Best NASDAQ Brokers
To help you find the best NASDAQ brokers in South Africa, we researched them for you. Many metrics are used in financial markets, but the NASDAQ is one of the best known. A component of this index is the NASDAQ-listed publicly traded companies index, which includes the world’s largest companies.
Furthermore, this classification includes a wide variety of other businesses. This instrument is also known as the US TECH 100 and the NAS 100. Many forex and CFD brokers offer the NASDAQ as an instrument with different spreads and features.
This article examines the top four NASDAQ brokers in South Africa who offer excellent trading conditions and access to their clients.
What is a NASDAQ Broker?
Companies in the index represent a wide range of industries, including technology, retail, healthcare, pharmaceuticals, etc. However, technology companies dominate the index.
This index was launched in 1985 as NASDAQ 100 (NAS100). The NASDAQ composite, established in 1971, shouldn’t be confused with the NAS100.
Since its inception, the NASDAQ has grown by over 6000% cumulatively over the past 32 years. Based on this, it gives an average annual growth rate of 20 percent.
Based on the value of all the companies listed on the NASDAQ 100 index as of 2022, it has a total market capitalization of over 25 trillion USD. NASDAQ 100 traders are drawn to this index for many reasons, including:
In the first place, the index has a diverse mix of industries. A large percentage of US tech companies are incorporated into the NASDAQ index.
In addition to growth in the total market capitalization of listed companies, revenues, profits, and dividends, the NASDAQ 100 has shown growth in the total value of companies listed (the market capitalization). The NASDAQ 100 brokers primarily attract traders and investors because of their growth.
Nasdaq brokers South Africa
The volatility of the index makes it more appealing to traders than others. Therefore, a broker that supports NAS100 is a NASDAQ broker. Find the brokers with Nasdaq available in South Africa below.
Market maker Exness offers FX and CFDs, and the broker is licensed by the Financial Conduct Authority (FCA), the Financial Services and Conduct Authority of Australia (FSCA), as well as the Cyprus Securities Exchange Commission (CySEC).
The margin requirement for Exness’ CFDs is one percent, and the spread is five and one-half percent per lot for one mini lot contract. Traders can use US Tech 100 CFDs to trade on the index’s performance.
This Cyprus-based broker is regulated by strict and demanding regulatory entities, including the FSA, FCA, CBCS, FSC, FSCA, SIBA, and CySEC. As a regulated broker, client funds must be segregated from other funds.
To comply with this, traders must maintain separate client accounts from broker accounts, and their funds can only be used to trade.
Spreads on Exness start at 0.0 pips, with spread fees starting at $3.50. There are no deposit fees at Exness, and withdrawal fees are only applied to traders withdrawing amounts under $200 using Skrill.
Among Exness’ commission-based account types, the zero spread account type offers the lowest spread of 1.5 pip per lot for the US Tech 100 index.
With 107 currency pairs, Exness provides leading coverage. Exness has a maximum leverage of 1:2000 and a low minimum deposit.
up to 10%
With 107 currency pairs, Exness provides leading coverage. Exness has a maximum leverage of 1:2000 and a low minimum deposit.
A minimum purchase of one hundred United States dollars is required to buy NASDAQ CFDs on the XM platform. There is maximum leverage of 1:100 available for this instrument. Since the company offers several account types that only require $5 as a minimum deposit, a consistently rated NASDAQ Forex broker, XM ranks highly in terms of cost.
XM is regulated by international regulators, including ASIC in Australia, IFSC in Belize, and CySEC in Cyprus, so they are a good choice.
A minimum deposit of 5 (five) US dollars is required to open a real trading account with XM. Depending on the type of trading account selected, the minimum deposit for new traders may vary. The deposit can be activated after 72 hours.
For this index, large swings bring good trading opportunities, so you need to use a brokerage like XM that is reputable and well-established. They offer spreads as low as 2.2 pips for this stock index.
There are no extra fees or commissions every time you trade with XM. Also, compared to other brokerage firms in this area, they require lower margins.
Regarding NASDAQ trading, AvaTrade is one of the best options due to its multiasset, multi-regulated, and multi-award-winning status. AvaTrade is a market maker and an STP broker. It was established in 2006 and is one of the most trustworthy firms in the industry.
Trade with AvaTrade and take advantage of a range of tradable markets, including stock indices, individual stocks, CFDs on stock markets, currency pairs, cryptocurrencies, options, and more.
With competitive spreads, rapid trade execution, flexible funding options, and multilingual customer support available 24/5, traders can expect a great trading experience.
Among the many authorities and bodies regulating AvaTrade worldwide is the Central Bank of Ireland and the Financial Services Commission of the British Virgin Islands.
These include the Australian Securities and Investments Commission (ASIC), South Africa’s Financial Sector Conduct Authority (FSCA), the Japanese Financial Services Agency (FSA), and the Financial Futures Association of Japan (FFAJ).
With AvaTrade, you do not have to pay any deposit fees, and there are many electronic wallet options apart from bank transfers and credit/debit cards. A minimum deposit of $100 or equivalent is required.
