ETX Capital Review

ETX Capital is a margin trading and Spread Betting broker based in the City of London. The firm can trace its roots back to 1965 but its current format came into existence in 2002, in the shape of Tradindex, which was later re-branded as ETX Capital.

They now have some 55,000 clients from across the globe. Their main services and products are in CFDs, FX trading and Spread Betting, however, they also offer an equity trading service for HNWI.

ETX was recently acquired by the Swiss-based Guru Capital who are likely to broaden the range of services and products that the company offers to its clients.

ETX Capital Trading Account

ETX offers two FX and CFD trading accounts depending upon the platform that you will trade through. Traders have a choice of ETX Traderpro the company’s in-house trading system or an ETX hosted version of MT4, one of the most popular FX trading platforms in the world.

Traderpro, the ETX in house system has a wider range of markets compared to MT4 so which account/platform you choose will probably come down to the instruments you want to deal in.

ETX has more than 5000 markets for its clients to choose from, which is less than the likes of Saxo, CMC and IG, but that selection is still probably more than enough for the majority of traders.

ETX offers a more personalised service than many of its peers, particularly if you are an HNWI.

Our experience is that you can often speak to a person to resolve an issue or get some help rather than just relying on FAQs or a forum.

ETX Capital Mobile App

ETX offers mobile trading through dedicated apps for both Android and iOS devices, and you can download the apps via the ETX Capital website or from the respective app stores.

The Android version of the trading app has been downloaded more than 10,000 times, and it scores 4.5 out of a possible 5 stars. However, there do seem to have been some teething troubles with the platform judging by some of the more recent reviews in the Google Play store.

The iOs version of the app scores 4.4 out of a possible five in the app store and there have been 8 updates to this version of the app in 2021 as of the time of writing, suggesting that the latest version of this software had been a bit buggy.

However, we found navigating around the app, trading and placing orders on it to be straightforward.

The app is menu and icon-driven and easy to use, for instance, you can call up a chart by selecting an instrument from a watchlist, and you can change the time frames or chart style using the buttons below that chart.

Drawing lines and adding indicators is also straightforward. Though you may need to practice your screen tapping skills to get your trend line placement exact.

Balances and running P&Ls on your open positions are displayed prominently at the top of the screen, but you can toggle that view on or off using an icon in the top right-hand corner of the screen.

When we ran the app it worked well and was simple to use, easy on the eye and generally a positive experience. Charts always look better on a big screen, and if you have a phone with a small display you may find the layout a bit cramped, but that’s probably more of a comment about your device than it is about the app.

ETX Capital Pros

• A UK based and long-established business
• CFDs, FX and Spread Betting all available in one place
• Offers some unique markets such as equity index differentials

ETX Capital Cons

• Relatively narrow product range compared to peers
• The charging and fee structure can appear overly complicated
• No options trading at ETX Capital

ETX Capital Pricing, Charges & Fees

ETX charges a bid-offer spread on the products it trades, those spreads can vary between platforms, for example, on Traderpro the minimum spread in AUDUSD is 0.80 points whilst on MT4 the spread is a minimum of 1.10.

On index CFDs, spreads can also vary by the time of day or market session.

So for example on MT4 in the FTSE or UK 100 index, the minimum spread will be 6 points between 7.00 am and 9.00 pm and 10 points at other times.

And on Traderpro the UK 100 spread is 2.0 points between 7.00 am and 8.00 am, after which it falls to one point until 4.30 pm, when it reverts to 2 points, until 9.00 pm, before widening to 6.0 points overnight.

ETX sets out these variable charges in series of filterable tables on its website, so, despite the seeming complexity, it’s actually easier to follow than it sounds.

When it comes to CFDs over individual shares ETX charges commissions, so for CFDs on US stocks on Traderpro it charges 2 cents per share with a minimum ticket of $15.00 per side, and for trades on UK stocks, it’s 0.10% commission with a £10.00 minimum ticket.

Once again these charges are levied on a per side basis. However, if you are trading equity CFDs via MT4 you will just pay a spread that starts at 0.10% of the underlying price, per side.

ETX has also just introduced a list of Blue chip equity that can be traded as CFDs but without any commission charges.

