If you are on the search for FTSE 100 alternatives, which could result in substantial returns, then investing in and trading the FTSE 250 index might be a great option for you. In this guide, we not only reveal the best low-cost brokers for the FTSE 250 in 2021 but we show you how to get started straight away.
In This Guide
Providing the best blend of low-cost trading, top-rated functionality, and innovative platform features, in this section you will find the best broker for the FTSE 250 in 2021 including alternative options that made our top 10 list of recommended online brokers. For more comprehensive reviews of each, simply scroll down to find out more.
When searching on Google for FTSE 250 brokers you will be inundated with thousands of options. But, after extensive research, we have narrowed it down to a list of 10 top-rated and regulated brokers that have everything you need to make your investment goals a success.
With this in mind, below you will find our recommendations for the Best Brokers for the FTSE 250 UK to consider in 2021 and beyond.
When it comes to the best overall broker in 2021 eToro secures the number one position on our list, with plenty of reasons for it. Not only are there heaps of tradable assets for you to choose from but they can all be traded on a zero-commission basis.
This online stock broker is regulated by top financial authorities including the UK’s FCA, CySEC and ASIC. In terms of how your funds are protected, if eToro were to liquidate United Kingdom-based clients are covered by the Financial Services Compensation Scheme or FSCS up to £85,000.
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67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.
eToro, the number-one-rated broker of 2021, gives traders access to a wide range of financial markets and offers a well-designed and user-friendly trading platform. It is therefore obvious why it is now home to more than 20 million active traders.
With eToro you can sell and buy more than 2,000 stocks across heaps of international markets. Aside from the top-tier stock exchanges like the LSE and NYSE, you can also gain access to stocks listed in other global markets. Furthermore, this stock broker is completely committed to its commission-free trading policy.
eToro is our top recommended FTSE 250 broker because it is a great match for beginner traders. Its web and mobile trading platforms are easy to use and opening an account can be done in a matter of minutes. Perhaps the most attractive feature that eToro has on offer is its in-house developed Copy Trading feature. It does what it says on the tin; it enables you to copy the trades of an advanced trader like for like.
If you are looking for a passive way to start trading then eToro’s Copy Trading feature may just be exactly what you need. With a minimum access fee of just $200, this innovative trading feature comes with no other fees. eToro also offers a paper trading or demo account that gives traders the opportunity to experience online trading without the added volatility and risk of losing capital.
If eToro didn’t sound like your cup of tea, then a worthy alternative that we recommend highly is Capital.com. This forex and CFD trading platform is regulated by the FCA, CySEC, and NBRB and has close to 800,000 active clients. Part of being regulated by top-tier financial organizations is that it offers client fund protection against insolvency, which means that you can trade with peace of mind.
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71.2% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider.
Simply put, Capital.com is a CFD trading platform which means that you do not trade the asset directly. Instead, you end up trading a contract based on the underlying asset. The contract price is based on the asset’s price movements which pay out the difference between the open and close position.
Trading CFDs is an effective method of speculating on different securities such as the stocks of constituents that make up the FTSE 250. For instance, you could invest in a CFD based on a FTSE 250 constituent such as Hilton Food Group, and then diversify your investing portfolio with additional FTSE 250 stocks. Moreover, all investments that you execute through Capital.com are 100% commission-free. As a result, Capital.com makes revenue from the spread, which is basically the gap between the ask and bid prices. Typically, this spread is very low which means that trading and investing the FTSE 250 index with this online CFD broker is cost-effective.
76.25% of retail investor accounts lose money when trading CFDs with this provider.
Next on our list, IG is one of the largest global CFD brokers and is regulated by tons of financial authorities including FINMA, DFSA, ASIC, CFTC, and the UK’s FCA. IG Group is an internationally recognized broker and is listed on the LSE under the ticker symbol IGG. In terms of client fund protection, for UK-based traders funds up to £85,000 are covered by the FCA and the CFD broker offers negative balance protection.
IG has low non-trading fees such as £0 withdrawal and deposit charges. IG also offers Smart Portfolios which are iShares ETF portfolios that are actively managed by the investment management corporation BlackRock.
IG makes trading and investing in financial assets a breeze simply with the click of a buy or sell button. This CFD broker covers a range of international markets including most European exchanges.
When it comes to trading commissions, this typically depends on where you are located. For instance, certain nations have access to zero-commission trading on UK stock CFDs, whereas other countries incur low commission charges.
71% of retail investor accounts lose money when trading spread bets and CFDs with this provider.
