CMC Markets vs Pepperstone — which broker is better?

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

Pros

• Razor all-in EUR/USD cost of about 0.8 pips - a 0.0 to 0.1 pip raw spread plus USD 3.50 per lot per side
• No inactivity fee, no account-keeping fee and no account closure fee, confirmed on Pepperstone's own costs page
• Five execution venues on one account: MT4, MT5, cTrader, TradingView and the in-house Pepperstone Platform
• Three top-tier licences - FCA 684312, ASIC AFSL 414530 and BaFin 151148 - so most clients contract with a tier-1 supervised entity
• EUR, CHF and GBP accounts at every European entity (UK, Cyprus, Germany), which removes a layer of conversion cost for European clients
• Account approval typically inside 4-8 hours, with a USD 10 minimum first deposit and no minimum by bank transfer
• Active Trader rebates take the all-in EUR/USD cost down to roughly 0.26 pips at high volume
• UK clients get the same book as spread bets, with EUR/USD from 0.6 points

Cons

• Everything is a CFD. You never own the share or ETF, so there are no voting rights, no transferable holdings and no dividend tax reclaim
• Overnight financing on index and share CFDs is charged at 2.5 percent over the benchmark rate, which quietly punishes anyone holding for more than a few weeks
• No options, futures, bonds or mutual funds - the product shelf is narrow next to a full-service broker
• Education is a webinar and article archive rather than a curriculum; ForexBrokers.com marks it down for having no interactive courses or quizzes
• FIX API access is reported to need around USD 250 million in monthly volume, so systematic traders are confined to MT4, MT5 or cTrader automation
• Pepperstone publishes no headline currency conversion rate, which makes the true cost of a US share CFD from a EUR account hard to model before you trade