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Gold Trading UK Guide 2020

Looking to buy, sell, and trade gold from the comfort of your home? In this guide, we explain the ins and outs of gold trading in the UK.
Kane Pepi
Author: Kane Pepi

Last Updated: October 14, 2020
gold trading guide
gold trading guide

The price of gold goes up and down on a second-by-second basis. This is driven by the market forces of demand and supply. In times of economic hardship, the value of gold often enjoys an upward swing.

All in all, gold is highly conducive for both short-term and long-term trading. There are many ways to access the gold trading arena in the UK, such as CFDs, ETFs, futures, and even forex.

In this guide, we explain everything there is to know about gold trading in the UK. We will also explain the foundations of how gold trading online works, what instruments you can utilise to access the market, and finally – how you can get set up with an investment account today.

Table of Contents

    How to Trade Gold in 3 Quick Steps

    Looking to start trading gold right now? If so, follow the 3 steps outlined below to get started with a UK gold trading account straight away.

    Step 1: Open a Trading Account

    Open an account with a UK broker that gives you access to the gold trading markets.

    Step 2: Deposit Funds

    Deposit funds into your account with a debit/credit card, e-wallet, or bank account.

    Step 3: Trade Gold

    Set up a gold trading buy/sell position, set your stake, and confirm the order.

    75% of retail investor accounts lose money when trading CFDs with this provider.

    What is Gold Trading?

    gold trading UKThe term ‘gold trading’ can refer to many different forms of investing. With that said, gold trading typically involves buying and selling gold with the view of making a profit. This consists of a short-term trading strategy that will target small, but frequent gains.

    For example, a gold trader might open a position and then close it a number of minutes or hours later. In other cases, a swing trader might place a buy order on gold and then sell it a few weeks later. Either way, and as we cover in more detail further down, the easiest, safest, and most cost-effective way of trading gold in the UK is to utilize CFDs (contracts-for-differences).

    For those unaware, CFDs allow you to trade a financial instrument without you needing to take ownership. Instead, the CFD will mirror the market price of the respective asset like-for-like. This makes CFD platforms highly conducive for short-term gold trading online.  With that being said, there are several other mechanisms that allow you to gain exposure to the UK gold trading arena.

    For example, if you want to invest in the long-term value of gold, CFDs likely won’t suffice. Instead, you might want to use an online gold bullion vendor that allows you to purchase and own the asset outright. Alternatively, you can also trade the value of oil via futures contracts and even ETFs.

    Gold Trading Price

    When it comes to the price of gold, there are key metrics that you need to consider.

    • How is the price of gold determined?
    • How is the price of gold quantified?

    Let us elaborate on the above in more detail.

    How is the Price of Gold Determined?

    Put simply, all asset classes have one thing in common – the underlying value of the asset is driven by market forces. That is to say, if there are more buyers than sellers, then naturally, the price will go up. Similarly, if there are more sellers in the market than buyers, the price will go down. This demand and supply ratio is what dictates the value of gold.

    There are certain drivers that can influence the value of gold, too. For example, when the global stock markets are in a state of turmoil, the value of gold will often increase. This is because gold is viewed as a store of value. You will often find that gold experiences a downturn in demand when the stock markets are performing well.

    How is the Price of Gold Quantified?

    All asset classes are quantified – typically by a currency. For example, UK stocks like HSBC are priced in pence. While US equities such as Facebook and Netflix are priced in dollars. This allows you to determine the value of your investment in relation to your stake. It also allows you to perform analysis on the asset in question.

    gold trading price

    However, in the case of gold, several metrics are used in the trading markets. For example, it can be priced per ounce, gram, or kilo. In most cases, gold is priced in US dollars, much like oil, natural gas, and other commodities. As such, even though you will be depositing and withdrawing funds in British pounds, you need to get used to trading gold in USD.

    With that being said, most online brokers will price gold per ounce, in US dollars. For example, at the time of writing, the value of gold is $1,936 per ounce. As such, for the remainder of this guide, we will quantify our gold prices by using the aforementioned metric.