In terms of how ETX charges compare to the competition, you can probably trade cheaper elsewhere, but given the size of ETX’s client base, we have to assume that they are not shopping on price and must be staying put for the service.

ETX Capital CFD Trading

ETX offers CFDs or contracts for differences over a range of equity indices, single name equities and ETFs, commodities, bonds and interest rates. CFDs are cash-settled and OTC traded, and they have no fixed contract size or expiry date.

They allow traders to speculate on the rise and fall in the price of an underlying instrument without the need for ownership, meaning that CFD traders have an economic interest in a share or commodity, but not a physical one. When you trade with CFDs you could say that you are trading an assets price but not the asset itself.

At ETX charges vary by contract and the platform you are trading over, and we have outlined some of these in the section above. Overall there is a good range of instruments to trade CFDs on. The Traderpro platform is simple to use and navigate around, and the ETX CFD offering compares very favourably with that of their peers.

ETX Capital Forex Trading

ETX offers its clients the ability to trade FX or Foreign Exchange the world’s largest financial market by turnover.

Clients trade what’s know as rolling spot FX, on a margin traded basis, where a clients trading deposit is geared up or leveraged by their broker.

FX traders speculate on the rise and fall of the price of one currency in terms of another, for example, the value of the US dollar in Japanese yen or British pounds.

FX is traded in pairs because two currencies make up the FX rate. Though traditional only FX rates that contain the US dollar or Euro are considered pairs, all other FX rates are known as crosses. Backing or buying one currency in an FX pair or cross rate means that you are also shorting or selling the other currency in that pairing.

ETX Capital offer FX rates in majors, minors and so-called exotics. Clients trade these FX rates as CFDs and so there is no ownership of the underlying, just economic interest in price changes, there is no delivery of physical currency, instead, there is just a debit or credit on your account as and when the trade is closed, depending on whether the trade was closed for a profit or a loss.

ETX offers FX trading through Traderpro (its in house platform) and MT4, the spreads that are charged depend on the product you are trading and the platform you are trading it over.

For example, the minimum spread on Cable or GBPUSDF is 0.90 on Traderpro and 1.20 on MT4. Whilst the average spread on the pair is 1.58 on Traderpro and 1.85 on MT4. On that basis it’s more economic to trade FX at ETX using Traderpro, MT4 persists however as it’s a very popular platform.

In terms of how ETX stacks up with its peers in FX trading, they offer a decent range of FX contracts to trade, though less than direct rivals such as CMC Markets.

The two-tier pricing structure that ETX operates makes direct pricing comparison quite opaque a rule of thumb would be that Traderpro spreads are competitive, MT4 rates less so.

ETX Capital Spread Betting

ETX offers Financial Spread Betting alongside CFD and FX trading though clients will need to have separate accounts for trading and betting. Spread Betting on financial markets offers some tax advantages to UK residents and under current legislation profits made through Spread Betting, by individual UK taxpayers, are not subject to capital gains tax.

Whereas profits made from trading CFDs, FX, or other markets, that are greater than any personal allowances, are taxable.

Spread Bets on equity indices are among the most popular products, though people also regularly bet on FX rates, individual stocks and commodity prices

Spread Bettors look for active markets that are trending or trading within a discernable range, rather than moving erratically. Spread Betting customers at ETX can bet on a similar list of around 5,000 markets and can do so from both desktop platforms or mobile apps

ETX Capital Trading Platform

ETX Capital has its own in house platform known as Traderpro which is a browser or web-based system. There is no download you simply log in using your user name and password and the platform opens in a new browser tab, or window, on your desktop.

The trading platform is menu-driven you can search for markets to trade or scroll through a series of existing watch lists of trending and popular instruments, or different asset classes. Across the top of the trading screen is a toolbar with links to settings and other services.

The screen layouts can be configured to your needs and new layouts can be saved for later use there are a series of video available to take new users through that process which can be found under the trading tools tab. Likewise, you can customize and save your preferred chart setups.

