Risk Warning: Your Capital is at Risk.
This guide explains the essentials you need to know before you put money on the line with an Australian trading platform.
We also explain how to choose an ASIC-licensed online broker, and what products are offered on the Australian Securities Exchange (ASX).
ASIC stands for the Australian Securities and Investments Commission, the key financial regulator in the country.
Following this guide, you will know how to make an informed decision on what you want to trade, as well as different ways to trade your chosen instrument, like CFDs, stocks, or options.
In a hurry? See this list of regulated trading platforms in Australia, compared side-by-side.
Contents
If you’re new to choosing a broker, you can start by learning about margins and leverages. This information helps you choose from online platform providers in Australia, to get the right account type, fee structure, and trading features.
Online Brokers in Australia
Here are some of the best online trading platforms available to Australians.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74%-89% of retail investor accounts lose money when trading CFDs. You should consider whether you can afford to take the high risk of losing your money.
If you’re unfamiliar with what to look for when choosing a broker, you might want to see these seven factors to consider before choosing a trading platform.
What Do You Want To Trade?
There are two primary factors to make your mind up on before you trade via an online brokerage platform. These are:
- The type of instrument you want to trade
- The type of commodity categories you want to trade
The type of instrument you choose depends on whether you want physical ownership of an asset (e.g. bullion) or speculate on its price movements — as well as the contract commitments you’re willing to undertake.
As for the type of commodity, you must research the asset classes offered by your brokers of interest. Some may offer precious metals and agricultural commodities, others may offer energy commodities, while some may have all three!
Ways To Trade Commodities
Your choice of a trading instrument mostly depends on your answer to the following questions:
- Do you want ownership of the commodity?
- Do you want to trade physically or online?
- Do you want to commit to a trade or have the choice to withdraw until a given time?
Here are seven different ways to trade commodities with the above points taken into consideration, along with storage costs, ownership, contract expiry, and leverage. Most are supported by these ASIC-licensed brokers.
| Trading Method | Ownership | Management Costs | Security Costs | Expiry Date | Mgmt Cost | Leverage |
|---|---|---|---|---|---|---|
| Bullion | ✅ | ✅ | ✅ | ❌ | ❌ | ❌ |
| CFDs | ❌ | ❌ | ❌ | ❌ | ❌ | ✅ |
| Futures | ❌ | ❌ | ❌ | ✅ | ❌ | ✅ |
| Options | ✅* | ❌ | ❌ | ✅ | ❌ | ✅ |
| ETFs/Mutual Funds | ✅ | ✅ | ✅ | ❌ | ✅ | ❌ |
| Shares | ✅ | ❌ | ❌ | ❌ | ❌ | ❌ |
When choosing a product, do your research. For example, ETFs and Mutual Funds are fundamentally similar, though they may fall under different Australian Tax laws. Still, both are a form of ‘bulk’ share trading.
What Can I Trade on the Australian Securities Exchange?
You can trade a variety of futures, derivatives, and equities options on the Australian Securities Exchange (ASX).
ASX offers international stocks for share trading from Ireland, the UK, Canada, Singapore, Israel, the US, and New Zealand. When share trading international company stocks from Australia, be wary of overnight fees.
The list of trading products on ASX also includes:
- Equity derivatives
- Options trading on single stocks and exchange-traded funds (ETFs)
- Options on ASX indices
- Interest rates
- Futures and options on Australian and New Zealand interest rates
- Futures and options on Australian debt markets
- European-style options on interest rates
- Grain derivatives
- Wheat
- Feed Barley
- WA Wheat
- Energy derivatives
- Australian Electricity
- New Zealand Electricity
- Australian Gas
Learn more about the specific product codes and markets in our ASX Guide.
Margins & Leverage Explained
Here is a simple explanation of two terms that often confuse traders — margin and leverage.
Margin trades allow a trader to put up a defined chunk of money to execute a larger trade. In trading, the margin is expressed as a percentage. It represents the portion of the full trading amount that a trader needs to provide to open a position.
Leverage, on the other hand, is expressed as a ratio. It is determined by the margin value and shows the trade’s tradable value in relation to the cash deposit amount.
Please note, this is an example – not a recommendation.
