Can I have an MT4 ISA account?

Question: Can I use an ISA to invest in MT4?

The short answer to this is no you can’t.

The reason for this is that MT4 brokers do not support dealing in physical stocks and shares. Rather it’s a specialist platform for margin trading products, such as CFDs and rolling spot FX trading.

When you trade CFDs and margin FX you are merely speculating on changes in the price of the underlying instrument and are never the owner of that instrument and that means that they can’t be housed in an ISA.

You can invest in stocks, shares and ETFs using an ISA, however, it must be a stocks and shares ISA and you should check with the ISA provider about what instruments are permitted within it, and what the charges are for dealing in them.

Saxo Capital Markets does offer a SIPP account where you can trade CFDs. However, there is a conflict as CFDs are generally for short term positions and very high risk because of the leverage, whereas SIPPs are designed as a long term investment product. that being said, if you are looking to use CFDs to short an index or specific stocks within your SIPP portfolio they can be an effective hedging tool for this.

However, if you are looking for tax-efficient trading you can trade via a spread betting broker like IG or CMC Markets.

Spread betting is currently free of capital gains tax in the UK. Of course, anecdotally speaking there is a reason for that.

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Trading Risk Warning

ALL INVESTING INVOLVES RISK. Investing, Derivatives, Spread betting and CFD trading carry a high level of risk to your capital and can result in losses that exceed your initial deposit. They may not be suitable for everyone, so please ensure that you fully understand the risks involved.
ESMA & FCA Risk Warning – “CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 68-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Capital at risk”