A demo account for trading stocks works like a trading simulator on which you can practice stock trading without risking your own money. Despite the fact, that you can open a demo account for stock trading basically with any broker that features stocks on its platform, it is advised to pick a company with which you might trade in the future. Reason being, once you get used to a platform on a demo, it is easier to switch to a real account within the same trading platform. There are a couple of important broker’s characteristics on which a trader who is looking for the best demo stock trading account should focus on. Let’s review them:
Regulation - better safe than sorry
If you do not want to fall to a scam broker, regulation should be the no. 1 priority. A regulatory body oversees all actives that a regulated broker does and should there be any issue, you can always report the broker to the given regulator which will analyse and chase the broker to find out if they haven’t done any wrongdoing against you. The most reputable regulatory authorities are the UK’s Financial Conduct Authority (FCA), Australian Securities and Investments Commission (ASIC) and Cyprus Securities and Exchange Commission (CySEC).
Secondly, verify that a broker features stocks that you want to trade. Each trader has different needs and while one might be okay with a few dozens of shares, another trader would be disappointed with such limited offer. For that reason, before you register with any company, even with just a demo, make sure that you are going to find your stocks on the broker’s platform.
Fees - as low as possible
In this guide, we have selected some of the best brokers that feature a demo stock trading account, here is their breakdown:
Regulation – Brokers that support Demo Stock Trading
Plus500 (Read a review) –
- Plus500UK Ltd is a regulated in the UK by the FCA, License number: 509909 – register.fca.org.uk/ShPo_FirmDetailsPage?id=001b000000NMTYtAAP
- Plus500CY is a CySEC regulated company (Plus500CY – license number 250/14) – cysec.gov.cy/en-GB/entities/investment-firms/cypriot/40631/
- Plus500AU Pty Ltd is an ASIC regulated company (Plus500AU Pty Ltd (ACN 153301681) – license number 417727).
ETFinance (Read a review) –
- ETFinance is a CySEC regulated company operated by Magnum FX (Cyprus) Ltd, Licence Number: 359/18 – cysec.gov.cy/en-GB/entities/investment-firms/cypriot/80113/ (check approved domains)
IQ Option (Read a review) –
- IQ Option is a CySEC regulated company operated by IQOption Europe Ltd, Licence Number: 247/14 – cysec.gov.cy/en-GB/entities/investment-firms/cypriot/40647/ (check approved domains)
Stocks which you can trade on a demo or real account
European stocks (Including: Peugeot Citroën, Orange, Volkswagen, RWE, Bayer)
American stocks (Including: Tesla, Netflix, Boeing, Virgin Galactic, Shopify, Amazon, IBM, Alibaba)
Australian stocks (Including: Goodman Group, Canopy Growth, BlueScope Steel, AGL Energy)
Canadian stocks (Including: Canopy Growth, Tilray, Aurora Cannabis, Aphria)
Asian stocks (Including: Bank of China, China Railway, PetroChina, Xiaomi, Tencent)
70 European stocks (Including - Tesco, Volvo, Xiaomi, Marks and Spencer, Heineken, Adidas, BMW, Barclays, Orange)
6 Australian stocks (Aristocrat Leisure, Crown Resorts LTD, Caltex Australia, Challenger LTD, Bluescope Steel LTD, AGL Energy LTD)
US stocks (Including: Tesla, Apple, Beyond meat, Netflix, PayPal, IBM, easyJet)
Canadian stocks (Including: Canopy Growth Corp.)
European stocks (Including: Tesco, L'Oréal, Heineken, Barclays, Vodafone)
Fees that these companies charge
The biggest fee you are going to encounter when trading stocks is the spread fee, which is basically the difference between ask and bid price (example). ETFinance and ITRADER charge the same spreads. On the US and Australians stocks they can be as low as 0.21 and on European stocks spreads can be as low as 0.21 or 0.021, depending on traded stocks.
IQ Option spreads range from 0.01% to 1.81%, depending on a traded stock. Both Plus500 and IQ Option spreads are based on the current market conditions which means they change in real time. To give you some idea what spreads they charge, here is a breakdown of spreads that IQ Option and Plus500 charge today on popular shares.
|IQ Option spreads||Plus500 spreads|
|Goldman Sachs 0.14=0.06%||Goldman Sachs 0.57=0.24%|
|Netflix 0.53=0.15%||Netflix 0.4= 0.11%|
|Amazon 2.97=0.16%||Amazon 2.01=0.11%|
|Visa 0.36=0.18%||Visa 0.18=0.09%|
|Ferrari 0.12 =0.14%||Ferrari 0.42=0.24%|
|Coca Cola 0.1 =0.18%||Coca Cola 0.09=0.16%|
Data about spreads were taken from websites of the given brokers on the 26th of January 2020.