On paper, CMC Markets is an insanely attractive option for retail investors. It has scooped up tonnes of awards across several categories, and its commissions on trades are undeniably impressive.
However, before jumping through all the administrative hoops to set up a trading account, you should know that CMC Markets has some limitations (as do all platforms).
In this guide, I’ve pulled together all the facts — with a splash of my opinion, for good measure — to help you decide whether CMC Markets is right for you.
- Zero Commission On Aussie Shares: That’s right. You can buy Australian shares for $0 brokerage up to $1,000 (once per day).
- No Minimum Deposit: Excellent if you regularly add funds to your account — say, every pay cycle. This might seem minor, but it makes the platform more accessible to new investors.
- Research Tools: You’ll undoubtedly have heard of Morningstar if you’re an active investor. CMC Markets offers integrated Morningstar quantitative equity research reports directly from its Next Generation trading platform.
- Global Markets: You can easily access companies listed on the Australian Securities Exchange (ASX), the Sydney Stock Exchange, and other international markets, such as the London Stock Exchange (LSE) and the New York Stock Exchange (NYSE).
- Minimum Trade: A $1,000 minimum trade value for all global markets applies. That makes it tricky for new investors to diversify. Also, trading outside of Australia, US, UK, Canada, and Japan attracts a commission of $59.95 or 0.59%, which is costly for active investors pursuing high-frequency trades.
- Unnecessary Complexity: The split between the flagship Next Generation platform and Meta Trader 4 is clunky. The latter would be redundant if it wasn’t for its ability to download to your device, making it a weapon of choice for algorithmic traders.
- Confusing Brokerage Fees: CMC Markets’ pricing structure and package breakdown is hard to decipher.
Above: CMC Markets insists that you set up either a CFD or a forex trading account. Is this absolutely necessary?
CMC Markets At A Glance.
|Trading fees to watch out for||Spread costs. Additional charge for guaranteed stops.|
|Non-trading fees to watch out for||$15/month inactivity fee after 12 months.|
|Available share markets||ASX, NASDAQ, NYSE, AMEX, Euronext, HKEX.|
|Available CFD markets||Forex, shares, indices, cryptocurrencies, commodities, ETFs.|
|Available crypto markets||CFDs on all major coins and a small range of altcoins.|
|Available forex markets||338 global currency pairs (that’s a lot) up to 30:1 leverage|
|Support||CFD accounts: phone or live chat, 24hrs Mon-Sat AEST. Share accounts: phone or live chat, 730am-7pm Mo-Fri AEST.|
|Trading platforms||Proprietary Next Generation platform, MT4.|
Is CMC Markets Good For Beginners?
Guilty — on all counts. Once you’ve successfully signed up, you’ll soon discover that CMC Markets is relatively intuitive and easy to use (by share trading platform standards) on desktop and mobile devices (more on that shortly).
Proprietary New Generation platform is busy and sophisticated-looking (because it is), but not overly intimidating:
- There’s a plethora of educational material and research tools, so you can upskill and practise what you’ve learned using a demo account.
- Beginner traders will appreciate access to extended customer support. CFD traders can jump on a call with an experienced representative 24 hours a day, Monday to Saturday, while traders of other classes can call between 730am-7pm, Monday-Friday.
- Online chats can be frustrating, and not all platforms offer instant responses, so it’s great to speak to a living, breathing person. If you’re contacting customer support, it’s likely during a stressful situation when you need an immediate answer — and CMC Markets has got you covered.
Above: CMC Markets offers the full-featured New Generation platform, with its clear, logical interface. The design isn’t as sleek as that of mainstream products (e.g., Airbnb), but it gives you what you need, when you need it.
Is CMC Markets Good For Expert Traders?
Yes. CMC Markets offers traders a range of complex financial instruments and sophisticated market analysis tools. You’ll have access to charting tools, customisable layouts, and algorithmic trading options.
The range of tradeable assets is immense.
Advanced traders will appreciate the API integration that allows them to connect third-party systems, such as MetaTrader 4.
Where CMC Markets Stands Out.
The trading platform is centered around the needs of CFD and forex brokers.
1. Next Generation Trading Platform.
The Next Generation platform features a whopping selection of 12,000 financial assets. And I risk repeating myself here, but the charting tools at your disposal are second to none.
My favourite is the “Breakout and Emerging Patterns” tool, which auto-adjusts when the chart timescale is changed.
You can quickly scan one-minute and monthly charts to identify any patterns between them.
(Related: What Is An ETF)?
2. Wealth Of Resources
The educational resources on CMC Markets have considerable breadth and depth.
You’ll find over 150 articles on the fundamentals and technical aspects of trading strategies, from basic concepts to more advanced subjects such as cryptocurrency.
If you prefer listening rather than reading, you can find a tonne of educational videos and podcasts on both their website and YouTube channel. Some of their most popular series include the “Artful Trader” and the “Opto Sessions,” which present interviews with industry veterans.
They also host regular webinars run by in-house analysts and other trading experts.
3. Terrific Mobile Experience.
CMC Markets’ mobile app is intuitive and slick, just like the desktop version of the Next Generation platform.
There’s one slight drawback: the indicators don’t automatically sync from the web version to the mobile version.
Where CMC Markets Falls Short.
No trading platform is without its unique downsides. Here are some areas where CMC Markets misses the mark.
1. High Spreads.
Trading platforms make their profit either through commissions or spreads (or both). CMC markets tilts towards the latter, with a higher-than-average five-point spread for CFDs.
2. Complicated Fee Structure.
Deciphering CMC Markets’ fees can be a royal PITA. As someone who appreciates simplicity, I would not use this platform for this reason alone.
