What margin is required to trade index CFDs in the UK?
Verdict
- UK retail clients put up at least 5% margin on major index CFDs, the 1:20 retail cap; at Pepperstone, our pick, that means £500 for every £10,000 of index exposure.
- Capital.com applies the same 20:1 retail cap on major indices, and CMC Markets publishes index margin from 5%; Pepperstone's tiered margin table applies only to Professional clients.
- Professional status at Pepperstone allows up to 1:500 on indices but removes negative balance protection and requires two of three qualifying tests.
- Margin isn't a fee: the costs are the spread (UK100 from 1 point, no commission) and overnight fees after 10 pm UK time.
Margin on an index CFD is a deposit set as a percentage of the position's full value. UK retail limits make it the same at every FCA-regulated firm for major indices, so what differs is how safely you use it. Here are the numbers, worked examples and the Professional route.
The UK retail rule, and how Pepperstone applies it
Pepperstone Limited (FCA 684312) caps retail leverage on major indices at 1:20, which sets margin at 5% of exposure. The cap applies to index CFDs on Razor and Standard and to index spread bets. Retail accounts also get negative balance protection: if the account goes below zero, Pepperstone says it returns it to zero as soon as possible. Card deposits start at £10, and you can trade indices on five platforms with no commission on index CFDs.
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Margin at different position sizes
The last column is the one to remember: at 1:20, a 2% index move costs 40% of the margin whatever the size, and a 5% move uses it all up.
| Index exposure | Margin (5%) | Loss on a 2% fall | Share of margin |
|---|---|---|---|
| £5,000 | £250 | £100 | 40% |
| £20,000 | £1,000 | £400 | 40% |
| £50,000 | £2,500 | £1,000 | 40% |
Spread bets: margin per pound staked
With a spread bet, exposure is your stake multiplied by the index level. At £3 a point on an index at 9,000 points (an illustrative level), exposure is £27,000 and margin at 5% is £1,350. Doubling the stake doubles the margin, and the same 1:20 cap applies.
Retail versus Professional at Pepperstone
Pepperstone's FCA tiered margin table, which raises margin as positions grow, is stated to apply only to Professional clients.
| Retail | Professional | |
|---|---|---|
| Major indices | 1:20 (5% margin) | Up to 1:500 |
| Negative balance protection | Yes | No |
| Who qualifies | Every client by default | Two of three: 10 significant trades a quarter over the last year; a portfolio over €500,000; a year in finance with derivatives knowledge |
Capital.com and CMC Markets
Capital Com (UK) Limited (FCA 793714) publishes the same retail limits: 20:1 on major indices, 30:1 on major FX and 5:1 on shares. CMC Markets UK publishes margin as rates, from 5% on indices. So margin won't separate FCA-regulated firms for retail clients on the big indices. Guaranteed stops can: Capital.com offers them, which caps a gap loss at a known level, while Pepperstone does not.
A short margin checklist
- Check the margin rate the platform shows for your index; the 1:20 figure applies to major indices.
- Keep spare cash above the margin so an ordinary move doesn't close you out.
- Remember overnight fees are charged on the full exposure, not on the margin.
Sources
Is index margin the same for CFDs and spread bets in the UK?
Yes. At Pepperstone the 1:20 retail cap on major indices covers both.
Can a UK retail trader get more than 1:20 on indices?
No. Only Professional clients can, and they give up negative balance protection.
Is index margin the same at Capital.com?
For retail clients, yes: Capital.com caps major indices at 20:1, like Pepperstone.
Leverage magnifies gains and losses, and CFD or spread bet losses can arrive fast. Make sure you understand margin before trading and only risk money you can afford to lose. This is not investment advice; check each firm's live terms.