Established as a reputable CFD broker, Eightcap provides leveraged trading up to 500:1. Operating from Australia, they’ve expanded globally in recent years, thanks to their appealing asset selection and competitive spreads.
But, is Eightcap a secure choice?
In this review, we’ll delve into their reputation, history, and offer expert trading insights to help you make informed decisions.
About Eightcap
Founded in 2009 and headquartered in Melbourne, Eightcap operates under the parent company Eightcap Pty Ltd. Their main offices are situated at Level 11, 356 Collins Street, with additional branches in Shanghai.
Specializing in Contracts For Difference (CFDs), Eightcap employs a “no-dealing desk” Straight Through Processing (STP) model, ensuring traders access competitive spreads.
As a CFD broker, Eightcap facilitates leveraged trading, offering a maximum leverage ratio of up to 500:1 across various assets, including forex, commodities, equities, and cryptocurrencies.
Despite its Australian base, Eightcap extends its services to over 100 countries globally, with its website available in seven languages: German, Spanish, French, Italian, Chinese, Japanese, and Thai.
However, certain regions are restricted due to licensing requirements, notably including the USA, Japan, and specific provinces in Canada.
Is Eightcap Safe?
Ensuring broker safety and client protections are paramount in our reviews, particularly considering the risks associated with unregulated firms.
Where does Eightcap’s safety measure up?
Regulatory Compliance
We’re pleased to note that Eightcap is fully regulated by the Australian Securities and Investment Commission (ASIC), holding an AFSL license numbered 391441. This signifies adherence to stringent regulatory standards set by a reputable governmental body.
Advantages of Regulation:
- Capital Reserves: ASIC mandates brokers to maintain substantial capital reserves, ensuring they possess at least A$1 million to cover potential shortfalls.
- Background Checks: Rigorous KYC (Know Your Customer) procedures are conducted at both director and company levels before license issuance, enhancing transparency and accountability.
- Segregated Accounts: Brokers must maintain segregated bank accounts for client funds and the broker’s own funds, safeguarding clients’ assets from any potential misuse or insolvency issues.
- Regular Reporting: Compliance extends beyond initial licensing; brokers must provide ongoing updates to ASIC regarding their financial status and liquidity ratios, ensuring continued accountability.
In addition to meeting regulatory requirements, clients benefit from access to regulatory agencies such as ASIC for complaints resolution, backed by robust reporting protocols.
Audits & Insurance:
To ensure robust liquidity coverage, Eightcap engages an independent external auditor to monitor their capital adequacy regularly. Additionally, they conduct daily client money reconciliations to maintain transparency and accountability.
Moreover, Eightcap secures professional indemnity insurance, providing protection in the event of legal liabilities that may require financial settlements. Brokers lacking such coverage risk potential liquidity shortfalls under such circumstances.
Assets & Leverage:
Eightcap offers a diverse range of assets for trading, including Forex (Major & Minor), equities, commodities, and cryptocurrencies.
Regarding equity trading, Eightcap provides a standard selection of index CFDs; however, single stock assets are not available for trading. They offer 10 different index CFDs for traders.
In the cryptocurrency realm, Eightcap exceeds the norm by offering 6 different cryptocurrencies, including Bitcoin (BTC), Bitcoin Cash (BCH), Bitcoin Gold (BTG), Ethereum (ETH), Litecoin (LTC), and Ripple (XRP).
It’s essential to understand that trading cryptocurrencies with Eightcap does not involve purchasing the underlying assets. Instead, these are derivative instruments subject to daily mark-to-market valuation, rather than physical delivery.
When you open an account with Eightcap, the default leverage is set at 100:1. Should you wish to request higher leverage, you can contact customer support after completing the verification process.
It’s important to mention that the maximum leverage permitted for cryptocurrencies is only 1:5, which is relatively lower compared to other CFD brokers like IQ Option.
To mitigate the risks associated with leverage, Eightcap implements limits on the maximum equity allowed in accounts.
Here are the leverage options provided by Eightcap, along with the corresponding minimum and maximum account equity requirements:
- 500:1 leverage with a minimum account equity of $500 and a maximum account equity of $5,000
- 400:1 leverage with a minimum account equity of $500 and a maximum account equity of $10,000
- 300:1 leverage with a minimum account equity of $500 and a maximum account equity of $50,000
- 200:1 leverage with a minimum account equity of $500 and a maximum account equity of $100,000
- 100:1 leverage with a minimum account equity of $100 and a maximum account equity of $100,000+
- 50:1 leverage with a minimum account equity of $100 and a maximum account equity of $100,000+
- 25:1 leverage with a minimum account equity of $100 and a maximum account equity of $100,000+
- 1:1 leverage with a minimum account equity of $100 and a maximum account equity of $100,000+
While a 500:1 leverage may seem enticing when profits are rolling in, it can equally amplify losses if the market turns against you. It’s crucial to practice diligent risk management.
