I conducted a detailed study of brokers’ leverage offerings for CFDs, including stocks and indices, to identify the brokers with the highest leverage available for these instruments.

The main reason for this research was my desire to trade CFDs without committing too much capital upfront. Since I’m new to CFDs, I wanted to test the waters without risking a significant amount of money.

After trading for over a decade, demo accounts no longer feel practical to me. Instead, I prefer using live accounts with smaller funds to experience the market in real time. So, I rolled up my sleeves and started researching.

Unfortunately, finding accurate information about brokers offering high leverage for CFDs is surprisingly difficult. A quick Google search mostly leads to lists of brokers offering high leverage on forex pairs, which is irrelevant if you’re specifically looking for CFD leverage.

For forex brokers with the highest leverage on forex pairs, gold, and oil see this article.

Finding the Brokers with the Highest Leverage on CFDs

To compile this list of brokers offering the highest leverage on CFDs, I had to dig through countless broker websites, searching their pages and even chatting with customer support.

Honestly, I lost count of how many brokers I reviewed — probably over 100 — and it took me an entire day.

During my research, I focused on the leverage offered for two specific types of CFDs: CFD stocks and stock indices.

Here’s what I found:

• The highest leverage for CFD stocks is 1:20 — typically available for highly liquid stocks like major US equities.
• The highest leverage for stock indices is 1:400, but this applies mostly to major indices like the US 30 or S&P 500.

If you want to trade less liquid instruments, like German stocks, you’ll find the leverage is significantly lower, often around 1:5.

There are several reasons why leverage is generally lower for CFDs, particularly for stocks. We’ll dive deeper into this later in the post, but for now, let’s cover some basic concepts to help readers new to CFDs understand why leverage levels differ.

Leverage in Simple Terms

Leverage is essentially a loan provided by brokers, allowing retail traders to trade instruments like forex, shares, and indices without needing the full capital required for standard trading.

In traditional trading, instruments are traded based on their units. For example, the minimum amount needed to trade EUR/USD is 100,000 units of the base currency (the first currency in a pair), which equals €100,000 for a 1:1 leverage ratio.

Now, how many retail traders have €100,000 to trade one lot? Probably close to none.

This is where brokers step in, offering leverage to make trading more accessible to retail clients. For instance, instead of requiring €100,000, a broker may allow you to trade with just €1,000 or even less, depending on the leverage offered.

Let’s say you’re interested in trading one share of the S&P 500 Index. With a standard lot size requiring over $3,000, this might seem impossible for many traders. However, with leverage, you could start with as little as $300 or even $30 in some cases.

This not only enables traders to participate in the market but also helps brokers attract more clients, increasing their revenues.

Why Leverage is A Doubled-Edged Sword

While leverage provides greater opportunities for traders, it comes with significant risks. It’s a double-edged sword: just as it can amplify your profits, it can also speed up your losses.

For example, let’s say you want to open a 1 standard lot trade (100,000 units of the base currency) on USD/JPY with a broker offering 1:10 leverage.

• 1:10 leverage means you need 1/10th of the total trade value in your account as margin. In this case, you’d need $10,000 to open the position.
• Let’s assume the current price of USD/JPY is 111.10 and you set a stop-loss of 20 pips.

Calculating Pip Value

The value of one pip can be calculated as:

Pip Value = (1 pip / Current Price) × Lot Size

For our example:
Pip Value = (0.01 / 111.10) × 100,000 = $9 per pip

With a stop-loss of 20 pips, you’re risking:
$9 × 20 pips = $180

Losing $180 from your $10,000 account equals 1.8% of your capital.

Higher Leverage, Higher Risk

Now imagine you have the same $10,000 account but your broker offers 1:100 leverage.

If the trade goes against you and you lose $180, this now represents 18% of your account balance — a drastic loss compared to the 1:10 leverage scenario.

With 1:100 leverage, you only need $1,000 to open the same 1 standard lot trade (100,000 units).

