Charles Schwab vs CMC Markets — which broker is better?

Pros

• USD 0 commission on every online listed US stock and ETF order, with no share cap and no proprietary-fund restrictions
• thinkorswim desktop, web and mobile are included free — full options chains, thinkScript, backtesting and paperMoney simulation
• Options at USD 0.65 per contract, with the fee waived on buy-to-close orders at USD 0.05 or less
• Around 7,700 no-transaction-fee mutual funds in Mutual Fund OneSource, plus USD 0 new-issue Treasuries at auction
• 24/7 phone and chat support backed by close to 400 physical branches — an unusual combination for a discount broker
• SEC/FINRA-regulated with SIPC cover and an affiliated FDIC-insured bank; parent company SCHW is NYSE-listed and reports publicly
• Schwab Global Account gives online access to 12 foreign markets in local currency from the same login

Cons

• No spot cryptocurrency trading — only ETFs, futures and crypto-adjacent equities, which puts Schwab behind Fidelity and well behind Robinhood
• The default uninvested cash sweep pays close to nothing (0.01% at the time of writing); you have to manually move idle cash into a money market fund
• Transaction-fee mutual funds cost up to USD 49.95 per purchase, with a USD 74.95 ceiling for some fund families
• Margin rates sit near the top of the US market — roughly 11.8% below USD 25,000, versus mid-single digits at Robinhood
• Stock Slices fractional investing is limited to S&P 500 constituents, so it will not cover a small-cap or ADR watchlist
• Trading foreign stocks through a broker costs the greater of USD 100 or 0.75% of principal, which makes ad-hoc international orders expensive
• Currency conversion adds a percentage charge on top of the commission: 1% of principal per conversion below USD 100,000 in the Schwab Global Account, tapering to 0.2% from USD 1,000,000 — USD 100 on a USD 10,000 conversion. Except on small orders, the conversion charge is larger than the online commission. Outside the Global Account, Schwab's pricing guide allows a markup of up to 300 basis points (3%) on USD/foreign-currency conversions

Pros

• Next Generation is one of the strongest charting suites bundled with a retail CFD account —115+ indicators, 70 chart patterns, 12 chart types and pattern-recognition scanners, at no extra cost
• 0% commission on UK and European share CFDs (Greece the sole exception at 0.45%), against IG's spread-plus-conversion model
• EUR/USD averages around 0.7 pips on the standard account, and FX Active delivers from 0.0 pips for USD/GBP 2.50 per side per 100,000 notional
• No minimum deposit at all — CMC only suggests around GBP 100 to cover margin, which makes it genuinely testable with small money
• Three FCA licences (173730, 170627, 948126) plus ASIC AFSL 238054, BaFin and MAS, with FSCS cover of GBP 85,000 and client money segregated at NatWest, Barclays and Lloyds under annual PwC audit
• Cash-settled OTC options, available as a spread bet or through the CFD account, carry no commission and no holding or financing charge — the whole cost is in the spread
• 12,029 instruments on Next Generation, all of which are also tradable from TradingView charts
• Ten account base currencies including NOK, SEK, PLN and SGD, which removes conversion drag for Nordic and Asian clients

Cons

• None of CMC's derivatives is exchange-traded: the options it quotes are OTC and cash-settled, and there are no cleared futures at all, so CMC is the counterparty on every derivative contract and no clearing house stands behind it
• The 0.7% FX conversion charge on realised profit, loss and costs is high; IG applies 0.8% on the equivalent CFD trades
• Inactivity fee of GBP 10 per month starts after just 12 months without trading activity
• ASIC required CMC to remediate Australian retail clients in 2023 over CFDs offered above the product intervention leverage limits, and an Australian class action over 2011–2021 marketing remains outstanding
• MT4 carries only about 220 instruments against 12,029 on Next Generation, so algo traders who need MT4 lose most of the product range
• CMC does not publish a fixed index spread table, which makes cost comparison against brokers that do quote fixed minimums harder than it should be