Pepperstone – Best Options BrokerFind Out More

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.7% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.

Best 10 Options Brokers in the UK

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Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.7% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.

While options trading can seem somewhat overwhelming when first starting out, the fact is that once you have an insight into how the process works, it becomes far simpler and easier to understand.

Usually, investor portfolios utilise a range of asset classes, including stocks, bonds and mutual funds. Options act as another form of asset type, and when utilised correctly, they can offer a wide range of investment benefits.

Who Are the Top Options Brokers in the UK?

There are a wide range of choices when it comes to options brokers in the UK. However, not all brokers and platforms are born equal, so it’s worth taking the time to determine which option is the best fit for you and your trading style and requirements.

1. Pepperstone

Pros

  • Extensively regulated
  • No minimum deposit
  • Low fees and mostly free withdrawals
  • Good customer service

Cons

  • No investor protection for clients outside UK, EU and EEA
  • Withdrawal fee for clients outside EU and Australia
  • CFDs only

Recommended for: Safety and regulation (7 jurisdictions), low-cost processing, fast execution speed, perfect for algo-traders, EAs, etc.

Founded in 2010, Pepperstone has been quick to adapt to the social copy trading trend, providing plenty of tools for traders to share and mimic trading styles.

With over 1,200 instruments, it offers two account types:

  • Standard – The Standard account comes with market average spreads and zero commission
  • Razor – This account operates on a commission basis but with exceptionally low spreads

Pepperstone does not have its own platform but offers the complete MT4, MT5 and cTrader solutions, as well as supporting DupliTrade only for copy trading.

Pepperstone normally recommends a minimum of $100 to $200 to start trading.

Pepperstone doesn't directly offer options trading but has many complimentary services and is highly recommended.

Visit Pepperstone

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.7% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.

2. Degiro

Pros

  • Regulated by BaFin and FCA
  • No minimum deposit
  • Low trading fees
  • No inactivity fee
  • No withdrawal fee
  • No deposit fee
  • Web platform and mobile app are user-friendly

Cons

  • No credit or debit card deposits
  • Lacking educational resources
  • No demo account
  • No forex, CFDs or crypto
  • No customer support on weekends and no live chat

Best for: Low costs

Fees: Trading fees for users are classed as being low. There’s no inactivity fee charged, there’s no withdrawal fee, and there’s no minimum deposit.

The Dutch privately owned discount broker Degiro is known for offering a cost-efficient broker platform.

The platform is regulated and authorised by the FCA in the UK and is renowned for offering one of the lowest fees within the market.

Visit Degiro

3. IQcent.com

Pros

  • Low minimum deposit
  • Copy trading available
  • User-friendly interface

Cons

  • Lacks regulation
  • Withdrawals can be difficult
  • Limited chart tools and lacks educational resources

Best for: Beginner's journey.

A well-known Binary option and CFD trading platform. It has a variety of different payment gateways for easy deposits and withdrawals. It is easy to set up an account in seconds because the platform is user-friendly. Trading can start immediately after the initial deposit.

Advantages:

  • A higher yield that peaks at 95% or more. The trader is able to get a 95% payout on investment, this is higher than the industry average of between 75% and 80%.
  • 0% commission on deposits, withdrawals and account maintenance fee.
  • User-friendly platform with fast trade executions. The interface is easy to understand and navigate on.
  • Reliable support team.
  • Copy Trading feature. Allows you to copy live trades of the best traders on the platform.

Disadvantages:

  • Limited chart tools. IQcent mostly used for Binary Option style of trading, therefore, some tools might not be available due to the simplicity of the chart.

There are various reasons to trade with IQcent starting from the easy to understand software to a very reliable withdrawal system or be it the flexibility of its trading platform, diversity of the trading instruments, progressive partnership opportunities for loyal customers and bonuses – these benefits are what makes IQcent the best choice among all others.

Visit IQcent.com

4. XTB

Pros

  • Regulated by the FCA
  • Low forex fees
  • Fast withdrawal and deposit with no fee
  • Live chat customer service

Cons

  • No US clients
  • Limited product portfolio
  • High fees for stock CFDs

As a broker that you can trust, XTB is both well-regulated and listed on the stock exchange. The registered office is in Canary Wharf, London.

