Risk Warning.

When you trade leveraged financial products — including CFDs, spread bets, forex, and futures — you are trading with borrowed money. This means both profits and losses are amplified. It is entirely possible to lose more than you initially deposit, and in some cases you may owe the broker additional funds. Only trade with money you can afford to lose entirely, without affecting your financial security, your lifestyle, or your ability to meet your obligations.

The European Securities and Markets Authority (ESMA) has found that between 70% and 80% of retail investor accounts lose money when trading CFDs. This is not a small number — it is the overwhelming majority. The UK Financial Conduct Authority (FCA) publishes similar figures for UK retail clients. Before opening an account, ask yourself honestly whether you are prepared to be part of that statistic.

Leverage lets you control a large position with a small deposit. A 1:30 leverage ratio means that a £100 deposit can control a £3,000 position. A 3.3% adverse move in the market would wipe out your entire deposit. Some brokers outside the UK offer leverage as high as 1:500 or 1:1000 — which means a 0.2% move can eliminate your capital. Leverage is the single biggest reason retail traders lose money.

Financial markets can move suddenly and unpredictably. Unexpected news events, central bank decisions, geopolitical developments, and macroeconomic data releases can cause prices to gap — sometimes by more than your account balance. Stop-loss orders are not guaranteed. In fast-moving markets, they may execute at a worse price than you specified, or in rare cases not at all.

Not all brokers are safe. Unregulated or offshore brokers may refuse withdrawals, manipulate prices, or disappear entirely with client funds. Unlike UK-regulated brokers, unregulated brokers do not have to segregate client funds, do not participate in any compensation scheme, and cannot be held accountable to any UK authority. If a broker is not regulated by a recognised authority (such as the FCA in the UK, ASIC in Australia, or CySEC in the EU), the risk of losing your money through fraud is dramatically higher.

Unlike bank deposits, trading losses are not protected by any compensation scheme. The UK Financial Services Compensation Scheme (FSCS) covers eligible deposits in UK banks up to £85,000 — but it does not cover trading losses. If you lose money trading, that money is gone. The FSCS may offer limited protection if a regulated broker becomes insolvent, but this covers missing client funds only, not the outcome of your trades.

Leveraged trading is not appropriate for people who: are risk-averse; cannot afford to lose their deposit; are using borrowed money, credit, or funds earmarked for essentials; are inexperienced with financial markets; are emotionally affected by financial losses; or are in a difficult personal or financial situation. If any of these apply to you, we strongly recommend you do not trade leveraged products.

Brokergrade is a publisher, not a financial adviser. Nothing on this platform — including broker reviews, ratings, comparisons, and educational content — constitutes investment advice or a personal recommendation. We do not know your financial situation, your objectives, or your risk tolerance, and we cannot advise you on whether to trade or which broker to use. Before making any investment decision, consult a qualified, FCA-authorised financial adviser.

Investment and trading fraud is one of the most common types of financial crime in the UK. Warning signs include: guaranteed returns, pressure to invest quickly, unusual payment methods (cryptocurrency, gift cards, wire transfers to personal accounts), unregulated brokers, and requests to keep the investment secret. If you believe you have been a victim of fraud, contact Action Fraud (actionfraud.police.uk) and your bank immediately.

If trading is affecting your mental health, your relationships, or your finances, support is available. In the UK, you can contact GamCare (gamcare.org.uk) or the National Gambling Helpline (0808 8020 133) for free, confidential advice. For debt advice, contact StepChange (stepchange.org) or Citizens Advice (citizensadvice.org.uk). You are not alone, and help is available.