What are the Best CFD Brokers in Australia?

What is a CFD or Contract for Difference?

The term CFD is the abbreviation for Contract For Difference.

A CFD is a financial instrument in the derivative product category. Indeed, the value of a CFD is based on the performance of one or more underlying assets. The assets represented by a CFD can be diverse, such as stocks, indices, currencies, commodities, bonds or even cryptocurrencies.

One of the particularities of CFDs is that they allow you to speculate on both the rise and fall of the prices of a financial asset.

The profit or loss generated when closing the position corresponds here to the difference between the price of the underlying asset at the time of purchase and the price of this asset at the time of sale.

Attention !

81% of retail investor accounts lose money when trading CFDs.

What is a CFD broker?

A CFD broker is a trading platform that allows investors to speculate on the price movements of a financial asset without actually owning the underlying asset. CFD stands for "Contract for Difference", a derivative product that reflects the price movement of an asset such as a stock, currency, commodity or stock index.

A CFD broker provides traders with an interface where they can buy (long position) or sell (short position) a CFD on a given asset. The difference between the entry price and the exit price determines the trader's profit or loss.

The main elements that characterise a CFD broker are:

• Access to markets: brokers generally offer a wide range of assets in the form of CFDs, including stocks, indices, Forex, cryptocurrencies and commodities.
• Leverage: traders can use leverage, allowing them to amplify their exposure to the market with reduced capital. However, this also increases the risk of losses.
• Trading fees: a CFD broker may charge spreads (the difference between the buying and selling price), commissions or financing fees for positions held open overnight.
• Regulation: In Australia, CFD brokers must be registered with the Australian Securities and Investments Commission (ASIC) and comply with Australian regulations regarding investor protection and leverage limits.

Types of CFD Brokers: Market Maker vs STP/ECN

When choosing a CFD broker, it is important to understand the differences between Market Makers and STP/ECN brokers. These models influence order execution, fees and the trading experience.

What type of broker should I choose?

• Market Maker : Ideal for beginner traders and those who prefer simple pricing with fixed spreads.
• STP/ECN : Suitable for experienced traders looking for reduced costs, better transparency and direct access to the market.

What Regulation and Security are in Place for CFD Brokers in Australia?

In Australia, CFD brokers must be licensed and supervised by the Australian Securities and Investments Commission (ASIC). This regulatory body is known for its strict approach to consumer protection and transparent financial practices. Traders in Australia benefit from a high level of oversight and are also exposed to global regulatory standards when using international brokers.

All brokers offering CFD products in Australia must comply with ASIC’s updated product intervention measures introduced in 2021. These are designed to reduce the risk of significant financial losses among retail investors. Key protections include:

• Leverage limits for retail traders:
• 1:30 for major forex pairs
• 1:20 for minor forex pairs, gold, and major indices
• 1:10 for commodities (excluding gold) and minor indices
• 1:5 for shares or ETFs
• 1:2 for cryptocurrencies
• Negative balance protection : Retail clients cannot lose more than their invested capital.
• Ban on binary options and marketing bonuses : Deposit bonuses and high-risk products like binary options are prohibited for retail clients.
• Clear risk disclosures : Brokers must clearly communicate the percentage of retail clients who lose money.

ASIC’s regulation strikes a balance between providing access to leveraged instruments and protecting everyday traders from excessive risk. It's one of the most respected regulatory frameworks in the Asia-Pacific region.

How to choose a CFD broker?

Choosing a CFD broker is a crucial step for any trader looking to speculate on global markets. Several key factors should be carefully compared to ensure the broker fits your trading style, offers competitive conditions, and complies with the regulatory standards in Australia.

1. Available assets

A good CFD broker should offer a wide range of financial assets allowing traders to diversify their investments. Here are the main types of assets accessible via CFDs:

2. The Regulation of CFD Brokers

Regulation is one of the most important aspects of selecting a reliable CFD broker. In Australia, brokers must be licensed by the Australian Securities and Investments Commission (ASIC), which enforces strict standards on leverage, transparency, and client fund protection.Here are the top regulatory bodies to prioritise as an Australian trader:

Warning

Be cautious of brokers registered in offshore jurisdictions like Belize or Vanuatu. These regions often lack proper oversight and do not guarantee client protection.

3. Leverage in Australia and Elsewhere

Leverage allows traders to control larger positions with a smaller amount of capital, magnifying both potential profits and losses. In Australia, ASIC has implemented strict leverage limits to protect retail clients from excessive risk.

Professional traders in Australia may apply for higher leverage by meeting specific eligibility criteria, but will forgo some retail protections. Brokers outside of ASIC regulation may offer higher leverage, but often lack negative balance protection and carry greater risk.

4. Available Order Types

A good CFD broker should offer a variety of trading orders to optimize strategies and better manage risk.

5. Features Available

The best trading platforms offer advanced features that facilitate analysis and order execution.

