IC Markets and Plus500 are two forex brokers with both a international and domestic presence in Australia. In October 2018 these two fx brokers were put ‘head-to-head’ for a comprehensive IC Markets vs Plus500 comparison and full review. View our comparison table and write-up down the page.
In October we compared the spreads for IC Markets vs Plus500 fx brokers. Looking at the table it is clear that the spreads on offer by IC Markets are tighter.
Spreads on 02/10/2018
IC Markets (Avg)
Plus500 on 13/10/2018
When compiling out table of spreads, we used the best available spreads regardless each broker offers among all their accounts. This is so we can apply the fairest possible comparison based on fees. In the case of Plus500, only one type of account is offered.
True ECN Account by IC Markets
The main features of this account are:
Lot size of 0.01 to 100 lots available
AU$3.5 commission for each 100k traded round-trip.
Deposit minimum requirement of $200
Spreads starting at 0.0
Leverage of up to 500:1 avaiable
64 Pairs of Currency Available for Trade
Hedging and Scalping
Expert Advisors (or EAs for short)
IC Markets spreads are tighter because they are an Electronic Communication Network (ECN) Broker. ECN brokers do not use a ‘dealing desk’ but rather aggregate spreads directly with global liquidity pools (such as banks). As spreads are not manipulated, there is a commission is charge instead.
The IC Markets account has more trading options when we compare with Plus500. They allow scalping, hedging and EAs. Traders that use these tools and techniques generally will have sound trading experience and knowledge.
Pro account with Plus500
Only 1 account type is available with Plus500. The account offers these features:
Lot Trade sizes available: N/A
Minimum deposit $100
Spreads from 0.01
Over 60 Currency Pairs
Plus500 are a market maker and use a ‘dealing desk’. This means spreads are wider than with an ECN Broker. You will however will not incur commission fees in addition to the spread.
The Plus500 website does not the average spreads they offer. Therefore our spreads table therefore is using sample of spreads at a point in time. It is also important to note that while fixed spreads are not variable, they can change in an extremely volatile market. This means spreads quoted by us may be significantly different at diferent point in time.
Additional Fees with Plus500
Plus500 Premium (Overnight fee) Fee – A fee is charged if traders hold their position overnight or when market is down. This fee is to cover the risks the broker takes for keeping a trade open overnight.
Plus500 Inactivity Fee – There is a fee of $10USD if an account is inactive for a 3 month period.
Guaranteed Stop Order – We discuss this optional feature in risk management. If selected spreads will be wider
Trading Spreads and Fees Conclusion
The two main features that should be considered when deciding for each broker are:
Spread size – You will need to obtain the spread/pips and the volume or lot size you will trade and perform you own calculations when deciding between a commission or spread based account. Generally trading larger lots with low pips will result in greater saving. Low volume traders however may prefer no commission accounts.
Features – if any of the following are required hedging, scalping and Expert Advisors. If any of these advanced featured are required then Plus500 can be ruled out.
IC Markets and other ECN brokers such as Pepperstone offer better value due to its lower spreads and extra features. These reaons are why we consider IC Markets the preferred forex broker when it comes to spreads and fees.
Each broker offers trading platforms that contain features that are significantly different.
IC Markets Platform for Trading
IC Markets offer users the worlds leading platform known as MetaTrader 4. MT4 offers the following features:
One Click Trading for fast order execution
A Prompt order management functionality that enables one-click trading.
Expert Traders (EA) applications for automated trading based on algorithms (EAs are not permitted on Plus500s own platform).
Widespreads use with many brokers meaning you can easily switch to another broker that also offers the platform without compatibility issues and need for re-learning
IC Markets MetaTrader T4 advanced Tools
Advanced Trading Tools has 20 advanced features that cam be lead to more successful trading:
Alarm Manager – Provides notification about events on your account and in the general market. You can automate actions when specific events occur such as send automatic updates on twitter your followers.
Connect – All the latest news and analysis to help you make the best investments
Correlation Matrix – shows in grid form the connections between pairs over a period of time.
Correlation Trader – identify strong or weak correlations to highlight differences in variables being analysed.
Excel RTD – with this tool you can build your own trading dashboard. This allows you to receive real time data in 3 different excel spreadsheet. These spreadsheets can contain information such as account equity and balance, instrument prices and open positions.
Mini Terminal – A compact window called the mini terminal allows you to do the most important trading tasks such as placing positions, changing Stop Loss and Take Profit parameters super easily.
Market Manager – Provides information about your account such as equity, balance and margin usage.
Sentiment Trader – help you to see the sentiments of other traders when crafting a trading strategy.
Stealth Orders – Used to place orders and set your position to enter the market and exit the market while also remaining hidden from the market.
Trade Simulator – used reliable strategies proven successful in the past to show potential profit/ loss results.