XTB offers investors and traders the opportunity to trade commodities, stocks, metals, forex, indices and cryptocurrencies, as well as ETFs and CFDs, and it is regulated in top-tier jurisdictions by FCA, CySEC, IFSEC and KNF.

Traders can easily open an account online and can choose between the commission-free Standard account or the Pro account that includes tighter spreads, but there is a commission that needs to be paid on all trades.

Deciding what platform to use to make your trades depends on your location – in most countries, you can choose MetaTrader 4 or the proprietary platform xStation (although MT4 is not available to UK customers).

XTB is a great choice for beginners thanks to the huge range of educational materials, categorized by level (beginner, intermediate and advanced) and the customer service options that are available only on weekdays.

There is a fully functional demo account so beginners can practice strategies and get used to using the platforms.

The more experienced trader will enjoy a huge range of research resources, including trading signals, technical analysis, details about different instruments, and even a heat map and market sentiments.

Visit XTB

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

5. Videforex.com

Pros

  • 24/7 live video chat support
  • Credit/debit card deposits and withdrawals available
  • Copy trading
  • Demo account (though only accessible after minimum deposit)

Cons

  • Not regulated
  • Not available to US clients
  • Lacks educational resources
  • Inactivity fee

Best for: Day to day trading.

It might seem that the broker is another typical binary option trading platform, but the fact is that Videforex is standing out of other trading platforms by literally greeting the traders with a Live Video-Chat feature. For the first time in the industry, traders are able to see who they are dealing with as opposed to talking to a faceless entity behind the computer screen.

However this unusual but very outstanding feature is not the only reason you should choose Videforex as your main broker.

Videforex has:

  • A very comfortable interface to use.
  • Variety of trading assets and best trading conditions.
  • BIG payouts up to 90% compared to markets 70% + Leverage up to 1:500.
  • Live 24/7 customers service.
  • Reliable and fast withdrawal system.
  • Traders can be provided with a Demo account to practice their new strategies.

Should I Trade With Videforex?

The answer is YES! The platform offers a perfect balance between extensive trading tools and ease of use. Users of all experience levels will find themselves right at home.

Visit Videforex.com

6. Binarycent.com

Pros

  • Low minimum deposit
  • Small minimal trade size
  • Copy trading

Cons

  • Lacks regulation
  • Withdrawals can be difficult
  • Lacks research and educational resources

Best for: Allows you to trade with very small amounts. Good for beginners.

Besides the fact that this platform is very friendly for beginners since it allows you to trade in cents, it has made a name for itself as a stable platform.

  • Minimum deposit starts from 250 USD, relatively small amount considering that you can trade as low as 1 USD and 1 Cent per trade.
  • Withdrawal process takes up to an hour and provides variety of withdrawal methods.
  • Copy trading feature that helps beginners to understand and learn how professionals trade.
  • Weekly Contest. It only piques your interest in trading PLUS you are getting nice bonuses for your account, such as bonuses to your deposit and risk-free trades, meaning you are not losing any money for your lost trades.

Overall, the platform shows itself to be a decent broker. It makes you feel comfortable having your money with Binarycent.

Visit Binarycent.com

Top Options Brokers in the UK
Top Options Brokers in the UK

7. Raceoption.com

Pros

  • User-friendly interface
  • Copy trading available

Cons

  • Lacks regulation
  • Lacks research and educational resources

Best for: Weekly contest with highest bonuses.

The trading platform since it first began operations in 2014 is already a relatively known brand among the binary options trading community. The goal of Raceoption has always been to offer its clients a safe and secured environment for traders to trade binaries.

Advantages and Disadvantages:

  • Fast withdrawals with no hidden charges. Withdraw funds from as low as $50 within 1-2 days with no hidden charges.
  • User-friendly interface. Raceoption has made its online platform very easy to use. Indeed, a beginner can learn how to use the platform in a few hours.
  • Customizable trade duration. Traders are given an option of customizing their trade durations.
  • High returns up to 90%.
  • Raceoption is known for having a great support team. You will be helped!