Interactive Brokers is perfectly suited for advanced traders and investors. This is due to the online platform’s array of trading tools and features. Interactive Brokers gives its clients exposure to over 130 markets all over the world. Launched in 1978, this discount broker is regulated by the likes of the FCA and the SEC. As far as client protection is concerned if you conduct forex, and CFD trades you will be covered by the FCA up to an £85,000 limit.
Interactive Brokers has a vast range of asset classes on offer especially when it comes to bonds and ETFs. Traders at Interactive Brokers have access to 78 stock markets and a whopping 13,000 ETFs. In terms of stock trading, last year this CFD stock broker started giving its clients the option of buying and selling fractional shares. This means that you can diversify your investment portfolio on a low budget.
As well as stock index CFDs Interactive Brokers offers Bitcoin and Ethereum trading in addition to Bitcoin futures. So, if you’re a trader with an eye for cryptocurrency trading or CFDs, Interactive Brokers has it all.
Your capital is at risk.
Established in 1989, CMC Markets is a global CFD and forex broker that is regulated by the Financial Conduct Authority and is listed on the London Stock Exchange under the ticker symbol CMCX. This CFD trading platform has competitive stock index CFD trading fees with low non-trading fees.
CMC Markets users have access to more than 8,000 stock CFDs, 1,000 ETF CFDs, over 135 commodity CFDs and 56 bond CFDs. Something to bear in mind is that leverage levels cannot be altered when trading with this broker.
CMC Markets offers a range of trading ideas which it calls Chart Forums and Insights. These are similar to social trading features as users have access to technical analysis and chart speculations, including the FTSE 250 chart, from financial experts and other traders.
If you are just starting out in the world of online trading then CMC Markets has you covered. Reflecting all features of a live trading account the demo account is a risk-free way of learning the ropes without having to worry about risk tolerance or losing capital.
If you’re on the search for a CFD broker with tons to offer then Trading 212 is a great option. This online broker has over 2,500 CFDs, and more than 10,000 funds and stocks for long-term traders and investors. Trading 212 provides zero-commission trades giving its clients access to low-cost trades. On the flip side, its spreads are slightly above average when compared to other brokers.
Established in 2004, Trading 212 is regulated by the UK’s Financial Conduct Authority and the FSC. Providing 100% commission-free ETF and stock trading it is home to thousands of traders. According to the broker itself, its mobile trading app has been downloaded by more than 14 million users which makes it one of the most popular trading apps out there.
Trading 212 CFD account holders have access to more than 1,500 share CFDs and just under 30 ETF CFDs. On the other hand, if you use a Trading 212 Invest account you can gain exposure to a range of UCITS ETFs that track the price movements of the FTSE 250 index.
Invest and ISA accounts with Trading 212 are charged zero-spreads when investing in shares. All in all, this CFD broker offers low-cost ETF and stock trading with 0% commission but can be slightly costly when it comes to active CFD trades.
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Your capital is at risk.
Offering low trading and non-trading fees, Fidelity International is a UK-based trading platform that is regulated by the FCA. This trading platform charges a £10 flat rate, which in a nutshell is a pricing structure that charges a fixed service fee.
On the plus side Fidelity International has low non-trading fees including £0 account and deposit fees. Opening an account with this broker is fully digital and can be completed in around 10 minutes. However, there is a £1,000 minimum deposit for ISA, SIPP, and Investment accounts.
In terms of tradable assets and markets that are on offer at Fidelity International, the range is quite limited when compared to the other brokers in this FTSE 250 index brokers guide. Put simply, ETFs and stocks traded on the LSE are offered with this broker, with the exception of 150 mutual funds.
You can also invest in investment trusts with Fidelity International, these are funds registered as public traded companies. There are more than 150 of these investment trusts available at Fidelity International, making it a great way to diversify your portfolio without owning the underlying asset.
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Your capital is at risk
If you’re looking for a CFD broker then XTB has a lot to offer. Despite only offering CFDs, forex, and crypto trading, there is a fair amount of each asset to satisfy most traders’ needs. XTB offers 1,800+ stock CFDs, more than 40 stock index CFDs and 114 ETF CFDs, as well as 25 cryptos. Basic and standard account users benefit from trading on a commission-free basis.
On the flip side, if trading stocks and ETFs in the traditional sense is more of your thing then you may be disappointed to find out that XTB does not offer real stock and ETF trading to clients in the UK.