    Gold Trading Hours

    Unlike the traditional UK stock trading arena, gold can be traded around the clock. This is because it is a global commodity trading used and traded by all corners of the world. However, most brokers in the online space will install gold trading sessions.

    In the UK, you might find that you are able to buy, sell, and trade gold CFDs 24 hours per day – 5 days a week. If the broker offers trading over the weekend, you should expect lower volumes and wider spreads.

    Ways of Trading Gold

    This section of our guide on UK gold trading is potentially the most important. This is because there are several ways in which you can access the market. For example, while some methods are suitable for day trading, others are more conducive for long-term investing.

    Either way, below you will find the most commonly used ways to trade gold in the UK.

    Gold CFDs

    If you are interested in trading the short-term value of gold, there is no better way to this than through CFDs. As noted earlier, CFDs are tasked with tracking the second-by-second price movement of an asset. In other words, if the value of gold increase by 0.37% in the open marketplace, so will the CFD. If it then decreases by 0.21%, the CFD will mirror this.

    As such, the costs of deploying CFD trading services in the UK are ultra-small. In turn, this often allows you to benefit from super-low trading costs and tight spreads. Furthermore, gold CFDs can be traded with leverage.

    This means that you can trade gold with more money than you have in your brokerage account. In the UK, regulations permit leverage of up to 1:20 on gold CFDs. This means that a £100 balance would permit a maximum trade of £2,000. Furthermore, gold CFDs allow you to go short. As such, you can trade the value of gold going down.

    Here’s an example of how a gold CFD trade would work in practice:

    • Your broker is quoting a price of $1,935 per ounce on gold
    • You think in the next few hours, the price will decrease
    • As such, you place a £500 sell order
    • Your prediction was correct, as gold is now priced 1.5% lower
    • On a stake of £500, this means that you made a quick profit of £7.50

    Crucially, if you applied the maximum amount of leverage permitted at 1:20, your £7.50 profit would have been amplified to £150. Of course, leverage can also amplify your losses, so do bear this in mind.

    Gold Futures

    Gold futures work much the same as CFDs. That is to say, you can apply leverage, and choose from a buy/sell position. However, there are a couple of differences that need to be taken into account.

    • Gold futures will always have an expiry date. This is usually the third Friday of each month.
    • The contract generally lasts for a period of 3 months
    • When the contract expires, anyone holding it must buy or sell the underlying asset

    In most cases, gold futures are settled in cash. This means that you won’t be required to take delivery of physical gold bars in the event you fail to offload the futures before expiry.

    Gold Options

    Options contracts are a highly sophisticated form of trading. Although you will be trading the future value of gold, you will be doing so by paying a ‘premium’. This premium – which is often in the region of 5-10% of the total contract price – is what gives you access to the market.

    Much like futures, options contracts will always have an expiry date. However, the key difference is that there is no obligation to buy and sell the asset when trading options. Instead, as the name suggests, you are given the ‘option’ to make the purchase.

    When trading in options contracts, only one of the two things can happen.

    • The options contract expires
    • You sell it

    Gold Forex Pairs

    As gold is a multi-trillion dollar asset class, it makes sense that you can trade its value via forex. After all, the main concept of the UK forex trading scene is to determine whether an exchange rate will go up or down.

    In the case of gold, most UK forex brokers offer a market on XAU/USD. For those unaware, XAU is the ticker symbol for gold. In truth, trading gold via a forex pair works exactly as a CFD, because both are typically priced against the US dollar.

    Long-Term Investing

    investing in gold long-termAll of the aforementioned trading mechanisms are suited for short-term trading. Even in the case of futures, a broker will rarely offer a marketplace than exceeds 3 months.

    Crucially, if you are planning to invest in gold on a long-term basis, you will need to take an alternative angle. The best way to do this from the comfort of your home is to invest in a gold exchange-traded fund (ETF).

    There are several providers active in the space that physically purchase gold bullion. This means that the ETF is backed by the asset that you wish to invest in.

    Then, as the global price of gold goes up and down, as will the value of your ETF. Although you will not have possession of the gold, this doesn’t matter if you are investing with the view of increasing your wealth. After all, you don’t need to worry about transporting or storing physical bars yourself, as such everything can be completed online.

