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S&P 500 CFD spreads at FXTM explained

Your expert
Eszter Z.
Fact checked by
Gyula L.
Updated
3w ago
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Are S&P 500 CFD spreads low at FXTM as of January 2024?

No, unfortunately, S&P 500 CFD spreads spreads at FXTM are high. If you are looking for a broker with lower CFD spreads, check out our article on the best lowest-spread CFD brokers.

The S&P 500 CFD spread is 1.0 at FXTM while the average spread is 0.7 for the same currency pair at 53 brokers reviewed by BrokerChooser.

S&P 500 CFD Spread Analysis: Ranking 53 Brokers by BrokerChooser
S&P 500 CFD spread
S&P 500 CFD spread fee class
0.5 Low
0.4 Low
2.3 High
1.5 High
0.2 Low
0.3 Low
0.4 Low
0.3 Low
0.4 Low
0.3 Low
0.4 Low
0.6 Low
0.4 Low
0.4 Low
0.4 Low
0.4 Low
0.4 Low
XM
0.5 Low
0.4 Low
0.4 Low
0.4 Low
IG
0.4 Low
0.6 Low
0.4 Low
0.4 Low
0.5 Low
0.5 Low
0.5 Low
0.5 Low
0.5 Low
0.5 Low
0.6 Low
XTB
0.6 Low
0.6 Low
0.6 Low
0.6 Low
0.6 Low
0.6 Low
1.0 High
0.6 Low
0.7 Average
0.8 Average
0.9 Average
Axi
0.5 Low
1.0 High
0.8 Average
1.1 High
1.7 High
1.5 High
FBS
1.5 High
3.0 High
1.0 High

Data updated on January 29, 2024

The Essence

  • Lower spreads potentially increase your profit and reduce your losses, so lower spreads are preferable.
  • However, it depends on your trading style if higher spreads could still work for you.
  • If you hold your trade position for short periods of time, lower spreads could be better.
  • Learn about CFD trading before getting into it, it carries significant risks.

For low-spread CFD brokers offering competitive rates on S&P 500, check out our article on the best lowest-spread CFD brokers.

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S&P 500 CFD spreads and costs at FXTM

Now, let's check the S&P 500 CFD spreads and costs in detail at FXTM!

S&P 500 CFD spreads and costs
💹 S&P 500 CFD spread 1.0
📊 S&P 500 CFD spread fee class High
💰 S&P 500 CFD fee The fees are built into the spread, 1 point is the average spread cost during peak trading hours.
📈 S&P 500 CFD benchmark fee $3.1

The data presented in the table was collected on Oct 5, 2023.

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OK, now you know the technical details, but what do they all mean?

What is S&P 500 CFD trading?

The S&P 500 is a stock market index that measures the performance of 500 of the largest publicly traded companies in the US. The S&P 500 is a popular index with traders because it is seen as a benchmark for the overall health of the US economy. The index is widely recognized as an indicator of the performance of large-cap stocks, and it is often used by traders and investors to gauge the direction of the stock market as a whole.

S&P 500 CFD trading involves speculating on the price movements of the S&P 500 index without actually buying or selling any stocks. Instead, you can use a broker to trade contracts for difference (CFDs), a derivative financial product that is based on the price of the index.

What is the spread?

So you are now familiar with the basics about S&P 500 CFD trading, but what is a spread and why is it important that it is low?

CFD spread refers to the difference between the buy and sell price of a CFD. The spread is the primary cost of trading CFDs, and it basically represents the broker's commission for facilitating the trade. In other words, when you open a CFD position, you pay the spread to the broker. The spread can vary depending on the underlying asset, the market conditions, and the broker's policies. A low spread means lower trading costs for you, the trader. This can help increase your potential profits and reduce losses.

Here's an example:

  • Let's say you want to trade a CFD on the S&P 500 index.
  • The current market price for the S&P 500 index is 4,200.00 bid and 4,201.00 ask.
  • The bid price is the price at which you can sell the S&P 500 CFD, and the ask price is the price at which you can buy the S&P 500 CFD.
  • The difference between the bid and ask price is the spread. In this case, 1.00 (100 basis points).
  • So if you want to buy the S&P 500 CFD, you would need to pay the ask price of 4,201.00. If you want to sell the S&P 500 CFD, you would receive the bid price of 4,200.00.

It's important to note that CFDs are leveraged products, which means that you can trade with a small amount of capital, but your potential profits and losses can be magnified. Therefore, it's essential to manage your risk carefully, monitor your position regularly and use for example stop-loss orders to limit your losses.

Is a financing rate charged at FXTM?

At FXTM, the financing rate for S&P 500 CFDs is 7.0%, offering competitive terms for traders seeking to hold positions overnight.

The data regarding the financing rate for S&P 500 CFDs was collected on Oct 5, 2023.

What does the CFD financing rate mean?

The financing rate, also known as the overnight financing rate or the rollover rate, is a cost or credit that is charged or paid to hold a CFD position overnight. In CFD trading, a position held overnight is subject to a financing charge or credit, which reflects the cost of borrowing money to maintain the position.

When trading CFDs, the position is usually leveraged, meaning that you only need to put up a fraction of the total position value as a margin deposit. The broker provides the remaining funds as a loan to you, and charges or pays interest on the borrowed amount based on the financing rate.

The financing rate is calculated based on the interbank lending rate of the currency in which the CFD is denominated, adjusted for the broker's markup or discount. The financing rate is usually expressed as a percentage per annum, and is applied daily to the open position.

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Looking for a CFD broker?

If you are looking for the brokers that offer the best CFD trading conditions, check our top recommendations of the best CFD brokers in the world.

Read Best CFD Brokers article

Our expert team here at BrokerChooser specializes in helping you find a broker that best suits your needs. We have reviewed over a 100 brokers based on BrokerChooser's unique methodology.

If you have any feedback or questions, feel free to contact us via email!

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Further reading

Author of this article

Eszter Zalán
Eszter Zalán

Eszter is a former Editor and Financial Journalist for BrokerChooser. She wrote and edited BrokerChooser's content from 2021 onwards, bringing her more than a decade-long experience in journalism to the team. She has covered world affairs and several financial crises, and dove deep into SEO and coding to make BrokerChooser's content more accessible to users.

Everything you find on BrokerChooser is based on reliable data and unbiased information. We combine our 10+ years finance experience with readers feedback. Read more about our methodology.

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