Cfd online trading

The trader's net profit is equal to profits minus charges: 526.32 (profit) – 10 (commission) – 32.89 (interest) – 10 (commission)= £473.43 (net profit).

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An Introduction to Contract for Differences (CFDs), cfd online trading.

Suppose that a stock has an ask price of $25.26 and the trader buys 100 shares. The cost of the transaction is $2,526 (plus any commission and fees). This trade requires at least $1,263 in free cash at a traditional broker in a 50% margin account, while a CFD broker requires just a 5% margin, or $126.30.

An introduction to contract for differences (cfds)

A contract for difference (CFD) is a contract between a buyer and a seller that stipulates that the buyer must pay the seller the difference between the current value of an asset and its value at contract time. Cfds allow traders and investors an opportunity to profit from price movement without owning the underlying assets. The value of a CFD contract does not consider the asset's underlying value: only the price change between the trade entry and exit.

This is accomplished through a contract between client and broker and does not utilize any stock, forex, commodity, or futures exchange. Trading cfds offers several major advantages that have increased the instruments' enormous popularity in the past decade.

Key takeaways

A contract for differences (CFD) is an agreement between an investor and a CFD broker to exchange the difference in the value of a financial product between the time the contract opens and closes.

A CFD investor never actually owns the underlying asset but instead receives revenue based on the price change of that asset.

Some advantages of cfds include access to the underlying asset at a lower cost than buying the asset outright, ease of execution, and the ability to go long or short.

A disadvantage of cfds is the immediate decrease of the investor's initial position, which is reduced by the size of the spread upon entering the CFD.

Other CFD risks include weak industry regulation, potential lack of liquidity, and the need to maintain an adequate margin.

Contract for differences (CFD)

How cfds work

A contract for differences (CFD) is an agreement between an investor and a CFD broker to exchange the difference in the value of a financial product (securities or derivatives) between the time the contract opens and closes.

It is an advanced trading strategy that is utilized by experienced traders only. There is no delivery of physical goods or securities with cfds. A CFD investor never actually owns the underlying asset but instead receives revenue based on the price change of that asset. For example, instead of buying or selling physical gold, a trader can simply speculate on whether the price of gold will go up or down.

Essentially, investors can use cfds to make bets about whether or not the price of the underlying asset or security will rise or fall. Traders can bet on either upward or downward movement. If the trader that has purchased a CFD sees the asset's price increase, they will offer their holding for sale. The net difference between the purchase price and the sale price are netted together. The net difference representing the gain from the trades is settled through the investor's brokerage account.

On the other hand, if the trader believes that the asset's value will decline, an opening sell position can be placed. In order to close the position, the trader must purchase an offsetting trade. Then, the net difference of the loss is cash-settled through their account.

Countries where you can trade cfds

CFD contracts are not allowed in the U.S. They are allowed in listed, over-the-counter (OTC) markets in many major trading countries, including the united kingdom, germany, switzerland, singapore, spain, france, south africa, canada, new zealand, hong kong, sweden, norway, italy, thailand, belgium, denmark, and the netherlands.

As for australia, where CFD contracts are currently allowed, the australian securities and investment commission (ASIC) has announced some changes in the issue and distribution of cfds to retail clients. ASIC’s goal is to strengthen consumer protections by reducing CFD leverage available to retail clients and by targeting CFD product features and sales practices that amplify retail clients’ CFD losses. ASIC’s product intervention order will be effective on march 29, 2021.

The U.S. Securities and exchange commission (SEC) has restricted the trading of cfds in the U.S., but non-residents can trade using them.

Fast fact

CFD trading is surging in 2020; the increase in popularity may be because of covid-19-induced volatility in the markets. A key feature of cfds is that they allow you to trade on markets that are heading downwards, in addition to those that are heading up—allowing them to deliver profit even when the market is in turmoil.

The costs of cfds

The costs of trading cfds include a commission (in some cases), a financing cost (in certain situations), and the spread—the difference between the bid price (purchase price) and the offer price at the time you trade.

There is usually no commission for trading forex pairs and commodities. However, brokers typically charge a commission for stocks. For example, the broker CMC markets, a U.K.-based financial services company, charges commissions that start from 10%, or $0.02 cents per share for U.S. And canadian-listed shares. The opening and closing trades constitute two separate trades, and therefore you are charged a commission for each trade.