How To Choose An Online Trading Platform
When choosing an online broker with a suitable platform, our golden checklist includes seven factors to consider:
- ☑︎ Regulators: Brokers in Australia are regulated by ASIC, an organizations to protect consumers, traders — you. Regulators also determine the countries where the broker is allowed to operate. The more established the regulator, the stricter the guidelines are for a broker. The Australian Securities and Investments Commission (ASIC) is one of the most rigorous regulators and is responsible for trading standards set on the island.
- ☑︎ Account Type: Brokers offer different account types: most commonly ‘standard’ and ‘professional’ accounts. Standard accounts have simpler verification processes, while professional accounts require more trading experience and capital. The trading account you choose depends on your experience and capital.
- ☑︎ Instruments and Products: Brokers offer different ways to speculate on trading instruments, as well as varying categories of products. Before you commit funds, check if your broker offers what you want to trade.
- ☑︎ Fees: Trading platform fee structures vary. Some charge deposit and withdrawal fees, while others do not. Inactivity fees and other account fees are common. More, fees vary based on what payment method you use — some may be cheaper than others. Remember, free trading is a myth. Trading may be low cost, at best.
- ☑︎ Funding Methods: Some brokers offer bank transfers only, while others have e-wallet support for the likes of PayPal and Skrill. You want a secure, low-cost way to transfer money to and from your Australian trading account.
- ☑︎ Leverage and Margin: If you want to open high value trades with significantly lower value deposits, you’ll need a broker with low margin requirements and high leverages.
- ☑︎ Trading Platform Features: The quality of a trading platform is determined by convenience — ease of use and the trading tools provided. Look for features like charting features, technical analysis tools, platform design, and educational resources that match your level of experience.
- ☑︎ Mobile: Does the trading platform offer a mobile app or in-browser mobile trading? Find out how the mobile trading experience compares to the desktop trading platform.
Reviewed Online Trading Platforms in Australia
We listed our recommended online commodity brokers at the beginning of this guide. Below we compare them in depth while keeping the above checklist in mind.
Plus500: Hundreds Of CFDs for All Trading Levels
Regulated by 7 organizations with over 2,000 trading instruments available, Plus500 offers a free trial account to Australian traders.
Support is available via live chat and e-mail in more than 60 countries, including Australia.
- Regulators: FCA, ASIC, CySec, FSA, MAS, FMA, FSCA
- Account Types: Real Money
- Instruments and Products: CFDs on Indices, Commodities, Forex, Cryptocurrencies (Availability subject to regulations), Shares, Options, and ETFs
- Fees: Overnight, currency conversion, inactivity, guaranteed stop orders (See details in our Plus500 Review)
- Maximum Leverage: Up to 1:30
- Top Platform Features: Position management with advanced filters, a platform available in over 32 languages
- Mobile Trading App: Android + iOS apps
Forex.com: Learn To Trade On The Go
Forex.com has been active for over 20 years in 140+ countries.
They offer detailed educational resources for all trading levels and 24/5 support via e-mail, live chat, and phone for all traders.
- Regulators: FCA, MiFID, ASIC, SFC, CIMA, IIROC, FSA, CFTC, NFA
- Account Types: Standard, Commission, Direct Market Access (DMA), and Professional
- Instruments and Products: Forex, Spot Gold & Silver, Futures, Options, CFDs on Indices, Shares, Commodities, Cryptocurrencies* (except Canada)
- Fees: Commissions on Shares CFDs, Fees on currency conversions, overnight, inactivity, rollovers, same-day withdrawal, dividend adjustments, shorting (See details in our Forex.com Review)
- Maximum Leverage: Variable (visit Forex.com for details)
- Top Platform Features: MetaTrader 4 (MT4) compatible, trading tutorials, advanced technical indicators
- Mobile Trading App: Android + iOS apps
Start Trading Now at Forex.com
Fortrade: Start With An Interactive Platform Tutorial
More than 300 instruments are traded as CFDs, including precious metals, energy, and agricultural commodities.
Fortrade offers a practical interactive tutorial to get started on the platform.