Eightcap Spreads & Fees
Considering the scale of your positions, the spreads play a significant role in your overall profitability and are thus a key consideration for us.
At Eightcap, the spreads you’ll encounter depend on the type of account you hold. They offer both Standard and Raw accounts, with the Raw account boasting near-market “raw” spreads.
Here are examples of spreads for various assets on both the Standard (S) and Raw (R) accounts:
- AUD/USD: 1.0 – 1.4 pips (S) / 0.0 – 0.4 pips (R)
- GBP/USD: 1.2 – 1.8 pips (S) / 0.2 – 0.8 pips (R)
- EUR/CHF: 1.0 – 2.5 pips (S) / 0.0 – 1.5 pips (R)
- EUR/AUD: 1.0 – 2.5 pips (S) / 0.0 – 1.6 pips (R)
- AUD/USD: 1.0 – 1.4 pips (S) / 0.0 – 0.4 pips (R)
- AUS200: 1.0 – 1.2 pips
- SPX500: 0.3 – 2.5 pips
- XAU/USD: 20 – 30 cents
- UKO/USD: 0.05 – 0.59 points
- Bitcoin (BTCUSD): 40 – 50 pips
- Ripple (XRPUSD): 1 – 2 pips
The forex pair spreads are generally reasonable, although Bitcoin’s spread of 40-50 pips is relatively high. Note that while raw spreads are lower than standard, there’s a fixed “lot commission” of $3.5 per lot traded.
In addition to spreads, you might incur a “Swap fee,” which varies with market conditions and can be viewed in your MT4 / MT5 dashboard.
The swap fee is essentially an overnight rate applied to your positions, accounting for the interest rate differentials between currencies. This rate could be positive or negative, depending on the relative interest rates, and is charged at 00:00 New York time each night.
Fortunately, there are no additional fees applied to the account, including withdrawal and funding fees. However, if you opt for an international wire transfer, an additional $25 fee for the telegraphic transfer will be charged.
Eightcap Account Types:
As mentioned earlier, Eightcap offers two distinct account types: Standard and Raw.
The Standard account is ideal for beginners entering the Eightcap platform. It provides full access to both platforms, along with access to deep liquidity and competitive spreads.
On the other hand, the Raw account offers direct market access, resulting in lower spreads (nearly zero on forex). With no dealing desk involved, you can expect near-instant execution of your orders.
We were impressed to find that both account types offer considerable flexibility in trading strategies, allowing for scalping, hedging, and the development of custom Expert Advisors (EAs).
With a reasonable minimum deposit requirement of $100 and a minimum lot size of 0.01 lots, these accounts are well-suited for beginner traders looking to enter the market gradually.
Ultimately, your choice of account will depend on your trading volume. If you’re a frequent trader, the savings on spreads may outweigh the commission charged on lots. However, for those starting with smaller trades, the standard account may be more suitable.
Eightcap Demo Account:
Why risk funds when you can try it for free? Eightcap offers a standard demo account with full functionality and demo money, providing a risk-free opportunity to explore the platform.
The demo account is easily accessible with just your contact details and platform preference required for registration. It’s a valuable tool for beginners to familiarize themselves with the platform and for experienced traders to observe the spreads offered by Eightcap.
While the demo funds can be replenished up to $1 million in base currency, please note that all demo accounts have a 30-day limit, although you can open multiple accounts if needed.
Eightcap Platforms:
Eightcap offers the widely popular MT4 and MT5 trading platforms, developed by MetaQuotes, a leading provider in the industry.
MT4, the original platform, is renowned for its extensive charting features and technical analysis capabilities, making it a favorite among traders. Despite its advanced features, MT4 remains user-friendly, with intuitive navigation and quick buy/sell functionality.
Moreover, MT4’s proprietary coding language, MQL4, enables users to create their own Expert Advisors (EAs) for automated trading. The platform is accessible across various devices and operating systems, including web browsers, PCs, MacBooks, and mobile apps for Android and Apple devices.
MT5:
As you may have gathered, MT5 represents a more advanced and upgraded platform developed by MetaQuotes, offering access to the full range of assets available at Eightcap.
From a user interface perspective, MT5 has been enhanced, introducing features such as a comprehensive order depth chart and an integrated economic calendar directly within the platform.