A financing charge may apply if you take a long position; this is because overnight positions for a product are considered an investment (and the provider has lent the trader money to buy the asset). Traders are usually charged an interest charge on each of the days they hold the position.

For example, suppose that a trader wants to buy cfds for the share price of glaxosmithkline. The trader places a £10,000 trade. The current price of glaxosmithkline is £23.50. The trader expects that the share price will increase to £24.80 per share. The bid-offer spread is 23.48-23.50.

The trader will pay a 0.1% commission on opening the position and another 0.1% when the position is closed. For a long position, the trader will be charged a financing charge overnight (normally the LIBOR interest rate plus 2.5%).

The trader buys 426 contracts at £23.48 per share, so their trading position is £10,002.48. Suppose that the share price of glaxosmithkline increases to £24.80 in 16 days. The initial value of the trade is £10,002.48 but the final value is £10,564.80.

The trader's profit (before charges and commission) is: £10,564.80 – £10,002.48 = £562.32.

Since the commission is 0.1%, upon opening the position the trader pays £10. Suppose that interest charges are 7.5%, which must be paid on each of the 16 days that the trader holds the position. (426 x £23.48 x 0.075/365 = £2.06. Since the position is open for 16 days, the total charge is 16 x £2.06 = £32.89.)

When the position is closed, the trader must pay another 0.01% commission fee of £10.

The trader's net profit is equal to profits minus charges: 526.32 (profit) – 10 (commission) – 32.89 (interest) – 10 (commission)= £473.43 (net profit).

Advantages of cfds

Higher leverage

Cfds provide higher leverage than traditional trading. standard leverage in the CFD market is subject to regulation. It once was as low as a 2% maintenance margin (50:1 leverage), but is now limited in a range of 3% (30:1 leverage) and could go up to 50% (2:1 leverage). Lower margin requirements mean less capital outlay for the trader and greater potential returns. However, increased leverage can also magnify a trader's losses.

Global market access from one platform

Many CFD brokers offer products in all the world's major markets, allowing around-the-clock access. Investors can trade cfds on a wide range of worldwide markets.

No shorting rules or borrowing stock

Certain markets have rules that prohibit shorting, require the trader to borrow the instrument before selling short, or have different margin requirements for short and long positions. CFD instruments can be shorted at any time without borrowing costs because the trader doesn't own the underlying asset.

Professional execution with no fees

CFD brokers offer many of the same order types as traditional brokers including stops, limits, and contingent orders, such as "one cancels the other" and "if done." some brokers offering guaranteed stops will charge a fee for the service or recoup costs in another way.

Brokers make money when the trader pays the spread. Occasionally, they charge commissions or fees. To buy, a trader must pay the ask price, and to sell/short, the trader must pay the bid price. This spread may be small or large depending on the volatility of the underlying asset; fixed spreads are often available.

No day trading requirements

Certain markets require minimum amounts of capital to day trade or place limits on the number of day trades that can be made within certain accounts. The CFD market is not bound by these restrictions, and all account holders can day trade if they wish. Accounts can often be opened for as little as $1,000, although $2,000 and $5,000 are common minimum deposit requirements.

Variety of trading opportunities

Brokers currently offer stock, index, treasury, currency, sector, and commodity cfds. This enables speculators interested in diverse financial vehicles to trade cfds as an alternative to exchanges.

Disadvantages of cfds

Traders pay the spread

While cfds offer an attractive alternative to traditional markets, they also present potential pitfalls. For one, having to pay the spread on entries and exits eliminates the potential to profit from small moves. The spread also decreases winning trades by a small amount compared to the underlying security and will increase losses by a small amount. So, while traditional markets expose the trader to fees, regulations, commissions, and higher capital requirements, cfds trim traders' profits through spread costs.

Weak industry regulation

The CFD industry is not highly regulated. A CFD broker's credibility is based on reputation, longevity, and financial position rather than government standing or liquidity. There are excellent CFD brokers, but it's important to investigate a broker's background before opening an account.

Risks

CFD trading is fast-moving and requires close monitoring. As a result, traders should be aware of the significant risks when trading cfds. There are liquidity risks and margins you need to maintain; if you cannot cover reductions in values, your provider may close your position, and you'll have to meet the loss no matter what subsequently happens to the underlying asset.

Leverage risks expose you to greater potential profits but also greater potential losses. While stop-loss limits are available from many CFD providers, they can't guarantee you won't suffer losses, especially if there's a market closure or a sharp price movement. Execution risks also may occur due to lags in trades.

