Which broker is cheapest for holding positions long term?
Verdict
- For leveraged positions held for weeks or months, Pepperstone is our pick in the UK: no inactivity or account fee, low share CFD commission (0.10% per side on UK shares, $0.02 per share on US), and a spread betting account whose profits it describes as CGT-exempt.
- The biggest long-term cost of any CFD or spread bet is overnight financing, charged for each night past 10 pm UK time at Pepperstone; no broker in our data publishes rates in a form we can compare fairly.
- If you plan to hold for months without leverage, owning the asset removes financing altogether; eToro lists real stocks and ETFs, and Trading 212 offers Invest and Stocks ISA accounts.
- Capital.com, our second choice, offers CFDs and spread betting to UK clients and lists a '1X' account type; its overnight rates are not in our data.
Long-term holding changes which costs matter. Spreads and commission are paid once; financing is paid every night. Here is how the costs stack up over months, why Pepperstone is our pick for leveraged holds, and when an unleveraged account is the cheaper tool.
Our pick for leveraged long-term holds
Pepperstone suits traders who keep leveraged positions open for weeks, because its one-off costs are low and nothing extra accrues while you wait: no inactivity or account-keeping fee, share CFD commission of 0.10% per side on UK shares and $0.02 per share on US shares, and FX spreads averaging 0.1 pips on Razor. UK residents can also hold through a spread betting account, where Pepperstone says profits are exempt from capital gains tax. What no leveraged account avoids is overnight financing, covered below.
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How holding costs build up
Over a few days the one-off costs dominate; over months, the nightly fee becomes the main cost. So the cheapest broker for a long hold is the one whose financing suits your position, which you check in the platform's symbol specification.
| Cost | When you pay it | Grows with time? |
|---|---|---|
| Spread | Once, across the round turn | No |
| Commission (Razor FX, share CFDs) | On opening and on closing | No |
| Overnight fee | Each night held past 10 pm UK time | Yes |
| Inactivity or account fee | Never, at Pepperstone | No |
Leveraged position or owning the asset?
If you do not need leverage or the ability to go short, owning the asset takes overnight financing out of the picture. The trade-offs:
- CFD or spread bet at Pepperstone: 20% margin on shares at the 1:5 retail limit, short selling allowed, a nightly fee while open.
- Real shares or ETFs: the full cash cost up front and no nightly fee; eToro lists real stocks and ETFs, and Trading 212 offers Invest and Stocks ISA accounts.
- Tax: Pepperstone notes CFDs carry no stamp duty but are liable to CGT, while spread bets carry neither.
- Capital.com's account list includes a '1X' option next to CFDs and spread betting; check whether it fits an unleveraged plan.
Worked example: £10,000 of a UK share held for three months
Commission uses Pepperstone's published share CFD rate; the overnight line has no number because the rate is shown per symbol in the platform.
- Commission: 0.10% × £10,000, on the way in and out, is £20.
- Margin tied up at 1:5: £2,000.
- Overnight fees: three months of nightly charges; read the rate before you open and multiply it out.
- As a spread bet instead: no commission, a spread cost in its place, and the same 10 pm charge point.
Checks before you hold for months
- Read the long and the short overnight rate in the symbol specification before opening.
- Size the position so an ordinary pullback does not eat your margin.
- Decide between spread bet and CFD on tax grounds at the start, not halfway through.
- Review held positions monthly; a nightly fee you have stopped noticing is the quietest cost there is.
Sources
Fees and account types as each broker publishes them.
Does Pepperstone charge an account fee while I hold positions?
No inactivity or account-keeping fee. The ongoing cost of a held position is the overnight fee, charged for each night it is open past 10 pm UK time.
Is a spread bet cheaper than a CFD for long holds?
On commission and, according to Pepperstone, on tax, it can be: spread bets have no commission and no CGT. Both pay an overnight fee, and our data shows no difference in the rate.
Do I need leverage to hold positions long term?
No. Leverage magnifies gains and losses and brings a nightly financing charge. If you can fund the whole position, owning the asset avoids financing.
CFDs and spread bets are complex instruments and come with a high risk of losing money rapidly due to leverage, and holding costs accumulate the longer a position is open. Consider whether you can afford that risk. This page is not investment or tax advice.