Session Map – shows your local time in relation to trading sessions around the world.
Trade Terminal – So you can monitor and place orders on many instruments at one time.
Smart Lines – this utilises charts to show take profit and stop-loss positions.
The Plus500 Forex Trading Platform
There is only one platform available with Plus500. The `Plus500 Forex Trading Platform` is propriety and we found it to be one of the most user friendly and intuitive platforms among all CFD providers.
Available for Iphone/Ipad, Android and Windows mobile, Windows 10 and Web Trader, platform is not rich in graphic feature but has a well-designed interface that makes users feel they have all the tools and features at their disposal at all times. Plus500 has over 2000 trading instruments making access to a broad range of information in easy to digest many essential given users can be overwhelmed with information overload.
While the platform is very user friendly, there are a few disadvantages of the platform. No scalping is allowed, it is not compatible with EAs nor is there a social feature for trading.
Plus500 is a great trading platform for traders that are beginners or looking to trade taking advantage of the 2000 plus instruments available. The platform however is not so great for traders that require EAs and advanced trading resources.
Forex Trading Platforms Conclusion
Metatrader 4 provides an excellent range of features for a wide range of users. Mt4 is the platform that is most used by both brokers and traders, therefore we would recommend users choose IC Markets as they offer the Mt4 platform.
Execution Speed and Risk Management – IC Markets and Plus500
When we reviewed the execution speeds we found IC Markets place a high priority on execution speed while Plus500 don’t make mention of execution speeds to their website. Instead Plus500 provide a suit of risk management tools so traders will not need to worry about ‘slippage’ risks.
IC Markets Execution Technology
We found IC Markets website provide a reasonable level of information about the technology infrastructure they use and order execution speeds.
IC Markets claim an average execution speed of 40ms from their servers to liquidity pools. The following methods are used to achieve these exceptional speeds:
Dedicated Fibre Optic Cable – means lower congestion as fewer resources are using the fibre optic cables to obtain needed information. Fibre Optic technology provides the fastest means for transmitting orders.
Equinix Servers near New York and London Financial Centres – By placing servers new liquidity centers data lower latency can be achieved as data does not need to travel far for executed orders.
Sponsored Virtual Private Servers – IC Markets will sponsor VPS if trader makes a minimum volume of 15 round turn lots a calendar month. Latency speeds between VPS and IC Markets servers can be as low as 0.5ms.
Risks associated with ‘gapping’ can can cost a suprising amount. IC Markets therefore offer fast order execution speeds which can reduce the lag time in the order execution process. This should ensure your trades are predictable. Despite this Slippage can still occur and IC Markets do not provide a guarantee against losses.
Plus500 and Risk Management
Plus500 don’t provide much information on their website in relation to execution speed however speed might not be so as important from a trader’s perspective. Below we list the risk management features on offer by Plus500 and note if also available with IC Markets.
Pending Order (Profit Limit and Stop Loss) – Price Level can be set when opening a new position. This order allows you to set a specific rate your position will close. This helps protect profits and minimise losses. Pending orders does not mean Slippage’ wont occur.
Guaranteed Stop/Loss – For protection from slippage, you can place a limit on your position that will limit your potential loss. If price moves unfavourably, your position will automatically close at price limit. You must purchase Guaranteed Stop Order at the time you open your position. Purchase of guarantee doesn’t have a direct cost but rather results in slightly wider spreads. This covers the cover the risk the broker is taking on your behalf.
Trailing Stop – A trailing stop helps assure you will maintain a set percentage of profit when you open a position. Your buy/sell trading position will be open as long as price movement is favourable but if it drops by specified amount of pips, your position close. You can however still experience ‘slippage’ as a trailing stop has no guarantee with either IC Markets or Plus500.
Negative Balance Protection – A margin call system is in place that aims to protect your account funds from going into debt. what this means is your will receive request from your broker to top up your funds if there is it available funding falls below a certain level. While this provides some debt protection, you may still experience debt if the market is volatile.
Note: IC Markets also offer pending orders and a margin call system to protect your funds The key difference is IC Markets have no guarantee to repay your losses in the event slippage occurs. This means you will need to pay any money owing if your account funds are in negative.
IC Markets vs Plus500 Execution Conclusion
If it important you know in advance the maximum possible loss you could experience on a position then you may prefer Plus500. Guaranteed Stop/Loss however is really the only risk management tool they offer not offered by IC Markets. Most experienced traders are therefore likely to prefer to the tighter spreads and exceptional execution speeds offered by IC Markets.
Leverage IC Markets vs Plus500
Leverage available with Plus500 of 300:1 is significantly lower one can obtain with Ic Markets. Higher leverage can be advantageous if you are looking to make quick profits however it can also amplify the risk that you may go into significant debt or loss. A margin call system or negative balance protection can only do so much to protect your fund if currency movements are unfavourable in a volatile market.