Because the industry is not regulated and there are significant risks involved, cfds are banned in the U.S. By the securities and exchange commission (SEC).

Example of a CFD trade

A CFD trade will show a loss equal to the size of the spread at the time of the transaction. If the spread is $0.05 cents, the stock needs to gain $0.05 cents for the position to hit the break-even price. While you'll see a $0.05 gain if you owned the stock outright, you would have also paid a commission and incurred a larger capital outlay.

If the stock rallies to a bid price of $25.76 in a traditional broker account, it can be sold for a $50 gain or $50 / $1,263 = 3.95% profit. However, when the national exchange reaches this price, the CFD bid price may only be $25.74. The CFD profit will be lower because the trader must exit at the bid price and the spread is larger than on the regular market.

In this example, the CFD trader earns an estimated $48 or $48 / $126.30 = 38% return on investment. The CFD broker may also require the trader to buy at a higher initial price, $25.28 for example. Even so, the $46 to $48 earned on the CFD trade denotes a net profit, while the $50 profit from owning the stock outright doesn't include commissions or other fees. Thus, the CFD trader ends up with more money in their pocket.

Cfds faqs

What are cfds?

Contracts for differences (cfds) are contracts between investors and financial institutions in which investors take a position on the future value of an asset. The difference between the open and closing trade prices are cash-settled. There is no physical delivery of goods or securities; a client and the broker exchange the difference in the initial price of the trade and its value when the trade is unwound or reversed.

How do cfds work?

A contract for difference (CFD) allows traders to speculate on the future market movements of an underlying asset, without actually owning or taking physical delivery of the underlying asset. Cfds are available for a range of underlying assets, such as shares, commodities, and foreign exchange. A CFD involves two trades. The first trade creates the open position, which is later closed out through a reverse trade with the CFD provider at a different price.

If the first trade is a buy or long position, the second trade (which closes the open position) is a sell. If the opening trade was a sell or short position, the closing trade is a buy.

The net profit of the trader is the price difference between the opening trade and the closing-out trade (less any commission or interest).

Why are cfds illegal in the U.S.?

Part of the reason that cfds are illegal in the U.S. Is that they are an over-the-counter (OTC) product, which means that they don't pass through regulated exchanges. Using leverage also allows for the possibility of larger losses and is a concern for regulators.

The commodity futures trading commission (CFTC) and the securities and exchange commission (SEC) prohibit residents and citizens of the U.S. From opening CFD accounts on domestic or foreign platforms.

Is trading cfds safe?

Trading cfds can be risky, and the potential advantages of them can sometimes overshadow the associated counterparty risk, market risk, client money risk, and liquidity risk. CFD trading can also be considered risky as a result of other factors, including poor industry regulation, potential lack of liquidity, and the need to maintain an adequate margin due to leveraged losses.

Can you make money with cfds?

Yes, of course, it is possible to make money trading cfds. However, trading cfds is a risky strategy relative to other forms of trading. Most successful CFD traders are veteran traders with a wealth of experience and tactical acumen.

The bottom line

Advantages to CFD trading include lower margin requirements, easy access to global markets, no shorting or day trading rules, and little or no fees. However, high leverage magnifies losses when they occur, and having to pay a spread to enter and exit positions can be costly when large price movements do not occur. Indeed, the european securities and markets authority (ESMA) has placed restrictions on cfds to protect retail investors.

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Cfds are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading cfds with this provider. You should consider whether you understand how cfds work and whether you can afford to take the high risk of losing your money.

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What is CFD trading?

Experienced investors would have heard of the term CFD trading, but if you are new to the trading and investment world, you may be wondering what does it mean and how does it work.

The first thing to know is that CFD stands for contract for difference. But exactly what is CFD trading? And how can it be part of your investment portfolio, both as a novice and a seasoned investor? Let’s take a look at CFD trading in more detail to help you understand.

A contract for difference (CFD) is a financial contract between the investor and an online provider, based upon the value of a financial asset or group of assets, without owning the agreed upon underlying asset. CFD trading can be offered on a varied number of financial instruments, such as shares, bonds, commodities, forex, metals, energy, stocks, indices, currencies and cryptocurrencies.

CFD trading enables the opportunity to speculate on the price movement of a financial asset and involves trading on the price of an asset at the point of opening the contract to when it closes, exchanging the difference in price.

How does CFD trading work?

