ETF Trading
ETFs, or exchange-traded funds are unique investment products that allow investors to express their views on specific markets or sectors, as well as the broader stock markets, in a specific country or globally. These funds trade on an exchange just like regular stocks, offering investors plenty of flexibility when trading them. One popular example is the SPDR S&P 500 ETF Trust (SPY) which is a popular ETF that tracks the performance of the S&P 500 index, offering investors exposure to the largest 500 companies in the US.
Why trade ETF CFDs with Pepperstone?
We offer more than 100 ETFs that track the performance of sectors including mining, energy, technology, bond markets and retail.
Our ETF CFDs offer a comprehensive way to gain exposure to the overall performance of equity markets in 35 countries and across 6 continents.
The variety of themes, sectors, and countries means endless diversification. Build a portfolio that suits your views, risk tolerance, and investment goals.
Available ETFs
Our commissions when trading ETF CFDs
Trading ETF CFDs with Pepperstone means you trade on direct underlying exchange prices with no additional mark-ups added to the bid/offer spread. Instead, you'll pay a small commission per trade placed. Here's the breakdown:
$0.02 (USD) commission per share, per trade.
Exchange spreads. No markups.
Overnight funding costs (if you hold positions over consecutive days).
Why trade ETF CFDs?
What we offer are a wide variety of contracts-for-difference (CFDs) on ETFs for day trading or other trading styles. In trading CFDs, you're not taking ownership (buying or selling) of your stake in an ETF on a particular exchange. Rather, you're making an assumption on the underlying price of the ETF. This means you can go long and short without restrictions, since there's no ownership interest on the individual stocks or mutual funds. If you anticipate a particular market sector or region to experience a decline in growth and value, you can short an ETF CFD in the same, straight-forward manner as you would buy an ETF CFD were you to see it appreciating in value.
ETF CFDs also enable you to trade with leverage, which means you only need a portion of the notional value of your trade to enter it, reducing your capital requirements. This means you can trade more and expose your capital to a wider array of opportunities. There are several other advantages listed below, and like any financial asset, there are risks involved.
Advantages:
Trade any ETF long or short – potentially profiting from any direction of the ETF. Trade movement on core markets, interesting themes and often hard to access markets.
Trade on leverage – place a percentage of the notional USD face-value down, and make your capital go further.
Cost-effective – 2 cents a share allows for traders to be highly active in their trading approach.
Use automated trading strategies and apply a diverse range of risk management strategies on the powerful MT5 platform.
React real-time - Trade some of the most liquid ETFs in the pre-and post-market session.
Diversification - Rather than trading one specific stock, ETFs offer diversification to a market theme, as well as making that theme incredibly intuitive.
Risks:
Leveraged trading imposes additional risk of loss to your capital.
No ownership interest - you don’t own a share in the underlying ETF when you trade CFDs, so you are not entitled to some benefits that ordinary investors would be.
Spreads - while we provide exchange spreads for our ETF CFDs, like any market the underlying spread may widen during periods of volatility, increasing your costs.
ETF closures - the provider may cease managing the fund, resulting in liquidation and dispersion of funds.
ETF Instrument may be located in the Shares folder of the MT5 platform, rather than the ETF folder.