- Min. Deposit – $0
- Max. Leverage – 30:1
- Headquarter – Melbourne, Australia
- Products (CFD) – Forex, Commodities, Indices, Cryptocurrencies, Shares, ETFs
Since opening its doors in 2010, Pepperstone Group has emerged as a top-tier player in the online brokerage landscape, building a highly competitive and full-featured trading portal that focuses on forex, shares, indices, metals, commodities and even cryptocurrencies.
Customer accounts are segregated from company funds, providing an additional layer of security in an industry that is prone to turbulent periods. Support options are plentiful, highlighted by 24/5 chat/phone support and a functional FAQ that includes clearly stated policies on deposits, withdrawals, and trade disputes.
Numerous desktop, mobile, and web-based platforms, an industry-standard product catalog, above average educational resources, tight spreads, and multiple account types all combine to offer a trading experience that will appeal to novice and professional traders alike.
Who Pepperstone Is for
Pepperstone offers uncomplicated access to the markets which allows the client to focus on the complicated task of trying to successfully trade the markets. Pepperstone is ideally suited to traders that want a manageable range of low-cost offerings, multiple choices of user interfaces and account types, and efficient customer support. Investopedia’s ranking algorithm factored in these attributes in declaring Pepperstone as the Best Forex Broker for Trading Experience in 2020.
Pros
- Low FX spreads
- Range of platform offerings
- Good customer service
Cons
- No guaranteed stop loss
- Demo account provided after verification
Costs
Pepperstone’s costs are very competitive within the online brokerage industry. New clients can choose between the “Standard” account with minimum FX spreads starting from one pip but no commission, or the “Razor” account with minimum FX spreads starting from zero pips but with commission added. The other instruments offered by Pepperstone all have either straight spreads or some combination of spread plus commission.
For example, the broker advertises that the average spread for EUR/USD on Razor is 0.13 pips and a commission will be added on to that. The average spread for the Standard account is 1.13 pips, all in. The average spread cost with an MT5 Razor account for a completed (buy & sell) €100,000 trade, where the base currency is euro, would be 0.13 pips + €5.23 commission. This would translate to a total spread cost of 0.653 pips.
The website’s attempt at transparency regarding its spreads, while well intentioned, is confusing (outlined in the graphic below). Assuming that the differences highlighted are errors due to a lack of oversight, and that there aren’t differences between MT4 and MT5 with respect to FX spreads, Pepperstone’s spread costs are among the lowest available in the online retail forex arena.
Funding options are comprehensive and include Visa, MasterCard, POLi, Bank Transfer, BPay, PayPal, Skrill, Neteller, and Union Pay. The broker states that “funding options are fee-free for traders in most countries.” No dormant or inactivity fees were found when reviewing site disclosures and FAQs. Apparently, Pepperstone doesn’t charge an inactivity fee, which is a rarity in this industry. There are, however, fees for international bank wire withdrawals.
As is the norm in the FX industry, clients will be charged swap fees on positions that they hold overnight. Pepperstone advertises that its “overnight rates are set at the benchmark regional interest rates for the underlying product, plus (or minus) our fixed charge of 2.5%,” which is applied directly to the client’s account.
Required margin varies with the type of instrument being traded but can only be found in the “New to trading” FAQ section on the website. Prospective clients can, however, access margin requirements for all available products by logging into the the “secure client area” > “trading tools” > “calculators” > “margin calculator”.
Trade Experience
Pepperstone offers a broad range of platforms to suit every investment and trading style. The platforms are third-party, white-label offerings, as Pepperstone has shied away from building a proprietary interface. Customers can choose between MetaTrader (MT) 4/5 and cTrader, a higher-end system with direct liquidity-provider pricing and advanced technical features that include detachable charts, back-testing, and algorithmic strategy support. Smart Trader Tools for MT4 extend technical functionality, adding a suite of apps that assist with trade execution, market research, and depth of market analysis.
Pepperstone’s cTrader is a streamlined trading platform that is available as a download or web-based interface, which is stable and easy to access from any browser (Chrome, Firefox, Safari, or Internet Explorer). This platform provides an updated look and feel, one-click trading, and full integration across desktop and mobile platforms, which enhance the trading experience for all types of traders.
Pepperstone’s cTrader has a simple and easy-to-use interface where traders can set up watchlists, analyze charts, place and monitor trades, have access to an instrument’s “depth-of-market,” and keep abreast of upcoming events with the market calendar. The technical analysis charts can be expanded to full screen and come with more than 70 technical indicators that you can apply over many different time frames, from tick charts to monthly charts.
The Autochartist program generates trade ideas based on technical analysis patterns. The platform additionally provides traders with the option of “copy” or “social” trading, which can be accessed through the desktop trading platform, and also automating their own strategies.
