Top 10 Best UK Forex Brokers For Spread Betting for 2021

Filippo Ucchino Last Updated: March 2021 12 min read
Top Rated:

Are you looking for the best UK forex brokers for spread betting because you want to avoid being taxed on your trades?

We can help you.

Spread betting has been around for a long time, but not all forex brokers have caught up with how popular it is. On top of that, while there are many that offer spread betting, there are plenty of brokers that lack the experience and technology traders really want.

Don’t just sign up to the first spread betting broker you come across. Sign up to a broker that will provide you with the trading conditions that suits your trading style.

Table of contents

Top 10 Best Uk Spread Betting Brokers Of 2021

Here’s our ranking.

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76% of retail CFD accounts lose money

1. IG Markets

For a truly great spread betting experience, you cannot go wrong with IG. Operating since 1974, IG is perhaps the most experienced spread betting broker traders will come across. They are also a highly innovative broker, offering some of the best technology available today and a DMA trading environment. Traders can take advantage of IG’s web platform, which is built to handle spread betting and access to over 16,000 markets.

They are also a well-regulated CFD broker, boasting respected regulation from the FCA in the UK and offering trading in more than 10,000 shares markets. What you will find is that the IG Markets minimum deposit starts from $300. This is not too small, but also still within range for most spread betting and forex traders. Spreads here start from 0.6 pips on forex trading and an even better value 0.1 pips on other assets including indices, shares, and cryptos.

91
Rated: Excellent
security 98
cost 65
trading 100
education 84

Platforms: Proprietary Web Platform, MAC Platforms Regulations: FSA, MAS, FINMA, FCA, CFTC, MIFID-ESMA, ASIC, FMA, FSCA, DFSA Minimum Deposit: 300
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79.6% of retail CFD accounts lose money

2. ETX Capital

ETX Capital is also a highly respected spread betting broker, operating for over 50 years. To get the most out of spread betting with ETX Capital, traders should use their ETX TraderPro platform which was awarded ‘Best Spread Betting Platform 2018’ by the ADVFN International Financial Awards and offers a range of customisable features to implement strategies. ETX Capital also offers instant execution and access to over 5,000 markets.

This UK broker is also FCA regulated there so can be well trusted by traders. They boast a really strong educational section so this makes it the ideal place to learn about spread betting for beginners. As well as their own platform, you can trade through MT4 and get spreads on forex trading from 0.6pips, but as low as 0.01 on commodities, and 0.1 on bonds.

90
Rated: Excellent
security 94
cost 83
trading 100
education 56

Platforms: Mirror Trader, MT4 Dekstop, MT4 Web, Proprietary Desktop Platform, Proprietary Web Platform, MAC Platforms Regulations: FCA, MIFID-ESMA Minimum Deposit: 100
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79% of retail investor accounts lose money

3. AvaTrade

AvaTrade is another of the top forex brokers to also offer spread betting as an option through their dedicated platform. With spread betting being legal in the UK and Ireland, this means that many traders choose AvaTrade as their spread betting broker. They are a well respected Irish broker who are regulated there also.

Through AvaTrade as a spread betting trader or another form of trader, you will find that the minimum deposit is reasonable across the board at only $100 to open your account. This combined with very low spreads starting at 0 pips is another attractive point as well as the fact that you can spread bet on more than 200 assets including forex, commodities, indices, equities, bonds, and ETFs. You are also allowed to scalp and as a regular trader, the top trading platform MT4 is available for your use.

83
Rated: Excellent
security 94
cost 82
trading 75
education 72

Platforms: Mirror Trader, ZuluTrade, MT4 Web, MT5 Web, Proprietary Web Platform, MAC Platforms Regulations: FSA, MIFID-ESMA, ASIC, IIROC, FSCA, Offshore, FSC (British) Minimum Deposit: 100
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74-89% of retail investor accounts lose money when trading CFDs

4. Pepperstone

Pepperstone regularly features as a top broker on many of our listings, and again here as a top FCA regulated broker. Pepperstone is an Australian broker who operates and is regulated in many areas worldwide. This includes the UK where they are FCA regulated (#684312). They too are a hugely successful, award-winning broker, and a very popular choice among all levels of trader. They provide spread betting and CFD trading across more than 150 instruments, including forex, index and commodities onMT4, MT5 and cTrader platforms.

You can get started trading with Pepperstone for a minimum deposit of £200 through either their standard, or Razor account types and once you are set up you will be glad to find a very good value spread that starts from the bottom, 0 pips. There is something for everyone with the broker also incorporating many great social trading features and a top class active trader program to help keep your trading costs as low as possible.

88
Rated: Excellent
security 96
cost 98
trading 70
education 100

Platforms: cTrader desktop, cTrader web, ZuluTrade, MT4 Dekstop, MT4 Web, MT5 Desktop, MT5 Web, MAC Platforms Regulations: FCA, MIFID-ESMA, ASIC, DFSA, CYSEC, Offshore Minimum Deposit: 0
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73.5% of retail investor accounts lose money

5. Oanda

Oanda is another firmly established broker and has been operating since 1996 and has a strong presence in the UK. They are a great option for those who want to spread bet with the popular MT4 and have amassed plenty of awards for their service. While they do offer fewer instruments than other brokers, they do have some of the best analytical tools available. Irish traders are also accepted.