IC Markets vs Plus500 Leverage Conclusion
You will need to decide how much leverage you are comfortable working with. If you decide to trade with IC Markets, you can easily reduce your leverage to lower levels if you wish. So the main advantage Plus500 have with their lower limit is that you will not be tempted to trade with higher leverage.
IC Markets vs Plus500 – Contracts For Difference (other than Forex)
Forex Exchange broker Plus500 have the most extensive collections of CFDs for trade among all brokers in the online industry and their platform is built so users can have the best user experience when trading with many instruments. Of the 2000 Instruments available for trade the following are available: indices, energy commodities (such as brent oil, heating oil, gasoline, natural gas). Metals such as gold, copper, palladium, silver, platinum) and soft commodities live cattle, lean hogs and feeder cattle which are not often offered by online brokers. They also offer an extensive range of Cryptocurrencies including (Bitcoin/cash, Ethereum, NEO, Litecoin, Ripple, Monero, IOTA, EOS). Lastly Plus 500 have shares, options and ETF available for trade.
IC Markets collection of CFD is also relatively extensive but not as large as Plus500. This includes indices / indexes, metals (silver, gold, palladium and platinum), energy (oil, gas), Soft Commodities (cotton, corn, soybean, sugar, coffee, cocoa). When it comes to cryptocurrencies the options are more limited when compared with Plus500 but still extensive. These include Bitcoin and Bitcoin Cash, Ethereum, Ripple, Litecoin and Dash). Lastly Bonds, Futures and Stocks are on offer for trading.
IC Markets vs Plus500 CFDs Conclusion
Among all brokers, Plus500 offer one of the largest range of instruments for trade. Their platform has been designed to make trading with many different instruments simple and easy to manage. Therefore when i comes to trading with CFDs, Plus500 are an excellent option.
IC Markets vs Plus500 Customer Service
Each broker has customer support available by email and live chat at all times throughout the week. While IC Markets offer 24/7 phone support Plus500 have no phone support.
For instant support each broker offers a live chat feature available directly within their platform and via their website. We tested the live chat feature and found IC Market could handle all out inquiries regardless how complex they may have been however Plus500 did not seem to be able to handle the more technical questions.
When it comes to email IC Markets provide the email contact of specific departments you may wish to address your queries. Plus500 email sending integrated directly into their Web Portal.
IC Markets unlike Plus500 also have a range of educational tools available including glossary terms, video tutorials and tips for starting in trading. Plus500 would benefit greatly by introducing such as feature.
Lastly, it is worth noting that both brokers have a demo account available that is free for use. While some brokers limit the features available or the time the account can be used both IC Markets and Plus500 provide no restrictions with the demo accounts.
IC Markets vs Plus500 Customer Service Conclusion
You have access to a more extensive range of customer service tools with IC Markets along with a useful education library which can help you grow your trading skills. For this reason, we recommend IC Markets if excellent customer service is important to you.
IC Markets vs Plus500 Joining Bonus
Only Plus500 have a joining bonus program. Plus500 offer a first deposit bonus program. The larger your first deposit is, the larger the bonus reward will be. You will need to earn a set amount of trader points to claim the deposit bonus.
IC Markets vs Plus500 Conclusion – Joining Bonus
As only Plus500 offer a joining bonus, we recommend Plus500.
IC Markets vs Plus500 Deposits and Withdrawals
Our review of IC Markets and Plus500 found that Plus500 offer a far more extensive suite of financial issuers when it comes to deposits and withdrawals. Some of these providers however, are based in Europe so are not likely be of interest to Australian traders.
Deposits with IC Markets are generally instant and do not incur a fee. They are kept with NAB and Westpac to satisfy Australian Securities and Investment Commission (ASIC) regulations.
Domestic bank transfers and e-wallet withdrawals offer free of charge same day processing. International withdrawals however can take up to 3-5 business days and cost $25 AUD.
Deposit and Withdrawal do not result in fees by Plus500. Fees however, may be levied by your payment issuer. Fees will occur in the following instances:
International credit cards – Apply when transaction go through foreign acquirers
Bank transfer – When transferring money from your bank account to Plus500 or Plus500 to your bank account.
Forex Conversions – when depositing a currency not supported by the selected payment method.
Withdrawal process time is 3-7 days depending on the payment method. This is noticeably slower than IC Markets.
IC Markets vs Plus500 – Conclusion for Deposits and Withdrawals Conclusion
You will need to determine what your preferred method for trading is and investigate if the broker offers this method for funding. If you require fast deposit and withdrawal you may prefer IC Markets. Plus500 however do offer a wider range of payment merchants.
CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.