Pepperstone Review

While Pepperstone offers a small set of tradeable products, it provides one of the largest selections of third-party platforms, including multiple social copy trading options.

Top Takeaways for 2021

Here are our top findings on Pepperstone:

• Founded in 2010, Pepperstone is regulated in two tier-1 jurisdictions, making it a safe broker (low-risk) for trading forex and CFDs.
• Catering to algorithmic traders and copy traders, Pepperstone offers both the MetaTrader and cTrader platform suites. Also, Pepperstone provides multiple premium platform add-ons to enhance the MetaTrader offering. Meanwhile, research at Pepperstone is better than the industry average but still trails leaders such as IG or Saxo Bank.
• Pepperstone provides a small selection of tradeable products. That said, pricing is competitive for active traders on Pepperstone's Razor accounts, while for retail traders, it is in line with the industry average.

Overall Summary

Is Pepperstone Safe?

Pepperstone is considered low-risk, with an overall Trust Score of 90 out of 99. Pepperstone is not publicly traded and does not operate a bank. Pepperstone is authorised by two tier-1 regulators (high trust), one tier-2 regulator (average trust), and one tier-3 regulators (low trust). Pepperstone is authorised by the following tier-1 regulators: Australian Securities & Investment Commission (ASIC) and the Financial Conduct Authority (FCA). Pepperstone is authorised by the following tier-2 regulators: Dubai Financial Services Authority (DFSA) Learn more about Trust Score.

Regulations Comparison

Offering of Investments

The following table summarizes the different investment products available to Pepperstone clients.

Cryptocurrency: Cryptocurrency trading is available through CFDs, but not available through trading the underlying asset (e.g. buying Bitcoin). Note: Crypto CFDs are not available from any broker's UK entity, nor to UK residents.

Commissions and Fees

Pepperstone is an agency-execution broker that offers excellent pricing on its Razor account when combined with its Active Trader program for high-volume traders. Meanwhile, its Standard account has comparably higher spreads and is not impressive.

Razor account: The Razor account can be used with either the MetaTrader (MT4 or MT5) platforms or cTrader platforms and follows a commission-based pricing structure in addition to prevailing spreads. Average spreads of 0.16 pips on the EUR/USD in the Razor account (as of August 2020) is comparable to the industry average after including the commission of 0.70 pips to calculate the all-in cost of 0.86 pips on MT5 and cTrader.

Standard account: The standard account is commission-free but has higher spreads instead and is not as competitive as the Razor account, as average spreads on the EUR/USD are 1.16 pips, as of August 2020.

Active traders: Pepperstone's active trader program rebates a portion of the spread, depending on your monthly trading volume and the applicable tier.

United Kingdom: In the UK, premium clients must trade at least $15M per month or 150 standard lots, to be eligible for the tier-1 rebate of 10% per lot, while tier-3 rebates can be negotiated for those who do more than 500 lots monthly.

Australia: A minimum of 200 lots is required to qualify for the lowest tier in Pepperstone's Active Trader program. Tier one provides a rebate of $1.00 per standard lot, which reduces the effective spread from 0.75 pips to 0.65 pips. At the same time, tier two rebates 15% or more of the commission (reducing the effective spread to 0.638), for those who trade more than 200 lots monthly.

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Platforms and Tools

While Pepperstone lacks a proprietary platform, it offers nearly every third-party platform a trader could ever want to use. Overall, we were impressed and Pepperstone finished Best in Class MetaTrader in 2021.

Platforms: Pepperstone offers the full MetaTrader and cTrader suites, including MT4 and MT5 (desktop and web), cTrader (desktop and web), and cAlgo. Traders can use either account type, Razor, or Standard, with any platform.

