQQ, ChinaCSI300, Euro Trust

➡️️​ Cryptocurrencies: Bitcoin, Litecoin, Ripple, Ethereum

How do you trade CFDs?

👉 You can trade CFDs on multiple financial assets by registering with a regulated CFDs broker and opening a live trading account. You can use a free demo account and practice trading CFDs with virtual money until you feel confident trading on a live account with real money.

How long can you hold a CFDs position?

👉 CFDs positions do not expire. You can hold them for a short time or as long as you wish. It depends on your trading strategy and if you prefer to hold short or long positions. You can open and close a CFDs position in a few minutes or keep it open for months. There are costs associated with carrying overnight positions which need to be calculated into your CFDs trading strategy.

What are CFDs risks?

👉 There are three risks involved in trading CFDs online: market, liquidation and counterparty risk.

👉 Market risk is high because traders pay the difference between the opening and closing price on the underlying asset and risk losing a lot of money if the market goes against them. CFDs traders speculate on the price movements on the global markets, using stop-loss orders to manage their financial risk.

👉 Liquidity risk is high because CFDs are traded on leverage and margins. CFDs traders must add additional funds to maintain their margins. CFDs brokers require you to deposit more money to cover your margin levels, known as a margin call. These calls can be short notice, and financial losses can escalate quickly when the market is running.

👉 Counterparty risk is high for any over-the-counter (OTC) derivative and relates to the financial solvency or stability of the counterparty to the contract. If the counterparty does not meet its financial obligations, your CFD has little to no value. You can incur significant losses even if the underlying asset is performing well.

How much does it cost to trade CFDs?

👉 The cost of trading CFDs is covered in the spread. The buy and sell prices are adjusted continuously to reflect the trading cost. The spread in CFDs trading is the difference between the bid (buy) and ask (sell) price quoted for the underlying asset. The spread fluctuates based on market conditions and is quoted in pips. A pip is the slightest price movement reflected on an opening and closing position.

👉 The exception to this is CFDs for exchange-traded funds (ETFs). With ETF CFDs, the buy and sell price match the price of the underlying asset and you are charged a commission on the transaction.

FOREX TRADING AFRICA DISCLAIMER

Forex and CFDs are complex instruments, and trading these instruments come with a high-risk warning. Trading forex and CFDs involves a high risk of losing money rapidly due to leverage and margin. You need to understand how forex trading works and decide whether you can afford to take the risk of losing money on trade orders that do not go your way.

Forex Trading Africa annually reviews brokers and financial instruments and provides information to help traders and investors make better decisions when trading on global markets. The information is published to help improve your knowledge and understanding of international multi-asset trading and market participants.

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