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5 Best CFDs to buy on the JSE

Updated 15 Aug 2022
5 Best CFDs to buy on the JSE

The 5 Best CFDs to buy on the JSE revealed. We have carried out extensive research and analysis on the best CFDs that you can buy on the JSE in South Africa.

This is a complete guide to the 5 Best CFDs to buy on the JSE

In this in-depth guide you’ll learn:

  • Overview of trading CFDs on the JSE
  • 5 Best CFDs to buy on the JSE
  • How to choose the Right Share Broker in South Africa
  • The Best Share Brokers in South Africa

And lots more…

So, if you’re ready to go “all in” with the 5 Best CFDs to buy on the JSE…

Let’s dive right in…

Overview of trading CFDs on the JSE

A “contract for difference,” or CFD, is a legally binding agreement to buy or sell the fluctuation in price of an underlying asset between the opening and closing of a trade.

eCFDs are Contracts for Difference that are exchanged and settled on an exchange, such as the one run by SAFCOM. There are over 370 shares on the JSE that are CFDs, and most brokers have a 10% margin on the most liquid equities on the exchange.

eCFDs can only be traded through the list of approved JSE-registered Market Makers and Brokers including Investec, RMB Morgan Stanley, and others.

south africa cfd trading

5 Best CFDs to buy on the JSE

Anglo American PLC (JSE: AGL)

This corporation is dedicated to being carbon neutral across all activities by 2040, and it does so while still producing diamonds (via De Beers), copper, platinum group metals, high-grade iron ore and metallurgical coal for steelmaking, nickel, and agricultural nutrients.

With a market value of ZAR 738 billion, or around 3.71% of the equities market on the JSE, Anglo American plc is currently the sixth most valuable stock on the JSE.

Growth, Valuation, Trading Information
Share Price 558.67 ZAR
Market Capitalization 738 billion ZAR
Gross Turnover 6.6 million ZAR
52-Week Range 475.05 – 842.61 ZAR
Shares Outstanding 1.34 billion
Earnings per Share 103.53 ZAR
P/E Ratio 5.33
Dividend per Share 43.05 ZAR
Dividend Yield 7.8%

Merafe Resources Ltd (JSE: MRF)

Shares of Merafe (MRF) are traded on the JSE Ltd. in the General Mining category. Merafe’s current operations are concentrated on its 20.5% stake in Merafe Ferrochrome and Mining (Pty) Ltd., a fully owned subsidiary.

The Venture was established in July 2004 when Merafe and Glencore South Africa operations (Glencore) combined their chrome activities to become the world’s biggest ferrochrome producer.

With a market worth of ZAR 3.45 billion or around 0.017% of the equity market on the JSE, Merafe Resources Ltd is the 171st most valuable stock currently.

Shares of Merafe Resources started the year at 1.20 ZAR and are now worth 1.35 ZAR, showing a 15% increase that places it 47th on the JSE’s year-to-date performance list.

Growth, Valuation, Trading Information
Share Price 1.48 ZAR
Market Capitalization 3.45 billion ZAR
Gross Turnover 2.7 million
52-Week Range 0.69 – 1.96 ZAR
Shares Outstanding 2.5 billion
Earnings per Share 0.67 ZAR
P/E Ratio 2.06
Dividend per Share 0.29 ZAR
Dividend Yield 21%

Absa Group Limited (JSE: ABG)

best cfds to buy south africa

Absa Group Limited is a South African financial services provider that serves individual and commercial clients. The company provides a full range of banking, credit card, corporate and investment banking, wealth and investment management, and insurance services.

This popular retail bank provides asset financing to business clients in addition to a full menu of retail banking services for consumers.

Direct contacts through multi-channel interfaces, such as electronic banking, are only one part of Business Banking South Africa’s coverage strategy, which is, in turn, focused on unique customer value propositions linked with customer and client demands.

With a market value of ZAR 142 billion or around 0.713% of the equity market on the JSE, Absa Group Limited is now the 22nd most valuable stock listed on the exchange.

For the year so far, Absa’s stock price has increased by 9.8% from its opening price of 152.55 ZAR, placing it 70th on the JSE’s list of best-performing companies.

Growth, Valuation, Trading Information
Share Price 168.94 ZAR
Market Capitalization 142 billion ZAR
Gross Turnover 801,000 ZAR
52-Week Range 123.00 – 195.36 ZAR
Shares Outstanding 848 million
Earnings per Share 21.47 ZAR
P/E Ratio 7.80
Dividend per Share 7.85 ZAR
Dividend Yield 4.69%

BHP Group (JSE: BHG)

BHP Group Limited is the world’s top supplier of iron ore, copper, oil, natural gas, and metallurgical coal. With more than 60,000 workers and contractors, the corporation extracts and processes minerals, oil, and gas, mostly in Australia and the Americas.