Investors can take a position on both falling and rising prices with CFD trading, as one of the conditions of a CFD is that the investor does not own the underlying asset.

Each CFD contract has a buy and a sell price, which are slightly higher or lower than the market value, respectively. The difference between these two prices is known as the spread, and the trading involves the prediction of movement of these prices. As previously mentioned, CFD trading allows an investor to speculate on the market in either direction of rising or falling, with the price of the CFD contract mirroring that of the underlying asset.

Similar to traditional trading, if you expect the market to rise, then you would aim to buy, which means that you are ‘going long’ or you are ‘long’, and will profit from the rise in prices. However, in contrast to traditional trading, you can also open a CFD position if you believe that the prices of the underlying asset in the market will decrease, then you would sell and be ‘going short’ or are ‘short’.

The profit and loss are reliant on the extent to which your predications on these prices are correct. The more the market goes in the direction that you have predicted, the larger the profits. Likewise, if the market moves in the opposite direction to what you have predicted, then the more you would lose.

What is leverage in CFD trading?

Leverage allows investors to only invest a smaller amount compared to the actual value of the trade, meaning that they can gain exposure to a much larger position on the market without having to invest the full cost, like you would have to with a standard trade. With a leveraged CFD, you can therefore put down a smaller portion of the cost and spread your investments further, controlling a much larger position of investments. The fact that CFD trading provides this leverage and this market exposure to more winning trades, are some of the reasons CFD trading is so popular among investors.

But, when CFD trading using leverage, it is important to remember that just as much as the leverage can enhance your buying abilities by multiplying the original amount invested, it can also multiple both your profits and losses. This is because the outcome is calculated on the full size of the position, not on the actual amount invested. Therefore, it is always advised to research and take into account the leverage ratio when CFD trading.

CFD trading is a popular strategy for investors for many reasons. It allows the opportunity for trading on both rising and falling markets, with short and long positions available, depending on the market and adapting to the investor’s trading strategy. As well as the option of leverage, CFD trading can also work in terms of hedging, when you can open a CFD to prevent potential losses when owning the actual asset itself and if you believe the share prices will go down. With so many benefits, its clear to see why CFD trading works for many investors.

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Cfds are complex instruments and come with a high risk of losing money rapidly due to leverage. 76.4% of retail investor accounts lose money when trading cfds with this provider. You should consider whether you understand how cfds work and whether you can afford to take the high risk of losing your money.

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Online trading

Trading, in general, has been around for hundreds of years; it has been the primary method for exchanging goods and services between two or more people. However, this term has been evolving as the years passed, and it's now a globalized concept with several branches that you can study before starting to trade any asset.

There are hundreds of reasons why you may have decided to start trading:

You may have read about it online.

Some friends told you about it.

You came across it while browsing the internet.

Regardless of the reason, trading is an exciting world with thousands of possibilities to be discovered!

Before we start diving into recent trading platforms and how you can use them to your benefit, we believe it's important that you know a bit of online trading history. This piece of information can give you a glimpse of how trading has evolved over past decades and how it's going to keep growing in the future.

How was online trading created?

Online trading was born in 1972 when the national association of securities dealers (NASD) programmed a piece of software as the first electronic stock market in the world. This product was called the national association of securities dealers automated quotations (NASDAQ).

However, NASDAQ didn't perform like trading platforms work nowadays. Back then, the platform still needed human broker input to start, which required up to seven days to execute a single trade. When it first started, NASDAQ mainly worked with floor trading, which is when people gathered into a single room and began shouting bids.

In the 1980s, more people started to execute trades by phone, which lead to more efficiency with this software. Phone trading lasted until the 1990s since the internet started to become widely popular as a better way to execute trades without losing much time.

NASDAQ is still working to this day, and it has evolved to adapt to recent trading trends, making it the second-largest electronic stock market in the united states.

As you can see, trading has gone through several platforms to work, and it's expected to keep evolving as new technology and trading tendencies come by. Getting access to information is easier than ever, which makes us believe that this is one of the best times to start your trading journey.

What does trading involve?

Trading is a basic economic concept that has been around for hundreds of years. It's the act of exchanging goods and services; normally, these transactions happen in two ways:

A buyer pays a transaction fee to a seller.

Two parties exchange goods and services without any additional fees involved.

While that's the broader concept, online trading has a slightly different approach. In this "online" variant of trading, you're exchanging different financial instruments instead of goods and services. These financial instruments can be many types of assets, such as cfds, cryptocurrencies, commodities, currencies, and more.

