Derivatives brokerages are firms that let you speculate on financial markets like stocks, commodities, indices, fixed income and foreign exchange through financial products derived from their pricing via futures, options, CFDs or spread betting. We have ranked and reviewed the best retail derivatives brokers in the UK that are regulated by the FCA.
Derivatives trading via CFDs and spread bets are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 65% and 82% 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. This article contains affiliate links which may earn us some form of income if you go on to open an account.
Compare derivative brokers’ market access and account types
You can use our comparison table of what we think are the best retail derivatives brokers to compare market access, minimum deposits and the different types of accounts each broker offers.
To compare derivatives brokers by product, please view the specific pages:
Different types of derivatives broker
There are two different types of derivatives brokers, retail and professional.
Institutional derivatives brokers
Professional derivatives brokers provide hedge funds with direct market access to stock, commodity and futures exchanges around the world. If you cannot be classified as a professional investor with sufficient market knowledge or capital you will not be able to trade with them. Institutional derivatives brokers provide some of the best leverage and lowest commission as their customers trade in large volume and with high frequency.
- Are you a hedge fund? Use our prime broker finder to get connected to discount institutional derivatives brokers.
Retail derivatives broker
These are more online trading platforms where everyday investors can trade CFDs, spread bets, futures and options. These firms are heavily regulated by the FCA as they can offer very high risk products to investors with little or no experience.
Derivatives broker FAQs:
Yes, but as they are high-risk financial products, before you can open an account with a derivatives broker, you need to demonstrate that you understand the risks involved. If you are new to investing, you are better off with an investing account, and only using derivatives to hedge your portfolio.
Yes, you can make money trading derivatives if, as with any investment, you correctly time the market. It’s also important to note that as derivatives are often leverage products, your profits can be amplified by trading on margin. But, more importantly, so can your losses, and you can very quickly lose all of your money. Although if you are a retail trader, you do benefit from negative balance protection, so you will never lose more than your account balance.
Yes. Statistics show that between 65% and 85% of retail clients in the UK that trade derivatives lose money. You can read more the importance of client loss risk warnings here.
The most popular financial products for derivatives traders are:
- Financial spread betting