    Benefits of Gold Trading in the UK

    Still not sure whether an online gold trading account is right for you? Below we’ve detailed some of the benefits of accessing the UK gold trading marketplace.

    Hedge Against Falling Markets

    Gold is the most recognised store of value globally. As we mentioned, investors often flock to gold when the wider economy is performing badly. This became evident in the midst of the financial crisis of 2008. While the stock markets went on a prolonged period of bearishness, gold moved in the opposite direction. Moreover, gold trading online can be a great way to hedge your investment portfolio.

    Go Long and Short

    When you buy gold in the traditional sense, you do so because you think the value will increase. In other words, wouldn’t buy gold bullion as an investment if you felt that gold was overpriced. With that said, there might come a time where you want to profit from a falling market.

    If this is the case, online gold trading sites allow you to do this with ease. In fact, you can achieve this goal in several ways, such as gold CFDs, futures, and forex. All you need to do is place a sell order.

    Huge Trading Volumes

    As a major asset class, gold benefits from significant trading volumes. In turn, this provides brokers with plenty of liquidity. As a result, you will benefit from tight spreads. All in all, this provides a highly conducive arena for trading.

    Your Investment is Liquid

    As we said, you won’t be buying physical bars of gold bullion, so you don’t need to worry when it comes to cashing your investment. Instead, whether it’s in the form of a CFD, ETF, futures/options contract, or a forex pair – you can offload your investment at the click of a button.

    Once you do, the funds will be reflected in your brokerage account. Best of all, you won’t have problems finding a buyer to take over your position. This is because the gold trading markets are highly liquid.

    Leverage

    In the conventional gold marketplace, you can only make an investment equal to your budget. However, several gold trading instruments enable you to gain access to the market with leverage. This means that you can enter a gold trading position worth more than you have in your brokerage account.

    As noted earlier, UK regulations allow you to trade gold CFDs with leverage of up to 1:20. This will amplify your profits (and losses) by 20 times.

    How to Make Money Trading Gold

    Much like other financial instruments, you can make money trading gold when you correctly predict which way the markets will go. That is to say if you are long on gold, and the price increases, you will make a profit. Similarly, if you short-sell gold and the price goes down, you will also make a profit.

    Whether or not you make money will ultimately depend on how successful you are in predicting the markets. The amount that you stake on each trade will also play a part in how much you are able to make.

    make money trading gold in the UK

    Seasoned traders will typically set themselves a weekly/monthly target, albeit, this will vary from individual-to-individual. The most important thing is that you generate more winning trades than losing ones in the long run.

    Let’s look at a couple of examples of how you could make money trading gold in the UK.

    Day Trading Gold

    By day trading gold, you will rarely keep a position open overnight. Instead, you might keep a position open for several hours, or even minutes. As such, you will be chasing ultra-small profit margins, but on a frequent basis.

    For example:

    • Let’s say, you place a £100 buy order on a gold CFD
    • You apply the leverage of 1:10, meaning the value of your stake is £1,000
    • A couple of hours later, the value of gold increases by 2%
    • You are happy with your gains, so you close the position by placing a sell order
    • On a stake of £10, this would ordinarily have made you £2
    • But, because you applied leverage of 1:10, you actually made £20

    You do, however, also need to factor in gold trading fees, which we explain in more detail later on.

    Long-Term Trade

    Short-term gold trading won’t be for everyone. After all, you will need to actively research the gold markets, and subsequently, place trades throughout the day. You also need to have a firm understanding of how to read charts and perform technical analysis.

    If this sounds like you, long-term investing might be more suitable to help you achieve your goals. This is because short-term pricing swings won’t appeal to you. Instead, you will be looking to keep hold of your gold investment for several years.

    For example:

    • You invest £5,000 into a gold ETF which is backed by physical gold bullion
    • The value of your investment will go up and down, in-line with the global price of gold
    • A few years later, gold is worth 15% more than what you initially paid
    • In this scenario, on a total investment of £5,000, you made £750

    Once you cash out your investment, the funds will be placed into your brokerage account. You can then withdraw the money and invest in other assets.

