Best CFD Brokers in the USA 2024
We rigorously test brokers on real accounts and evaluate them using our methodology. Here are the top CFD brokers based on our analysis:
- 1
FOREX.com - Best CFD trading broker - Broker with many years of history and a global reputation. A variety of deposit methods. A wide variety of available markets and products. - 2
IG - Licenses from regulators with a high level of credibility. Tight spreads. A variety of markets and products. - 3
- 4
- 5
eToro - A social network for traders. Good selection of trading instruments. Fractional shares purchasing.
This comprehensive guide explores the top CFD brokers available to U.S. traders, providing a detailed comparison to help you make informed decisions.
Comparison of Top 5 CFD Brokers in the USA 2024
Selecting the right CFD broker is crucial for a successful trading experience. Below is a comparison of the top 5 CFD brokers operating in the USA, highlighting their key features, advantages, and areas to consider.
1. FOREX.com
FOREX.com is an excellent broker for trading in the Forex and CFD markets. They offer fast execution speeds, a wide selection of currency pairs, and other assets for trading. Their customer service is outstanding, and multiple financial authorities regulate them.
Pros and Cons of FOREX.com
Pros
- Broker with many years of history and a global reputation.
- A variety of deposit methods.
- A wide variety of available markets and products.
- Advanced analytical tools and daily updates from the company's professionals.
- Comprehensive educational materials for all levels of traders.
Cons
- Lack of specialized accounts.
- High transaction fee on DMA Account.
2. IG
IG is a highly regulated broker with licenses from reliable financial authorities, providing clients with high funds protection. Thanks to narrow spreads, traders can effectively manage their costs and increase the profitability of their operations. Quality trading platforms and advanced analytical tools support informed trading decisions, while extensive educational resources make IG attractive to traders of all experience levels.
Pros and Cons of IG
Pros
- Licenses from regulators with a high level of credibility.
- Tight spreads.
- A variety of markets and products.
- Extensive set of analytical tools and content.
- Quality educational resources for different levels of traders.
Cons
- Limited choice of trading accounts.
- High trading fee on DMA account.
- Inactivity fee.
- Limited choice of payment methods.
3. Trading.com
Trading.com is an attractive choice for traders due to its low commission policy, which makes trading more affordable. Using the MetaTrader 5 platform satisfies traders' needs for modern trading tools and functionality. Additionally, the broker supports various deposit and withdrawal methods without additional commissions, which is convenient for clients from different countries.
Trading.com is suitable for experienced traders who do not depend on the broker's training materials and analytics and who are looking for low-cost trading in a wide range of traditional financial instruments.
Pros and Cons of Trading.com
Pros
- Low trading fees.
- Multiple deposit and withdrawal methods.
- Quality technical support.
Cons
- Limited educational materials.
- Sparse analytics.
4. OANDA
Oanda is an excellent choice for US traders seeking a reliable and regulated broker with competitive spreads and various trading assets.
With quality analytics and diverse educational materials, Oanda suits beginners and experienced traders.
Pros and Cons of Oanda US
Pros
- Tight spreads.
- Advanced trading platforms.
- Quality analytics.
- Extensive learning section.
Cons
- Limited trading account types.
- Inactivity fee.
- High swaps.
5. eToro
eToro stands out from other brokers due to its unique combination of trading services and social features, making it particularly attractive to traders interested in innovative approaches to investing. Narrow spreads and the ability to buy securities in fractions simplify access to different assets, while the social network allows users to share strategies and copy trades of successful traders, which is a big plus for beginners and those looking for new investment ideas. The simple and intuitive interface makes the platform accessible even for those who are just starting their trading journey.
eToro is best suited for beginner traders who are looking to capitalize on the social aspects of trading and do not require complex individual trading account settings. The platform is also ideal for those looking for an active community to share ideas and strategies.
Pros and Cons of eToro
Pros
- A social network for traders.
- Good selection of trading instruments.
- Fractional shares purchasing.
- Narrow spreads.
Cons
- Only one trading account is available.
- eToro has its own trading platform, but there is no alternative to it.
- Poor customer support performance.
- Delays and hidden fees during fund withdrawal.
What is CFD?
A Contract for Difference (CFD) is a financial derivative that allows traders to speculate on the price movements of various assets without owning the underlying asset. CFDs are popular due to their flexibility and the ability to trade on margin, enabling traders to amplify their potential returns.
How CFDs Differ from Other Financial Instruments
Unlike traditional investing, CFDs do not involve ownership of the asset. Instead, traders enter into a contract with a broker to exchange the difference in the asset's price from the time the contract is opened to when it is closed. This allows for both long and short positions, providing opportunities to profit from rising or falling markets.
Pros and Cons of CFD Trading
Advantages
Leverage: CFDs allow traders to control larger positions with a smaller capital outlay.
Flexibility: Ability to trade on both rising and falling markets.
Diverse Markets: Access to a wide range of markets including stocks, commodities, indices, and forex.
No Ownership: No need to manage or store physical assets.
Disadvantages
Risk of Losses: Leverage can amplify losses as well as gains.
Complexity: CFDs can be complex and may not be suitable for all investors.
Costs: Potential for high costs due to spreads, commissions, and overnight financing fees.
Regulatory Risks: Varying levels of regulation can impact trader security.