To start trading, you need to follow some basic steps, such as opening a trading account, learning the fundamentals of stock markets, creating a trading plan, and practicing in an online stock simulator if you want.

However, the most important thing to start trading is doing proper research. The stock markets are always evolving, making it difficult to keep up with all the information coming in. If you don't take the time to read new information, you may have some issues understanding why the market is behaving in a particular way.

Overall, trading can be done by anyone with an active internet connection and browser, but it needs dedication and patience to become an expert in it.

What kind of assets can you trade?

The possibilities of online trading are endless! Many platforms allow you to trade most assets available on the market right now. If you're just starting to trade, you may be confused about what asset best fits your goals. Here's an overview of the most frequently traded assets.

Contracts for difference (cfds)

This is a contract made between the investor and the broker. When the contract ends, both parties exchange the difference in a particular financial instrument's opening and closing prices. In trading, it involves speculating how high or low a specific financial instrument's price is going to achieve in the future.

The difference between CFD trading and traditional trading is that you're not directly trading the assets; you're trading a specified number of units from that asset.

Currencies

Currencies are your traditional assets, such as USD, EUR, GBP, CAD, etc. In this type of trading, you're doing it in currency pairs. For example, whenever you're going to trade a currency pair, it means that you're selling a currency and buying a different one.

Some of the most popular currency pairs include EUR/USD, USD/CAD, USD/JPY, and many more.

Cryptocurrencies

These are a recent addition in trading. Cryptocurrencies are digital assets that don't exist in physical form, and they can be easily obtained from anywhere in the world. To trade cryptos, you have to speculate on the price a particular cryptocurrency may reach in the future and execute a buy/sell order based on that speculation.

It may be difficult to choose a particular cryptocurrency to trade at first since there are hundreds of them. However, if you're just starting, you can go with the most popular ones, such as bitcoin, ethereum, ripple, litecoin, etc.

Commodities

Commodity trading involves agricultural commodities, metal commodities, energy commodities, and many more. Here, you're mostly trading gold, oil, and other agricultural products.

This type of trading has been around for several years, focusing on the primary economic sector.

Are there other assets on the market?

Keep in mind that an asset can be any object with financial value, meaning it can be turned into cash. In the case of financial assets, you can find all the instruments mentioned above, as well as bonds, mutual funds, deposits, and much more.

As we said before, the trading market is huge, and you can trade pretty much anything that has value. However, it may be confusing for you at first to find the correct asset to trade. Thankfully, our trading app, CFD trader, allows you to trade all the mentioned assets with a single platform.

How does CFD trader work?

Trading apps are still a fairly new creation, so it's common to find many of them with different features, compatibility, and look. However, finding a reliable trading app is not so simple because some of them are created by developers who don't know anything about trading, which leads to bad functioning.

CFD trader was developed by a large team of passionate traders and developers, so you can rest assured that this piece of software contains the right information that you need to start your trading journey more efficiently.

This app has a simple concept, but it's more powerful than you may think. To use CFD trader, you need to input your trading parameters on the system; these parameters involve entry and exit points, type of asset you're trading, and overall game plan. After you do this, the app is going to continually look for appropriate trades that match your criteria.

The best thing about CFD trader is that it can save you a huge amount of time if you use it consistently. One of the traders' primary concerns is not having enough time to learn enough about proper trading. While trading requires a lot of dedication to become good at it, it doesn't hurt to have a helping hand every once in a while.

Last but not least, this app can be used by anyone who has an active internet connection and browser. There's not a required level of experience to start using CFD trader, so if you're a beginner looking to dive into trading, this may be one of the best ways to go.

Discover the benefits of using CFD trader

One of the most important things about any app is its features. It's what makes them unique among all the others on the market. With the constant creation of new and innovative software, it can be complicated to stand out.

Fortunately, we did our best to ensure that CFD trader offers an unforgettable trading experience to anyone who uses it, regardless of their current trading level. If you want an in-depth overview of how this app can help you become a better trader, keep reading!

Most traders do their sessions on a computer since it's a powerful and comfortable device to keep track of all the information coming in. However, not everyone has a computer or laptop available for trading, making it inaccessible for some users.

To fix this, we made CFD trader available to any smart device that has an active internet connection. This means that if you have a smartphone or tablet, and you want to start trading, you can do it by creating a CFD trader account.