Additionally, the coding language for developing Expert Advisors (EAs) has been updated to MQL5, which is more object-oriented. This provides increased functionality, including the ability to create custom indicators, and enhances the robustness of backtesting.
MT5 boasts a vibrant community of users who freely share scripts and provide support, making it accessible even for those who may not have coding skills.
Similar to MT4, MT5 is accessible across various devices, including web browsers, PC/Mac clients, and mobile apps for both iOS and Android.
Eightcap Mobile App:
While Eightcap does not offer a dedicated mobile app for account management, deposit, or withdrawal, you can still access the MT4 and MT5 mobile apps through your mobile browser.
The MT4 and MT5 mobile apps are highly regarded, offering features such as charting, order management, one-click trading, and monitoring of EA performance. Both apps have garnered overwhelmingly positive reviews on app stores, with millions of installations.
However, desktop clients still offer greater functionality compared to mobile apps. Factors such as charting complexity and order latency should be considered when trading on mobile devices. Nonetheless, the mobile apps are a convenient option when you need to trade on the go.
Here’s a breakdown of the payment options accepted by Eightcap, along with their respective terms:
- Credit/Debit Card: Visa and Mastercard are accepted for instant processing with zero transaction fees. Available currencies include AUD, USD, GBP, EUR, NZD, CAD, and SGD.
- POLi Payment: A quick and easy online funding method for Australian clients, offering instant clearance with no fees. However, it’s only available in AUD.
- Wire Transfer: Traditional funding method with possible fees and a processing time of 1-3 business days. Available currencies are AUD, USD, GBP, EUR, NZD, CAD, and SGD.
- Bpay: Another quick and simple funding option for Aussie traders with no transaction fees, but takes a day or two to clear.
- China Union Pay: Ideal for Chinese clients making payments in RMB, with no transaction fees and instant processing.
- Skrill: A popular online web wallet option, formerly known as “money bookers”. Funding in USD or EUR incurs no fees, with clearance taking about a day or two.
In summary, card payments offer the quickest method to transfer funds to the broker, available 24/7, and credited to your account as soon as received by the broker.
Withdrawals:
Withdrawing funds from Eightcap is as straightforward as depositing them. Simply navigate to the “Withdrawal” section in your client portal and complete the provided form, selecting the withdrawal amount and method.
Ensure that you’ve fulfilled the Know Your Customer (KYC) requirements before requesting a withdrawal, as Eightcap may refuse withdrawals until verification is completed.
Withdrawal requests submitted before 01:00pm AEST/AEDT on a business day will be processed on the same day; otherwise, they’ll be processed the next day.
If you’ve funded your account using a card in the past 90 days, the initial funding amount will be returned to your card upon withdrawal. For withdrawals exceeding the initial funding amount or for deposits made via Skrill, alternative payment methods will be used. Withdrawals to bank accounts may take 2-5 days for SWIFT withdrawals, and while Eightcap does not charge withdrawal fees, a $25 fee for telegraphic transfers may be applied.
As with deposits, withdrawals must be made to an account in your name; third-party accounts are not accepted.
Eightcap Customer Support:
Quality customer support is crucial for a positive broker experience. Eightcap offers various support channels, including email at [email protected] and a phone line at +61 3 8373 4800.
However, their online live chat function stood out as the most user-friendly option, available 24/7 via Zendesk. During our tests, we received instant assistance, and this experience seems consistent based on feedback from various forums and trader groups, highlighting the broker’s efficient customer service approach.
While labeled as a “promotion,” it functions more like a referral or affiliate scheme commonly offered by other brokers and exchanges.
Analysis & Education:
Similar to many brokers, Eightcap offers free educational materials, which can be valuable for novice traders seeking guidance on strategies and forex terminology.
Trading Analysis:
Eightcap provides general market updates and analysis to all traders, focusing on significant market movers and the potential impact of economic announcements on the forex market.
Additionally, they offer technical analysis on key levels for various forex pairs, serving as a useful supplement to independent analysis.
While these market updates are well-written and intuitive, they may not be as comprehensive as resources found on other websites and forums.
Conclusion
Eightcap emerges as a solid broker choice. Their full regulation, coupled with low fees, swift execution, and responsive customer support, instills confidence in their services.
Moreover, they provide traders access to advanced platform technology via the Metatrader suite, enabling trading across a diverse range of assets, catering to various trading preferences.
However, there were certain aspects we found lacking, suggesting room for improvement. Whether these factors are significant enough to deter you depends on your individual trading preferences.
Ultimately, if you seek a straightforward CFD broker offering low and transparent spreads, Eightcap could be an appealing option worth considering.
