ETFinance Review

Etfinance.eu briefly

ETFinance is a trading name of Magnum FX (Cyprus) Ltd., which is authorized and regulated by the Cyprus Securities and Exchange Commission (CySEC). ETFinance provides online trading in currency pairs, indices, commodities, shares and cryptocurrencies through the world’s well-known trading terminal – MetaTrader 4 (MT4). ETFinance was established to help people realize their financial potential in a changing financial world, the company claims.

Regulation

It is essential to know where the company is regulated. Magnum FX (Cyprus) Ltd. is a Cyprus Investment Firm (CIF), which is authorized and regulated by the Cyprus Securities and Exchange Commission (CySEC), under license number 359/18. It operates on the European market in accordance with the Markets in Financial Instruments Directive (MiFID) and is authorized to provide investment services across the majority of the European Union. Services include reception and transmission of orders and execution of orders. It is also a member of the Investor Compensation Fund (ICF) retail clients are protected by the Financial Services Compensation Scheme (FSCS).

Account Types

There are three types of live accounts, which differ mainly in the spread and the number of instruments offered.

Silver account – There 750 instruments available including 62 currency pairs, 15 indices, commodities, and shares. The average spread for the EUR/USD pair is 2.2 pips. Trading is commission free.

Gold account – There are the same instruments but the average spread for the EUR/USD pair is 1.3 pips. There is a swap discount of 25%. Trading is commission free.

Platinum account – There are the same instruments, but the average spread for the EUR/USD pair is 0.7 pips. The swap discount here is 50%.

The minimum deposit amount is USD250 for the Silver account. Other values are not revealed but the Terms and Conditions document mentions an amount of USD1,000. The company does not clarify whether this applies to all types of accounts.

What type of Brokerage the company is?

The Order Execution Policy text shows that ETFinance executes each order you place through the liquidity provider which acts as your counterparty. For the execution of orders, the company acts as an agent on your behalf and not as a principal. For the purposes of client orders, the liquidity provider is always the counterparty (or ‘principal’) to all your trades. The liquidity provider is the sole execution venue for the execution of the client’s orders. This means the company uses a Straight Through Processing (STP) model to execute orders. In this way, the company does not keep the financial risk to itself, but transfers it to the liquidity providers; therefore, there is no conflict of interest, such as with market makers.

The same document reveals that under specific trading conditions it might not be possible to execute orders (Stop Loss, Take Profit, Buy Limit, Buy Stop, Sell Limit or Sell Stop) at the requested price. Under such circumstances, the company has the right to execute the order at the first available price. In other words, market orders are subject to slippage and stop loss orders are not guaranteed.

The Terms of Business document informs that all retail investors are provided with Negative Balance Protection, which means that client’s losses cannot exceed the client’s amount invested.

Fees

In addition to all the usual fees, such as spreads and rollovers, there also is an inactivity fee. Trading accounts with no trading activity (open/close a trade or deposit) for a consecutive period of 60 days shall be classified as Inactive Accounts. For example, during the period of 60 days the client did not open any new trade or did not make any new deposit. Inactive accounts will be charged quarterly with an inactivity fee within EUR120-EUR500.

Deposits and Withdrawals

Deposits can be made by bank transfer, credit/debit cards Skrill and Trustly. The minimum deposit is USD250 and there are no fees on deposits.

Withdrawals can be made in the same ways as deposits – bank transfer, credit/debit cards, Skrill and Trustly. The minimum withdrawal amount for bank wire transfer is EUR50. The company charges a fee of EUR50 if no trades are made prior to the withdrawal request. The company also reserves the right to charge a EUR15 processing fee for withdrawals made by bank wire. In case of credit card deposits, the company will first refund all amounts up to the amount deposited through that same card. Then the funds will be returned to the client via bank wire. Withdrawals are processed in one business day.

Trading Platforms

Clients can trade via one of the most widespread trading platforms globally – MetaTrader 4 (MT4). It is favored by all types of traders – beginners and experienced ones. MT4 has a wide set of trading tools and features and is available as both web and mobile terminals. It offers a perfect solution for your trade using technical and fundamental analysis. The platform is highly customized, giving detailed information about financial instruments and deals. You can perform one-click trades and implement your strategies easily. Plenty of analytical tools and technical indicators can be placed on charts, allowing traders to take better decisions. ETFinance allows you to subscribe and follow investors who share trading signals and whose trades can be copied.

Assets

Currency pairs – More than 50 popular major, minor, and exotic currency pairs can be traded. Spreads depend on the account type and the average value for the EUR/USD pair is 1.6 pips for the Silver account and 0.7 pips for the Platinum account. The leverage is 1:30 for retail clients and up to 1:500 for professional ones. Trading is commission free.

Indices – You can trade 21 of the major and minor indices, such as ASX200 and DJIA. The minimum spread is 2 points, and the leverage is 1:20/1:10 (major/minor) for retail clients and 1:125 for professional ones. Trading is commission free.

Commodities – 17 of the most traded commodities are available such as Gold, Silver, Oil, Brent, Wheat, etc. The average spread for the Gold is USD0.75 and the leverage is 1:10 for retail clients and 1:125 for professional ones. Trading is commission free.

Shares – Over 200 global shares are available for trading. The leverage is 1:5 for retail clients and 1:10 for professional ones. Trading is commission free.

Cryptocurrencies – 34 cryptocurrencies are available for trading including Bitcoin, Ethereum, Litecoin etc. The required margin is 50% (1:2 leverage) for retail clients and 100% (1:1 leverage) for professional ones. Trading is commission free.

Education

The website has an educational section full of information, including a third-party economic calendar, a corporate profit calendar, articles, videos, e-books, tutorials and more.

Summary

ETFinance is a brokerage firm regulated by the CySEC that uses the STP model to execute client orders, so there is no major conflict of interest. You can trade currency pairs, commodities, indices, shares and cryptocurrencies through the MT4 terminal, available as a desktop version, as a web-based version and as a mobile app. You can deposit by bank transfer, debit/credit cards, and e-wallets. You can start trading with a deposit of at least USD250. Spreads are variable and the one for the EUR/USD pair has a minimum value of 1.7 pips (for the Silver account). All instruments can be traded without commission.