What is Plus500?
Plus500 is a leading online Contract for Difference (CFD) trading platform that is owned by a holding company called Plus500 Ltd. The company is listed on the Main Market of the London Stock Exchange (LON: PLUS) and operates through 3 different subsidiaries:
Plus500CY Ltd and
Plus500AU Pty Ltd.
Plus500 (or subsidiaries) are regulated in several different jurisdictions around the world, making the brand synonymous with reliability and safety.
In addition to being regulated around the world, Plus500 is also an active sponsor of professional Soccer and Rugby teams. The firm have been the official sponsor of Club Atletico de Madrid since 2016. They also added Legia Warsaw and Atalanta to their list during 2020.
Traders can earn a first deposit bonus on their initial deposit, up to a maximum of $10,000. Additional leverage of up to 1:300 is also available.
Before we go into detail about the Pro’s and Con’s of Plus500, let us quickly give you a brief background about CFD trading.
What is CFD trading and how does it work?
A Contract for Difference (CFD) is a popular form of derivative trading that enables investors to speculate on the rising or falling prices of fast-moving global financial markets (or instruments) such as shares, indices, commodities, currencies and treasuries. A CFD is essentially a contract between an investor and an investment bank, or spread betting firm. At the end of the contract, the parties exchange the difference between the opening and closing prices of a specified financial instrument, which includes shares and commodities.
A trader with a Plus500 account can trade CFDs on underlying financial instruments such as Forex, Stocks, Commodities, Cryptocurrency, Options and Indices. With tight spreads and no commission, they are a leading global brand. Back to Plus500…..
How reliable is Plus500?
Since its inception in 2008, Plus500 has earned a reputation among traders in the online community as being reliable and trusted. In terms of regulatory oversight, Plus500 subsidiaries are regulated by several regulatory agencies:
Plus500UK Ltd is authorised and regulated by the Financial Conduct Authority (FRN 509909).
Plus500CY Ltd is authorised and regulated by the Cyprus Securities and Exchange Commission (Licence No. 250/14).
Plus500AU Pty Ltd, ACN 153 301 681, AFSL # 417727, issued by the Australian Securities and Investments Commission is authorised to issue these products to Australian residents.
Derivatives issuer licence in New Zealand, FSP #. 486026 authorises them to issue these products to New Zealand residents.
Plus500AU Pty Ltd, is also an authorised Financial Services Provider in South Africa, FSP 47546.
With subsidiaries as regulated entities under the UK’s FCA, ASIC in Australia and CySEC, Plus500 is able to work with traders from Australia, Europe and the UK. Clients can therefore take advantage of the benefits of being protected under the Financial Services Compensation Scheme (FSCS) and Investors Compensation Scheme. For full details of the protection these schemes offer, visit the website.
Plus500 facts and figure
As we’ve already mentioned, a trader with a Plus500 account can trade CFDs on underlying financial instruments such as Forex, Stocks, Commodities, Cryptocurrency, Options and Indices. With tight spreads and no commission, they are a leading global brand. Plus500 offer a first deposit bonus, up to $10,000 AUD.
|Bonus||Up to $10,000 AUD|
|Instruments||CFD, Forex, Crypto, Stocks, Options|
|Min. Trade||Varies by asset|
|Regulated By||FCA, CySec, ASIC|
|Mobile Apps||iOS, Android and Windows|
|Plus500 Offer forex trading via CFDs with tight variable spreads and a range of well over 70 currency pairs. Free Unlimited Demo Account.Plus500 offer a first deposit bonus, up to $10,000 AUD. Plus leverage up to 1:300|
|Plus500 accounts can trade CFDs on a range of cryptocurrencies 24/7, with competitive spreads (Just 1% for BTC). Leverage of 1:2 is also available. Plus500 offer a first deposit bonus, up to $10,000 AUD|
|Spread||BTC 1%, ETH 1.6%|
|Coins||BCH, BTC, ETH, LTC, XRP, IOTA, NEO, EOS, XMR|
Now that you’ve seen the numbers, let us go into the Plus500 Trading Platform.
