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Trading Spreads and Other Fees – Plus500 vs City Index
Both Plus500 and City Index are known as market makers with dealing desk. This means the brokers are always the counterparty when you execute a trade. This trading model is sometimes known as B-book as the brokers keep the customer’s trades on their own books.
Although market maker types broker profits when your trades lose and can be therefore seen to be working against you, there are still good reasons to consider choosing a market maker. These include:
- Your spreads will generally be fixed. Advantages of this include
- Easier to trade when large market shocks occur
- Better consistency during peak and off-peak trading hours
- No commissions add-ons to your costs
- You trades are more likely to fill even when liquidity in the general market is low
- Market maker spreads need to be competitive due to competition so spreads will generally reflect market prices.
|City Index (CFD)||0.69||0.77||0.73||1.22|
|City Index (MT4)||1.7||2.2||1.5||2.1|
Looking at our sample of spreads, it does appear that Plus500 spreads are slightly more narrow than City Index using each broker own platforms. Spreads on MT4 for City Index are wider and so, therefore, more costly.
It is worth noting that City Index spreads are taken from their website and is a time-weighted average for the first quarter of 2017. Plus500 on the other hand, don’t provide a time-weighted average and instead provide real-time quotes.
Given we are comparing spreads across a different time period, we can’t say with certainty that Plus500 spreads are going to be narrower than City Index but w can say they are likely to be very similar.
Guaranteed Stop Loss Order (GSLO) –
- Both brokers offer GSLO for a small premium
Inactivity Fees –
- If you don’t trade with your City Index account for a 24 month period then you will incur a monthly $15 charge.
- If you don’t log into your account for 3 months, Plus500 will charge you USD$10 once a month until you log back in.
Deposit and Withdrawal Charges / Funding Charges
|Plus500||City Index||Plus500 Minimum (Deposit)||City Index Minimum (Withdrawals)|
|Debit / Credit Card (Visa/MasterCard)||No Charge||No Charge||200||50|
|PayPal||No Charge||Not Offered||200||50|
|Skrill||No Charge||Not Offered||200||50|
|Bank Transfer||No Charge||No Charge||500||50|
|BPay||No Charge||No Charge||100||50|
|PayID||Not Offered||No Charge||N/A||N/A|
- City Index allows a maximum of $20,000 for a single transaction
- City Index allow $20,000 per 24 hours when you withdraw online with credit cards
Spreads Conclusion – Plus500 vs City Index
We noted that Plus500 had slightly cheaper spreads than City Index however we realise we have applied sample spreads for a different time period. If choosing between Plus500 and City Index we suggest looking at other criteria as part of your selection as this is where the most noticeable differences will be found.
Leverage – Plus500 vs City Index
If you are using City Index CFD Platform (not MT4) you will have access to the maximum allowable leverage in Australia for an ASIC broker.
City Index offer 0.20% margin rate which is the equivalent of 500:1 leverage. This means when you open a position you must have 0.20% funds in your account (If you opt to trade with the maximum).
Plus500 by contrast only offer leverage of 300:1.
If you trade with City Index using the MT4 platform then you will only have access to leverage of 200:1.
Leverage can be seen as a way to supercharge your earnings as the brokers will lend you greater levels of cash for each dollar your deposit in your account. Generally, forex currency pairs do not change enough for major savings to occur however with greater funds invested, you can increase your profits despite marginal changes in currency.
It is important to note, currency movements can be either favourable or unfavourable. When currency movements don’t move in your favour, you will make large losses which will need to be paid to the broker.
It is therefore important to use leverage responsibly. This means to assess the risks with your trade and the level of leverage you are willing to take on.
Provided you are using the City Index CFD trading platform, City Index offers more leverage for forex when we compare with Plus500. More leverage simply means the broker will lend you more funds for you to trade with.
If 500:1 is more than you need, you can select a lower level of leverage. For this reason, we recommend City Index but only using the CFD platform not the MetaTrader 4 platform as this only offer 200:1 leverage.
