Online trading is here to stay. The new generation of professional traders have never experienced the frenzy of an open-outcry trading floor.
For them, the trading experience involves staring at screens and monitoring up-to-the-second data and graphs. They are on constantly the move, trading over apps on mobile devices. In today’s world, one of the most important decisions facing any trader is which online trading platform to use. When making an online broker comparison, deposit limits must be considered. If the trading platform’s minimum deposit is high, too much money can end up being held in trading accounts.
- Overview of ETX Capital’s fee structure
- Details on minimum deposits
- Comparison with other brokers
- Information on ETX as a company
What is ETX Capital?
ETX Capital is a well-known UK-based online trading platform, providing spread betting and CFD trading services to institutional and retail investors. The company also retains a telephone-based brokerage service. ETX loosely stands for electronic trading, telephone trading and execution services. The parent company was founded in 1965 as Monecor Ltd. In 2002, they began operating TradIndex, which dealt in retail derivatives. In 2007, Monecor and TradIndex were bought out by a joint venture of JRJ Group and BXR Group.
The new trading platform was rebranded as ETX Capital and expanded to become a full-service online trading system. In 2015, ETX acquired the customer base of retail forex broker Alpari UK following its collapse.
But what sets ETX Capital apart from its competitors? Are ETX Capital minimum deposit amounts especially low? What other factors might attract investors?
- One-day processing for deposits
- £100 minimum deposit
- No maximum trade, pay-out can go as high as 85%
- Five free withdrawals for amounts over $100 per month
The ETX Capital minimum deposit amount of £100 seems low, considering the sums institutional traders have to invest. However, no two traders are alike. Some particularly small-scale retail customers might be looking for a lower minimum. As a matter of fact, there are currently plenty of online trading platforms offering no minimum limit for deposits and a few that don’t even charge commission.
Is It Competitive?
Some trading platforms offer bonuses for initial deposits but these are usually subject to high trading volumes within a set timeframe before you can actually withdraw any of the bonus funds. These trading volumes are often so high that it is as good as impossible to achieve in the time allowed. The funds appear in your account, but in the end you are never able to access them because you will never reach the required trade volume and inevitably the bonus is cancelled and deleted from your account. So be sure to read the fine print before letting the promise of a large sign-on bonus influence your decision.
ETX currently offers no deposit bonus on its website. The biggest advantages ETX has over competitors is their long-held reputation as a legitimate business. In a sector that often attracts scam operators, investor confidence is essential. The ETX Capital website states that it is pushing to be the best online broker: “At ETX Capital we acknowledge that traders have a significant number of brokerage choices. We have a healthy respect for our competitors and do not take any of them lightly. Nonetheless, we believe that ETX Capital offers traders a wide variety of benefits that many of our competitors may find hard to match.”
What Sets ETX Apart?
The ETX trading software can be installed on a computer for traditional use. For greater mobility, iOS and Android compatible apps are available for downloaded, providing full access to the trading platform.
This company boasts a multilingual customer service team with support available in English, Spanish, French, German, Polish, Czech, Greek and Mandarin. They provide a choice of three different specialised trading platforms with the ability to trade worldwide financial indices, numerous equities, more than 50 forex pairs and numerous commodities. There is also a demo account available so new customers can try out the service and get a feel for the software before risking any real investment.
ETX Capital boasts tight spreads on a range of different products.
- Forex spreads begin at 0.7 pips for EUR/USD
- Equities – 0.08 indicative spreads for some stocks
- Minimum commodities spreads start from 3 pips
- Minimum spreads on indices start from 1 pip for certain major indices
Leverage rates are available at 100/1 for many products, with leverage as high as 200/1 available on some products on the MetaTrader 4 platform.
ETX Capital is regulated by the Financial Conduct Authority and client funds are held in investment-grade banks in the UK. Their website says that: “Daily security checks are made to ensure that the firm has constant sufficient regulatory capital. Client funds are also kept strictly separate from company money.”
Company Performance and Direction
When making a broker comparison, it is a good idea to examine the underlying health of the company. This helps evaluate their longevity as a business. ETX has a reputation of being solid, but it is important to gather more concrete information. Monecor Limited’s most recent filing at Companies House said the company’s revenue is driven by three main areas, spread revenue representing the commission the company makes on each trade, charges for holding overnight positions and the net impact of hedging. Spread revenue represents the majority of the company’s funding. At the end of 2016, the company posted a loss of £2.9m and revenues of £34.3m. This means they are not running short of funds, but it would be even better if they were posting profits rather than losses.
The report with the Companies House filing said: “The company’s strategy remains to increase its penetration in the online retail segment of the business, which the directors believe will leverage the existing capabilities most effectively. This is done in a measured way by taking into account the channel profitability and sophistication of the market. Retail customers are acquired primarily through digital channels and from introducing brokers.
“The company believes that having a high-quality, multi-asset online trading platform across PC, mobile and tablet is key to the success of the business. This, in conjunction with a smooth onboarding process, has been the focus of management and the company’s information technology development during the year.”