Perfect for newer traders is the fact that Oanda has no minimum deposit. This is one of the reasons that they are often noted as one of the best brokers for beginners to add to their already strong reputation as a top broker. You will find spreads here starting from an excellent value 1 pip on the majority of markets.

79
Rated: Excellent
security 94
cost 73
trading 68
education 79

Platforms: Proprietary Desktop Platform, Proprietary Web Platform Regulations: FSA, MAS, FCA, CFTC, MIFID-ESMA, ASIC, IIROC Minimum Deposit: 0
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75.54% of retail investor accounts lose money

6. FxPro

FxPro are yet another award-winning broker to feature in our selection of the very best spread betting brokers that you have to choose from. They are regulated by several top-tier regulatory bodies including the FCA in the UK where spread betting is legal and they have collected more than 60 forex trading related awards in total.

Here you can start your spread betting account with as little as $100 through their very intuitive beta platform FxPro Edge that allows for a great and interactive spread betting experience. On top of this, you can expect some of the tightest spreads in the business on all markets offered including forex, shares, indices, metals, and energis. This makes FxPro a top choice for traders around the world.

84
Rated: Excellent
security 95
cost 81
trading 76
education 83

Platforms: cTrader desktop, cTrader web, MT4 Dekstop, MT4 Web, MT5 Desktop, MT5 Web, MAC Platforms Regulations: FCA, MIFID-ESMA, FSCA, CYSEC, Offshore Minimum Deposit: 100
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75.7% of retail CFD accounts lose money

7. ActivTrades

ActivTrades is one of few brokers that allow traders to spread bet on a variety of different platforms, including their ActivTrader, MT4, and MT5, which means traders can spread bet in a way they feel comfortable. They also claim to offer fully automated execution and allow traders to spread bet from a position as low as 10p up to £100. Added to this that the ActivTrades is an FCA regulated broker and the attraction for spread betters increases.

The broker features a range of markets available to trade in with something that is bound to suit every trader. As well as forex trading, here you can find markets on options, ETF, indices, shares, commodities, and bonds CFDs with spread betting available on most to UK-based traders. The final positive here which sees many choose this broker is the fact there are no minimum deposits.

79
Rated: Excellent
security 94
cost 78
trading 72
education 58

Platforms: Mirror Trader, ZuluTrade, MT4 Dekstop, MT4 Web, MT5 Desktop, MT5 Web, Proprietary Desktop Platform, Proprietary Web Platform, MAC Platforms Regulations: FCA, MIFID-ESMA, DFSA, Offshore Minimum Deposit: 1000
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72% of retail CFD accounts lose money

8. City Index

City Index are one of the most well-known spread betting brokers around, operating since 1983. They currently have over 4 million customers and supposedly handle over 1 million trades per day, proof of their success. When you sign up to spread bet with City Index you automatically get a free spread betting guide.

As a new trader, City Index may also be perfect for you due to the fact that there is no minimum deposit in place. So you can get the most out of trading with the broker, they do recommend that you deposit at least $100. Once you have an account you will be glad to find a wide array of assets, more than 8000 in total available to trade. These include many forex pairs, indices, shares, and cryptocurrency markets. The spreads here are also top value, starting at just 0.5 pips on forex with trading available through the trusted MT4 platform.

79
Rated: Excellent
security 94
cost 61
trading 77
education 69

Platforms: Proprietary Desktop Platform, Proprietary Web Platform Regulations: MAS, FCA, MIFID-ESMA, ASIC Minimum Deposit: 50
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76% of retail investor accounts lose money

9. LCG

LCG or London Capital Group is another broker that’s great for those who are looking for experience, building an excellent reputation in 20 years. With LCG, traders can spread bet on over 7,000 global markets using their web-based LCG Trader platform or MT4. The LCG Trader platform is particularly unique, boasting one-click trading, 70 technical indicators, and plenty of customisation.

LCG are also regulated by the FCA which should give you a lot of confidence in the trustworthiness and transparency of the operation as a potential trader with them. It may also be ideal for new traders in the sector since this broker does not need any minimum deposit. Once you have opened your account, you can engage in spread betting across a range of markets that include metals, indices, shares, bonds, commodities, and ETFs. With scalping allowed on the platform, this also is an attractive point for many of the more experienced traders to come to LCG.

83
Rated: Excellent
security 95
cost 77
trading 77
education 77

Platforms: MT4 Dekstop, MT4 Web, Proprietary Web Platform Regulations: FCA, MIFID-ESMA Minimum Deposit:
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79% of retail investor accounts lose money

10. Markets.com

Next on our listing of top spread betting brokers is a well-known and trusted name in the form of Markets.com. They have carved out an excellent reputation through their years in the industry and in particular for offering a great spread betting service.

