Transparency is important when it comes to investing your money. When you are depositing your money into an online brokers account that could be scary, because the risk of losing it is present. This article is to show you what our reviewed online brokers do with your money. By making this process transparent, you should find it a lot less scary to invest your money.
Before investing any of your money you should always follow a couple of simple rules. Ask yourself these questions:
- Is your online broker licensed and regulated?
- Does your online broker comply with the FCA rules and regulations?
- Does your online broker have negative balance protection?
Making Plus500 transparent
We have researched Plus500 before opening our own accounts here and to answer the above questions about Plus500.
Yes, Plus500 is an online broker that is authorised and regulated by the Cyprus Securities and Exchange Commission (Licence No. 250/14). They are also regulated by the Financial Conduct Authority (FRN 509909).
And yes, they also comply with its regulatory requirements. Below I’ll explain what makes it safe to use Plus500.
Client money protection
One of the regulatory requirements that is directly connected to us as the users is client money protection. This means that your money is protected, literally. When you open an account with Plus500 your funds will be held in accordance with the Cyprus Securities and Exchange Commission’s client funds rules. Under these rules, Plus500 pays each client’s funds into a segregated client bank account. This means the money you deposit goes into a separate bank account. They do not use your money to do anything for themselves.
Furthermore, Plus500 is debt free, has substantial liquidity and significant surplus regulatory capital reserves over its regulatory requirements. This means, because of having more than 1 million clients worldwide that carry out millions of transactions per month, they have enough reserved money to protect yours.
Negative balance protection
Another thing worth mentioning is that you cannot lose more money than you deposited, as Plus500 is one of the few CFD online brokers that offer negative balance protection. This means you do not owe the broker money in case your account has a negative balance (goes below zero). It could happen that a trade moves so fast that the money you used to open the account isn’t enough. With negative balance protection Plus500 automatically closes your position when it goes below zero, which is called margin call. This way you cannot lose more than you deposited. I think this is extremely important to know as there are many online brokers out there that doesn’t have it.
Withdrawing money with Plus500
Withdrawing money is easy. There are just a couple of steps that need to be done. You have to upload a couple of identification documents first. This is to ensure no money laundering (fraud) and to be sure that the money you deposit goes into the right person’s bank account, so nobody can steal from you if for example by any chance they’ve hacked your account. This means you can only withdraw your deposited money to a bank account using the same name as your identification document.
These are the documents that you need to upload:
- Address verification document (must be a bill that has your full name and address on it)
- Any ID or passport.
Withdrawing money does not cost anything and usually takes up to 3-5 workdays, which isn’t long at all. My personal experience is that my withdraw shows up within 3 days if I use the wire transfer method.
Depositing money in Plus500
As for depositing money with Plus500, it’s also easy. The following methods are accepted:
- Wire Transfer
After using one of your favorite forms of payments, it is displayed in your account immediately and you can use it immediately. If you don’t want to use the money you deposited anymore. No problem! You can just withdraw it again anytime, without any additional costs.
Please also check out our other tips on how to recognize a good CFD broker.
These few reasons is why we have chosen Plus500 as our favorite online broker, because it’s safe and we are not scared of depositing our money in their platform. We trust them. Also, we are already making a small extra income every month by using it.
If you have any trouble, please let us know and we will try and contact them for you to solve your problem. Got any other questions? Please feel free to comment below this article.