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Leveraged trading is an effective approach that allows traders to take a large position in the market using a small amount of capital. Leveraged trading at a ratio of 1:20, for example, is trading at a multiplier of 20 – meaning with only £100, a trader can trade a notional value of £2,000.

In this guide, we review the best leveraged trading platforms UK of 2021.

Best Leveraged Trading Platforms 2021 List

The following is our list of the best leveraged trading platforms for UK traders.

  • eToro – Best overall leveraged trading platform specialized in social trading
  • Capital.com – Secure and reliable trading platform with great customer service
  • Libertex – Powerful platform with good integration and charting capability
  • Avatrade – Accessible and easy-to-use leveraged trading platform
  • Pepperstone – A cheap trading platform with a limited selection of financial markets & products
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10/10

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2.5

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1

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2

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5

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2

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3

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4

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1

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1.5

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2.8

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0

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30:1

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30:1

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30:1

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30:1

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30:1

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30:1

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9/10

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€20

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0.6 pips

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20:1

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100

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Forex

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0.0

Leveraged

Best Leveraged Trading Platforms Reviewed

Choosing the right trading platform is incredibly important for a trader. It can determine how fast trades are made, what trades are possible, the analysis and execution of a strategy, and what fees are incurred. Below is a breakdown of the best leverage trading platforms for retail investors in the UK.

1. eToro – Best Overall Leveraged Trading Platform UKetoro-logo-1-e1623748139151

Founded in 2007, eToro is a fast-growing trading platform that’s quickly becoming a favourite among retail investors. The platform is regulated in 2 tier-1 jurisdictions and facilitates trades within many different markets and asset classes. Beyond being a safe choice, eToro is known for its social trading, in which traders can copy the trades of the best platform’s professional traders, as well as read their tips on a social feed.

eToro is a common option when trading CFDs. Leverage can be changed manually to increase or decrease the risk of the trade. Furthermore, buying a stock at a 1x leverage is free at eToro. Margin requirements vary depending on the instrument, but retail clients can only leverage CFD stock trades by up to x5; thus, leverage trading x20 with stocks, for example, isn’t allowed, but it is with Forex trades, gold, and major indices.

 

Pros:

  • Highly safe and reputable platform regulated by top-tier agencies
  • Smooth and innovative social trading capabilities
  • A user-friendly mobile app with great functionality and a two-step login

 

Cons:

  • No fundamental data or news flow is available

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.

2. Capital.com – Best Leveraged Trading Platform With Tight Spreads in the UK

 

Capital.com is an exciting British CFD trading platform that integrates seamlessly with the ever-popular Meta Trader 4. MT4 has a large community behind it, and whilst some will claim it’s outdated, it remains to have powerful functionality and is a common choice for forex market and algorithmic traders.

The highest leverage offered by Capital.com is 30:1, though there are overnight fees based on the leverage. Besides this, there is no commission taken or hidden fees, and the powerful demo account allows users to test out their leverage-based strategies. Capital.com is only for CFD and real stocks, meaning the powerful Forex capabilities of MT4 cannot be exercised here.

Opening an account at Capital.com, like eToro, is incredibly fast, digital, and free. Its own trading platform performs well on mobile and web, and there is very good customer support.

 

Capital.com Platform User Interface Trades

Pros:

  • Safe and regulated by the FCA, CySEC, ASIC, and NBRB
  • Live chat and phone support with fast response times
  • MT4 offers powerful analysis tools for leveraging strategies and high flexibility

 

Cons:

  • Overnight fees
  • Limited markets and securities

Your capital is at risk

3. Libertex – Best Leveraged Trading Platform With MT4 in the UK

libertex Being founded by industry experts in 1997, in Cyprus, Libertex is a reputable and award-winning trading platform with over 2 million active traders. With over 250 financial CFD instruments and a maximum leverage of 600:1 (30:1 in the UK), Libertex is popular among experienced traders that use leverage.

Whilst MT4 is an industry-standard with a large community, some have decided to utilise the newly updated Metatrader 5 with Libertex (it’s available with both MT4 and MT5). Whilst they’re similar, MT5 does have better backtesting capabilities along with accessing more exchanges.

Libertex has no deposit or inactivity fees, but you may incur withdrawal fees (depending on the method). MT5 has a wide range of trading tools to stop you out of a trade automatically to limit losses and has a rich selection of charting capabilities and plugins.

Libertex Trading Platform Leveraged Trading User Interface

Pros:

  • Supports both MetaTrader 4 and 5
  • Zero spreads for some financial instruments
  • High leverage maximums (dependent on the trader’s jurisdiction)

 

Cons:

  • As a disclaimer, please consider that it is unavailable to clients in many countries and is only regulated by CySEC
  • A limited selection of financial instruments
  • Limited customer support

83% of retail investors lose money trading CFDs at this site.