Overall, we were quite satisfied with the quality of Raceoption’s services. At any given time, tens of thousands of traders are logged into the platform without any affectation of the platform performance or speed. Customer service is also great in terms of speed and quality of response.

Visit Raceoption.com

8. Tastyworks

Pros

  • Great set of tools designed for frequent traders
  • Key analytics built into software so it’s easier to see the probability of success when trading
  • Customisable platform with real-time quotes

Cons

  • Platform can seem a little overwhelming at first, especially for newer traders
  • Bonds and CFDs aren’t available
  • Portfolio analysis needs to be done on a separate website

Best for: Options trading

Fees: The platform has a unique fee system in place which charges $1 per contract to open a position, whereas closing trades is completely free.

Tastyworks is a platform that has been designed with active traders in mind. All of the tools available on the platform are designed to make focusing on liquidity, probability and volatility easier.

Visit Tastyworks

9. Webull

Pros

  • Commmission-free US-listed stock, ETF and options trades
  • Fractional shares and cryptocurrency
  • No minimum deposit
  • Member of FINRA, SIPC, NASDAQ and NYSE
  • Advanced charting
  • No inactivity fee
  • Great mobile platform

Cons

  • Deposit and withdrawal fees for wire transfers
  • Lacks educational and research resources
  • No mutual funds or forex
  • Does not provide interest on uninvested cash
  • Average customer support

Webull is a Chinese company with offices in China and New York, and offers a platform for trading stocks, options and ETFs.

This community-driven platform is focused on a great mobile trading experience, with sleek interfaces on the web, desktop and a mobile application that gives a consistent user experience.

As a broker, Webull has no minimum deposit and does not charge fees for withdrawals or deposits unless made by wire transfer.

There are no commissions on stocks, options or ETFs, and no contract fees on options.

Webull makes its money through interest rates on margin accounts, and these range from 3.99% up to 6.99% depending on trading volume.

The web and desktop platforms are similar in layout and are quite simple to customise so users can create an interface that works for them.

There are charting tools available, and a unique ‘Market Replay’ feature that can show the market activity over a certain time frame.

Research comes from news headlines, consolidated analyst ratings, a screener and a community-led private Twitter feed, where clients can comment and react to news and price movements, as well as predict future movements.

The mobile platform works in much the same way, with fully optimised apps for both iOS and Android which makes for an almost seamless user experience across all devices.

For new traders, there is not much in the way of education other than some basic articles, but there is a virtual portfolio that can be used to practice new trading techniques.

As an options broker, Webull offers access to several option markets, but it is not specified which ones. There is no commission charged on buying options, but there are margin rates to consider.

Visit Webull

10. Interactive Brokers

Pros

  • Regulated
  • Wide range of offerings
  • Low commission
  • Socially responsible
  • 24/5 customer support across multiple channels

Cons

  • No additional platforms
  • Inactivity fees

Best for: Low margin rates and professional traders

Fees: While Interactive Brokers were known for being a low-cost broker, following most larger brokers reducing or scrapping their fees altogether, they have become a somewhat expensive option when it comes to trading. The fee structure is rather complex, however there is a clear guide on their website that helps to make understanding the process a little easier.

Interactive Brokers offers a combination of high-quality tools, various asset classes and low costs. Boasting a wealth of tools for investors to utilise, there’s also an impact dashboard which can be utilised to help make tracking simpler and easier for users.

Visit Interactive Brokers

What Are Options?

Options are a form of contract that allow the buyer of the contract to buy or sell an item at a set price.

An option buyer is charged an amount known as a ‘premium’ by the seller for the right to purchase the product at a set price. If market prices are seen as being unfavourable for options holders, they will allow the option to expire, which ensures that any losses are not higher than the premium for the product.

In comparison, it is the option sellers who take on the greatest level of risk compared to those buying the options, which is why a premium is always set.