If you are looking to trade other contracts-for-difference (CFDs) on leverage, see our CFD section for leverage for each CFD.
Risk Management Inclusions
Spread betting carries risks but there there are tools that can help protect your investments against risk.
|Risk Tools||Plus500||City Index|
|Stop Loss Order||✔||✔|
|Guaranteed Stop Loss Order||✔||✔|
|Margin Call / Negative Balance Protection||✔||✔|
|Guaranteed Negative Balance Protection||✔||✘|
|One-Cancel the Other||✘||✔|
Both brokers offer the option of guaranteed stop-loss orders (GSLO). GSLO provide a level of security for each trade you execute for a small premium in your spreads. These are useful if you lack experience in trading or are trading in a volatile market.
Plus500 include guaranteed negative balance protection when you sign up with them and do not charge for this. Negative balance protection is a feature not offered by many brokers. Most brokers will only offer a margin call system which will notify you to top up your account when savings are below required limits and try (but not guarantee) to close your positions if your account balance looks like going into negative.
Beyond the standard risk management tools that all brokers offer such as stop loss and trailing, stops and price alerts, City Index offers some features Plus500 do not. These include
- IF Done-Orders – A contingent order is actioned only in the event criteria for the first is fulfilled.
- One Cancel the Other – This is when you two orders are placed simultaneously. In the event one order is filled, the other will order will immediately close.
Conclusion – Plus500 vs City Index
Both brokers offer a better range of risk management features than you will find with most brokers. City Index, in particular, has a larger mix of unique risk management tools however we personally favour Plus500. The reason we like Plus500 is that they include guaranteed negative balance protection. Given Plus500 appear to have spreads that match City Index’s spreads and also include guaranteed negative balance protection means you will not paying extra to protect your funds.
Trading Platforms – Plus500 vs City Index
Plus500 Trading Platform
Plus500 have their own propriety platform, they do offer MetaTrader which is commonly available with other brokers. The platform is available for web, desktop and mobile. Regardless of which medium you use for trading, the platform is the same for all tools meaning you can seamlessly switch between trading mediums.
One unique feature is that the platform is available in 30 languages. This may appeal to you if English is not your preferred language.
The platform main feature is its user-friendly design. Its clean interface and ease of navigation are exceptionally good for those new to trading as they will not be overwhelmed with too much information. The main catch with this design is that the platform has limited customisation features.
On the main screen, you will find all the information you need along with 4 tabs where you can access your past and current positions.
The platform allows you access to 2000+ instruments and you can choose from over 100 technical indicators.
One issue some users may find with the platform is that one cannot add 3rd party tools to the platform. This means you can only use Plus500 tools.
City Index Trading Platforms
Web Trader Platform
Released on December 2018, Web Trader is City Index’s online platform will Advantage Web which is being phased out. Web Trader is built using HTML5 rather than Flash which means better loading performance with less power.
The following key features are available:
- 10 workspaces that you can build with your desired charts, news, positions and watch lists.
- Single click between workspaces. and ability to switch between them with a single click.
- Advanced charts which consist of custom indicators and drawing tool which can capture precise information
- Charts with an overlay of 2 different markets
- 10 different chart types powered by Trading View
- Trade within charts
- 57 indicators
- Improved search functionality
- Search by market name
- Search by stock code
- Browse by product
- Browse by region
- P&L balance bar
- Risk management features in the smart trade ticket
- Set ticket by P&L, price or points away.
- Real-time ‘Margin required’ shown on the ticket price.
