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A Contract for Difference is an agreement to exchange the difference between the opening and closing value of a trade. They are a very exciting product that enable you to trade with greater ease. CFDs are classed as a derivative product so you do not own the underlying product. A CFD mirrors the performance of a share or Index and so the resulting profit or loss is a direct result between the difference of where you bought and where you sold. You will have certain advantages to trading CFDs over the more traditional methods. The three Main advantages are: Leverage - You only pay a % of the contract value:Going Short - As easy to sell a CFD as it is to buy one. Therefore profiting from falling markets.Global markets - Trade Global Shares, Global Sectors, Global Indices, Global Treasuries and Global Commodities
To view an example of a traded equity CFD vs a Traditional Share deal please click here |
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