The Plus500 Trading Platform
Although Plus500 uses a proprietary trading platform, the trading platform (Webtrader) is able to cater to the different needs of the broker’s international clientele base, as it is available across several different versions (including mobile).
There is a desktop version of the trading platform which traders can download and install onto their computers. Retail and professional accounts operate on the same platform. This creates pros and cons but with advanced research tools next to the ability to execute trades in a user friendly way the platform performs well.
For those who wish to trade directly from the internet, there is a web-based version of the trading platform which can be accessed with any web browser. There is no integration with MT4 at present.
The key difference between the Webtrader trading platform and the platforms provided by other brokers in the industry is the fact that Plus500 trading platforms work seamlessly with each other.
Getting started on the Plus500 platform
In order to begin using the platform, investors must open a trading account first. Plus500 only offers one account type, which is often referred to as a Retail account. You can apply for a Professional account if you meet two of the following three criteria:
-Sufficient trading activity in the last 12 months
-Financial instrument portfolio over €500,000
-Relevant experience in the financial services sector
A Professional account lets you trade with higher leverage compared to a Retail account, where the leverage has been reduced to the range of 1:2 to 1:30 as of August 2018. The maximum leverage for Professional accounts ranges from 1:5 (for options) to 1:300 (for forex) for the various instruments, with options at the bottom and forex products and indices at the top of the range.
The standard trading account requires a minimum deposit of $100 to open.
Apart from the standard trading account, Plus500 has also provided a free unlimited demo account which potential clients can use to test out the performance of the trading platform and develop a trading strategy.
Opening a Plus500 account
Plus500 accepts customers from many countries all around the world. However, residents of the US, Canada, Cuba, Iran and Syria are excluded.
For those who reside in participating countries, the account opening process is fully digital and quite seamless- you can easily open your trading account within a day.
After the online registration, you have to verify your identity and provide proof of residency. To verify your identity, an ID copy or passport can be uploaded whilst a bank statement or utility bill is acceptable as proof of residency. Alternatively, you can use a driving license or a residence permit for ID verification, or a toll taxes letter, salary slip or address card to verify your residency.
Account base currencies:
At Plus500, there are several currencies available but it is not transparent how many and which ones. The following account currencies are currently available: USD, GBP, EUR, CHF, AUD, JPY, PLN, HUF, CZK, CAD, TRY, SEK, NOK, and SGD. The default account currency is set based on your country of residency. To change your base currency, you’ll need to contact customer support.
Why does this matter? For two reasons: If you fund your trading account in the same currency as your bank account or you trade assets in the same currency as your trading account base currency, you don’t have to pay a conversion fee. If your bank account’s currency differs from the base currency, Plus500 will charge you a currency conversion fee of a maximum of 0.5% for all trades and instruments.
A convenient way to save on currency conversion fees is by opening a multi-currency bank account at a digital bank. These usually offer bank accounts in several currencies with great currency exchange rates as well as free or cheap international bank transfers. Opening an account only takes a few minutes on your phone.
Deposits and withdrawals:
∙Plus500 charges no deposit fees and your account can be funded in the following ways:
-Skrill (e-wallet options are available depends on your region)
The Plus500 minimum deposit is $100 for debit/credit cards and electronic wallets and $300 for bank transfers.
You can only deposit money from accounts that are in your name.
∙Plus500 withdrawal is free for the first five withdrawals each month. After that, there is a $10 fee per withdrawal.
There is also a minimum withdrawal amount, which is $50 for PayPal and $100 for bank transfer and credit/debit cards. If you want to withdraw less than this, a $10 charge will be applied. You can expect about 3 business days for your withdrawal to reflect in your account and you can use the same methods as for deposits.
Plus500 trading fees
We are aware that comparing trading fees for CFD brokers can be challenging. So how did we approach the problem of making their fees clear and comparable? We compared a few brokers by calculating all the fees of a typical trade for selected products.