    Gold Trading Risks

    The risks associated with gold trading in the UK are much the same as any other investment class. After all, there is no guarantee that you will make money. On the contrary, most newbie gold traders end up making a loss. This is because they do not spend the required time learning how the gold markets work.

    With that in mind, it is crucial that you continuously work towards improving your gold trading knowledge. This should also include an understanding of how to read charts. In doing so, you will give yourself the best chance possible of making a success from your online gold trading endeavours.

    Gold Trading Strategies

    You will need to have an understanding of at least one trading strategy if you want to make money trading gold. No-two gold trading strategies are the same, so it’s important that you find one that meets your investing goals.

    Some examples of gold trading strategies include:

    Go Long at Support

    In UK gold trading, ‘support levels’ are specific price-points that have historically prevented the price going any lower. It isn’t an exact science, as there is every chance that gold will break through the support zone.

    However, one strategy to consider is entering the market just above the support line. You should also consider entering a stop-loss just below the support line, just in case, it is breached.

    Swing Trading

    By swing trading gold, you are seeking to follow wider market trends. For example, if gold is on a good run, an experienced swing trader will attempt to keep their buy position open for the duration of the upward trend. Then, when it appears that gold is running out of power, the trader will likely exit their position.

    Similarly, if it turns out that the price of gold is on its way back down, the swing trader might switch to a sell order. This flexibility means that a swing trading position can remain open for several days, weeks, or even months.

    Scalping Trading

    From time to time, the price of gold will trade within a tight range. For example, the price might be stuck between $1,500 and $1,600 for several weeks. Although this might be frustrating for day and swing traders that seek volatility, this is highly conducive for scalping trading.

    support and resistance gold trading

    This is because the trader will place dozens of buy and sell positions throughout the day, looking to ‘scalp’ micro-small profits. They can continue to do this for as long as gold sits within the respective consolidation zone.

    Gold Trading Fees

    If you want to trade gold online, there are several fees that you need to be made aware of. These fees will be determined by your chosen broker.

    Gold trading fees include:

    • Trading Commission: This is a commission charged every time you place a buy or sell order, and is usually charged as a variable fee. For example, the broker might charge you 0.1%, that percentage will be calculated against the size of your gold trade.
    • Spreads: All online trading platforms charge a spread. This is the difference between the buy and sell price of gold. Fortunately, as gold is a major asset class which benefits from significant liquidity levels, spreads are typically very tight.
    • Overnight Financing: This is a fee that you need to look out for when trading gold CFDs. It is a fee that you pay for each day that you keep the position open. This is why you CFDs are not suitable for long-term trading, as the fees will quickly eat away at your profits.
    • Deposit/Withdrawal Fees: Some gold trading platforms in the UK charge a transaction fee. This almost always when you deposit and withdraw funds. Most of the brokers that we discuss on this page do not charge transaction fees but look out for this nonetheless.

    As noted above, the specific fees that you end up paying will depend on which stock brokers you choose. The good news is that there are lots of FCA brokers that allow you to trade gold on a commission-free basis.

    Check out the comparison table listed below – which outlines the fees charged by leading gold trading platform.

     

    ETF Broker Commission Deposit Fees Inactivity Fee Withdrawal Fee Max Gold Leverage 
    eToro Variable spread 0.5% currency conversion $10 per month after one year $5 1:20
    Plus500 Variable spread £0 £10 per quarter after 3 months £0 1:20
    Capital.com Variable spread £0 £0 £0 1:20
    FinmaxFX Variable spread £0 $80 after 2 months 0.9% – 7% 1:200
    IG £0-£10 if buying and selling, variable spread for CFDs Free (0.5%-1% on credit cards) £12 per month after 2 years £0 1:20

    We cover the ins and outs of the above UK gold trading platforms in more detail further down this page.

    Gold Trading Tips

    Looking to trade gold right now, but not too sure where to start? Before you part with your money, be sure to review the following five tips.