Options tend to be split into two different options types known as ‘call’ and ‘put’ options.

When it comes to a call option, the person buying the option contract purchases the right – but not the obligation – to buy the item in the future at a set price, known as the ‘exercise price’ or the ‘strike price’ on or before the contract expires.

Whereas, when it comes to a put option, the buyer is guaranteed the right – but again, not the obligation – to sell the asset at some point in the future, on or before the end date, at the agreed price.

There are four ways that you can trade options, these are:

  • Buying calls
  • Selling calls
  • Buying puts
  • Selling puts

People who buy options are known as ‘holders’ and people who sell options are referred to as ‘writers of options’.

When it comes to options, call holders and put holders are under no obligation to buy or sell; they have the choice to use their rights how they see fit. This helps to limit the risk for buyers.

Whereas, call writers and put writers are in a position where they are obligated to sell if the option expires. This means that the risks for call and put writers tends to be higher than for call and put holders.

Key Facts:

  • An option is simply a contract that gives the buyer the right to buy or sell the asset at a set price on or before a certain date.

  • People tend to use options for income trading, to hedge risk or to speculate.

  • Options are called derivatives as their value comes from the underlying asset being traded.

Options are part of a set of securities called derivatives.

What it’s important to understand about derivatives is the fact that the price of the derivative is derived – or dependent on – something else.

When it comes to options, these are derivatives of something known as ‘financial securities’ – the price of an option depends on the value of another asset. Some examples of this kind of derivative include Futures Investments, for instance.

Options are able to be purchased in the same way as most other asset types, through brokerage investment accounts.

Of course, it’s also important to bear in mind the fact that, like all trading, options investing involves a certain level of risk. It’s essential that the investor is aware of these risks before choosing to make their investment.

What Are the Advantages of Options Trading?

There are a range of advantages of choosing to trade options.

Options are known as being a powerful asset as they offer a fantastic route to enhancing and diversifying a person’s portfolio, this is done through increased income, protection and also leverage.

Depending on what the goal of the options trader is, there is normally a suitable options scenario that’s an appropriate fit for the trader’s goal.

For instance, in the example of needing to hedge against a stock market that is declining, options can be used as a means of limiting downside losses.

Options trading can also be used as a means of creating a regular income. In addition to this, options can also be utilised for speculative reasons, such as to wager on the direction in which a stock will go.

Key advantages of options trading include:

  • Options are extremely cheap to trade
  • You can get options on and off an exchange
  • The risk of options is limited to the premium amount agreed
  • There are high potential returns in relation to the level of risk
  • There are various strategies to utilise and speculate on the volatility of the investment and movement of price

What Are the Disadvantages of Options?

As noted above, there are a wide range of advantages of options trading, with a range of financial rewards available, but it is important to understand that there are still a number of drawbacks.

Options trading offers less liquidity which can make it tricky for a trader to enter or leave the trade.

It’s also important to be aware that options trading can be more expensive than some other forms of trading, such as when compared to futures or stock trading, for instance. However, that being said, there are discount brokers who are able to offer lower rates, but for the most part, it can be a little pricey to trade options.

One of the worst things about trading options is ‘time decay’; which is where the value of an option premium begins to decrease over time.

Key disadvantages of options include:

  • Options can lack liquidity
  • Options can become worthless in a short time frame, quickly losing their value
  • The risk is unlimited

One of the most essential factors when it comes to whether you will see options success is time; time decay can be a real issue when it comes to options trading. It’s also crucial to take the cost of trading into account when it comes to options.

How to Compare Option Brokers

Options trading has become exceedingly popular over the past few years, with more people than ever before interested in options trading.

The good news is that with the right options broker in place to help and support you, your options trading journey is sure to go smoothly.

However, determining which options trader is right for you and your needs can be difficult, which is why it’s important to know how best to compare options brokers.

There are some key factors to think about when it comes to comparing options brokers. Here are some of the key things to think about:

Are They Properly Regulated and Monitored by the FCA?

An accredited broker will usually display their FCA accreditation on their website and in any correspondence, so keep an eye out for this on broker websites.