With AvaTrade, you can take advantage of competitive spreads. At AvaTrade, the spreads over the market on the NASDAQ 100 are $1.00.
Trades with AvaTrade are not subject to commissions. Nasdaq 100 futures on AvaTrade require a minimum margin requirement and a minimum contract size. The Nasdaq 100 index options contract gives the buyer the right, but not the obligation, to purchase or sell the underlying asset.
HotForex is a Cyprus-based company and was established in 2010. A leading forex and commodities broker, providing retail and institutional traders with a wide array of trading services and facilities.
The platform is suitable for both novice and experienced investors. Forex pairs like GBP/JPY, NASDAQ (NAS100) index, USOIL, US30, and others are available to trade.
A Financial Service Provider (FSP), HF Markets SA (PTY) Ltd, holds license number 46632 from the Financial Sector Conduct Authority (FSCA) in South Africa. As an independent institution, the FSCA oversees the non-banking financial sector in South Africa.
HotForex ZERO Spread Accounts have just 200 USD opening requirements, so they are an excellent option for any trader. However, they are handy for scalpers, high-volume traders, and those trading with expert advisors (EAs).
On HotForex, USA100 has a spread of 2.
A commission of $3 to $4 per single side is charged on a Zero Spread account, and a commission of $6 to $8 per round turn is applied. The commissions are also based on instruments and volumes traded in two different structures.
How to trade NASDAQ in South Africa?
There is a regulatory authority for brokers in South Africa called the FSCA. Most South African regulated Forex brokers offer CFDs on the NASDAQ Index. According to the brokers’ trading platforms and contract specifications, the instrument will be known as NAS100, US100, or USTEC.
First, we will explain how to open a CFD account on NASDAQ, then explain what CFDs on NASDAQ are and why trading them should only be done by experienced traders. A South African resident who wants to trade NASDAQ with a CFD broker must open a live trading account with the broker.
To open an account with HotForex, we must follow some simple steps. You can open a real account by filling in your registration details.
NASDAQ broker account opening
- After completing that, your email address needs to be verified. If you do not verify your email, you will be unable to proceed to the next step.
- Complete the form by entering your personal information. It will require you to enter information such as your full name and address. At the broker, you’ll also have to complete an adequacy test.
- Ensure your personal information, such as your address and identity, is accurate. A copy of your ID and proof of your address are required. In most cases, the verification process takes under 48 hours if all your documents are in order.
- Deposit into your MyHF wallet. The majority of SA brokers accept bank transfers for funding.
- If you’re biased toward long or short positions on NASDAQ, you can open a long or short position.
Let’s now discuss what CFDs on NASDAQ are and why they must be traded with caution. Trading CFDs on NASDAQ involves certain risks; if you aren’t aware of them, you could suffer losses.
As the name implies, contracts for difference (CFDs) are agreements between traders and brokers in which the difference is settled as profit or loss based on the difference between the opening and closing prices during the trade.
When you trade CFDs on it, you do not own any stocks or the NASDAQ Index; you are simply speculating on price movement trajectory based on your biases on whether it will go up or down.
An example of NASDAQ trading
Let’s look at how it works using an example.
Following your analysis, you can sell if you believe that NASDAQ will decline. If the price moves in your direction, you will be able to make money on your trade. However, if the NASDAQ rises, your CFD position will lose money.
As an additional consideration, CFD trades on the NAS100 involve leverage and margin. Margin trading is available with most CFD brokers for the NASDAQ 100 index. Trading with leverage allows you to trade positions higher than your account balance.
In essence, you can trade positions worth more than your capital. Among the CFDs on USA100 (NASDAQ) that HotForex offers on their platform, there is a leverage of up to 1:200.
Leverage for NASDAQ brokers
What is the mechanism behind this leverage? Let’s better understand what it means with the help of an example.
If one has $150 funds in their account balance, one can buy or sell almost one lot of the NASDAQ CFD at a 1:100 leverage. Lots are used to calculate CFD trades and index contracts.
If NASDAQ rises by 2% by the end of the trading day, a trader will make 100 times their investment without leverage. Leverage magnifies profits because it multiplies them.
Although leverage can increase profits in trade, it can also increase losses if a trader’s speculation fails. Traders can lose both their capital and profits within minutes of this. NASDAQ-100 stocks that offer leverage of 1:5 are available through brokers. Trades are conducted using 20 USD.
During the trading day, he believes Alphabet’s stock price will rise. Alphabet’s stock price increased by ten percent as a result. As a result of this example, a trader would have earned $2 without leverage. With leverage, however, the profit rises to $10.
With leverage of 1:2, the trader would have lost half of his trading capital if Alphabet’s stock price fell by 2 percent against his speculation.
According to FCA-regulated CFD brokers in the UK, more than 75-85 percent of retail traders lose money on their trades. Some CFD brokers have even higher losses, so traders should be cautious when trading leveraged CFDs.
The primary regulators have imposed leverage restrictions on indices because of their risk. SA NASDAQ brokers offer incredibly high leverage, which is extremely risky if you use it. CFDs on indices must be self-regulated, and leverage cannot exceed 1:5.
