Best Broker Bonuses 2021 – How to Find Top Brokerage Account Promotions
Want to claim some of the best broker bonuses around? You’re in luck. In this guide, we teach you everything you need to know about brokerage account promotions, including how they work and which ones are worth claiming. You’ll also learn which regulators put restrictions on bonuses, so you can be sure you’re getting the right deal for your location.
Top Brokers for Bonuses – Our Expert Picks
This year, our experts tested over 200 online brokers using our stringent methodology. This process considers 10 key areas, one of which is bonuses. When we analyze a broker’s bonus offers, we look at how rewarding they are, whether they’re suitable for all skill levels, and whether they come with any tricky terms and conditions.
Bonuses shouldn’t be the deciding factor when picking a broker, however. Safety, regulation, fees, and products are all more important. Given this, not all of our best brokers offer promotions. Instead, they shine in all departments to bring you a well-rounded trading experience.To learn more about each of our best brokers, visit our comparison page.
What is an Online Broker Bonus?
A broker bonus rewards you for choosing one broker over another. They come in all shapes and sizes, and you can claim them throughout your trading career. You may receive a bonus for choosing a certain brokerage account, for depositing funds, for referring other traders, or for staying loyal to your broker for a long time.
You may feel a little cynical towards the best broker bonuses. This is understandable. As a smart trader, you know online brokers are constantly competing for your money. It’s for this reason that they offer incentives – they don’t want you taking your trades elsewhere. Broker bonuses can, however, be precious trading tools. They can boost your capital, give you extra motivation, and allow you to try out new brokers for free. You just need to know how to use them to your advantage and, luckily, we’re here to help you with that.
Types of Broker Bonuses and Promotions
Choosing the right bonus is just as important as choosing the right broker, so let’s find you your perfect deal. We run you through each type of offer you may come across and explain what type of trader it’s best suited for.
- Deposit Bonus – As the name suggests, this is a bonus you receive when you deposit at a brokerage. Most of the time, brokers reserve this bonus for traders making their first deposit, although some will offer deposit bonuses to existing clients too. Usually, the size of the bonus will depend on how much you deposit, and the broker will express it as a percentage. For instance, if a broker offers a deposit bonus of 20% and you deposit $1,000, you’ll receive a $200 bonus. Deposit bonuses are best for high-volume traders, as you will need to reach a turnover target before you can withdraw any profits made from the bonus.
- No Deposit Bonus – If you’re feeling cautious about a broker, a no deposit bonus may be for you. Brokers give these bonuses to new traders when they register for an account, without requiring an initial deposit. They are usually small bonuses of around $20, yet they allow you to test out a broker without risking your own money. These bonuses aren’t great for increasing your profits, as they come with restrictions, yet they are perfect for practicing trading in a live real-money environment.
- Live Trading Contests – Designed for existing clients, trading contests allow you to compete against other traders for a grand prize. The contest will have strict rules, such as which assets you can trade, what size trades you can make, and for how long the contest will run. The trader who has made the biggest profit at the end of the contest will win a bonus. If your trading thrives under pressure, this is a great opportunity.
- Demo Trading Contests – Like live trading contests, demo trading contests are competitions between clients of the same brokerage. The client with the biggest profit at the end of the contest period wins a prize, the only difference is that you participate via your demo account. These contests are a great chance to perfect your trading strategy, whether you’re a beginner or experienced, as you needn’t risk real funds.
- Refer a Friend Broker Bonuses – You can earn this bonus by persuading other traders to sign up with a broker. These are some of the best broker bonuses you can claim, as you can gain rewards with little effort. You could receive a percentage return of your friend’s initial deposit, a set cash bonus, or a commission earned on total trading volumes. Brokers usually only credit these bonuses after your friend has made a certain deposit or amount of trades, however, so make sure your friend is serious about trading beforehand.
- Cashback/Rebate Bonuses – Online brokers want to make sure you’re happy enough to deposit time and time again, so they offer you a rebate on certain trades. The broker decides which trades apply, and the percentage of cashback you will receive. For example, if you have a 30% rebate bonus and you trade $100, you’ll receive $30 back. Some rebate bonuses apply to all trades, whether or not you make a profit, whilst some only apply to only losing trades. In either case, this is a valuable bonus for everyone.