Traderpro is a very approachable platform, and for free software without the need for a download, it’s very user friendly and intuitive. Yes, it may lack some of the bells and whistles of more advanced systems but often they come with a price tag or monthly subscription attached. Overall Traderpro compares very favourably with the platforms offered by ETX’s main rivals.

ETX Capital Options Trading

ETX does not currently offer options trading.

ETX Capital Demo Account

ETX offers demo accounts for both Spread Betting and CFD and Forex trading.

You can easily apply for a demo account online, and once open use it on both the desktop or mobile trading platforms, though not simultaneously.

Both the desktop and the mobile apps are intuitive to use, and using the demo account is the perfect way to explore exactly what the platforms can do.

You could easily spend thirty minutes just exploring the charts, indicators and drawing tools for example.

Demo accounts are funded with a notional balance of US $10,000 which means you can run multiple positions, and place pending orders, without running out of margin. There are no obvious limitations that are specific to the ETX demo account.

ETX Capital Education & Analysis

ETX offers a comprehensive range of educational materials that range from e-books and platform guide,s through to regular webinars and there is even a dedicated Trading Academy that’s run by former pro traders and analysts.

You will need to register in advance, for these webinars and courses, to be able to view them and participate. However, the e-books and how-to videos are available on demand.

In terms of research analysis, there are regular videos that cover topical market stories and events, which can be viewed at ETXs dedicated YouTube channel. And there are also daily written reports, that can be found on the analysis section of the ETX website. All of which is made available for free.

The analysis pieces are quite general in nature, some of the content is also out of date, however, ETX has recently added to their research team so that may improve.

ETX Capital Professional Account

If you are eligible you can apply for a professional account at ETX, however, you will need to meet two out of three tests to do so. You’ll need to have a portfolio of liquid investments of €500k or more, have relevant financial services industry experience and have conducted 10 trades of significant size, in each of the last four quarters.

If you meet those tests then you can trade without FCA/ESMA margin restrictions and receive a personalised service from ETX.

However, against that you won’t enjoy negative balance protection, meaning you can lose more than your stake or trading deposit and you may be subject to different language in any written communications with ETX, and you may be subject to different best execution criteria than retail clients are when you trade.

ETX Capital Alternatives

ETX competes directly with the likes of City Index and Spreadex in terms of size, but also with larger margin trading houses such as IG Group and CMC Markets, and to some extent with new entrants to spread betting such as Pepperstone.

ETX offers a more personalised service than the big boys, particularly for larger clients and for now, at least ETX Capital is focused almost entirely on margin trading. Though new owners Guru Capital may take the business into other areas going forward and they have already made an acquisition in that direction, in the shape of fintech Oval Money.

ETX Capital Versus CMC Markets

CMC Markets offer CFDs, Spread Betting and FX trading, so it competes with ETX on three fronts. CMC has a cleaner charging structure than ETX but it’s not necessarily cheaper than its smaller rival. One way to compare prices in running is to open demo accounts at both brokers and run their respective trading platforms side by side.

You can then directly compare the way that each broker prices an instrument under the same market conditions.

One thing that is immediately obvious when you do that is that CMC has a bigger range of instruments available to trade. Though it’s debatable if many retail traders take advantage of this. For example, most retail clients will likely trade rolling spot FX and never concern themselves with the forward contracts that CMC offers.

If the range of markets is looking like a deciding factor in your choice of broker, ask yourself what instruments are you likely to trade most frequently or regularly? That list will likely be a lot shorter than you think.

ETX is aimed at traders who are looking for a more personalised experience from their broker and as part of that, there is a focus on high net worths too.
CMC is aiming to attract customers of all levels of experience but at the same time, it’s building its products and technology to appeal to institutional customers, a side of the business that ETX doesn’t currently address.

ETX Capital Versus IG

These days IG is a far larger concern than ETX though they still compete directly in the key business areas of Spread Betting, CFDs and FX. However, IG would have to be considered number one globally in two of those businesses.

Once again the main areas of difference between the two firms in terms of charging and pricing comes in the tiered and multiplatform approach that ETX has.

Both houses amend their spreads on equity index CFDs depending on the time of day they are quoting prices. However, ETX also distinguishes between trading platforms, charging different spreads to different users.