 

4. Avatrade – Trusted Leveraged Trading Platform UK

AvaTrade Being founded in 2006, Avatrade is a relatively new online trading platform – however, this hasn’t stopped it from being a regulated broker by several authorities. The biggest advantages of using Avatrade come from its accessibility. Opening an account is extremely fast with a low minimum deposit of $100 (same as Libertex). It’s fast and digital, with several payment options available like credit cards, and there are no deposit or withdrawal fees on any of its account types.

The platform has a rich learning center, with many tutorials, general education, webinars, and a demo account. There are also low CFD fees.

However, Avatrade does have relatively high FX spreads and high inactivity fees. There is a decent range of financial instruments that leveraged margin trading can benefit from. Avatrade is mostly a forex trading platform, but it has over 600 stock CFDs, 59 ETF CFDs, cryptocurrencies (such as Bitcoin), and a handful of commodity CFDs. The maximum leverage offered on Avatrade is 400:1, though this is dependent on the trader’s jurisdiction.

 

Avatrade Leveraged Trading Platform User Interface

Pros:

  • A maximum leverage of up to 400:1 (outside of the EU)
  • Easy account opening and no deposit or withdrawal fees
  • Great web and mobile trading interface and functionality available for Android and iOS devices.

 

Cons:

  • High inactivity fee
  • No low spreads

79% of retail investors lose money trading CFDs at this site

 

5. Pepperstone – Best Leveraged Trading Platform for Short-Term Investors UK

PepperStone

Pepperstone is a brokerage founded in 2010 that is regulated in two tier-1 jurisdictions. Whilst the platform is often associated with algorithmic traders, with its integration of MetaTrader and cTrader, it’s also a strong choice among traders who use leverage.

The maximum leverage at Pepperstone is 500:1, though British retail traders under FCA regulations can only use a maximum of 30:1. Pepperstone is a very accessible platform with fast and free account opening, low fees (no deposit, withdrawal, or inactivity fees), and 9 base currencies.

Forex and other trading fees are low, but holding overnight positions imposes a high cost. The downsides of the platform center mostly around their limited markets and products, with only CFDs and forex being tradable. There are 61 currency pairs (including forex pairs as EUR/USD, GBP/USD, etc.), and almost 300 stock, index, and commodity CFDs.

Pepperstone Leveraged Trading Platform User Interface

Pros:

  • Low fees
  • Easy account opening and strong customer service
  • Higher leverage opportunity

 

Cons:

  • A small pool of financial instruments
  • Limited news feed and no fundamental data

Your capital is at risk

Leveraged Trading Platforms Comparison

For retail investors in the EU and UK, the maximum leverage is always going to be 30:1 as per regulation. Here is a breakdown of the leverages among different asset classes.

Platform Max. Leverage: Stocks Max. Leverage: ETFs Max. Leverage: Forex Max. Leverage: Commodities Max. Leverage: Indices
eToro 5:1 5:1 30:1 10:1 20:1
Capital.com 5:1 5:1 30:1 10:1 20:1
Libertex 5:1 5:1 30:1 10:1 20:1
Avatrade 5:1 5:1 30:1 10:1 20:1
Pepperstone 5:1 5:1 30:1 10:1 20:1

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.

What is Leveraged Trading?

Leverage trading is a way to increase exposure in the market. This is done by paying less than the full amount of the investment, with the broker covering a significant portion. Borrowing money to increase your position is useful for those with a small amount of capital and wish to trade larger positions.

What Assets Can You Use for Leveraged Trading?

Stocks

Stocks are one of the most popular securities to trade, and leveraged trading is no different. Purchasing a share in a company can be quite risky because any single company can go out of business given enough time. This is why leverage is capped at 5:1, due to the volatility of equities. However, news traders find stocks to be a great opportunity.

ETFs

Exchange-Traded Funds (ETFs) are a security that aims to track an index, commodity, or sector. There are ETFs that take a leveraged position to capture the average market returns of the S&P 500, for example, and amplify this through leverage. Strategies for trading leveraged ETFs are common, but there are also inverse ETFs, which can leverage the opposite performance of an underlying index. So, a 5x S&P 500 inverse ETF would turn a 5% downturn into a 25% positive return.

Forex

Forex is a common leveraged trading strategy. This is partly because many forex trading strategies operate on small margins with frequent trades. This can be difficult for those with a small pool of capital, which leveraged margin trading can help overcome. Furthermore, forex is often used as a hedging tool, and the ability to leverage this hedge can make it more effective. Because of the low volatility within currencies, usually, the maximum leverage of 30:1 can be exercised.

Commodities

Commodities include assets such as gold, silver, oil, and so on. Commodities often have a strong inverse relationship with other asset classes, such as forex, because they’re used as hedges against each other. For example, leveraged gold trading often rises in value when the dollar falls. Thus, it may be a strategy to leverage a commodity if you can foresee political or economic events.

Indices

Whilst individual stocks can outperform the entire index, many consider the risk to not be worthwhile. This is similar to ETFs, but is less liquidity on indices and can only be sold at the end of the trading day. It is therefore common for buy-and-hold strategies to use indices to capture the long-term average market returns. Generally, this will incur high overnight costs from leverage investors, who will take such fees into consideration when choosing a platform.