- Regulators: FCA, ASIC, CySec, NBRB, CIPF, IIROC
- Account Types: Standard, Professional, and Islamic
- Instruments and Products: CFDs on Indices, Forex, Shares, Commodities, ETFs, and US Treasuries
- Fees: Wire transfer withdrawal fee, overnight funding fee, dormancy fee (See details in our Fortrade Review)
- Maximum Leverage: Variable (visit Fortrade for details)
- Top Platform Features: MetaTrader 4 (MT4) compatible, interactive startup tutorial
- Mobile Trading App: Android + iOS apps
eToro: Social Trading On Mobile
eToro is known as the ‘social trading platform’ since traders can track the performance of other traders and copy them directly.
Traders have access to several categories of CFDs with a user-friendly mobile application on iOS and Android.
- Regulators: FCA, ASIC, CySec, FinCEN
- Account Types: Standard, Professional, and Islamic
- Instruments and Products: CFDs on ETFs, Stocks, Indices, Commodities, Cryptocurrencies*, and Forex
- Fees: Inactivity fee and overnight fee, withdrawal fee, cryptocurrency fees, conversion fee, wallet fee (See details in our eToro Review)
- Maximum Leverage: Up to 1:30 (higher for Professional Accounts)
- Top Platform Features: Social trading to duplicate trades, social trading news feed, interactive analytics, and market sentiment tools
- Mobile Trading App: Android + iOS apps
CMC Markets With Real Shares for Australian Traders
CMC Markets is regulated by 5 organizations with more than 10,000 trading instruments. There’s a free demo account to try the fully-featured, customizable trading platform on both mobile and desktop.
Support is available via live chat and e-mail, 24/5.
- Regulators: FCA, BaFin, FSCS, ASIC, MAS
- Account Types: Retail, Professional, Real Shares (AU + selected countries only)
- Instruments and Products: CFDs on Commodities, Cryptocurrencies*, Shares, Share Baskets, Indices, Treasuries, Forex, Real Shares (AU + selected countries only)
- Fees: Spreads, overnight, currency conversion, inactivity, guaranteed stop orders, rollover, inactivity (See full fee schedhule in our CMC Markets Review)
- Maximum Leverage: Up to 1:30 (Retail), up to 1:500 (Professional)
- Top Platform Features: Highly customizable, tiled platform design with complex analytics, filter asset browsing, and more.
- Mobile: Android + iOS apps
Start Trading Now at CMC Markets
easyMarkets Lets You Cancel and Reverse Trades
easyMarkets offers CFDs, Vanilla Options, Forwards, and other derivatives on forex, commodities, indices, cryptocurrencies, and shares. They offer a free 7-day demo account that becomes permanent with a funded account.
Support is available via email, phone, fax, and live chat in more than 150 countries.
- Regulators: ASIC, CySec, FSA, BVIFSC, and FSA Seychelles.
- Account Types: Retail and professional
- Instruments and Products: CFDs on Indices, Commodities, Forex, Cryptocurrencies, Shares
- Fees: None (See details in our easyMarkets Review)
- Maximum Leverage: Up to 1:30
- Top Platform Features: 3 ways to trade on mobile apps, dealCancelation, Forward deals
- Mobile: Android + iOS apps, MT4 mobile
Start Trading Now at easyMarkets
FXCM: Custom Baskets And Multiple Platforms
FXCM offers CFDs, baskets, and spreadbetting on forex, indices, commodities, cryptos*, and stocks.
You can try out the FXCM platform with a free trial account that comes with $50,000 play money.
Support is available via phone, SMS, live chat, and e-mail 14 languages.
- Regulators: FCA, ASIC, FSCA, BaFIN, ACP, and CONSOB
- Account Types: Retail, active trader, and professional
- Instruments and Products: CFDs and spreadbetting on Indices, Commodities, Forex, Cryptocurrencies*, Shares, and baskets
- Fees: Overnight fee, inactivity fee, wire withdrawal fee, currency conversion fee, and negative balance fee (See details in our FXCM Review)
- Maximum Leverage: Up to 1:30
- Top Platform Features: Customizable trading platform with add-on apps, NinjaTrader, streamlined mobile app
- Mobile Trading App: Android + iOS apps, MT4
Pepperstone: One Of The World’s Largest Forex Brokers
Pepperstone is regulated by 7 organizations with over 180 trading instruments available. Traders can get a free trial account for a period of 30 days.
Support is available via phone, live chat, and e-mail in languages.