Here you will find a tremendous selection of assets to choose from. This includes a total of more than 2,000 assets that you can spread bet on. Spread betting with Markets.com is available through their MarketsX account type and this is a popular choice for many spread betters looking for very fast execution that is offered by the broker alongside a top range of trading tools that can help you analyze the fundamental and technical points of an asset, as well as gain an insight into the current market sentiment. With Markets.com you will be able to open this spread betting account type with a £250 minimum deposit. This is great value given the experience and range of features available with the broker

91
Rated: Excellent
security 96
cost 74
trading 100
education 73

Platforms: MT4 Dekstop, MT4 Web, MT5 Desktop, MT5 Web, Proprietary Web Platform Regulations: MIFID-ESMA, ASIC, FMA, FSCA, CYSEC Minimum Deposit: 100

What is Spread Betting exactly?

As you can perhaps guess from the name, spread betting is most simply, betting on the spread of a market and how it is going to move. So, given that you are betting on the spread, your investment is not on the actual asset at all. Instead, the value of your money will rise and fall based on your predictions of the spread movement in that market. Very simply, you are betting on the spread rising or falling. If you bet on the spread rising and it does, then you will make a profit and vice versa.

Which countries allow spread betting?

Spread betting, due to the perception of many that it is closer to gambling than investing, is not legal in every country. It is however permitted in the UK, Ireland, Macau, Hong Kong, Taiwan, and some other countries. With that said, you should always verify with the local regulator as well as your broker first.

Countries where spread betting is currently illegal include the US, some European countries, China, Japan, and Australia. In some Islamic countries too where gambling is illegal, spread betting is also considered to be illegal regardless of whether you have an Islamic trading account.

Why is spread betting illegal in so many countries? 

What makes spread betting illegal in some countries is its very high-risk nature. This and the comparisons that some people make between spread betting and gambling all play a role in its legality within some countries.

To illustrate why many consider spread betting to be very high risk, let’s take a look at the following example. Here’s what would happen if your CFD investment loses 10 pips of value:

Losses with standard trading:

  • Let’s say you are not investing in Forex but rather in a CFD Stock worth $100.
  • If you invest $100 for buying it and it falls to $99,90 (10 pips), you lost only 0.10$

Losses with spread betting:

  • Let’s make the same example. However keep in mind that with spread betting you do not buy the whole asset, which is the $100 stock. In fact what happens is that you have to choose an amount of money to “bet”.
  • If you bet $1 on the rise when the stock is at $100, and it falls to $99,90, you actually lost $1 per every pip ($1 * 10pips = $10).
  • This means that if you would have bet $100, which was the actual value of the CFD stock, you would have lost $1000.

These same high risk losses though, can also lead to high risk profits in other cases.

Forex Spread Betting: How to calculate earnings/losses

To help you calculate your earnings or losses when spread betting, let’s take a look at an example with the major forex currency pair EUR/USD.

Let’s presume that EUR/USD pricing is 1.0940/1.0941

With spread betting, when you bet $10 that the spread will rise, you’ll earn $10 for every pip (0.0001) increment above 1.0941. Let’s say you close the position to 1.0950, you’ve earned 9 pips, equivalent to $90

But you should be careful because if the spread goes the other way around, you’ll lose a lot of money. In case of -9pips loss, you’ll lose $90, and not just the $10 you bet in first place.

In other words, you earn/lose 100% of the investment for every pip rise/fall. 5 pips, for example, equal a +/- 500% on the investment

Is spread betting worth it?

Spread betting first of all, like any other form of trading, is not without risk to your funds. Only you as a trader who is interested in spread betting can really make the final decision if it is for you or not.

If you are spread betting then you can potentially make big returns within a short period of time, though the all or nothing nature of the trading style also means that you could potentially make losses. The margin between significant gains and losses in spread betting is slim. This is something that makes it very exciting though, and does attract many traders.

However many others tend to avoid this type of account due to its purely speculative and risky nature, and that’s why they usually choose the best lowest spread forex brokers.

Spread betting alternatives

If spread betting has been deemed to be too risky, or even illegal in your country of trading, then you will not be able to engage in spread betting. There is still plenty of other trading types and potential you can engage in though.

The recommendation would be to try some other derivative instruments trading. This means that futures, options, or CFDs trading could all be potentially good choices with the exception of the US where CFDs trading is also not permitted.

Check our listing of top forex brokers for more alternatives that may fit your trading needs.

How to choose a spread betting broker

When choosing the best spread betting broker for you, what you are doing is betting on the spread essentially. For that reason, you should try to choose a broker that has the most competitive spreads and the lowest commission in place.

Taxes with spread betting

Generally speaking, spread betting is usually considered to be tax-free in the sense that you will not likely be charged any capital gains tax on earnings and profits you make. Similarly, there would be no rebate possibility in the case of losses.

With that said, it may depend on the country you are spread betting from, and it is always advisable to consult with a professional tax advisor on these matters.



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