Pepperstone Review
Pepperstone offers a small set of tradeable products but provides forex and CFD traders with competitive pricing, excellent customer service, and one of the largest selections of third-party platforms, including numerous options for social copy trading.
Top Takeaways for 2020
After spending five months testing 30 of the best forex brokers for our 4th Annual Review, 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 forex and CFDs trading.
- 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 MT4.
- Pepperstone provides a small selection of tradeable products. That said, pricing is competitive with the commission-based Razor Accounts, which include active trader rebates for eligible traders. Our testing also found customer service to be excellent.
Overall Summary
| Feature | Pepperstone |
|---|---|
| Overall | |
| Trust Score | 89 |
| Offering of Investments | |
| Commissions & Fees | |
| Platform & Tools | |
| Research | |
| Mobile Trading | |
| Customer Service | |
| Education |
Is Pepperstone Safe?
Pepperstone is considered low-risk, with an overall Trust Score of 89 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 zero 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
| Feature | Pepperstone |
|---|---|
| Year Founded | 2010 |
| Publicly Traded (Listed) | No |
| Bank | No |
| Tier-1 Licenses | 2 |
| Tier-2 Licenses | 1 |
| Tier-3 Licenses | 0 |
| Trust Score | 89 |
Offering of Investments
The following table summarizes the different investment products available to Pepperstone clients.
| Feature | Pepperstone |
|---|---|
| Forex: Spot Trading | Yes |
| Currency Pairs (Total Forex pairs) | 59 |
| CFDs - Total Offered | 86 |
| Social Trading / Copy-Trading | Yes |
| Cryptocurrency traded as actual | No |
| Cryptocurrency traded as CFD | Yes |
Commissions & Fees
Pepperstone is an agency-execution broker that offers a good range of options on its pricing plans, with its commission-based Razor Account being the best choice. In 2020, Pepperstone finished Best in Class in the Commissions & Fees category, as well as for Professional Trading.
Account types: Pepperstone offers two pricing models depending on the account type you open, ranging from the commission-based Razor Account to the Standard Account, which incorporates commissions into the prevailing spreads. Fees can also vary slightly, depending on the platform you choose to trade.
Razor Account: The Razor Account can be used with either the MetaTrader (MT4) 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 October 2019) are comparable to industry peers when factoring in the commission of 0.753 pips to calculate the all-in cost of 0.91 pips on MT4 (or 0.86 pips on 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 1.13 pips (Q3 2019), according to Pepperstone.
Active traders: Pepperstone’s active trader program offers discounts on the applicable commission rates - depending on the amount you deposit and your expected trading volumes - helping to boost its ranking in the active trader category. A minimum of 200 lots is required to qualify for the lowest tier, with a rebate of $1.00 per standard lot, and applies only to Razor accounts.
Order-Routing: Pepperstone uses its EDGE infrastructure to help bridge the MetaTrader platform with liquidity providers to whom it routes your order for execution while incorporating its Pepperstone Price Improvement (PPI) technology to help improve execution rates. This EDGE technology is a highly proactive approach for an agency broker.
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| Feature | Pepperstone |
|---|---|
| Minimum Initial Deposit | $200.00 |
| Average Spread EUR/USD - Standard | 1.13 (as of Q3 19) |
| All-in Cost EUR/USD - Active | 0.86 (as of May 19) |
| Active Trader or VIP Discounts | Yes |
Platforms & Tools
While Pepperstone lacks a proprietary platform, it offers a nearly every third-party platform a trader could ever want to use. Overall, we were impressed.
Platforms: Pepperstone offers the full MetaTrader and cTrader suites, including MT4 (desktop and web), MT4 Multi-terminal, MT5, 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 platform from Tradency, the ZuluTrade platform, and myFxbook for MT4, in addition to the native signals markets from MT4 and cTrader. The addition of Chasing Returns and DupliTrade ($5,000 minimum required) for social-copy trading further expanded the firm's offering. Pepperstone finished Best in Class in the Social Copy Trading category, for the third consecutive year in 2020.
cTrader vs MT4: While both cTrader and MT4 support algorithmic trading, cTrader has an advantage with its web-based platform, which offers a wider range of trading tools compared to MT4 Web. Meanwhile, the desktop version of MetaTrader 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 counterbalance its limited range of in-house content.