Overusing leverage can result in huge losses, so you must fully understand the risks involved.
Benefits of CFD Trading on Nasdaq
- Indexes are popular and growth-oriented indices that can be accessed without ownership of the underlying companies.
- A trader who uses leverage maximizes the portfolio’s potential – but note that the trader can also lose when markets move against their speculation.
- Trades can be taken speculatively, whether they believe the market will rise or fall.
- A trading index reduces the cost of holding a portfolio of companies.
- Trading on NASDAQ CFDs is convenient due to the availability of a large pool of regulated brokers.
- Although CFDs are highly leveraged, they carry a significant risk of capital loss because they are highly leveraged. Investing in these instruments is only recommended for experienced traders comfortable with risk.
A US-TECH 100 (NQ) CFD is available at Plus500, an authorized and regulated CFD broker. The CFD is based on the underlying E-mini Nasdaq 100 futures. An initial margin requirement is 0.33, and trades in the instruments are offered with a spread of 1.7.
The intuitive platform automatically calculates margin and minimum trade sizes. For manual calculations, use the following formula: CFD Margin = V (lots) × Contract × Market Price × Margin Rate, %.
How to choose a NASDAQ broker?
Trading NASDAQ CFDs in South Africa requires you to consider a few things. The following is a checklist you can follow:
First and foremost, ensure that the CFD broker is regulated by a top-tier regulator such as the FSCA, FCA, etc. The FSCA must regulate trading with a South African broker. Only reputed forex and CFD brokers regulated by CySEC, FSCA, or FCA have been listed in our directory.
You can find the broker’s FSP number on their website. It is usually listed on the websites of most brokers. FSCA regulations are mentioned in the footer section of Hotforex South Africa’s website.
As explained in our guide to FSCA-regulated brokers, you should verify the FSP number on FSCA’s website. Regulated CFD brokers will protect your funds and ensure they are not misused.
For SA traders, unregulated brokers pose a high risk since they do not follow the policies established by the FSCA and other regulators.
Overall NASDAQ broker fees:
Explore the overall NASDAQ trading and non-trading fees. In most cases, brokers display their typical spreads for NASDAQ and other instruments. The NASDAQ is referred to as the “US Tech 100” on most brokerage websites. To find the most cost-effective broker, comparing trading and non-trading fees is essential.
Ease of Withdrawals:
Make sure the withdrawal and deposit methods are convenient before opening an account. You should check the broker’s website for the average withdrawal time if you want to withdraw through a particular withdrawal method.
Your broker should offer funding and withdrawals via Internet Banking Transfer or EFT in ZAR. A local payment method will make funding your trading account and withdrawing funds easier.
An effective customer support team is vital to the broker’s success. There will be times when you’ll need support, and the broker should be available in that situation.
You should ask the broker if he has a South African phone number, if he offers English language 24/7 chat support and if he offers quick email support.
Platform’s ease of use:
Traders should have access to charting and analysis tools on the platform. To place new orders and close existing orders, you should be able to do so quickly.
The Metatrader platform (MT4 & MT5) is available with most of the NASDAQ CFD brokers on our list, but execution speeds vary. Instant order execution is offered by market maker brokers like XM, while brokers like Hotforex offer market execution.
What is the difference between the NASDAQ Composite and the NASDAQ 100?
The NASDAQ Composite index represents stocks listed on the NASDAQ stock exchange, whereas the NASDAQ 100 represents the top 100 non-financial companies according to their market capitalization.
Why is the NASDAQ 100 important to traders?
A NASDAQ stock exchange index consists of the exchange’s largest and most active companies. This index provides a benchmark for American technology stocks, retailers, industrials, biotechs, and health care companies.
What time does NASDAQ open for trading in South Africa?
Trading on the NASDAQ stock exchange takes place between 3:30 pm and 10:00 pm South African Standard Time. Trading outside of regular market hours is possible with some brokers.
Can I trade the NASDAQ 100 in South Africa?
Some regulated brokers accept South African traders to trade the NASDAQ 100 through contracts for difference (CFD).
How do I check if a broker that offers NASDAQ CFDs is regulated in South Africa?
A broker’s regulatory status in South Africa can be viewed by visiting the FCA’s official website and searching for its name.
The Nasdaq is an electronic stock exchange, while the Nasdaq index includes market mover stocks and is one of the most comprehensive market indices. Sectorally, the index is well-diversified and has outperformed multiple other indices.
The ETFs and various derivative products such as CFDs use the index as their benchmark and underlying value. NASDAQ index funds are among the most successful index funds in recent years.
Undoubtedly, his largest-weighted stocks – Apple, Amazon, Facebook, and Tesla – outperform the broader market year-over-year. With NASDAQ South Africa, XM is one of the best brokers for getting started with an investment today.
The regulated broker offers leveraged CFDs and ETFs for investing in the index. In any case, you will not be charged a commission!
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Heinrich is a forex and CFD enthusiast with a passion for writing good informative quality content. He strives to showcase the best forex brokers in Africa. Join him on his Journey!
Content Writer | Market Analyst
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