    Tip 1: Try Gold Trading Signals

    Trading signals are prevalent in the forex and cryptocurrency sectors. With that said, more and more providers are now sending out signals to cover the gold trading scene. For those unaware, these are trading ‘suggestions’ telling you what trades to place.

    This gold signal will provide specific prices relevant to entry, exit, stop-loss, and take-profit orders. Make sure you research the credibility of the gold signal provider before signing up, as the signal provider space is dominated by scam artists.

    Tip 2: Read a Gold Trading Book

    Gold trading books are great for improving your knowledge of the gold trading market.

    Look for books that offer chapters on:

    • The gold trading markets
    • Trading strategies
    • Chart analysis and technical indicators
    • The importance of fundamental news and geopolitical events
    • Risk management

    Furthermore, you can supplement your chosen book. By making the most of the vast amount of educational material available in the online domain.

    Tip 3: Read Gold Trading News and Analysis

    The supply and demand for gold will typically be dictated by real-world news events. This will, of course, have a direct impact on the future value of gold, so it’s important that you stay ahead of the curve.

    The best way of doing this is to sign up to a financial news website that sends you a notification every time a gold-related development takes place. In doing so, you will remain in the know-how on all-things gold trading in the UK. It’s also a good idea to read a gold trading forecast before you part with your money.

    Tip 4: Start With a Gold Trading Demo Account

    Demo accounts are a great way of learning how the real-world gold markets work without risking your own money. Such accounts are offered by most online brokers, and come loaded with ‘paper funds’.

    You will then have unfettered access to the gold markets, and be able to execute buy and sell orders as you please. This will also give you the opportunity to learn how to read and evaluate gold pricing charts.

    Tip 5: Consider Copy Trading

    Copy Trading is a relatively new phenomenon in the online investment space. For those unaware, providers like eToro allow you to select a trader that you like the look of and then mirror their orders like-for-like. This means that you can trade gold full-time without needing to do any of the work.

    You don’t need to have a large bank balance either, as eToro allows you to copy a trader from just $200 – which is about £160.

    Best Gold Trading Platforms 2020

    We now need to discuss gold trading platforms. After all, you will need to find a suitable online broker that allows you to trade gold at the click of a button. There are hundreds of UK platforms to choose from, so spend some time looking at fees, commissions, tradable markets, regulation, and more.

    If you don’t have time to find a broker yourself, below you will find a select of the best gold trading platforms currently serving UK residents.

    1. eToro - Overall Best Gold Trading Platform UK

    eToro is an online trading platform which offers everything from stocks, ETFs, forex, cryptocurrencies, and commodity CFDs. This means that you have lots of different gold-related markets to choose from. For example, the platform offers gold CFDs that can be traded around the clock. You have the option of going long and short and can even apply leverage. This stands at 1:20 at eToro.

    Additionally, eToro lists a variety of gold ETFs. This includes the SPDR Gold, which is the largest ETF in the world and is backed by physical gold. This allows you to invest in the long-term value of gold in a cost-effective manner. Crucially, this is because eToro does not charge any trading commissions. If opting for an ETF as opposed to CFDs, you will also avoid those overnight financing fees.

    If you fancy joining 12 million other investors, eToro allows you to open an account in minutes. First, you will need to meet the $200 minimum deposit. You can deposit via a UK debit/credit card, e-wallet, or bank transfer. Your money is safe at all times at eToro, as the platform is regulated by the FCA. The broker has also partnered with the FSCS scheme, meaning that your funds are safeguarded, up to the first £85,000.

    Our Rating

    • Trade gold commission-free
    • Regulated in the UK by FCA
    • Social trading tools
    • User-friendly trading platform
    • 0.5% currency conversion fee on deposits
    75% of retail investor accounts lose money when trading CFDs with this provider.

    2. Plus500 - Low Cost Gold CFD Trading Platform

    Plus 500 is a heavily regulated broker that specializes in CFD instruments. The platform offers several gold-related markets - all of which allow you to apply leverage and choose from a buy or sell position. This includes a gold CFD market which comes with super-tight spreads.