Copy trading: For social copy-trading, Pepperstone offers the MirrorTrader and RoboX platforms from Tradency, and myFxbook for MetaTrader, alongside cTrader and DupliTrade ($5,000 minimum balance required). Pepperstone finished Best in Class in the Social Copy Trading category for the fourth consecutive year in 2021.

cTrader vs MT4: While both cTrader and MetaTrader support algorithmic trading, cTrader has an advantage with its web-based platform, which offers a broader range of trading tools compared to MT4 Web. Meanwhile, MetaTrader's desktop version contains the algorithmic trading module – compared to cTrader, which requires the standalone cAlgo platform to run in parallel, a small but noteworthy difference.

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Research

Pepperstone's broad range of third-party social copy-trading platforms and research tools helps complement the content it develops in-house. Overall, Pepperstone delivers an okay balance of quality content across video and written format, which is a touch above the industry average.

Third-party tools: Pepperstone offers traders access to AutoChartist, a popular software provider of automated pattern recognition and trading signals. Pepperstone also offers Smart Trader Tools, an MT4 add-on with tools such as sentiment indicators, which is available to clients with an account balance of at least AUD 500. Finally, Delkos risk management tools are also available to Pepperstone clients.

In-house commentary: While Pepperstone's in-house research offers content such as "Daily Fix" and a "Chart of the Day" series, there are just a few articles and videos per week. To compete with industry leaders, including IG and Saxo Bank, Pepperstone will require more content in this area.

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Education

Pepperstone has at least 22 trading guides organized by experience, including for beginner, intermediate, and advanced users. Dozens of videos are available for forex education. While Pepperstone is light on CFD content, it provides more forex content, but still trails education leaders such as FXCM or CMC Markets.

Articles: Besides nearly a dozen platform tutorials, Pepperstone has a "learn to trade forex" category with nine articles and one page in its CFD learning section. Pepperstone also holds a few webinars each month. For clients who deposit more than $2500, Pepperstone offers premium education content and trading signals from BK Forex.

Educational videos: Pepperstone's YouTube channel provides dozens of educational videos covering beginner to advanced themes, such as in its "Master the Trade" series. I found the content to be of high quality and in-line with the industry average for this category.

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Mobile Trading

There are multiple options for mobile trading at Pepperstone. Traders can choose either the MetaTrader 4 (MT4) or MetaTrader 5 (MT5) mobile app, or the cTrader app, all of which are available directly from their respective developers. While these apps are reliable and deliver a good experience, our testing found that the highest-ranked brokers offer proprietary mobile apps.

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Final Thoughts

Pepperstone's niche offering of fewer than 200 instruments is for those traders who focus exclusively on forex and the most popular CFD markets. Considering Pepperstone's low minimum deposit and excellent range of third-party platforms, Pepperstone caters to all forex and CFDs traders, regardless of experience level.

About Pepperstone

Founded in 2010 in Melbourne, Pepperstone is regulated in Australia, the UK, the UAE, and in the Bahamas. The brand has offices in the United States (US), United Kingdom (UK), China, and Thailand. Pepperstone processes, on average, $9.2 billion of trades daily for more than 110,000 retail trading accounts. Read more on Wikipedia about Pepperstone.

2021 Review Methodology

For our 2021 Forex Broker Review we assessed, rated, and ranked 27 international forex brokers over a three month time period. Each broker was graded on 108 different variables and, in total, over 50,000 words of research were produced.

While encouraged, broker participation was optional. Each broker had the opportunity to complete an in-depth data profile and provide executive time (live in person or over the web) for an annual update meeting.

All data submitted by brokers is hand-checked for accuracy. Ultimately, our rigorous data validation process yields an error rate of less than .1% each year, providing site visitors quality data they can trust. Learn more about how we test.

Forex Risk Disclaimer

"There is a very high degree of risk involved in trading securities. With respect to margin-based foreign exchange trading, off-exchange derivatives, and cryptocurrencies, there is considerable exposure to risk, including but not limited to, leverage, creditworthiness, limited regulatory protection and market volatility that may substantially affect the price, or liquidity of a currency or related instrument. It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable, or that they will not result in losses." Learn more.