ETX has a far smaller range of markets and products than their larger rivals but as we noted before the 5000 markets that ETX does offer to traders will be more more than sufficient for most users needs.

However, if you do have specific requirements, such as trading options, UK smaller companies or ISA investing, then you will need to look elsewhere than ETX Capital. And IG Group might be one of the brokers that you consider.

IG is a broad church aimed at traders of all experience and abilities, ETX, however, is largely aimed at traders with some experience of the market who are looking for more of a personal service, though by the same token they don’t turn newbies and novices away.

ETX Capital CEO, Philip Adler, on the importance of putting client education and service first

Philip Adler, newly appointed CEO of ETX Capital tells us what his plans are for the CFD broker and why he views trader education as such a critical part of his strategy.

There have been many changes in the spread betting and CFD industry over the past year or so. With the restriction of marketing initiatives, brokers are going back to basics and focussing on good old client service. And as such, industry veterans are returning to the helm to instill these old school values.

I first met Phil Adler over 15 years ago. I sat across the aisle from him dealing derivatives on a desk at Man Financial. Phil headed up GNI Touch, the first CFD broker to offer direct market access to clients. In fact, GNI, at one time or other, hedged exposure for most (if not all) of the spread betting and CFD brokers.

Over a decade later, Philip tells us why he's joined ETX Capital and what his plans are as newly instated CEO.

Over the years you've founded and run some of the biggest CFD desks in the business. What's the draw of joining ETX Capital?

For many years ETX Capital has enjoyed an excellent reputation as a firm that puts the customer first. This is seen in ETX’s approach to all aspects of service whether customer support, trading or credit.

In my previous roles at GNI and Man Financial, we offered hedging and financing services to ETX so my relationship with ETX goes back many years. When dealing with ETX as a client they did everything the right way.

When I was recently offered the COO role by Arman the draw was immediate. Here was an opportunity to work with an established player, with motivated, hard-working and knowledgeable staff, with its own proprietary trading platform and with owners ambitious to develop the business.

What will you mainly be responsibilities at ETX Capital?

My current responsibilities unsurprisingly involve all aspects of the smooth running of day to day operations but also include some sales.

For instance, we have a serviced equities desk which looks after active professional traders and is run by experienced sales traders. In fact they are so experienced I have little to manage. I also have responsibility for the retail client conversion team which works closely with the more operationally focused account opening team.

Then there is the trade management team which performs middle office functions and looks after the relationships with our hedging brokers. I also have responsibility for the customer services and credit teams.

Any plans to introduce new services to ETX over the next year or so?

Although it is perhaps an unfashionable answer, I believe that the best opportunity for ETX is to build on our existing reputation for service and platforms. I want to make sure that we build on our position as a top 3 provider in the UK for all active customers.

This means maintaining our focus on customer account opening, trading and support services. However, we are looking at establishing ETX in a number of new geographies over the coming months.

Since the new ESMA ruling has made it harder to entice clients away from the major CFD and spread betting brokers. What, in your view, are the other major problems brokers face in the changing regulatory climate?

The recent ESMA changes have affected all the CFD and Spread betting brokers. I would guess that we have all faced volume of business reductions in a similar proportion. Whilst we are always looking to increase our market share, our marketing and networking efforts do not solely focus on enticing clients away from our competitors.

Education is key.

There are new clients routinely considering CFD and Spread betting activities. If we do a good enough job of explaining the products, the risks and the ETX service differentiators we shall continue to win new and existing client market share.

The regulatory climate has changed dramatically over my time in the business. The problems that CFD and Spread betting brokers face today are considerable. For instance, the recent ESMA changes mean that we are facing greater competition from offshore, unregulated brokers.

Furthermore, CFD and Spread betting brokers are having to spend more time, money and resource than ever before to fight market abuse and financial crime.

And from those problems, any particular opportunities for ETX to evolve and stand out?

Quite simply, the opportunity is to make sure that we increase our focus on client education and service.

We may have the best product range and the most sophisticated trading platforms but if we don’t educate the clients on how the products and trading platforms work and the risks of leverage we won’t win or keep market share.

Philip Adler is CEO of ETX Capital. For more information read our ETX Capital review here.