- Free Stocks Bonuses – If you trade stocks with an online broker, look out for free stocks bonuses. With these bonuses, you’ll receive stocks for free once you’ve completed certain activities, such as registering and depositing. The broker will decide which stocks to give you, and how much they are worth. For registering, you can expect to receive a cheap stock, whilst if you deposit a large amount, expect a stock worth $1,000 or more. You’re free to hold or sell these stocks as you please, yet the broker may restrict what you can do with any profits. Many brokers only allow you to invest profits from free stock bonuses into further trades. If you find a free stock bonus where you can withdraw your profits, you’re onto a winner.
Broker Bonuses Examples
It’s hard to visualize how a bonus may affect your trading profits. This is especially the case when a broker is advertising huge sums of money and huge percentages. To help you out, let’s look at how some of the most popular broker bonuses work in practice.
Forex Broker Deposit Bonus
When trading with forex brokers, you’re most likely to come across deposit bonuses. As we mentioned earlier, with these bonuses, the broker matches your deposit with a certain percentage.
- A forex broker offers you a 50% bonus, up to $500.
- You deposit $500 and claim the 50% bonus.
- The broker then credits your account with an extra $250 (50% of $500).
- Your starting account balance is $750.
To figure out how to get the maximum broker bonus in this scenario, you need to convert the bonus percentage into a decimal. Then, you divide the maximum bonus amount by the decimal, to give you the amount you need to deposit:
50% ÷ 100 = 0.5 500 ÷ 0.5 = 1,000 Required deposit for max. bonus = $1,000
With a more complex bonus scenario, the same calculations apply. For instance, if you’re offered a 20% bonus, up to $4,500:
20% ÷ 100 = 0.2 4,500 ÷ 0.2 = 22,500 Required deposit for max. bonus = $22,500
Free Stocks Bonus
One of the most popular bonuses offered by stock brokers is a ‘free stocks bonus’. Here’s how it works:
- The stocks broker offers you ‘2 free stocks valued between $2.50-$200 when you deposit $100 or more’.
- You deposit $150 and claim the free stocks bonus.
- Once your deposit has settled, the broker credits your account with two stocks worth $20.
- You can then hold or sell these stocks.
- If you sell the stocks, you may need to wait before you can withdraw profits.
In this scenario, you won’t know the value of your stocks until the broker credits your account. Due to market movements, the broker won’t know the value of your stocks either. Pay attention to the small print with these types of bonuses, as it’s here that the broker will explain your chances of gaining a valuable stock.
Look for statements like this:
- ‘We choose company shares based on the price of each share, from the most popular and highest value companies on our platform.’ This message ensures that you’re at least going to gain a share from a popular brand.
- ‘There is a 70% chance of your free stock having a value of between $2.50-$20. There is a 20% chance of your stock having a value of between $20-$100 and a 10% chance of your stock having a value of between $100-$200.’ This message shows you how likely you are to gain a stock worth the maximum amount.
Understanding Broker Bonus Terms and Conditions
Whilst the examples above illustrate how easy and lucrative broker bonuses can be, we know what you’re thinking – what’s the catch?
Unfortunately, even the best broker bonuses come with terms and conditions. You need to understand these to ensure you’re getting the best deal for your money. To avoid any confusion, read our expert explanations of important terms and conditions.
Trade Requirements to Withdraw
The biggest problem with deposit broker bonuses occurs when you want to withdraw. You cannot withdraw your bonus immediately, of course, because the broker would be at a loss. What happens, however, when you want to withdraw your profits or the capital you invested to start with?
Many brokers block your withdrawals until you reach a specified trade size. For instance, the broker may only release $1 of funds for every $10,000 traded. If you take a $250 bonus, you need to trade $2.5 million worth of currency to withdraw.
Bonus terms vary from broker to broker but, in most cases, you need to trade a lot to meet these requirements. This is why we only recommend deposit bonuses to high-volume traders. You have more chance of meeting requirements if you place multiple large trades a day and apply high leverage amounts.
If this isn’t your style of trading but you still want to claim a deposit bonus, look for brokers that offer ‘proportional bonus removals’. These brokers allow you to withdraw funds at any time, although they will retract some of your bonus funds too. For example:
- You deposit $500 and claim a bonus of $200 with a broker that offers proportional bonus removals. Your account balance reads $700.