Understanding how leverage works is crucial for managing risks effectively. Now that we’ve covered the basics, let’s dive into CFDs and the leverage offered by brokers for trading these instruments.

What is CFD?

A Contract for Difference (CFD) is a derivative financial product that allows traders to profit from the price fluctuations of underlying assets such as shares, indices, commodities, and even currency pairs without owning the actual asset.

CFDs are traded over the counter (OTC), just like forex, meaning they are not traded on centralized exchanges.

CFD vs. Physical Ownership

When you buy a share physically, you:

• Own a tangible asset (the share).
• Are exposed to profit or loss from price changes.
• Are entitled to dividends as a shareholder.

In contrast, with a CFD:

• You don’t own the underlying asset.
• There are no dividends or shareholder rights.
• You can profit purely from price movements — whether prices go up or down.

One key advantage of CFDs is that you can sell short without needing to own the asset first. This makes it similar to forex trading, where you can easily take long or short positions.

Differences Between Forex and CFD Trading

While CFDs and forex share similarities, there are a few notable differences:

Leverage: While leverage is common in both, it’s generally lower for CFDs (especially on stocks) than for forex pairs.

Market Hours: Forex markets are open 24 hours, 5 days a week. CFD market hours depend on the underlying asset.

For example, the UK100 index may be tradable from 7:00 to 21:00, while the S&P 500 index is available from Sunday 23:00 to Friday 21:15.

Variety of Instruments: Forex trading is limited to currency pairs, whereas CFDs include a wide range of assets, such as stocks, indices, bonds, and commodities.

Leverage in CFDs

In CFD trading, leverage enables traders to control larger positions with smaller amounts of capital. However, leverage ratios for CFDs are typically lower than forex pairs due to the nature of the underlying assets.

How Leverage and Margin Work in CFDs

Leverage for CFDs is often expressed as margin requirements:

• 1:100 leverage = 1% margin required.
• 1:200 leverage = 0.5% margin required.
• 1:20 leverage = 5% margin required.

For instance, with 1:1 leverage, you’d need the full value of the asset as margin. If the leverage is 1:10, the required margin becomes 1/10th of the asset’s value.

Why is Leverage Lower for CFDs (Especially Stocks)?

1. Low Liquidity and High Volatility

CFD stocks tend to be less liquid and more volatile than other markets.

• Many stock charts display frequent price gaps (especially on lower timeframes, like 15 minutes or less) and large, fast movements with long candles.
• This unpredictability makes stocks riskier for both traders and brokers.

When prices move rapidly, brokers may struggle to match your orders with their liquidity providers. In such cases, brokers might need to hedge your orders by taking the other side, increasing their risk.

To manage this risk, brokers impose lower leverage limits on highly volatile markets like stocks.

2. Stock Value Per Unit is Smaller

Unlike forex pairs, where the standard lot size is based on 100,000 units, a stock CFD’s unit size equals the price of one share.

• For example, if Apple stock is trading at $292.37, the required margin for one share at 1:1 leverage is $292.37.
• With 1:10 leverage, the required margin drops to $29.24.

Since stocks generally have smaller unit values, traders don’t need extremely high leverage to trade them effectively.

Maximum Leverage Found for CFDs

After researching numerous brokers:

• Stocks: The highest leverage available for stock CFDs is 1:20.
  • Brokers offering high leverage for forex pairs (e.g., 1:1000 or 1:3000) still limit leverage for stocks.
• Stock Indices: Leverage is higher than stocks, with common ratios around 1:100.
  • Some brokers offer leverage as high as 1:200, and in rare cases, even 1:400.

These differences reflect the liquidity and volatility levels of the underlying assets.

List of Brokers with the Highest Leverage on CFDs

These are the CFD brokers that have the highest leverage on CFDs, particularly on stocks and indices.

Note: in some of the brokers, the minimum deposit is as low as $1 or $5. It doesn’t mean you can trade all stocks with that amount. For example, as we mentioned above, for trading apple, you need to have something around $30 in your account as a required margin.

For forex brokers offering high leverage on CFDs to US clients see this article.

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