- Richard Berry
- Updated
Volatility trading platforms let you trade through synthetic indices like the VIX, VXX, VXZ and volatility 75 index. You can use our comparison table of what we think are the best synthetic indices brokers to compare trading costs, minimum deposits and how much it costs to keep positions open overnight. All brokers in this list are regulated by the FCA.
Compare Volatility & Synthetic Indices Brokers
Synthetic Index Broker | Minimum Deposit | GMG Rating | More Info | Risk Warning |
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£100 | Get Started | 69% of retail investor accounts lose money when trading CFDs with this provider | ||
£1 | Get Started | 75.3% of retail investor accounts lose money when trading CFDs with this provider | ||
£1 | Get Started | 64% of retail investor accounts lose money when trading CFDs with this provider | ||
£100 | Get Started | 80% of retail investor accounts lose money when trading CFDs with this provider. | ||
£250 | Get Started | 69% of retail investor accounts lose money when trading CFDs and spread bets with this provider. | ||
£1 | Get Started | 65% of retail investor accounts lose money when trading CFDs with this provider | ||
$50 | Get Started | 51% 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 | ||
£1 | Get Started | 68% of retail investor accounts lose money when trading CFDs with this provider | ||
£100 | Get Started | 74% of retail investor accounts lose money when trading CFDs with this provider. | ||
$2,000 | Get Started | 60% of retail investor accounts lose money when trading CFDs with this provider | ||
£10 | Get Started | 66.95% of retail investor accounts lose money when trading CFDs with this provider |
Our picks of the best synthetic index brokers for trading volatility
❓Methodology: We have chosen what we think are the best volatility and synthetic index trading platforms based on:
- over 17,000 votes in our annual awards
- our own experiences testing the synthetic indices trading accounts with real money
- an in-depth comparison of the features that make them stand out compared to alternative volatility brokers.
- interviews with the volatility trading platform CEOs and senior management
City Index: Best Volatility CFD trading platform
- Costs & spreads: 0.15
- Minimum deposit: £100
- Account types: CFDs & spread betting
69% of retail investor accounts lose money when trading CFDs with this provider
City Index Review
Name: City Index
Description: City Index is one of the oldest spread betting and CFD brokers based in the UK. They were founded in 1983 and offer trading in over 13,500 financial markets, to around 126,000 active clients. City Index is currently owned by StoneX, a US brokerage listed on the NASDAQ valued at $1.75bn.
69% of retail investor accounts lose money when trading CFDs with this provider
Why we like them:
City Index offers some of the best trading tools and analysis to help traders perform better. Their unique post-trade analytics and voice brokerage service make it an excellent choice for large and frequent traders.
Pros
- Excellent trading tools
- Post-trade analytics
- Publically listed (part of StoneX)
Cons
- Trading only, no investment account
- Limited options markets
- No direct market access
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4.3Pepperstone: Automated VXX trading on MT4
- Costs & spreads: 0.2
- Minimum deposit: £1
- Account types: CFDs & spread betting
75.3% of retail investor accounts lose money when trading CFDs with this provider
Pepperstone Review
Name: Pepperstone
Description: Pepperstone were founded in 2010 in Australia and have since then grown to be a global brokerage with international offices and around 400,000 active clients. They offer spread betting and CFDs on 1,200 major market instruments, which means they focus on the most heavily traded assets, mainly forex and indices trading. Of those 900 are shares on the major stocks on international exchanges.
75.6% of retail investor accounts lose money when trading CFDs with this provider.
Why we like them
Pepperstone is a good choice for traders that want to automate their trading strategies through MT4. As far as MT4 brokers they are one of the biggest and best and offers so good EA packages.
Pros
- Tight pricing
- Wide range of MT4 markets
- Pre-built MT4 indicator packages
Cons
- Limited market access
- Only third-party platforms
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4.1Spreadex: Volatility trading with personal service
- Costs & spreads: 0.25
- Minimum deposit: £1
- Account types: CFDs & spread betting
72% of retail investor accounts lose money when trading CFDs with this provider
Spreadex Review
Name: Spreadex
Description: Spreadex is a financial spread betting broker that has been in operation since 1999. It was founded by ex-city trader Jonathan Hufford and unlike many of its peers, it is not based in London, but instead is headquartered in St Albans Hertfordshire. Spreadex offers both financial spread betting and CFD trading from the same account. The company has some 60,000 account holders and offers access to more than 10,000 financial instruments, including UK small-cap shares, where it is something of a specialist.