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.
Market analysis: When it comes to fundamental and technical analysis, Pepperstone offers content from third-party analysts. For example, the FX Weekly analysis from Boris & Kathy of BK Forex provides an "Event Risk Calendar Forecast" report. Trading Economics, a provider of market data, powers the firm's economic calendar.
In-house commentary: While Pepperstone's in-house research offers content such as "Daily Fix" and a "Chart of the Day" series, it lacks overall. To compete with industry leaders, including IG and Saxo Bank, Pepperstone will require more content in this area.
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Mobile Trading
Mobile trading at Pepperstone is conduct with either the MetaTrader 4 (MT4) or MetaTrader 5 (MT5) mobile app, or the cTrader app, all of which are available directly from the developer. While these apps are reliable and deliver a respectable experience, our testing found that the highest-ranked brokers offer proprietary apps.
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Customer Service
To score Customer Service, ForexBrokers.com partnered with customer experience research group Customerwise to conduct phone tests from locations throughout the UK. For our 2020 Review, 330 customer service tests were conducted over six weeks.
Results
- Average Connection Time: <1 minute
- Average Net Promoter Score: 7.9 / 10
- Average Professionalism Score: 8.5 / 10
- Overall Score: 8.42 / 10
- Ranking: 4 th (22 brokers)
Final Thoughts
With barely 145 instruments available to trade, Pepperstone's niche offering is for those traders who focus exclusively on forex and the most popular CFD markets. Overall, Pepperstone finished Best in Class across five categories in 2020, including Customer Service.
Considering Pepperstone's low minimum deposit and an 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 and the UK and has offices in the United States (US), United Kingdom (UK), China, and Thailand. The broker processes, on average, $12.55 billion of trades each day (October 2019).
Pepperstone is best known for its extensive selection of third-party trading platforms. Pepperstone offers not only the full MetaTrader suite but also cTrader and a complete variety of copy-trading platforms. Read more on Wikipedia about Pepperstone.
Pepperstone Trading Features
| Feature | Pepperstone |
|---|---|
| Virtual Trading (Demo) | Yes |
| Proprietary Platform | No |
| Desktop Platform (Windows) | Yes |
| Web Platform | Yes |
| Social Trading / Copy-Trading | Yes |
| MetaTrader 4 (MT4) | Yes |
| MetaTrader 5 (MT5) | Yes |
| cTrader | Yes |
| Charting - Indicators / Studies (Total) | 51 |
| Charting - Drawing Tools (Total) | 31 |
| Charting - Trade From Chart | Yes |
| Watchlists - Total Fields | 7 |
| Order Type - Trailing Stop | Yes |
Pepperstone Research Features
| Feature | Pepperstone |
|---|---|
| Daily Market Commentary | Yes |
| Forex News (Top-Tier Sources) | Yes |
| Weekly Webinars | No |
| AutoChartist | Yes |
| Trading Central (Recognia) | No |
| Delkos Research | No |
| Social Sentiment - Currency Pairs | Yes |
| Economic Calendar | Yes |
Pepperstone Mobile App Features
| Feature | Pepperstone |
|---|---|
| Android App | Yes |
| Apple iOS App | Yes |
| Trading - Forex | Yes |
| Trading - CFDs | Yes |
| Alerts - Basic Fields | Yes |
| Watch List | Yes |
| Watch List Syncing | Yes |
| Charting - Indicators / Studies | 30 |
| Charting - Draw Trend Lines | Yes |
| Charting - Trend Lines Moveable | Yes |
| Charting - Multiple Time Frames | Yes |
| Charting - Drawings Autosave | No |
| Forex Calendar | No |
2020 Review Methodology
For our 2020 Forex Broker Review we assessed, rated, and ranked 30 international forex brokers over a five month time period. Each broker was graded on 105 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.
About the author: Steven Hatzakis Steven Hatzakis is the Global Director of Research for ForexBrokers.com. Steven previously served as an Editor for Finance Magnates, where he authored over 1,000 published articles about the online finance industry. Steven is an active fintech and crypto industry researcher and advises blockchain companies at the board level. Over the past 20 years, Steven has held numerous positions within the international forex markets, from writing to consulting to serving as a registered commodity futures representative.