- You request to withdraw $125. This is 25% of your initial deposit.
- Because you requested 25% from your deposited funds, the broker will take the same percentage from the bonus funds.
- Therefore, the broker removes $50 from your bonus pot (25% of $200).
- Your account balance now reads $525 ($375 of your own funds, and $150 of bonus funds).
Bonus Time Limit
If you claim a deposit bonus with trade requirements, chances are the broker will expect you to meet these requirements within a certain time period too. If you don’t release your funds before then, you forfeit your bonus funds.
Even the best broker bonuses have time limits. It’s important to find a broker that gives you a reasonable period, such as 30 days. Any less than this and your bonus is likely to be impractical.
Eligible Trading Instruments
Some broker bonuses have restrictions on which instruments you can trade with your bonus. For example, with forex bonuses, you can usually trade major and minor pairs. Exotic currency pairs, however, are often off-limits as their spreads are higher.
With stock broker bonuses, similar rules apply. You may be able to use your bonus funds to trade shares, but the broker won’t allow you to use them for trading ETFs (Exchange Traded Funds), or for investing in mutual funds.
Country Restrictions for Broker Bonuses
Broker bonuses aren’t available to everyone, unfortunately. Due to legislation and regulatory bodies, bonus offers vary depending on where you’re trading from. Currently, these regulators do not allow brokers to offer trading incentives:
- The European Securities and Markets Authority (ESMA) – ESMA-ruled brokers include those with licenses from the UK’s FCA, Germany’s BaFin, and the Cyprus Securities and Exchange Commission
- The Australian Securities and Investments Commission (ASIC)
Your broker should state any geographical restrictions clearly on all promotional materials. If a broker is offering you a bonus whilst having a license from a regulator that prohibits bonuses, avoid them. Do make sure, however, that you are visiting the correct domain for your country. Brokers often have different websites for specific regions.
Why Have Some Regulators Banned Broker Bonuses?
Regulators argue that brokers offering bonuses do not have their clients’ best interests at heart. As bonuses can persuade you to deposit larger amounts or more frequently, regulators claim they can be harmful.
If you live in a country where you cannot claim a broker bonus, it’s not all bad news, however. Many brokers operating under these regulations offer lower trading fees and free technical tools. As such, you’ll still save money during your trading career.
How to Claim the Best Broker Bonuses
Once you’ve found a broker offering a bonus, and you’ve read the terms and conditions, only a few steps separate you and your extra funds. Although the exact process may change depending on which broker and which bonus you select, the major actions remain the same.
Below, we walk you through what you need to do to claim the best broker bonuses.
Time needed: 20 minutes.
- Register with a broker
First, you need to register for a broker. This involves providing the broker with basic personal information such as your name, date of birth, address, and email. You also must create a password.
- Complete the trading questionnaire
Next, the broker may ask about your trading experience and goals. Answer these questions to the best of your ability. They allow the broker to determine which account you should apply for, and which bonus you should receive
- Choose an account
If the broker hasn’t selected an account for you, it’s time to choose one. If you’re unsure which to pick, go back and verify which brokerage account types offer bonuses and what the minimum deposit amounts are.
- Enter your bonus code
If you are claiming a no deposit broker bonus, enter your bonus code before finalizing your registration. If the bonus doesn’t require a code, you may need to confirm that you want the bonus. If you don’t, you can opt out here.
- Make a deposit
Once registered, if you want to claim a deposit broker bonus, you must visit the banking section. Here, you can select which payment method you want to use.
- Provide payment details
Provide your payment information and the amount you wish to deposit. Make sure this aligns with the minimum depositing amount for the bonus you want to claim.
- Submit the deposit request
Finally, submit your deposit request. Once the broker approves your transaction, you’ll find both your funds and your bonus money in your account.
- Claim further bonuses
If you want to claim further deposit bonuses, rebate bonuses, or enter contests, ensure that your broker account has the right amount of funds. Check the bonus requirements or reach out to customer support if you’re unsure.
- Claim a referral bonus
To claim referral bonuses, you usually need to send your friend a link from the broker website. Once they sign up via your link and make their deposit, your account will receive a bonus.
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