You can also use this app on separate devices, so you can have a primary and secondary device for your trades, depending on what you need. We suggest using a computer as your primary device and your phone as the second one for the most comfortable experience. However, if you don't have a computer, don't worry; you can still access the app's features from other devices.

CFD trader relies on its powerful algorithms to do its job. Some developers focus on giving their product a heavy marketing department without working on the app's technology. In these cases, you may end up with a product that advertises itself amazingly but performs poorly.

In our case, we paid full attention to the software since it's the thing that is going to make you learn the fundamentals of trading. If the app works, it's going to advertise itself, which we believe is even better!

Our algorithms are continually working to find appropriate trades for you; if you change your trading settings, the app is going to adapt to those changes to maximize its efficiency. This is not a one-size-fits-all app, but rather one that works alongside every user to achieve proper learning progress.

We know that managing your money is as important as the app's functionality. Some platforms may make you go through extensive funding or withdrawal processes that may feel confusing, so we decided to keep that area as simple to use as possible.

With CFD trader, you can easily make funding, saving, or withdrawal transactions at any point of the day without any extra steps. The money you invest with CFD trader is all yours, and you're free to use it however you want.

Regardless of your current skill level, you can take less than an hour to set up everything. If you're a beginner, you may spend more time looking at each feature and deciding which one works the best for you, but even in these cases, you may take up to 45 minutes to get ready.

Not everyone works at the same pace, and we took that into consideration when developing CFD trader. You can take as much time as you want in the set-up process, and we strongly advise that you do that to make sure that you're implementing the right strategies.

Hidden fees can be frustrating. We encountered our fair share of platforms with hidden fees back when we were trading, and it was not a great feeling. We didn't want to make the same mistake as other developers, so we decided to go with transparency in every aspect of our app.

You don't have to pay any registration, funding, or withdrawal fees with CFD trader. The only money that you have to use is the one you're planning to invest in.

Sign up for CFD trader by following these easy steps!

The easiest part of CFD trader is signing up. If you want to enjoy all the benefits this app has to offer, make sure that you become a member by following all the steps below!

Step one – registration

First, input your contact information so that we can send you a verification e-mail with the details. In this case, you have to send us the following:

Full name

E-mail address

Phone number

Step two – funding and planning

After you verify your account, you need to fund it and input your trading criteria to begin trading. Take as much time as you need in this step because it's the most important one. When you believe you're fully set up, you can move on to the next step.

If you're a beginner, don't worry; the app is going to lay out every feature inside it as well as recommendations on what to do in your first session.

Step three – trading

Last but not least, hit the "trade" button to start! Remember that you can change your trading settings whenever you consider it appropriate.

Frequently asked questions

Having doubts about any service is common, and it's vital that you clear up as many of them as you can to avoid any confusion or mistakes along the road. We wanted to get one step ahead of this and made a list of our most frequently asked questions.

If there's anything that you don't quite understand properly, you may find the answer below.

The main difference between assets is the thing you're trading and how you trade it. For example: in CFD trading, you're not trading the asset itself; you're trading a number of units from that asset. In currency trading, you're buying a currency and selling another, which is known as "currency pairs."

Last but not least, crypto trading involves trading the cryptocurrency itself based on previous speculation of its future value. Overall, each asset may be slightly different to trade, but with CFD trader, you can easily tell the difference apart since we laid out everything carefully in our user interface.

Do I have to pay anything to use CFD trader?

CFD trader doesn't require you to pay anything besides the investment you're planning to make. There are no registration, funding, or withdrawal fees, and you can manage your money in any way you feel appropriate.

To use CFD trader for free, you have to become a member of our trading community. Signing up for our app is fairly easy, and it doesn't take more than a few minutes.

Can I use this app if I don't have any experience?

Yes! CFD trader was created for every trader, regardless of their current skill level. Every feature in the app is carefully explained so that beginners can get on track faster. This piece of software is especially great for beginners since it serves as a way to learn the fundamentals of trading more effectively and without the stress factors that traditional trading often involves.

On the other hand, professionals can also use this app to save time in their trading sessions. We know how time-consuming this activity can be, which is why we're providing a tool that can help you get some breathing air every once in a while.

Join our trading community now!

We want to give you the help that we couldn't get back when we first started trading. It's important to have the right tools when you're learning how to trade, especially when there's such a large amount of information on the internet.