• Trading Platforms: MetaTrader 4 (MT4), MetaTrader 5 (MT5), TradingView, proprietary platforms.
• Charts and technical indicators: moving averages, RSI, MACD, Fibonacci, etc.
• Analysis and reporting tools: price alerts, trading signals, real-time market analysis.
• Mobile compatibility: iOS/Android app for trading on the go.
• Trading automation: trading robots (Expert Advisors on MT4/MT5) and API for algorithmic trading.
• Customer service: assistance in English, 24/7 support via chat, phone or email.

Which CFD broker is best for a beginner Australian trader?

Choosing a CFD broker when you are new to trading can be difficult. Here are the essential criteria for selecting a broker suitable for novice Australian traders.

• Simple and intuitive platform: choose a broker with a clear interface like eToro or XTB. MetaTrader 4 (MT4) is also a popular option, but a little more technical. It is recommended to test a demo account before switching to a live account.
• Regulation and security: a reliable broker must be regulated by ASIC or a recognised authority in Australia (such as APRA). They must guarantee protection against negative balance and segregation of client funds. Avoid offshore brokers (Belize, Vanuatu) that do not protect investors.
• Transparent and competitive fees: compare the spread (difference between buying and selling price), commissions (some brokers are commission-free on shares/ETFs), overnight fees (swap) and deposit/withdrawal fees. Opt for a broker with tight spreads and free withdrawals.
• Customer support in English: check if the broker offers support in English via chat, email or telephone, as well as a detailed FAQ. Support available 24/5 or 24/7 is a real plus.
• Educational resources and training: a good broker for beginners should offer video tutorials, webinars and trading guides. A free and unlimited demo account is essential for practicing without risk.

How to Trade CFDs with an Online Broker?

Trading CFDs with an online broker involves several essential steps. Here’s a detailed guide to get started effectively.

1. Choose a Regulated CFD Broker

Before you start trading, it’s essential to select a regulated and trustworthy CFD broker. For Australian residents, make sure your broker is licensed by the Australian Securities and Investments Commission (ASIC). ASIC-regulated brokers are required to meet strict standards regarding leverage, risk management, and client fund protection.In addition to regulation, consider the following:

• A user-friendly trading platform (e.g. MetaTrader 4/5 or proprietary platforms)
• Competitive spreads and transparent fees
• Responsive customer support, ideally available in English and during Australian trading hours
• Local deposit/withdrawal options like POLi, PayID, or bank transfer

Choosing a regulated broker ensures you’re protected by law and operating in a safe, transparent trading environment.

2. Ouvrir un compte de trading

Une fois le broker sélectionné, l’ouverture d’un compte nécessite :

• An online registration with your personal information
• An identity verification (identity card, proof of address)
• An initial deposit according to the broker's requirements (often between $150 and $750 AUD)

Certain brokers offer a demo account to practice risk-free before trading with real money.

3. Choosing an asset to trade

CFD brokers in Australia offer a wide range of markets to trade, including popular local and international instruments.Here are some of the most commonly traded assets among Australian CFD traders:

• Shares: BHP, Commonwealth Bank (CBA), CSL, Tesla, Apple
• Indices: ASX 200, S&P 500, Nasdaq 100, FTSE 100
• Forex: AUD/USD, EUR/USD, AUD/JPY, GBP/USD
• Commodities: Gold, Brent Crude Oil, Natural Gas, Iron Ore
• Cryptocurrencies: Bitcoin, Ethereum, Ripple, Solana

Choose assets that match your strategy, risk tolerance, and market knowledge.

4. Analyse the market and take a position

Before opening a position, analyse the market with:

• L’analyse technique : indicateurs (RSI, MACD, moyennes mobiles) et figures chartistes
• L’analyse fondamentale : actualités économiques, résultats d’entreprises, décisions des banques centrales

Next, you can open a position:

• Achat (Long) : si vous pensez que le prix va monter
• Vente (Short) : si vous anticipez une baisse

5. Define your leverage and protection orders

Leverage allows you to control a larger position with a smaller initial investment, but it also increases your exposure to market volatility. In Australia, ASIC limits leverage for retail traders to protect against large, rapid losses:

• 1:30 for major forex pairs
• 1:20 for gold and major indices
• 1:5 for shares
• 1:2 for cryptocurrencies

To protect your capital, it’s vital to use risk management tools:

• Stop-loss: Closes your position automatically when the market moves against you beyond a certain threshold.
• Take-profit: Automatically closes your position when your profit target is reached.

These tools help limit your losses and lock in gains—especially important in fast-moving CFD markets.

6. Monitoring and Closing Your Position

Once your position is open, monitor its progress via the broker's platform. Depending on your strategy, you can:

• Fermer manuellement votre position
• Laisser votre take-profit ou stop-loss s’exécuter automatiquement
• Ajuster vos ordres en fonction du marché

Attention!

Positions held open for multiple days may incur overnight fees (swap), to be verified with your broker.

7. Analyse Your Performance and Optimise Your Strategy

After each trade, analyse your results to progress:

• Vérifiez ce qui a fonctionné ou non
• Adaptez votre gestion du risque et vos stratégies d’entrée/sortie
• Utilisez les outils du broker comme les journaux de trading et les analyses de marché

What are the CFD broker fees?