Withdrawals and Fees
Withdrawals can take up to six working days to arrive back in the customer’s bank account. ETX Capital offers clients the opportunity to make up to five withdrawals (for any amount over $100) each month without incurring a process or admin fee. However, according to the ETX website, due to fees ETX incurs from banks in processing the withdrawals, clients who withdraw funds more than five times in a calendar month will incur a charge of $25 for each subsequent withdrawal – clients are not charged retrospectively for the previous five withdrawals. For withdrawals after the fifth one which are below the cap of $100, customers will only incur one processing fee.
A monthly inactivity charge of $25 is deducted for dormant accounts where funds are left available. Accounts are considered dormant or inactive if there has been no other trading activity for a continuous period of 365 days or more. If the client decides to reactivate an account by trading again, the inactivity charge for up to three previous months is refunded to the customer’s account if it has already been deducted. While there is an ETX Capital minimum deposit amount, clients will not be charged any actual fees for making deposits.
Using The Website
While the ETX Capital website has a functional, easy-to-use design, the information seemed fragmented. The same information could have been put across using fewer pages, each containing more information. And one of the most important pieces of information, the ETX Capital minimum deposit, did not appear at all on the payments information page and could not be found anywhere on the website, including the FAQ pages.
We had to contact the company directly to find this information and there was confusion on other websites as to whether it is $100, £100 or £200 when merely doing a broad internet search. This shows that when looking for figures such as minimum deposits, it’s best to only trust information directly from the company.
While the FAQ section was comprehensive and written in easy-to-understand language, the FAQ search facility was not working when we tried to test it out. A message was sent to the customer service email regarding this issue. The company’s Grayson Evans replied, stating that the website does not support a search function. He thanked us for bringing the presence of the search bar to his attention and assured us he would pass the matter onto their marketing team so could resolve the confusion immediately.
- Intuitive user interface and design
- However, slightly cluttered website
- Useful FAQs section
Special Features and Awards
In addition to the online system and telephone service, ETX offers instruction in how to make the most of the tools it provides. The website says: “Educating our clients to become better traders is very important to us, and we offer seminars to traders with all levels of knowledge. Our free seminars are provided by both our in-house expert team and an independent trader company to ensure your education needs are met.”
In addition to live seminars, ETX provides live and pre-recorded webinars, exhibitions at trade shows around the world, and even an eight-hour trading course free to clients who hold a trading account, which they claim is worth $1000.
In 2017, ETX launched a new version of its proprietary ETX TraderPro platform which included Bitcoin markets on the new platform. Also in 2017, ETX won Best Forex Educators at the 2017 UK Forex Awards and Best Trading Education at the 2017 Shares Awards.
In 2018, ETX made several new cryptocurrencies available to trade and won two awards for the updated TraderPro platform. They took Best Trading Platform at the 2018 Online Personal Wealth Awards and Best Spread Betting Platform at the 2018 ADVFN Financial Awards, as well as Best Education at the 2018 Online Personal Wealth Awards.
Reviews and Feedback
As we highlighted in our ETX Capital review, real users' experience is mostly positive. User reviews lauded the wide selection of assets to trade with, the low spreads and the fact that the company is regulated by the FSA. Negative reviews were almost exclusively about delays of up to two weeks for processing withdrawals.
One online review published on the website www.forexiswhyimbroke.com said: “The clients of ETX Capital are surprisingly quiet. With ETX taking over Alpari’s clients (UK), you would expect some heated discussions, a lot of media exposure, but nothing like that is happening.
“While reviewing ETX Capital I needed some clarification regarding some of their offerings so I figured the fastest way to get it was to contact Live Chat support. That’s when their bad side – more like a downside maybe – showed itself: they don’t have a live chat feature. Of course, this can be viewed differently depending on the person. Some people prefer email support because it feels more professional and usually the answers you get on email are from a person higher in the hierarchy of the company than a chat representative. […] Also, some might think that not having such a basic function shows lack of professionalism.”
Our Take On ETX Capital
Because of the global nature of the internet, there are many online trading platforms out there competing for the same clients, using a wide range of products to lure valuable customers. ETX knows this and appears to be working hard to make sure it is not left behind as the technology evolves. Having a website offering a search facility that doesn't work and shouldn't be there, along with a lack of online customer service chat shows that they need to work harder to create a website which gives the user confidence in the company. Instead, these issues raise doubts about the functionality of the platform.
After examining what exactly is on offer, it is difficult to say ETX Capital definitely lives up to its promises. The foundation of the company does appear stable, and that certainly goes a long way to make clients confident that their investment capital will not vanish overnight in the event of unexpected market upheaval. But there are better deals with more technically polished offerings available in this sizeable marketplace.
Bearing all this in mind, it is questionable to impose a £100 minimum deposit when the product may not be the premium experience that such a limit would suggest.
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