Is Spreadex a good broker?
Spreadex is one of the most established spread betting brokers. They focus on providing excellent customer service through experienced dealers and a trading platform built from scratch in-house. A good choice for those that like to spread bet.
Pros
- Spread betting & CFDs
- Smaller cap stock trading
- Great customer service
Cons
- Not publically listed
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4.4Plus500: Global CFD Platform for Trading Synthetic Indices
👍Featured👍
- Markets available: 2,000
- Minimum deposit: £100
- Account types: CFDs
80% of retail investor accounts lose money when trading CFDs with this provider.
Plus500 Review
Name: Plus500
Description: Plus500 is an online trading company that operates in more than 50 countries worldwide. Founded in 2008, it has more than 26 million customers today.
Plus500 is headquartered in Israel, however, it’s listed in the UK on the London Stock Exchange (it’s a member of the FTSE 250 index). Here in Britain, its platform is operated by Plus500UK Ltd, which has offices in London.
In the UK, you can only trade CFDs with Plus500. CFDs are financial instruments that allow you to profit from the price movements of a security without owning the underlying security itself.
80% 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.
Is Plus500 a good broker?
Overall, Plus500 is a good online trading platform for traders who do not want to do anything more complicated than buy and sell CFDs. The broker does provide sentiment indicators and are quite transparent with costs and fees. In summary:
- Plus500 is a trading platform that offers CFDs.
- You can trade a range of assets on Plus500 including stocks, indices, and currencies.
- There are no commissions when placing a CFD trade on the Plus500 platform but there are some other fees to be aware of.
- The platform offers a range of features including a demo account, alerts, market news, and an economic calendar.
- There are platforms that offer more markets than Plus500.
Pros
- With Plus500, you can trade CFDs on a range of assets including shares, currencies, indices, and ETFs.
- There are no commissions when placing a CFD trade on Plus500’s platform.
- Plus500 offers a range of features to help traders navigate the markets and capitalise on opportunities including charting tools, alerts, an economic calendar, and market news.
Cons
- Other platforms offer more markets than Plus500.
- You can only trade CFDs on the platform (you can’t invest in stocks directly).
- You can’t contact the company by telephone if you require support.
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4.2IG: Best Volatility spread betting platform
- Costs & spreads: 0.16
- Minimum deposit: £250
- Account types: CFDs & spread betting
69% of retail investor accounts lose money when trading CFDs and spread bets with this provider.
IG Review
Name: IG
Description: Founded in 1974 as Investors Gold Index, then IG Index, now just “IG” is one of the world’s largest margin trading brokers. IG offer CFDs, FX and Spread Betting (in the UK) alongside share trading and prime brokerage to over 313,000 active clients and offers 17,000 tradable markets. IG also recently introduced physical share dealing and smart portfolios for longer-term investors.
69% of retail investor accounts lose money when trading CFDs and spread bets with this provider.
Is IG a good trading platform?
Yes, IG provides an excellent all-round trading and investing brokerage service. IG pioneered online trading and financial spread betting for private clients and remains not only one of the largest online trading platforms, but also one of the best. IG stands out through deep liquidity, high market range and excellent added value such as trading tools and analysis.
Pros
- Vast range of markets
- Excellent liquidity & DMA equities
- Listed on the London Stock Exchange
Cons
- Customer service can be slow
- No DMA futures trading
- Still charges inactivity fee
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4.7Interactive Brokers: Discount VIX trading
- Costs & spreads: 0.005%
- Minimum deposit: $2,000
- Account types: CFDs, DMA, futures & options
60% of retail investor accounts lose money when trading CFDs with this provider
Interactive Brokers Review
Name: Interactive Brokers
Description: Interactive Brokers is a major US online automated electronic broker company. The financial broker is listed on the Nasdaq Exchange with ticker IBKR. The firm operates in 150 electronic exchanges in 33 countries, and offers trading in 23 currencies. Interactive Brokers has more than 1.75 million institutional and retail customers.
