FPMarkets Review

FPMarkets Review

Australia's Forex & CFD Trading Platform

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First Prudential Markets (otherwise known as "FPMarkets") is an Australian exchange offering derivative financial products, including the likes of CFD's, foreign exchange & direct market access.

The company was established in 2005 and became a regulated member of the Australian Securities Exchange (ASX) in 2007. In 2008, the company opened its first European headquarters (in the UK), allowing for trading into the highly lucrative markets of the UK & EU.

The system provides access to over 10,000 trading instruments and has a low starting deposit requirement of $200, with a 1:500 leverage option. Because it's focused on providing derivative investments (which means you don't buy the asset buy a contract against it), the service gives beginner traders the opportunity to purchase positions they may not have been able to afford otherwise.

To this end, it must be stated that if you're looking at getting involved with the "CFD" game, you NEED to be clear about how it works. CFD's are NOT investments in themselves, they are *contracts* you take out against assets, with the broker. In other words, you are trading on a particular asset against the broker. There is no purchase of underlying equity.

The way they work is very similar to what happens if you put a "deposit" down on a car. You may need to get financing for the car's full purchase price, and so if you put a deposit down - you're entering into a contract to purchase the car at a particular price.

This is exactly the same as a "CFD" - you put a small amount of money down to "buy" an asset, and then use leverage provided by the broker to purchase the rest of it. This is why many newbie traders end up using CFD's - it gives people with relatively little capital the opportunity to purchase assets they may have not afforded before.

The problem with CFD's is that it's not as simple as what you think.

To take the car example - say the manufacturer has a problem and needs to increase the retail price of the vehicle. You are in a good position because you're getting it for the original price, and so the dealer may wish to "renegotiate" the contract (or just cancel it outright). Likewise, if the opposite happened, you'd end up trying to get a better deal with the dealer.

The point is that CFD's are contracts you're buying for the intended purchase of an asset.

Whilst you may not actually intend to follow-through with the purchase, that's what the contract is for. You're essentially buying a contract from the broker to purchase an asset at a particular price - if it rises or falls during that time, determines whether you owe the broker, or vice versa.

What is FPMarkets?

Founded in 2005
The company was created in 2005 by two founders in Australia. They worked at the UK's market-making CFD platform and spotted a niche they wanted to explore (CFD's) - FPMarkets was born.

No US Signups
Because the system is regulated in Australia, and deals primarily with CFD's (which are banned in the US), it does not accept any signups from the US as well as a number of other countries at present.

NO "Crypto" Trading
It does not yet support trading the various "crypto" tokens that others do; for example the likes of Bitcoin. Whilst this is not an issue in of itself, it is indicactive of the way in which the company has responded to developments in the market.

Offers both IRESS and MT4 trading platforms
IRESS is actually quite an interesting system - not supported by a large number of providers... but because of its location (Australia), has quite a close relationship with FPMarkets. Thus, it provides great depth to allow you to manage different types of software.

Mobile Support
Like many other platforms, it's able to provide you with mobile support.

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The most important thing to realize about FPMarkets is that it's based in Australia. According to their website, both founders of the company worked at the largest CFD broker in the UK, spotting a niche in the market which lead them to create FPMarkets in 2005.

The service is built on top of a core regulated company, allowing users to identify and manage the various financial assets they may have. One of the big advantages of using FPMarkets lies in its ability to interface with 10,000+ different financial instruments, including the entire Australian stock market.

The service allows you to invest into the following assets:

  • Markets & Instruments
  • Forex
  • Majors
  • Indices
  • US Stocks
  • UK Stocks
  • Penny stocks
  • Energies
  • Metals
  • Agriculturals
  • FTSE
  • Dow Jones
  • Dax
  • Nikkei

At the moment it sadly does not provide "crypto" trading.  Obviously, getting access to "crypto" CFD's is not on the top of most trader's lists - but as an ideal, having access to new markets like that is a good way to determine whether the company actually has its technological ideals in order.

Despite that, we've found that FPMarkets' offering is somewhat more sophisticated than the likes of, for example, eToro. With 1:500 leverage, and access to over 10,000 different financial instruments - it's a good way to broaden your horizons as a trader.

Conclusion

Like most of the "online broker / platform" systems, FPMarkets offers the standard retinue of functionality - real time charts, multiple asset classes, the ability to track your investments etc.

As mentioned, the system has a heavy focus on derivative offers, which allows for leveraged investments. Whilst there is nothing wrong with this, it means that if you're looking at getting into the "forex" or "trading" markets, you'll typically have a learning curve in order to become profitable.

Most interestingly (and quite rare for a financial services provider), the service has a 9/10 score on Trustpilot. Normally, you'll get 75% of reviewers leaving 1* ratings because they lost money; but surprisingly, this has not happened with FP.

It doesn't mean the service is going to constantly make money, but it's a good indicator of the level of support offered, as well as any of the underlying benefits of the system itself.

Whilst FPMarkets works just as well as the likes of IG, it does lack with its current offerings (it doesn't support "crypto" yet for example). This means that if you're looking at getting involved with the trading space, FPMarkets is a decent mid-tier offering (on a similar level to Markets.com).

The service has strong pedigree and functionality with good breadth of service ... it does have its own quirks and is generally quite profitable in terms of the financial instruments it provides access to.

To further this, we've found that if you want to ensure you're able to gain the most out of the system, you need to be sure that you're able to balance its functionality with a real set of education from one of the forex/trading information providers out in the world.

Our rating for FPMarkets stands at 5 / 5; this is because the trading experience is excellent, they adhere to tough regulation, funds are secure (no market manipulation, and swift withdrawals) and service is top notch.