CFD brokers apply different fees that influence the profitability of trading. It is essential to understand these costs before opening an account. Here are the main types of fees, with concrete examples.

1. The spread

The spread is the difference between the buying (Ask) and selling (Bid) price of an asset. This is the main source of income for commission-free brokers.

Example of CFD spread

A broker offers a CFD on the EUR/USD with a spread of 1.2 pips. If you open a position of 1 lot (100,000 units), the cost of the spread will be:

• 1 pip = $10 on a standard lot
• 1.2 pips = $12 fee to open the position

2. Commissions

Some brokers charge fixed commissions in addition to the spread, particularly on ECN/STP accounts, which offer tighter spreads.

Example of CFD commission

An ECN broker charges a commission of $7 per lot on a Forex trade. If you open a 1 lot position on the EUR/USD, you will pay $3.50 on opening and $3.50 on closing, i.e. $7 in fees in total.

3. Overnight fees (swap)

Les frais overnight, aussi appelés swap, sont facturés lorsque vous conservez une position ouverte après la clôture des marchés (22h GMT). Ils sont basés sur les taux d’intérêt des banques centrales.

Exemple de frais swap sur CFD

Vous détenez une position acheteuse sur le CFD EUR/USD avec un effet de levier de 1:30. Votre broker applique un taux de swap de -0,7 pips par jour. Si votre position est de 1 lot, vous paierez 7 $ de frais overnight chaque nuit.

4. Les frais d’inactivité

Brokers may charge inactivity fees if your account remains inactive for a certain period (usually 3 to 12 months).

Example of inactivity fees

A broker charges AU$10 per month after 6 months of inactivity. If you don't trade for a year, you'll pay AU$60 in inactivity fees.

5. Deposit and withdrawal fees

Some brokers charge fees on bank transactions or withdrawals depending on the payment method used.

Example of deposit and withdrawal fees

A broker charges 1.5% on deposits by credit card and $5 AUD on each withdrawal by bank transfer. If you deposit $1,000 AUD, you will pay $15 AUD in fees. If you withdraw $500 AUD, you will pay an additional $5 AUD.

6. The Fees Associated with Leverage

Leverage allows you to trade with more capital than is available in your account, but it can lead to financing fees.

Example of leverage fees

You open a position of $10,000 AUD with a leverage of 1:30. Your broker applies a daily financing rate of 0.01% on the borrowed amount ($9,667 AUD). Each day, you will pay approximately $0.97 AUD in fees to maintain this position.

What strategy to trade with a CFD broker?

CFD trading offers flexibility to adopt different strategies depending on your experience, risk tolerance, and market outlook. Australian traders can access a broad range of local and international assets—from ASX-listed shares to major global indices—allowing for both short-term and long-term approaches.Below is a summary of the most popular CFD trading strategies, adapted for the Australian market:

What is the Taxation on CFD Income in Australia?

In Australia, profits made from trading Contracts for Difference (CFDs) are generally considered capital gains or income, depending on your trading activity and intent. It is important for Australian traders to understand the correct tax treatment to remain compliant and avoid unexpected liabilities.

1. CFD Tax Regime in Australia

Whether your CFD profits are taxed as capital gains or income depends on how the Australian Taxation Office (ATO) views your trading. Occasional or long-term traders may be taxed under Capital Gains Tax (CGT) rules, while frequent, high-volume traders may be taxed under income tax rules.Here’s a summary of the potential tax treatments:

*Most retail traders fall under CGT rules unless they run a full-time trading business.

2. Offsetting Losses and Taxing Gains

The ATO allows you to offset CFD losses against gains of the same nature.

• Capital losses can be used to reduce capital gains, but cannot be used to offset regular income.
• Trading losses (if classified as a business) may be deductible against other income, subject to certain rules.

Example:You earn AUD 6,000 in profits from CFD trading and incur AUD 2,000 in losses in the same financial year.

• Your net capital gain is AUD 4,000.
• This amount is added to your taxable income and taxed at your applicable marginal rate.
• If you held your CFD positions for more than 12 months, you may be eligible for the 50% CGT discount (i.e., only AUD 2,000 would be taxable).

3. Declaring CFD Income to the ATO

All CFD-related profits and losses must be reported in your annual tax return, specifically:

• Capital Gains: Declare in the “Capital gains or losses” section of your return.
• Income (if trading as a business): Declare under “Business income and expenses”.

The financial year in Australia runs from 1 July to 30 June, and returns must typically be filed by 31 October (or later if using a registered tax agent).

Important

If you use an offshore broker and hold funds in overseas accounts, you may also need to declare foreign income and assets to the ATO under the Foreign Income Reporting rules.

P. Laurore

Finance expert

Co-founder of HelloSafe and holder of a Master's degree in finance, Pauline has recognised expertise in personal finance, which she uses to help users better understand and optimise their financial choices. At HelloSafe, Pauline plays a key role in designing clear, educational content on savings, investments and personal finance. Passionate about financial education, Pauline strives, with every piece of content she oversees, to provide reliable, transparent and unbiased information for independent and informed financial management. To this end, she has tested over 100 trading platforms to help internet users make the right choices.