Key Factors to Consider When Choosing a CFD Broker
Selecting the right CFD broker involves evaluating several critical factors to ensure a safe and efficient trading experience.
Regulation and Security. Ensure the broker is regulated by reputable U.S. authorities such as the Commodity Futures Trading Commission (CFTC) and the National Futures Association (NFA). Regulation by these bodies provides a level of security and ensures that the broker adheres to strict financial standards and practices. US-regulated brokers are required to maintain transparent operations, safeguard client funds, and comply with rigorous reporting and compliance obligations, offering traders peace of mind and protection against fraudulent activities.
Trading Fees and Costs. Consider the overall cost of trading, including spreads, commissions, and any additional fees. Lower trading costs can significantly impact profitability, especially for high-frequency traders.
Trading Platforms. A user-friendly and reliable trading platform is essential. Popular platforms include MetaTrader 4, MetaTrader 5, and cTrader, each offering different features and tools to enhance trading efficiency.
Asset Availability. A wide range of available assets allows for diversified trading strategies. Check if the broker offers the types of assets you are interested in, such as forex, commodities, indices, cryptocurrencies, and stocks.
Customer Service. Responsive and knowledgeable customer support can resolve issues quickly and provide assistance when needed. Look for brokers that offer multiple support channels, including live chat, email, and phone support.
Educational Resources. Educational materials such as webinars, tutorials, and market analysis can help traders improve their skills and make informed trading decisions. Brokers that invest in educational resources are often more trader-friendly.
How Was the List of the Best CFD Brokers in the USA Compiled?
In compiling the list of CFD brokers for U.S. traders, we adhered to a meticulously defined and weighted set of criteria to ensure only the most reliable and high-quality brokers were selected. Our selection process included the following key factors:
We began by leveraging our comprehensive Forex broker list as the foundation for ranking, ensuring that brokers with proven excellence in Forex trading were also evaluated for their CFD offerings.
Brokers were rigorously assessed based on our strict testing standards, which evaluate their overall quality, reliability, and performance. This methodology ensures that only brokers meeting high operational standards make it to our final list.
All selected brokers offer services tailored to U.S. traders, providing terms and conditions that are accessible and favorable to a wide range of American investors. This includes compliance with U.S. regulations and support for trading in USD.
We ensured that each broker provided specific offers and features for CFD trading, catering to both novice and experienced traders. This includes a diverse range of trading instruments, competitive spreads, and robust trading platforms.
The brokers included in our list meet stringent security requirements, safeguarding client funds through measures such as segregated accounts and adherence to regulatory standards set by U.S. authorities like the Commodity Futures Trading Commission (CFTC) and the National Futures Association (NFA).
By applying these comprehensive criteria, we have curated a list of CFD brokers that are not only reliable and secure but also specifically cater to the needs of American traders. This ensures that our recommended brokers provide exceptional quality services, enabling U.S. investors to engage in CFD trading with confidence and peace of mind.
FAQ
Is CFD trading legal in the USA?
CFD trading is heavily regulated in the USA. Unlike many other countries, CFDs are not widely available to U.S. residents due to strict regulations imposed by the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC). Traders should ensure they are compliant with U.S. laws before engaging in CFD trading.
What is the minimum deposit required to start trading CFDs?
The minimum deposit varies by broker, typically ranging from as low as $1 with brokers like OANDA to $200 with brokers like eToro. It's essential to choose a broker with a minimum deposit that aligns with your trading budget and strategy.
Can beginners successfully trade CFDs?
Yes, beginners can successfully trade CFDs with proper education, a solid trading plan, and disciplined risk management. Utilizing demo accounts to practice and leveraging educational resources provided by brokers can significantly enhance a beginner's chances of success. Additionally, be sure to check out our Best Forex Brokers for Beginners in the USA list to find brokers that are well-suited for those just starting out.
What are the risks associated with CFD trading?
CFD trading involves several risks, including the potential for significant financial losses due to leverage, market volatility, and the complexity of the instruments. It's crucial to understand these risks and implement effective risk management strategies to mitigate potential losses.
How do I choose the right trading platform for CFDs?
Choosing the right CFD trading platform depends on your trading style, technical requirements, and personal preferences. Consider factors such as ease of use, available tools and indicators, execution speed, and compatibility with your devices. Popular platforms like MetaTrader 4, MetaTrader 5, and cTrader offer a range of features catering to different trading needs.
Can I trade CFDs on my mobile device?
Yes, most reputable CFD brokers offer mobile trading platforms compatible with smartphones and tablets. These platforms provide the flexibility to trade on the go, access real-time market data, and execute trades seamlessly from your mobile device.
What types of assets can I trade with CFDs?
CFDs allow you to trade a wide variety of assets, including forex, commodities (such as gold and oil), indices, stocks, cryptocurrencies, and ETFs. This diversity enables traders to diversify their portfolios and explore multiple markets within a single trading account.
How do CFD brokers make money?
CFD brokers make money primarily through the spread, which is the difference between the bid and ask prices of an asset. Some brokers also charge commissions on trades, especially for certain account types or asset classes. Additionally, overnight financing fees may apply for positions held open beyond a trading day.
Are demo accounts available for practicing CFD trading?
Yes, most CFD brokers offer demo accounts that allow traders to practice trading with virtual funds. Demo accounts are an excellent way for beginners to familiarize themselves with trading platforms, test strategies, and gain confidence before committing to real capital