- Set more than one stops and limit for each position on the trade ticket
- hedging via trade ticket
360° Market view
- Latest market prices
- Economic Calendars
City Index AT Pro
Available as a download on desktop, AT Pro is for advanced users as it offers the most powerful trading features in the City Index trading suite. The following features are available:
- Creation custom templates with .NET, C# or Visual Basic
- 140 indicators
- Backtesting tools
- 25 drawing tools
- 15 timeframes
City Index Apps for IOS and Android
- Apple. Android mobiles and tablets
- 60 indicators are available
MetaTrader 4 (MT4) – City Index
City Index offers MetaTrader 4. MetaTrader 4 is the most commonly used trading platform for both traders and brokers. Its popularity means you can sure to find all the essential features you will need for successful trading.
As MT4 is common it means you can easily change to other brokers without needing to learn a new trading platform.
MT4 is best if you trade Forex or other decentralised assets such as commodities. It is not the best platform for assets that trade via a centralised exchange such as shares or stocks.
Conclusion – Plus500 vs City Index
Normally we would recommend MetaTrader 4 platform however we have previously noted that spreads with MT4 for City Index are wider so we advise looking at one of the brokers custom platforms.
Choosing between Plus500 or City Index custom platforms is a case of personal preference. We are impressed with City Index Web Trader platform because it all the charts, timeframes and indicators the majority of traders will require and is built to HTML5 meaning faster speeds and therefore less slippage.
We suggest signing up for a demo of each brokers platform and testing them out for yourself.
Contracts for Difference (CFDs) – Plus500 vs City Index
|CFDs||Plus500 Options||City Index Options (Range) / Spread (Points)||Plus500 Margins||City Index Maximum Leverage and Margins|
|Share Markets CFDs||1900+ Range||4500 Range||1:20 Leverage||1:20 Leverage|
|Soft Commodities||10 Range||17 Range||1:150 Leverage||1% to 3% Margin|
|- Sugar (Futures)||0.03 Points||0.06 Points||1% Margin||3% Margin|
|- Coffee (Futures)||0.02 Points||0.9 Points||1% Margin||3% Margin|
|- Wheat (Futures)||0.55 Points||1 Points||0.67% Margin||3% Margin|
|Hard Commodities||12 Range||14 Range||1:150 Leverage||1:200 Leverage|
|- Gold||0.28 Points||0.3 Points||0.67% Margin||0.5% Margin|
|Indices||67 Range||21 Range with Fixed 1 Point spread||1:300 Leverage||1:500 Leverage|
|Interest Rates||N/A||3 Range||N/A||4:1 Leverage|
|- Short Sterling||0.02 Points||0.25% Margin|
(0.02 to 0.06 points)
|- UK100 CFD Mnth||1.8 Points||4 Points||0.33%Margin||0.5% Margin|
|Cryptocurrency||14 Range||5 Range||1:20 Leverage Maximum||4:1 Leverage|
|-BitCoin||55||35||5% Initial Margin||25% Initial Margin|
|-Ethereum||2||1.2||5% Initial Margin||25% Initial Margin|
The above table shows the range of available CFDs each broker offers along with a sample of CFD. The tables also show maximum leverage and typically required margin, these, however, may vary for each individual asset traded. For example, BitCoin offers leverage of 2:1 up to 45 contracts and after this 1:1 for each contract. Ethereum also offers 2:1 but this is up to 215 contracts and 1:1 thereafter. Some points to note:
If you buy shares CFDs with City Index then you will pay 0.08% / $5 for Australian shares and 2 cents per share / $15 for international shares.
Plus500, on the other hand, don’t charge a commission for trading share CFDs.
City Index offers both cash CFD and futures for trade. Cash CFDs are ideal for short term trading and have tighter spreads. Futures are better for long term trade and have wider spreads but you won’t incur overnight finance charges.
Conclusion – Plus500 vs City Index
City Index offers a greater range of CFD options however Plus500 does appear to generally offer (but not always) slightly better spreads and leverage. We recommend deciding on the CFDs you may wish to trade with and investigate the spreads, margins/leverage each broker offers or will require.
Customer Service – Plus500 vs City Index
|Customer Support Tools||Plus500||City Index|
It is interesting to note that Plus500 doesn’t offer phone contact with their customer services. If you desire human interaction for you support then City Index will be a better option for you.