    You will also be able to trade gold put and call options. These come with various strike prices, this allows you to choose a market that mirrors your appetite for risk. There are no commissions to pay when trading at Plus 500, and deposits/withdrawals are free. Minimum deposits start at £100.

    Our Rating

    • No deposit/withdrawal fees
    • 0% trading commission
    • FCA regulated
    • No educational material
    80.5% of retail investor accounts lose money when trading CFDs with this provider.

    3. Capital.com - Gold Broker with Excellent Educational Resources

    Capital.com is an FCA-regulated trading platform that offers over 3,000 markets. This includes a gold spot market which can be traded long or short. Once again, you will be offered leverage of up to 1:20 when trading gold CFDs. The platform does not charge any trading commissions on any of its assets, and gold spreads average 0.50-60 pips, which is good value.

    Capital.com offers a trading app too, which is ideal for entering positions when on the move. We find the Capital.com trading platform easy to use, so it's a worthy choice if you are a complete novice. You will also find lots of educational resources. You can open an account with just £20 when depositing with a debit/credit card or e-wallet. There are no fees to deposit or withdraw, either.

    Our Rating

    • Get started with just £20
    • No commissions and tight spreads
    • Great for newbies
    • Minimum £250 deposit when using a bank transfer
    72.6% of retail investor accounts lose money when trading CFDs with this provider.

    4. IG - Established Gold Trading Platform With MT4

    IG offers one of the most comprehensive trading platforms in the space. Launched in 1974, the broker is regulated by several bodies, including the FCA. When it comes to gold, you can choose from CFDs or spread betting. Both options allow you to apply leverage and choose from buy/sell positions. You can also trade gold CFD futures.

    If opting for the spread betting facility, you will avoid capital gains tax on your profits. IG also offers a traditional share dealing facility, which includes ETFs. As such, this allows you to invest in gold on a long-term basis. Fees will depend on the market you wish to access. CFDs and spread betting are commission-free, and ETFs at £3 or £8 - depending on your trading activity. The minimum deposit is £250, which you fund via a debit/credit card or bank transfer.

    Our Rating

    • Super-tight spreads
    • Supports MT4 trading platform
    • Excellent research department
    • 1% fee when using Visa and 0.5% via MasterCard
    • Spreads on some crypto pairs are somewhat expensive

    5. FinmaxFX - New Gold CFD Broker with High Leverage Limits

    FinmaxFX is an online broker that offers super-high leverage limits. While UK-based platforms are capped at 1:20 on leveraged gold products, you'll get up to 1:200 with this broker. This means that a £100 deposit would permit a maximum trade value of £20,000. You should, however, tread carefully if applying this much leverage.

    Nevertheless, FinmaxFX has partnered with popular third-party trading platform MT5. This means you can trade gold online, or through desktop software. The latter allows you to install automated gold trading software. You can also trade gold via the mobile app. The minimum deposit is $100 at FinmaxFX. Support payment methods include debit/credit cards, e-wallets, and bank wire transfer.

    Our Rating

    • Leverage of 1:200 on gold CFDs
    • Accepts most popular payment methods
    • Bonus available to new customers
    • Trading fees are somewhat high
    • Not FCA regulated
    There is no guarantee you will make money with this provider.

    Gold Trading Pros and Cons

    Pros

    • One of the most traded financial instruments globally
    • Highly liquid asset class when traded online
    • Access the gold trading markets through CFDs, futures, ETFs, options, and more
    • Ability to go long and short on gold
    • You can trade gold with leverage of up to 1:20 in the UK, and more with offshore brokers
    • The best online brokers offer commission-free trading and tight spreads

    Cons

    • No guarantees that you will make money
    • It can take many months before you feel confident trading gold

    How to Start Gold Trading

    We are now going to walk you through the process of getting started with a gold trading account. The guidelines outlined below are based on commission-free broker eToro, which offers several gold-related trading markets.