Accreditation is important as it means that the broker adheres to a certain set of key regulations, ensuring that all trading is done fairly and legally and meets all national requirements.

Buying and Selling

It’s also important to determine whether a platform will allow you to both buy and sell options, rather than simply offering you one or the other. If you want to have the option of selling and buying then you need to source a broker who is able to offer that.

Rate of Commission

Another key factor to determine when it comes to options trading is the rate of commission that the platform charges. While some platforms charge higher rates of commission, others have lower and more affordable rates in place.

Option Strategies

It’s also important to determine if option strategies are allowed. Option strategies not only define how a trade deal will be entered and exited, but it can also help to make managing risk and the associated volatility a little easier.

There are a wide range of option strategies to choose from, and every trader has their own trading strategy.

For instance, some traders prefer to use a covered call options strategy, while other traders prefer to use a credit spread options strategy.

Some brokers don’t allow the use of certain approaches and strategies, so this is something worth looking into before selecting a broker to work with.

Extra Features

It is also important to determine what features and tools the platform has on offer for its users, such as what specific features there are in place to aid trading strategies.

What Are Paper Options?

When it comes to seeing success as an options trader, you need to be able to work quickly and effectively, never deliberating for too long on an investment opportunity.

An easy way to hone and improve your options trading skills is via paper options trading; this is a form of practice trading, which simulates a real training situation, allowing options traders to gain an insight into the process and improve and enhance their skills by doing so.

For any trader wanting to learn more about options trading – or plot out a new options strategy – paper options is a great resource to utilise.

Frequently Asked Questions

The exact platform which you choose will likely depend on your individual needs and requirements. Having said that, Interactive Brokers has consistently performed well when it comes to 12-month options in the UK.

There are several places to look for options brokers. The list of best brokers above is a good place to start. Once you have decided on the features and capabilities which are most important to you, you will be able to narrow your choice down further.

If you are looking for a platform that offers users the ability to deposit a very low amount to open an account, there are several options:

  • Webull – No minimum deposit
  • Hargreaves Lansdown – Free demo account, £200 deposit for live account
  • Interactive Brokers – Deposit of $100 or approximately £70
  • Fineco – No minimum deposit

One of the most well-known and trusted brokers for binary options would be IQCent.com. With an easy-to-use interface and reliable customer support, it’s easy to see why it’s so popular with traders.

Many US options will be available for trading on UK platforms via CFD or spread bet investments. Some of the most commonly used platforms for US options trading are:

Weekly trading is a good choice for people who like to see a faster return on their investments. While most options brokers will offer monthly trading as the standard, there are some which have weekly options. IG is one of the best brokers for weekly trading available to choose from.

If you aren’t sure about using Interactive Brokers for your options trading investments, then there are plenty of others to choose from.

The list detailed above looks at some of the best options currently available, but eToro and Pepperstone are generally considered to be the market leaders.

The exact fees and margins will vary from platform to platform. If you are unsure of the trading regulations in the UK, it is a good idea to take some beginners course in options and trading in general before creating any strategies or investing any money.

The best platform for you will generally depend on your personal needs. If several platforms seem to offer what it is that you are looking for, then it is often a good idea to try a demo account.

This will allow you to get to grips with how a platform works without risking real money. You can also develop strategies and build your understanding of how each platform differs.

It can be challenging to recover your money if you have fallen victim to a bad binary options broker.

In this situation, it’s probably best to seek advice from a recovery firm that will be able to offer specialist advice.

There are plenty of legitimate binary options brokers to choose from. One of the most popular choices currently on the market is IQCent.com.

Alternatively, you could try IQOption or Binary.com.

Final Thoughts

When it comes to options trading, there are a number of trading platforms available to choose from, each of which is designed to meet the needs of a different type of trader.

While some platforms offer a fantastic range of educational tools and demo platforms, others are renowned for having low fees, making trading more affordable.

WikiJob does not provide tax, investment, or financial services and advice. The information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Past performance is not indicative of future results. Investing involves risk including the possible loss of principal capital.

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.7% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.


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