In terms of fundamentals, XTB is regulated by a bunch of major financial authorities such as the FCA, CySEC, IFSC, KNF and the CNMV. XTB charges $0 deposit fees while popular e-wallets including PayPal charge a 2% fee. And when it comes to opening individual brokerage accounts there are no minimum deposits required. But, there is a £15,000 minimum required deposit if you open a corporate account.
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Mixing education with functionality, TD Ameritrade provides an all-round brilliant online trading platform that helps both new and advanced traders achieve their investment objectives. As one of the biggest US-based index brokers, TD Ameritrade’s offering of tradable assets and educational resources are designed to meet your trading needs.
Launched in 1975, TD Ameritrade is regulated by major financial authorities including the Securities and Exchange Commission, the Commodity Futures Trading Commission, and the Financial Regulatory Authority, or FINRA for short. As we have already mentioned this broker provides its own in-house developed a desktop trading platform called Thinkorswim which is industry-leading and has tons of research tools and fundamental data which makes charting a great experience.
TD Ameritrade has low trading and non-trading costs. For example, its clients benefit from 100% commission-free stock and ETF trading. Additionally, there are no deposit or account fees making this a great low-cost broker. In terms of its range of tradable instruments, TD Ameritrade offers everything from free stock and ETF trading to cryptos and futures. While this online broker does not offer CFD trading, it does offer other useful trading features such as robo-advisory services and social trading.
TD Ameritrade also offers a demo account called paperMoney via its user-friendly Thinkorswim desktop trading platform. In addition to a default virtual fund balance of $100,000, users also have access to heaps of state-of-the-art trading and charting features. As you may or may not know, demo accounts are perfect for beginner traders who want to get a hands-on experience of the online trading scene and even for advanced investors who want to use trial and error to test a new trading strategy or trading idea without risking their own capital.
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Last but not least on our list is FxPro. This CFD and forex broker was established in 2006 and is regulated by the Securities Commission of the Bahamas, CySEC, FSCA, and the UK’s FCA. Furthermore, this broker also provides negative balance protection which means that you are covered should your account balance shift into the negatives.
FxPro has competitive trading fees and its price structure varies depending on the type of trading account you choose. In terms of trading and investing in the FTSE 250 index, this CFD and forex broker offers low stock index CFD fees while its stock CFD charges are quite high when compared to other brokers on the market.
When it comes to non-trading fees, FxPro does not charge an account fee, deposit fee, or withdrawal fee but does include an inactivity fee of $5 per calendar month after 6 months. There are also four separate trading platforms to pick from with FX Pro, including FxPro EDGE (its in-house developed trading platform), MetaTrader 4 and MetaTrader 5, and cTrader.
In terms of FxPro’s educational features, it offers platform tutorials, educational resources, and a demo account. You can even access educational content via its YouTube page, self-assessment trading tests, and a walkthrough guide to technical analysis via Trading Central. You can also attend online webinars which are tailored to either beginner or advanced traders.
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The FTSE 250, commonly known as the UK 250 by traders who favour share dealing, spread betting, and CFD trades, is a stock market index that monitors the 250 LSE-listed constituents that come after the 100 blue-chip and the largest FTSE 250 companies.
The 250 mid-cap companies that make up the index are selected based on their market value. This index also includes a variety of investment trusts, which are investment vehicles that offer shares on the stock exchange. These investment trusts are managed in the same way that mutual funds are, however, traders invest in them by purchasing shares.
Trading and investing in the FTSE 250 index starts by picking a top-rated and trusted broker. For this we recommend eToro as opening an account and trading at the click of a button is made easy and simple. But more on this in the next section.
Index funds are one of the most effective and passive methods of gaining exposure to the FTSE 250. Index funds typically work by copying the FTSE 250’s performance through a portfolio of all 250 constituents that form the index itself.
Arguably the most popular way to trade the UK 250 is via a traditional index fund. With some of the largest investment management companies, such as Vanguard, there are many available options. To get an idea of potential returns, we can cast our attention on the Biffa PLC FTSE 250 index, which happens to be highly sought after by the investing community in the UK. This index fund has returned 44.75% during the last year, reinforcing how much potential these funds have.
Alternatively, you can gain exposure to the UK 250 index via index futures. This asset class enables traders and investors to speculate on price movements in the future. Simply put this is a great investment for long-term investment strategies. Index futures give you the ability to buy and/or sell a position in the index now, which will be settled at a specified date in the future, and your returns will be based on the price set out by your futures contract and the actual price in the future.
Lastly, there is the option to day trade the FTSE 250 index. Despite not being as popular as futures contracts or index funds, this is a viable option for active day traders. FTSE 250 index funds usually display less risk than equities because of their diversification.
