Using Monthly Rebates to Cut Your Trading CostsRebates are a way of getting some money back from your broker or spread betting company.
Financial Spreads have started a new monthly rebate scheme called “Trader Rebate” which looks like one of the more generous and user-friendly schemes.
We have covered the Trader Rebate and other rebate offers below.
First Things First… Do Rebates Help You?
What About The Little People? What About Low Volume Traders?1) Same as the big boys… concentrate on getting your trading right.
2) Keep your trading costs low and use a firm that offers tight spreads:
Note that Financial Spreads does tend to do well on the comparisons but a number of the firms are similarly competitive if you are just trading the FTSE 100 or EUR/USD.
3) Use a firm that doesn’t charge you commissions to open/close a trade.
Many spread betting, CFD and forex firms don’t charge commissions to open/close trades but if you use their MT4 platforms then some extra commission costs can creep in. Check trading costs in advance if you want to use MT4.
FinancialSpreads.com’s “Trader Rebate”: Up to 20% RebateAs of August 2017, the “Trader Rebate” ticks the boxes of:
The downside… as with nearly all rebates, you need to trade a lot to get a rebate, see examples below.
But… if you trade a lot anyway then they are useful.
Although… as of 21 August 2017 Financial Spreads have dropped the entry level so that if you trade £250 in spread then you’ll get a 10% rebate. This makes it a lot more realistic. But it’s still a lot of trades.
Trader Rebate FAQsHow Big is the Trader Rebate? Monthly Rebate Tiers
|Spread Costs in the Calendar Month||Rebate Tier|
|£1,500 – £3,999||15%|
|£250 – £1,499||10%|
|Less than £250||0%|
Spread costs = spread x stake, e.g. one closed £10/pt trade on GBP/USD (0.9pt spread) = £9 in spread costs.
How To Get a Rebate?
As above, and trading with a Financial Spreads Account: How To Withdraw the Rebate? Does the Trader Rebate Work on All Markets? Monthly Trader Rebate Example 1 Monthly Trader Rebate Example 2
The following trades create spread cost of £1,505 and so give a Trader Rebate of £1505 x 15% = £225.75:
More Rebates for Forex, Spread Betting and CFDs
Rebate 2: InterTrader’s “TradeBack”InterTrader’s “TradeBack” is similar to the “Trader Rebate” but the tiers are not as generous. E.g.:
Note 1) InterTrader‘s TradeBack only applies to their web platform and not MT4 trades.
Note 2) There is no maximum monthly rebate with “TradeBack”.
In comparison, the maximum rebate with Financial Spreads is £2,500 per month but you would need to trade off the charts to hit that limit.
Err… e.g. you could have 1,562 closed trades on the FTSE 100 (0.8pt spread) with a healthy £10 stake before you hit the £2,500 maximum.
That’s a lot of trading for one month.
(1,562 x 0.8pt x £10/pt = £12,496. 20% of £12,496 = £2,499.2).
Tip: if you happen to be doing this much trading every month then drop them an email. They might adjust the limits for you. You’ll probably need to show you are serious by trading with them for a month first. But it’s worth a simple email.
Rebate 3: Financial Spreads “25% Rebate”As well as the Trader Rebate, Financial Spreads offer an introductory one-off “25% Rebate”.
Other FX, CFD and Financial Spread Betting RebatesThe above list is not definitive and naturally it is subject to change.
Other brokers may offer rebates.
Remember: Spread betting, CFDs and forex trading carry a high level of risk. You can lose more than your initial investment. These products are not suitable for all investors. Only speculate with money that you can afford to lose. Make sure you fully understand the risks involved and seek independent financial advice where necessary.