- Regulators: FCA, ASIC, CySEC, BaFIN, CMA, DFSA, SCB
- Account Types: Standard, Razor, and Islamic
- Instruments and Products: CFDs on Indices, Commodities, Forex, Cryptocurrencies*, Shares
- Fees: Overnight fee, markup on raw spreads, commissions on Razor account (See details in our Pepperstone Review)
- Maximum Leverage: Up to 1:30 for other retail accounts
- Top Platform Features: cTrader, MT4, MT5, cAlgo integration, Facebook and Google sign-in, Autochartist, Smart Trader tools
- Mobile Trading App: Android + iOS apps
Start Trading Now at Pepperstone
FAQs
How do I open a trading account in Australia?
Once you have ensured that your chosen broker covers all your needs in this seven-step checklist, whether it’s for share trading or forex, you need to sign-up with an ASIC-licensed trading platform. Then, you’ll be required to provide your basic contact details like e-mail address, mobile phone number, name, and address.
Once you’ve signed up, the brokerage will open your trading account after appropriate verification, for which you need to provide proof of residence, proof of identity, and in some cases, proof of personal finances fit for trading.
What does ‘ASIC-Licensed’ mean?
When an online broker in Australia is ASIC-licensed, it means that the provider has adhered to the requirements of the Australian Securities and Investments Commission (ASIC). The ASIC is the leading organization in charge of regulating consumer-facing financial activities in Australia. These reviewed trading platforms are all ASIC-approved.
How does share trading work?
Share trading is the act of buying, selling, and transferring your own shares, sometimes with or without paying a third-party service provider to do it for you. Online trading platforms that support share trading may still charge a fee, though not anywhere near as high as mainstream financial institutions do, like banks. Exchanges like the ASX may be cheaper to directly trade shares with.
How do I buy shares online in Australia?
The simplest way to buy shares is to find an ASIC-licensed broker like eToro that gives you access to shares from the Australian Securities Exchange (ASX). Once you open an account with an online broker that supports Australian or international stocks, like eToro, you are set for share trading. If you want to trade shares cheaper, you can go directly to ASX.
Can you use multiple online brokers?
Yes, you can have active accounts with multiple online brokers. However, you may incur inactivity fees if you leave one of your accounts without any trading activity for a defined period. For example, if you have accounts with eToro and Plus500, and you trade with Plus500 while your eToro account is inactive for 12 months, you get charged $12 for that year of inactivity.
What is the cheapest online broker in Australia?
As to which broker is the cheapest to use as an Australian resident depends on what fees you’re liable to pay. First, you must consider what products you want to trade, and whether trading those products has extra costs, like potential overnight fees for international shares. Then, it’s down to the spread (or ‘pip’) or commissions charged by the broker. Plus500 and eToro have reasonable fees for Australian traders.
How can I buy US stocks in Australia?
As a share trader, you can access US stocks in Australia via any ASIC-licensed online broker with support for US company stocks. Alternatively, you can go directly to the Australian Securities Exchange (ASX) and choose from over 40 US company shares. Using the ASX is cheaper, yet more complex. Using an online broker is simpler, but more expensive.
How do commodity brokers make money?
Some commodity brokers charge a commission on trades, although most ‘no-commission’ or ‘commission-free’ brokers make money on a traded product’s spread. A spread or ‘pip’ is the difference between the price markers of opening a short position and a long position. Spreads and pips can be fixed or variable, but mostly they’re the latter.
Which broker is best for commodity trading?
The best broker for commodity trading depends on your individual needs and preferences as a trader. Things that will shape your decision include what you want to trade, how you want to trade it, and which brokers are regulated in your country of residence.
Other factors to consider are margins and leverages, platform features and device compatibility, and whether you can afford the fees charged by the broker.
What is the minimum amount required for commodity trading?
The minimum amount to trade commodities is determined by the minimum deposit requirement of a commodity broker. Fortrade is a broker with a minimum deposit requirement of just $1 while other brokers like eToro and FXCM set a minimum deposit of $50.
Traders can get started with other regulated CFD providers like Plus500 and Forex.com with a $100 initial deposit.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74%-89% of retail investor accounts lose money when trading CFDs. You should consider whether you can afford to take the high risk of losing your money.
