ETX Capital Review
It’s a bit of a shame writing this review because by the time you read it ETX Capital may well no longer exist as we know it. ETX Capital can trace it’s roots back to 1965 when it was incorporated Monecor as a member of the London Stock Exchange. In 2002 it enabled trading for retail clients through its TradIndex brand. It even had a shopfront in The City of London, round the corner from the office when I was a stockbroker 20 years ago on Mansell Street. You could pop in to open an account, in the same way as booking a holiday with a travel agent. In 2007 it launched ETX Capital, ETX Capital stood for Electronic Trading, Telephone Trading and Execution Services.
Recently Guru Capital, the new owners of ETX acquired Oval, and is merging the brands to become more of a fintech, than a stand-alone trading business. If you want to know more about the people running ETX take a look at our interview with Phil Adler the current CEO. I’ve known Phil, for ages and 15 years ago worked across the aisle from him when he was running GNI, where they (and him) pioneered CFD trading. This was of course when it was mainly for sophisticated investors and you needed a minimum of at least £10k to trade. GNI Touch was a great platform and the first to offer DMA trading en-mass.
Anyway ETX Capital now has around 55,000 active trading clients globally (with the exception of course of America) and offers access to just over 3,500 markets through spread betting and CFDs. That’s not as broad as brokers such as IG or Saxo Markets, but it is perfectly good if you are trading the most liquid and popular assets, which is what most online traders do anyway.
ETX TraderPro is the in-house platform. ETX used to outsource platform development, but in 2014 they acquired their trading software provider Ariel Communications. ETX does offer MT4 as well if you want to plug in your own systems, but the main platform ETX TraderPro is available through web browsers or mobile.
Obviously, when you trade online, you can also trade on the go with the mobile app.
One of the things I like about ETX is that it sits in the middle. The platform is basic and intuitive enough for new traders to use, a bit like Plus 500 (which is at the real basic end of the spectrum) but they also offer professional execution services through voice brokerages in the same way as more professional trader focussed firms like Saxo Markets or IBKR. But ETX keeps it simple by just offering spread betting and CFDs rather than futures and DMA trading. So, if you are a big trader and work market-moving orders, ETX can work things like VWAPs for you. I think having a bank of experienced dealers you can talk to on the phone, directly is a big plus for brokers these days. Especially as brokers are all selling the same thing really, that is access to the markets. The FTSE is the FTSE, and Cable spreads are all so narrow these days there isn’t really much difference between platform prices. But, when something goes wrong, or you’ve had an error, or you need a bit of help, it is comforting to know that when you pick up the phone, the person you speak to will be in London and know what they are talking about.
There are some quite good features on the platform, like watch lists broken down by what’s trending, meme stocks, and markets that are in the news. There are all the major indices, forex markets and major stocks. You can also trade US stocks pre-market and deal over the phone, if you’ve got big orders or want to work a bid or offer. ETX does have professional traders and does institutional business so has the capability to deal with large order flow. I remember visiting their offices when I was trying to flog them some research and it was buzzing with some fairly large FX trades when I walked through the dealing floor.
One of the other features I quite like, which oddly enough quite a lot of other brokers don’t have is the ability to rank markets. For example, you can bring up the FTSE 100 constituents and rank them by winners and losers. Which gives a good idea of what is moving. When you click on a stock it also brings up the asset’s key market information, which you don’t get with platforms like MT4.
You also get access to some zero commission stocks and ETFs. They are still CFDs (no spread bets) rather than physical but, they are competing against the other major free stockbrokers so you don’t have to pay stamp duty and as they are fully paid up there is no financing charges. However, if you are investing in the long term you are better of with a traditional investment account like Hargreaves Lansdown or Interactive Investor, as there are no Stocks & shares ISA or SIPP accounts.
There are some other good features like trading from the chart. When you move stops and limits directly on the chart, it shows what your live P&L will be if they are hit. You can do this on the mobile app too.
The charts are basic, but come with pretty much all the indicators you could need. There is no pairs trading, or complex orders online, but when I was chatting to Michael Baker, the head of relationship management at ETX, he said they stopped offering it because there was practically zero demand for it. But, if you have a big pairs order, where you are trading the spread between two stocks or markets they can work that over the phone for you.
They have a pretty good research offering too. They provide daily technical analysis on the major and moving markets. Retail brokers can’t obviously provide trading advice or ideas, but they can highlight potential trading scenarios. Their analyst is Alex Neale, who’s research I’ve been following for more than ten years, he’s got a great way of looking at the market and putting trading opportunities in front of you. From there you can either take a position it’s up to you but he’s great at cutting through the clutter and highlighting what’s relevant at the time. He’s just won an award from the Society of Technical analysts. If you are interested in trading with technical analysis, our own analyst Jackson Wong has written a pretty comprehensive guide to technical analysis, or you can read our interview with Clive Lambert, Vice-Chair of the STA.
ETX also host their own webinars, where they can take your through their trading platforms and you get the opportunity to ask questions and interact with the dealers.
You also get free access to The Corillian Academy, for their big Sunday webinar.
There are some pretty good webinars on how to trade like a professional trader and how they differ from retail traders and explain some basic trading strategy like trend flow and so on.
The majority of traders will of course just tap away on the trading platform, but if you want there is a lot more on offer under the hood, if you need it, like voice brokerage and access to new issues. You probably won’t need it but it’s great to know it’s there if you do…