We compared Plus500’s fees with those of two similar brokers: eToro and XTB. This selection is based on objective factors such as products offered, client profile, fee structure, etc.
We also selected popular instruments within each asset class:
Stock index CFDs: SPX and EUSTX50
Stock CFDs: Apple and Vodafone
Forex: EURUSD, GBPUSD, AUDUSD, EURCHF and EURGBP
A typical trade means buying a leveraged position, holding it for one week and then selling. For the volume, we chose a $2,000 position for the stock index and stock CFDs and $20,000 for the forex transactions. The leverage we used was:
20:1 for stock index CFDs
5:1 for stock CFDs
30:1 for forex
These catch-all benchmark fees include spreads, commissions and financing costs for all brokers. Let’s see the verdict for Plus500 fees.
Plus500 has generally low CFD trading fees.
There is no commission: everything is included in the spread, i.e. the difference between the ask and bid prices.
Plus500 CFD fees for a $2,000 long position held for one week
|S&P 500 index CFD fee||$2.1||$2.4||$2.0|
|Europe 50 index CFD fee||$1.3||$2.7||$2.2|
|Apple CFD fee||$8.9||$6.3||$17.9|
|Vodafone CFD fee||$7.6||–||$20.9|
Plus500 forex fees are average. Again, no there is commission, and everything is included in the spreads.
Plus500 forex benchmark fees of a $20,000 30:1 long position held for one week
|EURUSD benchmark fee||$17.9||$19.6||$15.0|
|GBPUSD benchmark fee||$14.0||$16.2||$11.1|
|AUDUSD benchmark fee||$12.6||$12.4||$10.0|
|EURCHF benchmark fee||$9.0||$11.8||$6.6|
|EURGBP benchmark fee||$14.6||$19.9||$9.9|
Plus500’s withdrawal fee conditions are as follows:
– Five free withdrawals per month, after which the withdrawal fee is $10 per transaction.
– $10 if you withdraw less than the minimum withdrawal amount of $100.
– Withdrawal by bank transfer has a fixed rate of $6.
-Account inactivity fee of $10 per quarter after 3 months of inactivity.
TIP: This can be avoided by simply logging on to the platform. Some brokers require you to not only login, but trade as well.
Features of the Plus500 Trading Platform
The Plus500 web and mobile trading platform Pro’s:
∙ User – friendly interface
∙ Safe login- uses two step authentication
∙ Clear fee report
∙ Available in many languages including Arabic, Dutch, Chinese, Malay, Slovakian, Maltese, Portugese, Hebrew and many more.
∙ There is a search function which allows you to find the products categorized on the left or you can search by typing in the product name.
There is only one negative that we found on the Plus500 platform: it is not customizable.
Other interesting features on the platform are:
Order placing functionality:
You can use the following order types:
*This guarantees that your position will be closed even if there is a large market movement. If you use it, the spread will be wider. This is the extra cost of using this order type.
These orders can be cancelled at any time before they are executed, i.e. they are Good Till Cancelled (GTC). However, there are no other order time limits provided.
Alerts and notifications functionality:
You can set up email, SMS and push notifications.
The alert lets you know if the price of an asset reaches a certain level or changes by a set percentage. Additionally, you can sign up to be alerted if the Plus500 Traders’ Sentiment (the percentage of Buyers and Sellers among Plus500 customers) reaches a certain level. We think this is a great tool.
Portfolio and fee reports:
Plus500 provides transparent portfolio and fee reports. It is clearly indicated how much you paid in overnight fees. The composition of your current portfolio is also made clear, which you can check in the bar at the top of the platform.
The charting tool is of good quality and there are 119 technical indicators and great editor tools available for users. A great benefit is that you can also save the charts. Additionally, Plus500 clients have the opportunity to use 9 charts simultaneously on WebTrader. To enable the Multiple Charts, just find a button with four quadrants on the chart’s toolbar.
The Plus500 platform comes with a well-designed economic calendar. We liked that you can filter for macro events or company-related events.
Traders’ Sentiment tool:
This is a handy research tool which shows the proportion of buyers and sellers at Plus500 for the given asset.