After spending two hours untangling its complex web of trading and non-trading fees for the purposes of this review, I was ready to throw in the towel.
CMC Markets Fees, Spreads, Commissions, and Charges In Detail.
To make things as straightforward as possible, I’ve broken down CMC Markets’ numerous, potentially confusing fees into two categories: trading and non-trading.
- Trading Stocks: Trades on stocks are commission-free from the US, UK, Canada, and Japan. It’s also $0 brokerage on one Australian trade a day (below $1,000). That’s what we like to see!
- Spread: This is their primary source of revenue. The spread of an instrument reflects the supply and demand of a particular asset class. A narrower bid-ask spread suggests a general consensus on the price of an asset.
- Overnight Financing: Also known as holding costs. At the end of each trading day, leverage positions in your account may be subject to a charge (or credit). The overnight funding amount is either added to or deducted from your account and depends on prevailing interest rates for the instruments. I recommend you strengthen your understanding before committing to any trades.
For those already familiar with holding costs, here’s how CMC Markets calculates theirs:
Daily holding cost = (units x level 1 mid-trade price x overnight holding rate buy) x CMC Markets’ currency conversion rate.
Daily holding cost = (units x -1 x level 1 mid-trade price x overnight holding rate sell) x CMC Markets’ currency conversion rate
- Account Inactivity: There’s a monthly charge of $15 on dormant accounts unless there are no funds. An account is considered dormant if no trading activity exists for one year.
- Deposit and Withdrawals: Zilch!
- Live Market Data: You can access free delayed data (20-minute delay) as part of a standard account. Live data is available for $10 monthly — or free for an Active Investor account. There’s also an additional option to subscribe to live US market data for $11 per month.
- For dynamic data, a $41.25 monthly fee applies, though this is rebated if over 30 trades are made in a month (it’s not explicit, but I presume this is a set number of days rather than a calendar month).
CMC Markets’ Limits On Deposits And Withdrawals.
CMC Markets is a front-runner when it comes to deposits and withdrawals.
- There are no limits on the amount that can be deposited, but your bank may impose them.
- Withdrawals are entirely free, and there are no limits to the number of times you can withdraw in a designated period. (Time to up your game, eToro!) You can withdraw a maximum of $40,000 (or your account currency equivalent) to your card in any 24-hour period.
Is CMC Markets Safe?
CMC Markets is regulated by five tier-1 regulators (high trust) and one tier-2 regulator (average trust).
Some tier-1 regulators include the Australian Securities & Investments Commission (ASIC) and the New Zealand Financial Markets Authority (FMA). Here are a few reasons why CMC Markets is regarded as one of the most trustworthy platforms:
1. Segregated Accounts.
CMC Markets is required by law to segregate client money from CMC’s own.
So, your money won’t be affected if the company finds itself in financial turmoil.
2. ASIC License.
When trading an asset on any platform in Australia, the most important legal requirement is that they are licensed and regulated by the ASIC.
3. Financial Control.
Never leave yourself exposed to volatility, and be sure to make use of the financial controls. You have stop losses, trailing stop losses, guaranteed stop losses, and others available at your disposal.
Alternatives To CMC Markets.
CMC Markets has several direct competitors for both forex trading and CFD trading. I’ve written a number of guides that will help you decide which is best:
Frequently Asked Questions About About CMC Markets Australia.
Potential CMC Markets clients often ask these questions about trading costs, trading tools and account types.
What Is CMC Markets Invest?
CMC Markets Invest is the company’s standard product for retail traders and investors. With an Invest account, you can trade in Australian and international markets.
What are the ASIC changes?
On 29 March 2021, the Australian Securities & Investments Commission (ASIC) introduced rules regarding how investors can trade CFDs.
These changes were designed to protect Australian investors and ensure a fairer and stronger financial system for all.
The new rules introduce:
- Negative balance protection.
- A drastic reduction in leverage limits.
- Limits on promotional offers.
Can You Use CMC Markets In Australia?
Of course. To be clear, even though it’s a UK-based financial services provider, CMC Markets’ Australian branch enables you to execute trades with the lowest brokerage prices in Australia.
What Other Countries Can I Trade In On CMC Markets?
Here is a list of countries that CMC Markets allows you to trade in:
|Germany||United Kingdom||United Kingdom|
Can I Transfer My Assets To CMC Markets If I Have A HIN With Another Broker?
Yes! And it’s much simpler than you might think. You just need to complete the ASX Transfer CHESS Holdings form (and the International Broker to Broker form, if applicable). You may also need to verify your identity with your broker before proceeding.
What Are Price Adjustments?
CMC Markets and any other brokers for CFD traders make adjustments on the relevant listed CFD on the ex-date or the date of the corporate action, such as dividend payments or shares splitting.
These adjustments maintain the fair value of the contract for both buyers and sellers.
Is CMC Markets Any Good?
It’s pretty good, but not without issues.
You won’t pay any commission for trades less than $1,000 — and while the spreads are slightly above average, the two offset each other from a profitability perspective.
While the high minimum value for international trades might be off-putting for some, it shouldn’t deter those who plan on making fewer, more considered investments.
- Intermediate and advanced traders evaluating CMC Markets will love its comprehensive Next Generation trading platform, complete with sophisticated reporting and charting tools.
- Beginners will love access to live support from within the trading platform.
But what turns me off CMC Markets Australia is its ridiculously complicated trading fee structure, which is inconsistent across all available account types.
There are too many fee tiers and account levels.
I suspect they’re built around the needs of CMC Markets’ internal business units rather than the needs of customers – and I would rather spend my time trading rather than untangling unnecessary complexity.
The competition among share trading platforms in Australia is very stiff, and CMC Markets needs to up its game in order to compete in 2023.