Investing in FTSE 250 tracker funds is another way to gain exposure to the index. Much like index funds, tracker funds monitor the performance of underlying indices. Therefore, by investing in FTSE 250 tracker funds, your fund’s value depends on the price fluctuations of the actual FTSE 250 index. Simply put, when the FTSE 250 index price increases so do the value of FTSE 250 tracker funds.
Additionally, you can invest in the FTSE 250 index through stocks and ETFs. Investing in ETFs is a great way to gain exposure to the UK equity market, what’s more, with eToro you can do this without paying any commission.
On the other hand, if you don’t want to invest in exchange-traded funds then you can invest in FTSE 250 stocks to recreate the performance of the index. eToro provides nearly all of the FTSE 250 stocks, giving you the chance to start stock trading and create a diversified portfolio with the added benefit of 100% zero-commission trading.
Throughout this section of our FTSE 250 broker comparison review, we take you through the actual process of investing and trading the FTSE 250. We highly recommend picking eToro as you can trade heaps of tradable assets on a zero-commission basis.
Opening an eToro account is user-friendly, fully digital, and simple. Furthermore, you can open an account via the website trading platform or mobile app. Just click the join now button and provide your personal credentials.
Identity and address verification are requirements set out by the UK’s Financial Conduct Authority. Consequently, as eToro is regulated by the FCA you will have to upload ID and proof of address. eToro makes this a seamless process usually takes a matter of minutes.
The next step involves depositing funds into your trading account to enable you to invest and trade the FTSE 250 index. When it comes to payment options eToro gives you the option to use credit or debit cards, e-wallets including PayPal, or bank transfers. If you use a credit or debit card your funds are deposited into your account straight away.
Now you’re ready to choose FTSE 250 stocks to add to your portfolio to track the performance of the index. For this step, we will focus on MEDICLINIC INTERNATIONAL PLC as an example of a FTSE 250 constituent that is available through the eToro trading platform. Simply enter the company’s name in the search bar to access an overview of the stock as well as stats, charts (like FTSE 250 live chart), and social feeds.
The last step is confirming your trade with eToro. After clicking on trade you will be presented with another page that asks you to specify the amount you want to invest. Purchasing the underlying asset with zero commission is made with the click of a button at eToro, which is why we recommend it as the best broker for the FTSE 250 index.
To summarize, the FTSE 250 index is a popular investment amongst advanced and beginner investors who want to gain exposure to the equity market. The FTSE 250 is made up of 250 innovative companies that present promise for expansion and growth which offers investors the opportunity to yield huge returns.
If you’re on the hunt for a top-rated and regulated stock broker to trade and invest in the FTSE 250 then eToro is the best choice. With eToro you can buy shares of stocks that make up the UK 250 on a 100% commission-free basis. Moreover, the minimum investment is just $50 making it a low-cost trading platform. Finally, eToro offers social and Copy Trading which allows you to copy the trades of existing investors and interact with the rest of the trading community.
The FTSE 250 index, otherwise called the UK 250, is a stock market index which tracks the performance of 250 companies that are listed on the LSE (London Stock Exchange).
Perhaps the most popular method that investors use to gain exposure to the FTSE 250 index is via an index fund. Index funds work by replicating the FTSE 250’s performance through portfolios of stocks that make up the index. Alternatively, you could invest in FTSE 250 tracker funds, ETFs and stocks, or index futures.
The FTSE 250 or UK 250 is a stock market index that monitors the 250 LSE-listed constituents that come after the 100 blue-chip companies that make up the FTSE 100 index.
The smallest company that makes up the FTSE 250 index is TBC Bank Group PLC with a market cap of (£m) 586.86.
eToro is the best trading platform for beginner traders because it offers social trading and Copy trading which allows you to copy the trades of other investors on the platform like-for-like while interacting with the trading community. eToro users can also use its demo account that gives you $100,000 worth of virtual or paper funds to practice your trading strategies without the risk of losing your capital. eToro’s demo account is perfect for those just stepping into the online trading scene. Enabling users to trade heaps of financial assets without having to pay a penny in commission, eToro is now home to over 20 million traders worldwide.
Dassos Troullides is an experienced finance writer who specializes in CFD, stock, and crypto trading. In particular, Dassos is skilled at breaking down complex financial topics to help new and advanced investors make better trading decisions. Dassos also writes for BuyShares.com, InsideBitcoins.com, LearnBonds.com, ForexCrunch.com, and EconomyWatch.com
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