Plus500 customer service can be reached via live chat and email. There is no telephone or WhatsApp support but an integrated ‘Contact Us’ page can be used for inquiries.
We tested the Plus500 live chat several times and on all occasions, it was always quick and reliable. You can also rate the agent after every call- this shows that Plus500 values client feedback.
The email customer support is also very efficient, with the response turnaround time under an hour.
We can sum up customer service as efficient, reliable and convenient (available 24/7).
All education related materials can be reached on the Plus500 website under the ‘Trader’s Guide’ section. If you browse their FAQ, you will find a few more videos detailing, for example, the process of payment verification.
Is Plus500 safe?
To be certain if a brokerage is safe, we highly advise that you check two facts:
-How you are protected if something goes wrong
-What the background of the broker is
How you are protected
Plus500 operates several subsidiaries and which one will serve you depends on your residency. The investor protection amount you get depends on the country of the subsidiary you are signing up with.
For example, if you are from the UK, your account will be with Plus500UK Ltd and you will get £85,000 in investor protection. Plus500UK Ltd is regulated by the FCA, the UK’s financial authority.
|Client country||Investor protection amount||Regulator||Legal entity|
|EEA countries (EU, Switzerland, Norway)||€20,000||Authorized and regulated by the Cyprus Securities and Exchange Commission (#250/14)||Plus500CY Ltd|
|UK||£85,000||Authorized and regulated by the Financial Conduct Authority (#509909)||Plus500UK Ltd|
|Australia, New Zealand and South Africa||No protection||Licensed by the ASIC (AFSL #417727), Financial Markets Authority (FSP #486026), and FSCA (FSP #47546)||Plus500AU Pty Ltd|
|Singapore||No protection||Licensed by the Monetary Authority of Singapore (#CMS100648-1) and the IE Singapore (#PLUS/CBL/2018)||Plus500SG Pte Ltd|
|Israel||No protection||Licensed by Israel Securities Authority (#515233914)||Plus500IL Ltd|
|All other clients||No protection||Seychelles Financial Services (Authority Licence No. SD039)||Plus500SEY Ltd|
Plus500 provides negative balance protection for CFD trading, but only for retail clients from the European Union. This means that if the balance on your account goes into negative territory, you will be protected.
NOTE: Professional and non-EU clients are not covered with any negative balance protection.
Our final thoughts on Plus500
Plus500 is a good CFD broker and we highly recommend it for traders who are aware of the risks of CFD trading. The broker is regulated by several financial authorities globally, including the UK’s FCA, and is listed on the London Stock Exchange- therefore it is both reliable and reputable.
The Plus500 platform is easy to use, providing a great user experience even for first-timers as well as a demo account to help users practise before beginning to trade.
Account opening, making deposits and withdrawals is also fairly easy as most popular payment methods are accepted.
Once you begin trading, you will find that spreads are competitive, but financing rates are quite high. On the downside, we found that CFDs are the only product offered, the platform cannot be customized, and there are limited research and educational tools on the platform. Go ahead and give Plus500 a try!