The sales and marketing of BHP’s goods are directed from Singapore and Houston, United States. The organization’s worldwide headquarters are in Melbourne, Australia.

Currently, BHP Group is the second most valuable company on the JSE, with a market value of ZAR 2.23 trillion, or around 11.2% of the whole Johannesburg Stock Exchange equities market.

Growth, Valuation, Trading Information
Share Price 445.43 ZAR
Market Capitalization 2.23 trillion ZAR
Gross Turnover 3.53 million ZAR
52-Week Range 406.81 – 583.52 ZAR
Shares Outstanding 5.06 billion
Earnings per Share 55.7 ZAR
P/E Ratio 7.90
Dividend per Share 52.31 ZAR
Dividend Yield 11.9%

Telkom SA SOC Ltd (JSE: TKG)

cfd trading JSE

Telkom is South Africa’s major supplier of information and communications technology (ICT) services. Telkom’s purpose is to link people effortlessly to a better life, and Telkom reflects this across all its brands, whether consumer, commercial, or wholesale.

The Telkom Foundation actively strives to bridge the digital gap via initiatives such as the Connected Schools program, while FutureMakers enables digital entrepreneurs to realize their vision.

In South Africa, Telkom SA SOC Ltd offers fixed-line voice and data communications services. In South Africa, the fixed-line sector has more than 4.5 million access lines, and fixed-line penetration is 9.3%.

Telkom SA SOC Ltd is the eighty-fifth most valuable stock on the JSE with a market value of ZAR 21.9 billion, which represents around 0.11% of the Johannesburg Stock Exchange equity market.

Growth, Valuation, Trading Information
Share Price 42.78 ZAR
Market Capitalization 21.9 billion ZAR
Gross Turnover 160 million ZAR
52-Week Range 32.57 – 59.80 ZAR
Shares Outstanding 511 million
Earnings per Share 5.75 ZAR
P/E Ratio 7.44
Dividend per Share 0.50 ZAR
Dividend Yield 1.17%

How to choose the Right Share Broker in South Africa

South African traders could not have picked a more favourable time to enter the investment market than the present. Competition among online brokers is high, which means costs are dropping down and features are being boosted.

Those interested in trading global financial instruments could choose from a wide variety of online forex and CFD brokers. However, there are several factors to consider when choosing a broker and we will go through them here.

Commission Charges

Individual stocks, options, mutual funds, exchange-traded funds, and bonds are the main investment types offered by brokers. Some will also provide exposure to the forex market, futures trading, and cryptocurrency exchanges.

Both the suitability of the broker’s offerings to your investment requirements and the fees you must pay is dependent on the investments the broker has available. You should pay close attention to the commissions that are involved with the investments you like.

cfd trading south africa

Overall Reliability

There is a diverse selection of brokers available. Several have been popular for many years, while others have just recently emerged.

That does not imply they cannot be trusted, but if they are managing transactions for clients, they are members of a self-regulatory organization like the Financial Conduct Authority (FCA), the Financial Sector Conduct Authority (FSCA) and other regulators, or subject to additional oversight.

Account Fees

While it could be impossible to eliminate account fees, they may be kept to a minimum. To withdraw funds or investments, or to close your account, most brokers will assess a fee. When switching brokers, your new firm could pay some or all your transfer expenses.

If a broker does not charge them, or if you do not use their optional services, you could avoid paying most additional costs.

Annual costs, inactivity fees, trading platform subscriptions, and additional charges for research or data are all examples of the kind of expenses you should be aware of.

Pricing and Execution on Trades

Cost is less of a factor today, leading to commission-free transactions becoming the norm at most brokerages.

However, you should consider the brokerage’s position on the controversial practice of paying for order flow and how much it costs before making a final decision.

This is especially true if you are an active trader who wants their deal completed at the best price possible, even if it means a difference of a few cents.

Additional Tools, Educational Materials, and Features

Look for a brokerage that provides free educational tools like live webinars, detailed how-to instructions, video tutorials, glossaries, and more if you are just starting in the investment world.

You should also look at the broker’s commitment to educating its customers about the inherent hazards of more complex trading tactics like options.

JSE CFD trading

Conclusion

An investor may use contracts for difference (CFDs) to either speculate on future exchange rate movements or protect themselves from potential losses.

When trading CFDs, investors could gear (leverage) their investment while avoiding many of the expenses and difficulties associated with trading the underlying item directly.

CFD trading is more complex than regular stock trading and should only be tried by those who are familiar with leveraged products.

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