Why we like them
Interactive Brokers is an exceptional trading platform that offers institutional-grade trading capabilities to private clients around the world. IBKR has some of the lowest trading and investing fees and the widest market range in the industry.
Pros
- Very low dealing fees
- Wide market range
- Direct market access
- Complex order types
Cons
- Customer services can be slow
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4.6CMC Markets: High-tech Volatility trading platform
- Costs & spreads: 0.13
- Minimum deposit: £1
- Account types: CFDs & spread betting
74% of retail investor accounts lose money when trading CFDs with this provider
CMC Markets Review
Name: CMC Markets
Description: CMC Markets is one of the original spread betting and CFD brokers based in the UK. They have been providing forex trading services since 1989 and are now listed on the London Stock Exchange. The broker has over 300,000 active clients trading online and is operated from 13 global offices, with headquarters in The City of London.
68% of retail investor accounts lose money when trading CFDs with this provider
Is CMC Markets legit?
Yes, CMC Markets has always offered, and still does one of the best trading platforms for high-frequency and active traders. It’s a good choice for those who want to trade on tight spreads, with a platform built on exceptional tech.
Pros
- Excellent trading platform
- Good liquidity
- Unique sentiment tools
Cons
- Trading only, no investing account
- Limited smaller cap stocks
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4.6Saxo Markets: Best Volatility futures trading & ETF platform
- Costs & spreads: 0.15
- Minimum deposit: £500
- Account types: CFDs, futures & options
70% of retail investor accounts lose money when trading CFDs with this provider
Saxo Review
Name: Saxo
Description: Saxo is one of the largest CFD brokers worldwide and provides direct market access to equities, bonds, forex, futures and options as well as being a major liquidity and infrastructure provider to wealth managers, banks and smaller brokers.
65% of retail investor accounts lose money when trading CFDs with this provider
Is Saxo Markets a good broker?
Yes, Saxo is a good choice for more sophisticated traders. The platform, analysis, and direct market access may be too complicated for beginners. But, for experienced traders its coverage, commissions and research are unrivalled.
Pros
- Direct market access
- Low commissions
- Robust trading platform
Cons
- Seen as a trading platform for professionals
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4.6eToro: Copy other people’s Volatility trading
51% 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 Review
Name: eToro
Description: eToro is a social trading platform that lets their users share new and existing CFD positions and their investment portfolios. eToro was founded in 2007 in Tel Aviv, Isreal and has grown to offer investing and trading on 3,000 global assets (including real cryptocurrencies) to 30 millions users worldwide.
51% 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
Is eToro a good broker?
Yes, eToro does have its flaws for experienced investors, but if you are just getting started eToro is a great introduction to financial markets. eToro is actually a very innovative trading platform offering copy trading, social networking and unleveraged CFDs.
Pros
- Really simple to use
- Social and copy-trading
- Set your own leverage
- Pre-built sector portfolios
Cons
- Can only trade and invest in USD
- No SIPPs or ISA
- No direct market access
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4.1Trading VIX futures:
VIX futures were created around 2004 to facilitate trading and hedging of volatility and are based on the VIX index. The VIX index is based on the options on the S&P 500 Index (SPX), the most-watched US equity index. SPX is a broad measure of the US stock market which tracks the top 500 listed US companies.
You can not trade the VIX index directly nor can you trade volatility directly like you trade stocks. To do that, you need derivatives – like futures and options, spread betting or CFD trading.
Trading VXX & VXZ ETNs
VXX and VXZ (its sister fund) were the first ETNs (Exchange Traded Notes) made available for volatility trading in the United States. To properly understand what VXX is, you need to understand how its value is assessed, and how Barclays (Britain’s foremost multinational banking and financial services company) earns equity from running it, and what it actually tracks.
In 2009, Barclays created two of the earliest volatility ETNs – VXX and VXZ (its sister fund). These ETNs were made available for volatility trading in the United States just like any other stocks (prospective here).* They can be sold, bought, or sold short whenever the market is open for trading, and that includes both pre-market and after-market timeframes. The current market cap of VXX is around $800 million. The average daily volume consists of 40 million shares, and its liquidity and spread status is very good. The bid–ask spreads are just a penny.