    Step 1: Open a Stock Trading Account

    Visit the eToro website and select ‘open an account’. You will be asked to enter some personal data, including your national insurance number. You’ll also need to provide and verify your mobile phone number and email address.

    eToro sign up

    You will also need to upload a couple of verification documents, as per UK anti-money laundering laws. This includes a copy of your passport or driver’s license and proof of address. The latter can be a utility bill or bank account statement but usually has to be dated within the last three months.

    Step 2: Deposit Funds

    You will now be asked to make a deposit. You can choose from the following payment methods at eToro.

    • Debit card
    • Credit card
    • Paypal
    • Skrill
    • Neteller
    • Bank Transfer

    The minimum deposit is $200 (about £160).

    Step 3: Choose Your Gold Trading Market

    There are several gold trading markets offered by eToro. If you want to take part in short-term trading, you are best suited for CFDs.

    How to trade gold on eToro

    Alternatively, if you want to invest in the long-term value of gold, you might want to consider an ETF. Either way, spend some time browsing the eToro asset library to find a market that meets your investing goals.

    Step 4: Place a Gold Trade

    Once you have found a gold trading market that you like the look of, you will need to set up an order. As we have reiterated throughout this guide, you will need to choose from a buy or sell order, depending on which way you think the markets will go.

    How to trade gold on eToro

    You will also need to enter a stake, and if applicable, the amount of leverage you wish to apply. To mitigate your potential losses, it might be worth setting up a stop-loss order. Take-profit positions can also be useful, as this will enable you to lock in your profit.

    How to trade gold on eToro

    Finally, confirm the order to get your gold trading position entered into the market.

    Conclusion

    In summary, gold trading is hugely popular with seasoned investors. Whether you want to trade the short-term price of the asset or invest for several years, there is a gold trading market to suit most requirements.

    With that said, you should avoid jumping into the gold markets without at least doing some research on how things work. It’s also a good idea to start off with a live demo account. In doing so, you can trade the markets without risking any funds.

    If you’re ready to start trading right now, FCA-regulated platform eToro offers several gold markets, all of which can be accessed commission-free. You can open an account in minutes and instantly deposit funds with a UK debit/credit card.

    CFD trading is highly speculative. You may not get back the full value of your initial investment and may lose more than you originally invested.

    eToro: Best Gold Trading Platform UK

    Our Rating

    • Trade gold CFDs with low fees
    • Social trading network
    • Copy other gold traders
    • Accepts PayPal
    • FCA regulated
    75% of retail investor accounts lose money when trading CFDs with this provider.

    FAQs

    How do you trade gold online?

    The main premise of gold trading is that you need to determine which way you think the markets will go. That is to say, if you think the value of gold will increase, you need to place a buy order. If you think the opposite, you need to place a sell order.

    Can you invest in physical gold?

    Yes, there several ways to invest in physical gold. For example, you might consider investing with an ETF which is backed by physical gold. Alternatively, there are online merchants that sell physical gold by the gram. The gold is stored in a safe, and regularly audited.

    Can you short gold?

    You certainly can. You can do this by short-selling gold on CFDs. You can also short-sell gold via futures and options

    Who decides the price of gold?

    Like all asset classes, the price of gold is determined by market forces. This is ultimately based on supply and demand.

    How much leverage can you apply to gold trades?

    UK brokers are bound by the regulated installed by ESMA. This limits UK traders to leverage of 1:20 on gold. If you want higher limits, offshore brokers like FinmaxFX offer up to 1:200.

    Can you practice gold trading online?

    Yes, most UK gold trading platforms allow you to trade via a demo account facility. This is normally loaded with a large 'paper money' balance.

    What is the smallest amount of gold you can trade online?

    This depends on the brokers' minimum deposit and trade policy. eToro, for example, allows you to deposit from just $200, and trade gold CFDs from just $50.

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    All trading carries risk. Views expressed are those of the writers only. Past performance is no guarantee of future results. The opinions expressed in this Site do not constitute investment advice and independent financial advice should be sought where appropriate. This website is free for you to use but we may receive commission from the companies we feature on this site.
    Kane Pepi

    Kane holds academic qualifications in the finance and financial investigation fields. With a passion for all-things finance, he currently writes for a number of online publications.