Research and Education:
|Daily Market Commentary||✘||✔|
|Technical Analysis Tools.||✘||Trading Central |
- Market Analysis
- Alert Notifications
- Screening of Markets
|Fundamental Analysis Tools||✘||Trading Central |
- Stock valuations
- Best buys
- Company metrics
- Global data
Plus500 offers little in the way of research tools. Research tools are valued by traders as it can help them makes the right trading decisions in order to be profitable. Many of City Index’s research tools are powered by Trading Central. This company specialises in providing award-winning analysis and pattern recognition tools that help traders better participate in financial markets.
|Trading Strategy Course||✘||✔|
|Trading Instructional Videos||✘||✔|
|Introduction to Trading Series||✘||✔|
As you can see Plus 500 don’t offer Education tools. City Index, however, offers a wealth of research tools.
City Index offers a training course that will teach you all about training strategy. This course is valued at $5000 and is developed by TECHFX TRADERS. The course covers 3 difference modules “including forex”, “learn to trade” and “How to trade like a pro”
TECHFX TRADERS are an independent firm that offers top quality and timely technical analysis to traders. They know the trading industry inside and out so are able to provide information that will help grow your trading knowledge.
TECHFX TRADERS also manage to run the City Index Webinars. Here a range of trading topic is covered over the web, where you will have the opportunity to ask questions as part of the session.
|Demo Account||Plus500||City Index|
|Time Limit||No||Yes - 12 Weeks|
|Easy switch between real and demo accounts||Yes||Yes|
With City Index, you can choose if you wish to use City Index CFD platform or MT4. The demo account has a limit of 12 weeks however, you can contact support and they will reactivate the account at the end of the 12 week period. This refresh means you will lose access to existing virtual funds.
Plus500, however, offer unlimited access with their demo account. If your virtual funds dip below $200 then your virtual funds will reset to default.
Conclusion – Plus500 vs City Index
Without a doubt, City Index offers better customer support tools. If you need assistance, City Index has contact you can use to directly reach customer service for support. Plus500 does provide support however their customer support team don’t have the same immediate presence City Index have. For example support contact in Australia.
City Index also offers free custom services like research and education tools. Plus500 does not offer any of these.
We do however like the fact Plus500 offer unlimited time/funds platform demo. This is a feature we would like to see offered by more brokers.
Bonus Programs – Plus500 vs City Index
The Plus500 offer a rebate and first deposit program. The higher your initial deposit to start trading is, the more trading credits Plus500 will reward you with. Likewise, the more you trade each month, the more T-points for trading credits you receive.
Plus500 First Deposit Program
Plus500 Rebate Program
For every $1500 traded, you will receive a different amount of TP points depending on your chosen currency pair.
A cash rebate program is on offer with City Index. City Index will reward you with rebates provided you reach a certain level of trading volumes. Rebates will vary depending on your chosen asset class.
Account Features Comparison
|Fixed or Variable Spreads?||Fixed||Fixed and Variable|
|Lots||Standard, Micro, Mini||Standard, Micro, Mini|
|Minimum Deposits||No Minimum||No Minimum|
|Leverage||300:1||0.20% (500:1) CFD Platform|
200:1 MT4 Platform
At the account level, both accounts are relatively similar, the main difference of note is that City Index do allow hedging which Plus500 doesn’t. Hedging is a useful risk management tool as it allows you to protect your position with currency movements.
Plus500 Account Details
City Index Account Details
Justin Grossbard has been investing for the past 20 years and writing for the past 10. He co-founded Compare Forex Brokers in 2014 after working with the foreign exchange trading industry for several years. He also founded a number of FinTech and digital startups including Innovate Online and SMS Comparison. Justin holds a Masters Degree and an Honours in Commerce from Monash University. He and his wife Paula live in Melbourne, Australia with his son and Siberian cat. In his spare time, he watches Australian Rules Football and invests on global markets.