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Plus500 review 2022

by forextrader January 13, 2022
January 13, 2022

Plus500 Review

Plus500 is a brokerage firm through which you can trade CFD contracts for more than 2,400 instruments. Instruments include currency pairs (forex), stocks, indices, commodities, and popular cryptocurrencies.

The broker offers a web and a mobile app for trading. The good news is that you can test both apps first. The broker even offers a free demo test account.

Other advantages of Plus500 are low and transparent fees and a minimum deposit of 100 euros. Traders from Europe will also be pleased about the account management in your local currency, the language support, and the Czech customer service.

The broker is based in Cyprus, is subject to CySEC regulation, and is a member of the ICF compensation fund. In accordance with the European directives, traders are protected against negative balances so that they can only lose as much as they have deposited into the account.

You can trade more than 2,400 assets in seven classes with Plus500 using CFDs:

  • 71 currency pairs – EURUSD; USDCHF; GBPUSD; USDJPY, AUDUSD…
  • 1,742 stocks – Apple, Facebook, Google, NETFLIX, Tesla, Amazon…
  • 22 commodities – gold, silver, WTI and BRENT crude oil, coffee, platinum, palladium…
  • 29 indices – USA500, US-TECH100, UK-100, US30, Crypto10, DAX40…
  • 95 ETFS – QQQ, SPY, VXX, VOO, VTI, XLF, SQQQ, EEM, GDX, TQQ…
  • 19 cryptocurrencies – Bitcoin, Ethereum, Litecoin, Ripple, EOS, Solana, NEO, DASH…
  • 440 options – index and stock options

Trrading Platforms

With Plus500, you have a simple and clear web-based platform that you don’t need to download or install. It works in a standard web browser. The platform includes a customizable chart with indicators and 5 different orders that will watch the market for you:

  • Close on Profit (take-profit).
  • The command automatically exits a trade that reaches a set loss.
  • Guaranteed stop: With a classic stoploss, slippage may occur (the trade will close at a worse price than you set). A guaranteed stop guarantees that you will close at the price you have chosen.
  • Trailing stop. If the price moves in your favour, the stop-loss boundary also moves, if the market goes against you, the stop-loss boundary stands.
  • Buy when the odds are: an order that triggers a prepared order the moment the instrument price reaches the desired value.

The Plus 500 platform is also available in a desktop version for Windows 10 PCs, and you can also use the business app for Android or iOS smartphones. However, you won’t find the popular MetaTrader platform at the broker.

Financial Leverage

CFDs are traded with financial leverage, so the trader finances only a fraction of the order. Leverage of 1:10, for example, means that you pay only a tenth of the order. The rest is money borrowed from the broker.

You can think of financial leverage as a multiplier, which multiplies profits as well as any losses. Leverage of 1:5 multiplies all gains and losses fivefold, leverage of 1:10 multiplies tenfold, etc.

Financial leverage allows you to profit from a small change in the exchange rate or without high capital. But keep in mind that higher leverage also means higher risk. For this reason, the leverage at Plus500 is limited by ESMA regulation:

  • Forex (currency pairs) – major currency pairs 1:30, others 1:20
  • Indices – major indices 1:20; others up to 1:10
  • Commodities – 1:10; gold 1:20
  • Stocks and ETFs – up to 1:5
  • Cryptocurrencies – 1:2

The ESMA limit applies to retail (retail) client accounts. Professional traders can request an increase in leverage up to 1:300.

Minimum Investment

The minimum investment varies for each instrument. Generally, however, you will need between 20 and €120 to make a single transaction. The size of the investment is displayed when placing an order as the Required Margin.

The specific values depend on the minimum order size and leverage.

How does it work? The minimum forex order volume for the EURUSD instrument is 0.01 lots, which is 1,000 units of the base currency. The minimum order is therefore €1,000. However, with leverage of 1:30, you only need a thirtieth (just under €34).

Account creation and verification

You can open a trading account in 14 different currencies including USD, GBP, EUR, PLN or CHF. However, the default currency depends on the country of residence, so for UK traders, accounts are basically GBP accounts.

The first step to opening a trading account is registration. All you need to fill in the registration form on the Plus500 website is your email and any password. All other details (name, address, phone number and date of birth) are entered after logging into the account. Once logged in, you must also complete an investment questionnaire regarding your trading experience.

Deposits and withdrawals

Plus500 supports 3 payment methods for deposits and withdrawals:

bank transfer
VISA and Mastercard payment cards
electronic wallets (PayPal, Skrill)

The minimum deposit for credit cards and e-wallets is $100. For bank transfer the minimum is $400. Payments by bank transfer are also the slowest, so it can take up to 5 working days to credit the money.

The minimum withdrawal is $50 for e-wallets or $100 for bank transfer and credit cards. The broker also points out that traders should use the same payment method for deposits and withdrawals (if possible).

Fees at Plus500

Fees at Plus500 are clear and relatively low compared to competitors. However, this is not the case for all instruments. Also watch out for administration fees – especially for withdrawals. While these can be avoided (5 withdrawals per month are free), you need to watch out for any exceptions.

Trading Fees

  • Spread: Spreads at Plus500 are relatively tight, but can change throughout the day.
  • For EURUSD, the minimum spread is 0.8 pip.
  • Overnight trading fee (swap). The size of the swaps is usually in the order of thousandths or hundredths of a percent.
  • Commission: You will pay a one-off commission fee of between 0.07% and 0.18% (usually 0.09%, depending on the market you choose) for each trade in a stock.
  • Currency conversion fee. A typical example is the purchase of US stocks in a CZK account.
  • Guaranteed stop-loss fee.
  • Trading fees are included in the ongoing profit/loss on the transaction. Therefore, expect that each transaction will be in a small loss immediately after it is initiated.

Trading fees are included in the ongoing profit/loss of the transaction. Therefore, expect that each transaction will be in a small loss immediately after it is triggered.

Comparison of fees

To get a better idea of the size of the spreads, we have compared Plus500 broker’s offer with the spreads of competing brokers:

 Plus500eToro RoboMarketsXTB 
EUR/USD 0.8 pip0.9 pip 0.6 pip 1 pip
NSDQ1001.92.4 1.5 1.0
Netflix$2.9$0.9 $0.60.08%
Bitcoin 109.89 274.52 n/a0.22% – 0.35% 
DAX401.972.01.01.6

Spreads as of 28.1.2022, the amount of the fee is subject to change.

Administrative Fees

  • Deposit fee: there is no deposit fee at Plus500.
  • Withdrawal fee. Up to $6 for withdrawals by bank transfer. / A $10 fee for withdrawing less than the limit. / A $10 fee for exceeding 5 withdrawals per month.
  • Inactivity Fee: If the account is inactive (no login) for 3 months, the broker will start charging a $10 per month fee. If you have no money in the account, you do not pay the fee.
  • Cancelled Account Refund Fee: If you request a cancellation of your account, the broker will charge you $10 to return the remaining funds. However, there is no charge for a refund via credit card.

Education and demo account

There is no point in trading CFDs without thorough training. Even if trading looks easy, only about 20% of traders can make a long-term profit!

You can try out the Plus500 app without obligation and without risk, because the broker provides an unlimited-time demo account with a notional deposit of $45.000. The advantage is that the demo account does not require verification or complicated registration. Just fill in your email, any password and you’re good to go.

The demo account will help you learn how to use the platform, plus you’ll get valuable feedback. The trading conditions and features are the same as on a real account, so if you can’t make money on a demo account, there’s no point in starting with real money.

The broker does not offer tutorials or educational materials.

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Forex and CFD Trading

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Forex
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    • Broker

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      January 4, 2022

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