|Contract for Difference (CFD)||A Contract for Difference is a well-known type of financial derivative instrument, much like indices, commodities, currencies,etc.|
|Contracts for Difference (CFDs)||A formal agreement between two parties/people to pay the difference in price from when the contract was opened until the contract is closed.|
|CFD Trading||Investors have the option to go short (sell a CFD) if they think a price will decrease or go long (buy a CFD) if they think the price will go up.|
|Margin||The margin refers to the minimum deposit required.|
|Initial Margin||The initial amount required in order to open the position. It is often also referred to as an initial deposit.|
|Average True Range||ATR refers to the measure of market volatility over a specific period of time.|
|Back Testing||Back testing occurs when a strategy is put to the test, by using historical data for validation.|
|Base Currency||The first listed currency in a pair.|
|Commodity CFD||A type of CFD that derives its value for an underlying commodity it’s meant to track.|
|Consolidation Market||A market that is stagnant, neither moving up or down.|
|Currency Pair||Forex is trading in currency pairs. It refers to the price quoted in terms of the relative values of one currency against another.|
|Leverage trading||Also referred to as margin trading. The process in which an investor borrows a large amount of money from a broker to open a larger position.|
|Leverage ratio||The amount of leverage/money provided by a broker to trade a leveraged product. The amounts typically offered are 5:1, 10:1 and 30:1.|
|Maintenance margin||The amount of minimum funds needed to keep positions on the account open.|
|Used Margin||The amount of money that is currently used to keep positions open.|
|Equity||The total value in an investors account.|
|Free Margin||Funds available on an account to trade with (not currently being used by open positions).|
|Overnight charges||A Fee charged by a broker for holding a position over night. It is also referred to as an overnight financial charge and is linked to the interest rate of the currency being traded.|
|Buy position (“going long”)||A long position is the purchasing of an asset, with the expectation that its value will increase.|
|Sell position (“going short”)||A short position refers to the sale of an asset. with the expectation that its market value is set to fall.|
|Slippage||The difference between a requested market price and the actual price the trade was filled at.|
|Debt-To-Equity Ratio||The ratio of the total debt of a company to the amount of capital that shareholders have invested in the company.|
|Derivatives||A financial instrument that obtains its price from underlying security, index, currency pair or commodity.|
|Donchian Channel||An indicator that has two boundary lines determined by the highest and lowest points.|
|Downtrend||A series of lower highs and lower lows in the cryptocurrency market.|
|Earnings Per Share (EPS)||The profit the company makes is divided by the number of outstanding shares the company has.|
|Ex-Dividend Date||The very first day, a buyer of a share no longer obligated to a payment of the dividend the stock (or CFD) offers.|
|Exposure||The sum total value of all your positions in the market at any particular time.|
|Finance Charge||The price charged to hold a given position from one trading day to the next. This charge is generally calculated, based on the country’s cash rate plus a small interest charge.|
|Fixed-Dollar Model||A certain fixed-dollar model, where a certain amount is allocated to risk on any given day.|
|Fixed Percent Risk Per Trade||This refers to a risk management model where a certain amount of money is allocated to overall trading capital.|
|Forward Testing||Testing a strategy in real time, while the movements in price unfolds.|
|Fundamental Analysis||A method developed to evaluate the value of a company relies on financial statements, PE ratios, future growth projections and company financial statements.|
|Post-market Auction||The last available trading opportunity for the day before the market closes.|
|Pre-Market Auction||The identical matching out of prices|
|Price-to-Earnings Ratio (PE)||Determining the projected worth of a project by dividing the current market price by the earnings per share.|
|Product Disclosure Statement (PDS)||A document held by every financial services company, to provide to their clients regarding their products or services. This document will outline how the product in question worked, its potential benefits, and associated risks.|
|Pyramiding||A rule where traders add to their existing position(s) in an attempt to maximize the potential profits on winning trades.|
|Range-Bound Trading||Trading in a range where the value fluctuates between two main points. The two points are typically referred to as “Support” and “Resistance.”|
|Return On Equity (ROE)||The return a company generates based on the net assets they hold.|
|Return On Investment (ROI)||The amount of return you’ve realized on your deposited capital.|
|Scaling In||Initiating a trade by opening a small position in order to determine your readiness to bring it up to a normal position.|
|Scaling Out||Gradually closing your trade as it moves in your favor or reaches some specified profit objective.|
|Technical Analysis||Any mathematical formulas used over the price and/or volume history of the market in an effort to determine the probable next move of any particular asset.|
|Volatile Breakout Trading||A type of trading strategy that attempts to take advantage of short, sharp movements in the market over relatively short periods of time.|
|Volume||A measure of the number of shares or contracts that are solidified over a set period of time.|
|Trend-Following Trading||A trading strategy that attempts to profit from markets that tend to move either up or down for extended periods of time.|
|Trend Line||A line drawn across a chart to line up successively higher bottoms in up-trending markets|