Using CFD trader doesn't guarantee any results since we didn't develop the app for that. However, we can promise that by using it constantly, you can become a much better trader who knows how to identify trading signals and strategies properly.

If you're ready to start your trading journey with us, make sure to fill out our registration form below, and let's get to work!

Important risk note: trading can generate notable benefits; however, it also involves a risk of partial/full funds loss, and should be considered by initial investors. Around 70 percent of the investors will lose money. Carefully read our terms & conditions and disclaimer page before investing. Customers must be cognizant of their individual capital gain tax liability in their country of residence. It is against the law to solicit united states persons to buy and sell commodity options, even if they are called ‘prediction' contracts unless they are listed for trading and traded on a CFTC-registered exchange or unless legally exempt.

What is CFD trading?

Experienced investors would have heard of the term CFD trading, but if you are new to the trading and investment world, you may be wondering what does it mean and how does it work.

How does CFD trading work?

Investors can take a position on both falling and rising prices with CFD trading, as one of the conditions of a CFD is that the investor does not own the underlying asset.

What is leverage in CFD trading?

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Last updated:

For experienced traders

For new traders

Professional trader

Find out more details, including eligibility criteria, by clicking 'learn more'.

Trade on over 12,000 markets

Indices

Forex

Commodities

Trade wherever you are, on our fast, reliable platforms

Award-winning platform

Actionable trade ideas

Trade anytime, anywhere

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Powerful charts

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Multiple charts layouts

View the price movements of many markets by embedding multiple charts into your chosen platform layout.

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65+ technical indicators

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Deal through charts

Trade directly from a chart. Your positions, stops and limit orders are displayed on the chart and can be amended by dragging the lines.

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Multiple chart types

Multiple chart types available, including candlestick, heikin-ashi and point & figure to allow you to identify trends and key levels.

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Extensive drawing tools

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Compare markets

Compare the relative performance and price action of one or more markets with another, within a single chart.

Multiple charts layouts

65+ technical indicators

Deal through charts

Multiple chart types

Extensive drawing tools

Compare markets

Latest news

Traders still pushing silver higher. Could it really be the next GME? January 29, 2021 4:18 PM

What is a short squeeze and how can it be predicted? January 29, 2021 4:08 PM

What is short selling and how do you short a stock? January 29, 2021 3:11 PM

read latest news

Need help?

Customer support

Available 24 hours monday-friday
local: 0845 355 0801 (local rate)
international: +44 203 194 1801
email: support@cityindex.Co.Uk

Web chat

Award-winning platform and service

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Financial strength and security

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Trading support service

We provide detailed information about every aspect of our service with ongoing account support for every client.

Welcome pack

Platform walkthroughs

Ongoing support

Market intelligence

† 1 point spreads available on the UK 100, germany 30, france 40 and australia 200 during market hours on daily funded trades and cfds (excluding futures).

City index and city trading are trademarks of GAIN capital UK ltd.

We use cookies, and by continuing to use this site or clicking "agree" you agree to their use. Full details are in our cookie policy.

CFD trading

CFD trading with city index gives you access to over 4000 global markets including indices, shares, FX, commodities and bonds.

Tight spreads from 0.5 points on FX

Choice of 4000+ cfds from one account

Awarded best CFD provider 2019 by ADVFN ‡

market name	spread from	margin from *
UK 100	1 point	5%
germany 30	1 point	5%
EUR/USD	0.5 points	3.33%
gold	0.3 points (around market spread)	5%
US crude	0.4 points (around market spread)	10%

*for retail clients. Professional trader rates here

Why trade cfds with city index?

Tight spreads

Hedging tool

4000+ CFD markets

Easy to spot trading opportunities

Advanced trading platforms

Commission free cfds

Quick links

Latest news

Traders still pushing silver higher. Could it really be the next GME? January 29, 2021 4:18 PM

What is a short squeeze and how can it be predicted? January 29, 2021 4:08 PM

What is short selling and how do you short a stock? January 29, 2021 3:11 PM

read latest news

Trade wherever you are, on our fast, reliable platforms

Customisable charts

Award-winning platform

Actionable trade ideas

Trade anytime, anywhere

/media/forex/images/page-banners/platform-in-mac.Png" alt="city index trading platform" />

Benefits of trading cfds

No UK stamp duty

Trade on falling markets

Hedge your portfolio

Trade on margin

What can I trade on?