What is Margin in Leverage Trading?

An initial margin is an amount of required cash (as a percentage) to be held as collateral when purchasing a security. This gives an idea of what leveraged margin trading is – it’s the investor’s deposit with their online broker in order to reduce the credit risk that they pose. For example, a 50% margin requirement would mean that you must have £5,000 as a margin in your account for a £10,000 security purchase.

Leveraged Trading Strategies

Leveraged Swing Trading

Swing traders look to capitalise on the price swings over a day or so, in which they use technical analysis to detect such patterns. Charting capabilities on the broker platform become very important for swing traders, who will spot support and resistance lines, for example. Swing trading is one of the most popular trading strategies.

Leveraged Scalping

Scalping is similar to arbitrage, in which the time between buying and selling is in minutes or hours. It is, therefore, less about predicting an asset’s rise in value but more about price discrepancies and buying before the market has finished reacting. Scalpers take a small amount of profit per trade, but instead trade with high frequency, making it intuitive to use leverage.

Leveraged Day Trading

Day trading is very similar to swing trading, but trades occur within the same day. This increases the frequency of trades and means more opportunities can be capitalised on (as there is less time spent holding a position). However, day trading is more susceptible to market noise and being prematurely stopped out, which is an issue that is magnified when leveraging.

Benefits of Leveraged Trading

Leverage can help free up capital, given that you’re only committing a fraction of the asset’s value. This is good news for retail investors and beginners, who often have limited capital but spot many trading opportunities. It’s even more of a benefit for those who use a trading strategy that takes small profits on large trading positions, as the profits are amplified yet the risk is limited due to the short-term nature of the trade.

Risks of Leveraged Trading

Of course, when profits are amplified, so is the risk. Although there are many ways to limit losses through risk management, there is no denying that the relationship of risk/reward doesn’t change simply because you’re in a leveraged position. In fact, the relationship is slightly changed when using leverage because of the extra fees incurred, which must be factored in when devising and practising a strategy. Furthermore, it can be psychologically more difficult to use leverage as a trader, where they may become more prone to panic selling due to the higher risk involved.

How to Make Leveraged Trades on eToro

In order to make your first leveraged trade (the below screenshots are using the advised demo account), you must choose the asset you wish to purchase.

eToro Leverage Tutorial

 

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.

Having clicked on Gold as the commodity we will trade, the following graphical interface will appear:

eToro Leveraged Trading Tutorial

In the top right of the page, there is a trade button. Clicking on this will bring up a tab in which you can change aspects of the trade prior to execution.

eToro Leveraged Trading Tutorial

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.

Here we can click on the middle button “leverage”, just below the “amount” which can be entered”.

 

eToro Leveraged Trading Tutorial

 

After selecting the leverage which you would like to use, between x1, x2, x5, x10, and x20, you can click the “open trade” button at the bottom to finally execute the trade. The stop loss in red is denoting the price it takes in order to automatically sell your position (a form of loss limitation).

The current live price of gold is in the top left, the amount of units is also denoted under the “amount”, as well as the exposure. Finally, the daily overnight and weekend fee is denoted at the bottom of the page.

Conclusion

Leverage trading comes with its risk, but it equally comes with its high reward potential. The best high leverage forex brokers recommended above are all great choices to start trading with leverage trading, and most importantly, they are all safe, regulated, and reliable platforms.

eToro comes out on top due to its accessibility and social features, making online trading a shared experience and knowledge transparent.

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.

FAQs

What is a leveraged trade?

A leveraged trade is a way to increase exposure in the market by only putting down a fraction of capital. With the broker paying the rest, you are investing on borrowed funds, which will incur a cost but will also amplify profits/losses given the increased exposure.

How does leverage work in trading?

A broker will allow maximum leverage for a retail investor (which depends on the jurisdiction and asset class). Presuming the trader meets the initial margin requirements, a trade can be executed using mostly borrowed funds. This is somewhat like buying a house with a mortgage, which the deposit is paid, yet returns are amplified.

How much do money do you need to make leveraged trades?

There is no minimum amount needed to make leveraged trades as long as the leverage ratio is within the regulatory maximum amount. However, there will often be a minimum deposit (i.e. $100) at a broker.

Can you go into debt with leveraged trading?

It depends on the broker, but it is possible to go into a negative balance on some leveraged trading accounts.

What is the best trading platform for leveraged trading in the UK?

We have reviewed multiple leverage trading platforms in this article. eToro is considered to be the best all-round broker for leverage trading. This is due to its promotions, social trading capability, as well as its low fees and powerful charting capability. However, we encourage you to read all the reviews so you can pick the one that suits your preferences and approach the best.

About Alan Lewis
About Alan Lewis

Alan is the Chief Editor of TradingPlatforms.com. He is an experienced finance and investment writer who is an expert on the stock market.

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