For example, the chart below shows the typical spread from IG index. In other words, moving in and out of volatility products are not overly expensive here in the UK.
To trade volatility ETNs successfully, however, you need to remember two things:
- Volatility ETNs are not meant for long-term holdings
- Volatility ETNs are high risk and prices can swing wildly over a short period of time
You can judge this from the price movements of VXX in 2018. Throughout the year, prices went from $28 to $50 twice. Daily 5-10% moves occur regularly; overnight price gaps further amplify this swings. So, how exactly do you use VXX to hedge against your long-only portfolio?
The general rule of thumb is to buy a small amount when the product is down for some time. Why? This is because markets tend to go up slowly and go down quickly, especially as we are on a bull cycle.
For example, VXX can roll lower continuously for six months and then, all of a sudden, surge. This price behaviour is typical (red circle, below). Accordingly, when VXX is down, buy some and hold for a few weeks before selling out. Of course, you may very well sell at a loss, but try to think of this as as the cost of protection for your share portfolio. The trick is to time your entry because VXX can move very fast.
Other entry signals for VXX include: 1) A bullish crossover of VXX against some medium-term moving average such as the 50 or 100-day moving average, or 2) Corrective setbacks after hitting multi-week highs, ie, around $32.
In all these cases, the advice is to limit the holding period because volatility ETNs can depreciate over time. Of course, having stop-losses on these positions are critical. Also, if you had timed VXX’s rally correctly, use trailing stops to protect your profits.
*http://www.ipathetn.com/US/
Typically speaking, VXX trades like any other stock. As such, it can be sold, bought, or sold short whenever the market is open for trading, and that includes both pre-market and after-market timeframes. The average daily volume consists of 75 million shares, and its liquidity and spread status is very good; the bid–ask spreads are just a penny. Here are a few of the best brokers for trading VXX Volatility
Best VIX, VXX & VXZ synthetic indices trading CFD & spread betting platforms
The major trading platforms that offer CFD trading, financial spread betting, futures and options on volatility markers are:
- IG – best for volatility spread betting
- Saxo Markets – best for volatility futures
- CMC Markets – best for volatility CFDs
- Interactive Brokers – best for volatility options
With this in mind, brokers that typically have tight spreads don’t have the same issue with trading VXX. spread betting broker IG Index, for example, has a relatively high average spread of on ETNs such as VXX and VXZ however, they do offer one of the widest-ranges of accessible markets and are listed on the LSE.
Similarly, forex broker CMC Markets, while having a good average spread already, has an extra sweetener for large-scale investors. It has a “big trader rebate scheme” with its own modern trading platform. If you’re after a long-term growth strategy with a large amount of capital, trading VXX with CMC Markets could be a wise move.
CFD broker Saxo offers VIX CFDs as well as DMA VIX on-exchange futures contracts. MT4 broker XTB offers the ability to create your own basket of assets to trade so you can trade volatility indices against other assets like Gold and USDJPY.
Whichever of the best brokers for trading VXX Volatility or CFD trading platforms you decide to go with, ensure that you do thorough research to mitigate risk and maximise your potential return on investment.
⚠️ FCA Regulation
All synthetic index trading platforms that operate in the UK must be regulated by the FCA. The FCA is the Financial Conduct Authority and is responsible for ensuring that UK volatility brokers are properly capitalised, treat customers fairly and have sufficient compliance systems in place. We only feature volatility trading platforms that are regulated by the FCA, where your funds are protected by the FSCS.
Volatility trading FAQs:
When asked what he thought of the stock market, JP Morgan quipped: ‘It will fluctuate’. Indeed. Markets go up and down – and when prices are down, investor fear increases and volatility spikes. This is simply because of higher market uncertainty. Given volatility’s inverse behaviour to prices, volatility indices are usually known as the ‘fear gauges’.
Yes, Volatility ETFs, such as ProShares VIX Short-Term Futures ETF and ProShares Ultra VIX Short-Term Futures ETF can be bought through a stockbroker and is as easy as buying any other stock like Apple or Lloyds.
Synthetic indices are stock market indices based on several contributing markets.
Richard Berry
This article contains affiliate links which may earn us some form of income if you go on to open an account. However, if you would rather visit the volatility brokers via a non-affiliate link, you can view their volatility trading pages directly here: