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Financial Spreads Review

AN OVERVIEW OF Financial Spreads

 

Finding a reputable Financial Spreads review local or worldwide can be a difficult process, especially finding a complete list from a trustworthy reputable source.

Below is an in-depth review regarding Financial Spreads to help you make an informed decision before opening your account or trading on their platform.

 

 

INTRODUCTION

Financial Spreads offers a wide variety of trading instruments complemented by tight spreads, which can be traded on an advanced proprietary trading app. The broker also offers necessary educational content and analysis for traders of all levels.

 

HISTORY AND HEADQUARTERS OF FINANCIAL SPREADS

Financial Spreads is a trading name of Finsa Europe Ltd, which launched in 2007 during the credit crunch as an online CFD trading and spread betting brokerage. The company is based in the UK and regulated by the highly reputable Financial Conduct Authority (FCA).

As such, the broker seeks to differentiate itself by offering traders the following key benefits:

  • User-friendly Trading – offering a clear and simple trading platform
  • Fixed Spreads – ‘variable spreads’ have become common place but the broker still prefers to give clients clear and simple pricing via fixed spreads
  • Competitive Spreads – the broker’s pricing has always remained competitive e.g., the EUR/USD spread is 0.7pts at all times
  • Your Privacy is Important – the broker respects your privacy and only contacts you when the support team deems it necessary, with an optional op-out available
  • Lower costs – e.g., only paying for Guaranteed Stops if the order is used – much of the industry still needs to catch up on this
  • CFDs Without Extra Commissions – the broker has always wrapped up all spread betting and CFD commissions into the spread itself, so that there is not a separate commission. This allows for clear and simple pricing.

The broker’s single proprietary platform supports spread betting and CFD trading across multiple devices. The platform provides traders with access to a live price feed, risk management tools, watchlists, plus P&L and account management tools.

This is further complemented by a wide range of time intervals, drawing options including Fibonacci Arcs, plus overlays and indicators such as MACD and Bollinger Bands.

Finsa Europe Ltd (Financial Spreads) is licensed and regulated by the Financial Conduct Authority (FCA) in the United Kingdom, under license number 525164.

The FCA is one of the most highly regarded financial regulators, providing a highly secure trading environment for the broker’s clients.

The broker also adheres to stringent rules and regulatory standards, most notable those regarding the use of segregated accounts to keep client money safe.

 

AWARDS AND RECOGNITION

When a broker has won numerous awards and indicates such on their website, it often instils more confidence in the broker as an industry leader and provides it with a good reputation in its solutions and services provision.

Despite the broker’s advanced and comprehensive offering, Financial Spreads has not listed any awards on its website to date. This may be due to the broker not participating in broker awards ceremonies at this stage.

 

FINANCIAL SPREADS ACCOUNTS

 

TYPES OF ACCOUNTS AND ITS FEATURES

A Forex account is a trading account that traders hold with a specific broker with the purpose of trading financial instruments.

Brokers offer a variety of trading accounts, or they may only offer a single account, in which they provide certain trading conditions that appeal to a variety of traders according to their trading needs and objectives.

The number and the type of accounts that traders are offered will vary from one broker to the next and therefore it is imperative for traders to know what their trading needs, and objectives are, and why they should choose a broker according to that, amidst other factors.

Financial Spreads offers only one account type, which provides access to all available CFD and spread betting assets, with trading costs rolled into the fixed spreads. The minimum initial deposit to open an account is £250.

The single live trading account from Financial Spreads comes with the following features and benefits:

  • Free Demo Platform – practice your trading on our free demo platform
  • Commission-free Trading – the broker does not charge commissions, and its profit margin is built into the spread.
  • 24 Hour Trading – trade a range of markets 24 hours day from Sunday evening to Friday evening
  • Over 1,000 global markets
  • Guaranteed Stop orders. With a Guaranteed Stop order you can trade safe in the knowledge that, should a market gap through your Stop Loss level, you will not suffer any extra losses due to slippage (market gaps).
  • With a Guaranteed Stop order your order will be stopped out at the level you requested.

 

DEPOSITS AND WITHDRAWALS

When evaluating brokers, the ease with which deposits and withdrawals can be made is another imperative factor to consider.

Regulation plays a key part where client funds are concerned as funds which are kept in segregated accounts must be available for withdrawal at any given time when a request is made by the trader and subsequent owner of the trading account.

The minimum deposit amount required to open a broker account with Financial Spreads is GBP 250, which is an industry standard minimum deposit amount amongst most brokers in the industry today.

Financial Spreads offers deposits and withdrawals via bank transfer, credit/debit cards and online payments, although the broker does not indicate which online payment processors are supported.

Added to this, the broker does not provide any information regarding deposit fees and withdrawal fees, which is concerning, as such fees represent valuable information for traders wishing to understand the broker’s overall cost structure.

As for the accepted deposit currencies, unfortunately the broker has an extremely limited selection, which consist of GBP, USD, and EUR only. Those depositing in smaller currencies, such as ZAR/Rand, will likely incur conversion fees.

This is unfortunate, as conversion fees can become costly overtime, and eat into traders’ withdrawable profit over time.

Financial Spreads is well regulated by the UK’s Financial Conduct Authority (FCA), which provides a prominent level of deposit security.

 

COST AND FEES, COMMISSIONS AND SPREADS

When evaluating a broker, it is imperative to look at the fees which are charged. These often depend on numerous factors including the spread, commissions, and margin requirements.

The spread is the difference between the bid and the ask price, which is expressed in pips, which is the smallest increment that a price can move either up or down.

A margin requirement is the amount of capital that the trader must put down at the start of the trade, or that they must have available in their trading account, as collateral for the trade. This amount is often lowered substantially when leverage is applied.

Spreads with this broker are around 0.7 pips for EUR/USD and 0.8 pips for EUR/GBP and USD/JPY. Crude oil spreads are 3 points, whilst major indices such as FTSE 100 are around 4 points.

Commissions are incorporated into spreads, so that the broker essentially offers commission free trading. Overall, spreads on Forex trading are tight and competitive.

 

LEVERAGE

With Financial Spreads, the maximum leverage available is 1:30 on major currency pairs, 1:20 for minor currencies and 1:10 for commodities. The margin requirements for each instrument are provided in the market information sheets on the website.

Leverage is a tool which allows the trader to open larger positions in addition to providing the trader with larger exposure to the market in which they are trading regardless of the trader’s initial deposit.

Leveraged products, such as Forex, increases the potential profits of the trader, but it also increases the risks and subsequent losses that the trader may incur.

Leverage is expressed as a ratio, for instance 1:1, 1:50, 1:100, 1:500, and even up to 1:3000. For instance, should a trader have $1,000 in their trading account and they apply a leverage ratio of 1:100, they can control a position of $100,000.

Margin is the amount required at the start of every trade which is collateral for any credit risks which may arise while trading. It is expressed as a percentage of the position size and traders must ensure that they have adequate funds to cover this requirement.

For instance, should there be a 1% margin requirement on a position of $1,000,000, the trader must cover a margin requirement amount of $10,000. The margin requirement must be equal to or more than 100% for the position to be opened.

 

BONUSES

Financial Spreads does not offer any type of broker bonus scheme for clients who choose to register for a real account, such as a welcome bonus, as well as any other type of additional promotions, such as a trading bonus or a referral bonus.

This is primarily because the broker is highly regulated by the Financial Conduct Authority (FCA), which has place restrictions on the provision of bonuses.

Forex brokers often lure new traders with offers of deposit bonuses. This can be useful, but it is essential to discern what the conditions are to benefit from the bonus.

The bonus usually compensates traders for choosing a certain broker, since once the account is active, the trader will have the same expenses as any other. The bonus usually only starts giving some expenses back to the trader once the person has proved himself as an active trader.

Hence, although no deposit bonuses are a fantastic way to help you start trading, the terms to benefit from it often require trading with such a high volume before you can withdraw profits, that it may not be worthwhile.

The European Securities and Markets Authority (ESMA) has also recently placed investor protection measures on the marketing, distribution, or sale of CFDs.

This prevents brokers from providing the retail client with a payment, monetary or excluded non-monetary benefit in relation to the marketing, distribution, or sale of a CFD, thus ruling out the offering of such bonuses.

 

TRADING PLATFORMS, SOFTWARE, AND ITS FEATURES

The trading platform available from financial spreads includes a live price feed, risk management tools, watchlists, plus P&L and account management tools.

There is also a broad range of time intervals, drawing options including Fibonacci Arcs, plus overlays and indicators such as MACD and Bollinger Bands.

A trading platform is a type of software which is used through which trading can be executed. Each broker has its own preference in which platforms it supports and often brokers offer the use of their own proprietary trading platforms.

 

MARKETS, PRODUCTS, AND INSTRUMENTS

Financial Spreads offers CFD and spread betting products across 30 forex pairs, 3 cryptocurrencies, 17 stock market indices on future and rolling cash contracts, 5 commodities, plus a variety of UK, US, and European shares.

Most brokers offer all or some of the following market instruments for trading:

Forex:

Forex trading, or currency or FX trading, involves the currency exchange market where individuals, companies and financial institutions exchange currencies for one another at floating rates.

Commodities:

As with currency exchange markets, commodity markets offer trading in contract-based tradable goods.

Indices:

Equity or stock indices can represent a specific set of the largest companies of a nation or they can represent a specific stock market. It is actual stock market indexes which measures the value of a specific section of a stock market.

Precious metals:

This involves the trading of gold, silver and other precious metals as hard commodities that are contract-based tradable.

Energy:

The high volatility of energy prices due to political, environmental and several other factors, is a typical feature of this product, making it a popular trading choice.

Cryptocurrencies:

Tradable cryptocurrencies include the following:

Bitcoin (BTC) is the digital currency with the largest market capitalisation and price levels and dominates 50% of the total crypto market cap.

Litecoin (LTC) is like Bitcoin but differs in terms of scalability.

Ethereum (ETH) is the second largest cryptocurrency after Bitcoin and allows developers to create smart contracts on a platform.

Ripple (RPL) is popular among big banks with the Ripple network a next generation real-time gross settlement system.

Bitcoin Cash (BCH) was created as an updated version of the blockchain with different rules.

 

 

SAFETY AND REGULATION

Financial Spreads is well regulated by the UK’s Financial Conduct Authority (FCA), which provides a prominent level of deposit security.

As such, deposits made by private individuals and small businesses to any authorised firms are protected by the Financial Services Compensation Scheme, FSCS. Therefore, each individual client could make a claim up to £85,000, i.e., the FSCS deposit compensation limit.

In the extremely unlikely event that this FCA regulated firm was to go into liquidation and there was a deficiency in the client money bank accounts, individual clients could make a claim up to £50,000, i.e., the FSCS investment compensation limit.

Furthermore, under the requirements of the FCA, all funds are held in segregated accounts with top-tier banks to avoid any financial misappropriation.

When choosing a broker, one of the benchmarks against which to measure safety and client fund safety and security, is to establish which regulating authorities oversees the operations of the broker.

 

CUSTOMER SUPPORT

Financial Spreads offers limited customer support through telephone and email only. Unfortunately, the broker does not offer a live chat service at this stage, which is an important aspect of quickly resolving client issues, particularly in the fast-paced Forex trading environment.

This is a critical point when evaluating potential brokers to trade with as the broker must ensure that their traders have a variety of ways in which to contact support should they have queries, questions, or issues.

 

EDUCATION AND TRAINING

The broker’s educational resources are slim and superficial, and beginner traders would have to look elsewhere to sufficiently equip themselves with effective trading knowledge.

Education refers to all the learning material and tools offered by brokers which is imperative for traders in their trading activities, especially beginners. It provides traders with the necessary knowledge that they will need to become successful traders.

 

RESEARCH

To assist in their trading endeavours, brokers offer traders with a variety of trading tools which can be used to refine their trading.

With Financial Spreads, research tools are provided via the broker’s platform, and consist of a live price feed, risk management tools, and watchlists.

While this is a broad selection of inbuilt analytical tools, the broker does not offer much in the way of independently accessible research on the website.

 

SUMMARY

Financial Spreads offers an advanced and comprehensive trading environment with access to a wide selection of assets, as well as spread betting facilities.

This excellent trading environment is complemented by rigorous financial regulation via the FCA. Unfortunately, the broker offers limited customer support and few educational resources for beginner traders.

 

DISCLAIMER

Financial Spreads warns potential customers that Forex and CFDs trading carries a substantial risk and may not be suitable for all investors.

Before deciding to trade with Financial Spreads, potential traders are advised to carefully consider their investment objectives, financial situation, needs and level of experience before investing money they cannot afford to lose.

Financial Spreads warns that margin trading involves the potential for profit as well as the risk of loss.

Movements in the price of foreign exchange and commodities are very unpredictable, hence Financial Spreads cannot guarantee a maximum loss that a trader may suffer.

 

FINANCIAL SPREADS AT A GLANCE

Broker’s Name Financial Spreads
Headquartered London, UK
Year Founded 2007
Regulating Authorities FCA
Countries not accepted for trade Unites States
Islamic Account (Swap Free) No
Demo Account Yes
Institutional Accounts Yes
Managed Accounts No
Maximum Leverage 1:30
Minimum Deposit GBP 250
Deposit Options Bank wire, Credit or Debit Card, Online Payments
Withdrawal Options Bank wire, Credit or Debit Card, Online Payments
Platform Types Financial Spreads proprietary trading platform
OS Compatibility Windows, Mobile, Web, iPhone, iPad

PC and Mac OS, mobile for Android and IOS

Tradable Assets Forex, Indices and Commodities
Customer Support Languages English only
Customer Service Hours 24/5

 

FAQ

 

TRADING ENVIRONMENT

How many instruments can I trade with Financial Spreads?

Financial Spreads offers CFD and spread betting products across 30 forex pairs, 3 cryptocurrencies, 17 stock market indices on future and rolling cash contracts, 5 commodities, plus a variety of UK, US, and European shares.

Which platforms are supported by Financial Spreads?

Financial Spreads proprietary trading platform

Does Financial Spreads offer leverage?

Yes, the maximum leverage available is 1:30 on major currency pairs, 1:20 for minor currencies and 1:10 for commodities. The margin requirements for each instrument are provided in the market information sheets on the website.

What spreads can I expect with Financial Spreads?

The Financial Spreads spread list is as follows:

Spreads are around 0.7 pips for EUR/USD and 0.8 pips for EUR/GBP and USD/JPY. Crude oil spreads are 3 points, whilst major indices such as FTSE 100 are around 4 points.

Does Financial Spreads charge commission?

No, commissions are incorporated into spreads, so that the broker offers commission free trading.

Are there additional charges on the Islamic account?

Financial Spreads does not offer an Islamic Account

Is Financial Spreads regulated?

Yes, Financial Spreads is regulated by Financial Conduct Authority (FCA).

Is Financial Spreads a recommended forex trading broker for experts and beginners?

No, Financial Spreads appears to position itself more towards advanced, professional, and institutional traders, although some beginner traders can consider testing the broker’s demo account.

What is the overall rating out of 10 for Financial Spreads?

8/10.

 

ACCOUNTS

What is the difference between a demo and live trading account?

A demo account offers the use of virtual funds instead of actual capital. This allows for risk-free trading as well as exploring of both the broker’s offer and the trading platform.

A demo account can be used for a variety of reasons including practice trading, testing trading strategies, exploring platforms and offers, and more.

Does Financial Spreads offer a demo account?

Yes, Financial Spreads offers a free demo account to all new traders.

For how long is the demo account valid?

The demo account is only available for 30 days.

Does Financial Spreads offer the option of an Islamic Account?

No.

Which live trading accounts does Financial Spreads offer?

Financial Spreads offers only one account type, which provides access to all available CFD and spread betting assets, with trading costs rolled into the fixed spreads.

What are the available deposit currencies for a live trading account?

Financial Spreads only accepts deposits in three currencies, namely USD, EUR, and GBP. This means that traders depositing in smaller currencies, such as ZAR/Rand, will likely incur conversion fees.

 

DEPOSITS AND WITHDRAWALS

What is the minimum deposit for Financial Spreads?

The minimum deposit amount required to open a broker account with Financial Spreads is GBP 250, which is an industry standard minimum deposit amount amongst most brokers in the industry today.

How do I make a deposit and withdrawal with Financial Spreads?

Financial Spreads offers deposits and withdrawals via bank transfer, credit/debit cards and online payments, although the broker does not indicate which online payment processors are supported.

Does Financial Spreads charge withdrawal fees?

The broker does not provide any information regarding deposit fees and withdrawal fees, which is concerning, as such fees represent valuable information for traders wishing to understand the broker’s overall cost structure.

How long does it take to make a withdrawal?

Bank wire transfers can take up to three working days, depending on the bank and your location, while online withdrawals can take up to ten minutes.

Author Details

Louis Schoeman

Louis Schoeman

Featured Forex and Stocks writer

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