What leverage can I use on share CFDs in Australia?
Verdict
- Retail clients in Australia can use up to 1:5 on share CFDs, meaning 20% margin, at Pepperstone, our pick, and at Capital.com (5:1); the same limit covers ETF CFDs at Pepperstone.
- Professional (wholesale) clients at Pepperstone can use up to 1:20 on shares and ETFs.
- At 1:5, a 10% move against you costs half the margin on a position, and a 20% move costs all of it.
- Pepperstone's Bahamas company allows 1:20 on stocks for its own retail clients, but its terms say its products are not intended for residents of Australia.
Shares sit near the bottom of Australia's CFD leverage table, above only crypto. That's deliberate: single companies can gap on results, takeover news or trading halts in a way indices rarely do.
1:5 at Pepperstone for retail clients
Pepperstone Group Limited (ASIC, AFSL 414530) lists 1:5 for shares and ETFs in its Australian retail leverage table, against 1:30 on major currency pairs and 1:20 on major indices and gold. It applies to all 1,162 share CFDs, whether ASX, US, UK, European or Hong Kong, and on every platform. Retail clients keep negative balance protection, so a gap can't push the account below zero. Commission is 0.07% per side on ASX shares and $0.02 per share on US shares.
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What 1:5 means for a A$10,000 position
A 10% fall in a single stock can happen on one results day, which is why the margin requirement is set this high.
| Move against you | Loss | Share of margin lost |
|---|---|---|
| 2% | A$200 | 10% |
| 5% | A$500 | 25% |
| 10% | A$1,000 | 50% |
| 20% | A$2,000 | 100% |
Professional leverage on shares: 1:20
Wholesale clients at Pepperstone can trade shares and ETFs at up to 1:20, so the same A$10,000 position needs A$500. Qualifying takes either a sophisticated-investor assessment, based on a record of frequent, large leveraged trades or professional trading experience plus a quiz, or a wealth test of AUD 2.5 million in net assets or AUD 250,000 a year in gross income, certified by an accountant. The trade-off: standard negative balance protection is replaced by a one-time cover of up to USD 100,000.
Why shares carry less leverage than indices
- A single company can be halted, gap on an announcement or be taken over overnight; an index averages that out.
- Pepperstone's stops aren't guaranteed, so a gap can fill a stop well beyond its level.
- Capital.com (AFSL 513393), our second choice, also caps retail share CFDs at 5:1 and offers guaranteed stops for traders who want a fixed worst case.
Using less than the maximum
Your effective leverage is the total value of your positions divided by your balance, and you control it through position size. Holding A$10,000 of shares on a A$5,000 balance is 2:1 effective leverage even though the cap is 5:1, and it leaves A$3,000 free to absorb losses before margin becomes a problem. If you want broad exposure with more leverage, an index CFD is the regulated route, not an offshore account.
Sources
Leverage limits and professional criteria as published.
Is leverage different on ASX and US share CFDs?
Not at Pepperstone. Its table has one shares and ETFs tier: 1:5 for retail clients and 1:20 for professionals.
What leverage applies to ETF CFDs?
The same 1:5 for retail clients; Pepperstone's ETF page describes it as up to 5x.
Does Capital.com offer more leverage on shares?
No. Its Australian company lists 5:1 on shares for retail clients, the same as Pepperstone.
Leverage increases both gains and losses, and share CFDs are complex products with a high risk of losing money rapidly. Read the PDS and TMD and consider whether you can afford the risk. This is general information, not investment advice.