Pepperstone’s cTrader has four basic order types with the option of attaching “take profit” and/or “stop loss” orders to them. Additionally, the trader can make the stop loss a trailing stop loss, though the option for a guaranteed stop loss is not offered. Furthermore, there is a choice as to whether the trader wants the stop loss order to be executed at the bid or ask rate.
- Market – The simplest order where a trader signals that their trade request should be executed at the prevailing market rate.
- Limit – A pending order where the entry is at a predetermined point below or above the prevailing market rate depending on whether it’s a buy or sell. The trader also has the option of selecting the expiration time of this order.
- Stop – A pending order where the entry is at a predetermined point above or below the prevailing market rate depending on whether it’s a buy or sell. The trader also has the option of selecting the expiration time of this order.
- Stop-Limit – A pending order where the entry is at a predetermined point above or below the prevailing market rate depending on whether it’s a buy or sell, but where the trader can select the tolerance range for execution. For example, if the market gaps over the selected rate and the tolerance interval then this order is immediately cancelled. The trader also has the option of selecting the expiration time of this order.
Impressive mobile options include MT4/5 and cTrader for iOS and Android. cTrader Web and the MT4 WebTrader provide tablet and iPad access, but there’s no MT5 web version. All mobile versions are useful but limited in functionality, which is expected, but some customers may wish for more sophisticated feature sets.
Pepperstone has also partnered with Equinix to provide low-latency access to the global interbank system, centered at the Equinix Financial Exchange in New York. High-end clients, who demand blazing fast execution speeds and minimized pricing lag, can choose from a wide range of VPS options through this facility.
Safety
Pepperstone is regulated by 7 national authorities including top-tier regulators such as the FCA in the UK. At the same time, the company is not listed on any exchange, does not disclose financial information and does not have a bank parent.
Is Pepperstone regulated?
Yes, it is regulated by the following authorities:
- UK’s Financial Conduct Authority (FCA) for UK clients
- Federal Financial Supervisory Authority (BaFin) for German and Austrian clients
- Cyprus Securities and Exchange Commission (CySEC) for other EEA clients
- Dubai Financial Services Authority (DFSA) for Middle-Eastern clients
- Australian Securities and Investments Commission (ASIC) for Australian clients
- Capital Markets Authority of Kenya (CMA) for African residents
- Securities Commission of The Bahamas (SCB) for all other clients
Markets and products
- 60+ FX pairs
- 16 index CFDs
- 60+ share CFDs
- 12+ commodity CFDs
- 5 cryptocurrency CFDs
- 3 currency index CFDs
All instruments are available in all account types, but cryptocurrency fees aren’t well documented, which is disappointing due to that category’s high volatility and relatively wide spreads. Pepperstone traders that select the MetaTrader 5 forex trading platform can trade U.S. share CFDs. Over 60 U.S. stocks can be selected to be traded as CFDs, with low commissions from USD$0.02 per share. Traders can go long or short on these CFDs.
Customer Service
Along with email support, the broker offers 24/5 chat/phone support as well as social media portals and an online contact form. Additionally, clients are assigned an account manager to assist them with relevant account-related matters. Given that the company advertises not having a dealing desk, it stands to reason that clients would not be able to contact the dealing desk in case of a trading emergency. Local clients can walk into the main Melbourne, Australia office, but online support options are likely to produce more rapid results. An adequate FAQ addresses most inquiries, though its organization and content could be improved.
Education
Pepperstone’s website contains comprehensive educational resources through a dedicated section that includes “Learn To Trade Forex” tutorials, numerous archived and live webinars, and an impressive list of trading guides. Commodity trading is also covered in detail, along with discussions on slippage, hedging, and margin. In addition, Pepperstone uses this section to highlight support options that include platform comparisons, platform guides, and deposit/withdrawal procedures. The site also features standard educational fare that includes a market glossary and technical analysis tutorials.
Research
Pepperstone’s market analysis and insights are on par with industry standards and serve to connect traders to the market and supplement its educational resources. Along with a “market calendar,” there are sections for “market analysis” and “market news,” which provide useful information and actionable analysis that add value to one’s trading. Daily pre-market “forex reports” are emailed to the client prior to the start of each trading session.
The analysis section covers a wide array of topics, from politics to other newsworthy events, while a section called the “Daily Fix” provides analysis on market-moving events. The broker’s X (formerly Twitter) account also appears to be quite active. MT4/5 and cTrader provide few research features but the Smart Tools add-on for MT4 partially remedies this deficit. Additional research with “more insights and analysis” is available for active traders and high-volume traders.
Final Thoughts
Pepperstone is a great forex and CFD broker, regulated by multiplse top-tier authorities, including the FCA, the BaFin and ASIC.
The account opening is fast and fully digital. Customer service is great, providing lightning-fast and relevant answers. Deposit and withdrawal are a breeze, with no fees charged in most cases.
Feel free to try Pepperstone as there is no inactivity fee or minimum deposit for standard accounts.