Indices

Fixed 1 point spreads on major indices †

Trade on thousands of global shares from 0.1% commission

Forex

Trade EUR/USD and USD/JPY from 0.5 points

Commodities

Trade gold from 0.3 points around market spread

Discover CFD trading

Cfds are popular with investors who want the opportunity to try to make a better return for their money.

However cfds contain significant risks to your capital and aren’t suitable for everyone. We strongly suggest doing your research and trading on a demo account before you try it with your own money.

Learn more about CFD trading

CFD trading

Find out more about contracts for difference (CFD) trading.

How to analyse markets

How to identify trading opportunities using city index's research tools

How to manage risk

Learn techniques to improve your trading and manage risk effectively

Start CFD trading

APPLY

TRADE

How to trade cfds

1. Choose a CFD market
decide which market you want to trade on. Get bullish and bearish trading ideas in our fundamental and technical analysis research portal

2. Decide to buy or sell
click 'buy' if you think the price will increase in value or ‘sell’ if you think the market will fall in value

3. Select your trade size
choose how many cfds you want to trade

4. Add a stop loss
A stop loss is an order to close your position at a predetermined price set by you

5. Monitor and close your trade
once you have placed your trade, you will monitor profit/loss update in real time at the top of the screen. Exit your trade by clicking the close trade button

Why city index?

Benefits of CFD trading

No UK stamp duty

As cfds are a derivative product, you don't actually own the underlying instrument that you are trading on. This means that you do not have to pay UK stamp duty, saving you the stamp duty charge associated with regular share dealing.

Ability to go long and short

With cfds you can trade on falling markets by 'going short' (selling), just as easily as you can trade on rising markets by 'going long' (buying).

If you believe a company or market will increase in value you take a long position (buy). Your profits will rise in line with any increase in that price and your losses will increase with any fall in that price.

On the other hand, if you believe that a company or market will experience a loss of value you can use cfds to go short (sell). Your profits will rise in line with any fall in price (and your losses will rise in line with any increase in that price).

Reduce your capital outlay using margin

Cfds are a leveraged product, which means you pay a small percentage of the total trade value to open your position, known as margin, rather than paying to cover the entire cost of your position.

For example, if a market has a margin requirement of 10% then you would need to have 10% of the full value of the trade in your account, as initial margin, to open the position.

Leverage is good news if the market moves in the direction that you expect, but it carries a high degree of risk if the market moves against you. In the same way that your profits are magnified, any losses will also be magnified and you could lose more than your initial investment.

Hedge your portfolio

If you believe your existing portfolio may lose some of its value, you can use cfds to offset this loss by short selling.

Let's say you hold £5,000 worth of vodafone shares in your portfolio. You can short sell the equivalent of £5,000 worth of vodafone shares through a CFD trade.

In the same way that your profits are magnified, any losses will also be magnified and you could lose more than your initial investment.

Access global markets & 24 hours trading

CFD trading gives you access to a wide range of markets that would not otherwise be available to retail investors, all from one trading platform. You can speculate on the price movement of thousands of individual shares, indices, currencies, bonds and interest rates from across the globe.

We know it's important for you to be able to access your account and trade whenever you want, wherever you are, particularly when market prices are moving quickly. So, we give you unrestricted access to your account 24 hours a day, 7 days a week.

Summary of differences between CFD trading and share trading:

† 1 point spreads available on the UK 100, germany 30, france 40 and australia 200 during market hours on daily funded trades and cfds (excluding futures).

City index and city trading are trademarks of GAIN capital UK ltd.

We use cookies, and by continuing to use this site or clicking "agree" you agree to their use. Full details are in our cookie policy.

Trade with the global forex trading specialist

Why FOREX.Com?

Metatrader

Trade over 500 markets including equities, indices, FX and commodities on the new and improved MT5

Competitive pricing

Maximize your potential with straightforward pricing choices to suit your trading style

Active trader

Earn rebates and one-on-one professional support when you qualify for our active trader program

Financial strength you can depend on

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Your FOREX.Com account gives you access to our full suite of downloadable, web, and mobile apps.

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Trade on one of the world's most popular trading platforms with access to dedicated support and integrated trading tools exclusive to FOREX.Com.

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Leverage our experts

Our global research team identifies the information that drives markets so you can forecast potential price movement and seize forex trading opportunities.

Ready to learn about forex?

New trader?

Welcome, we’ll show you how forex works and why you should trade it.

Have some experience?

Let’s create a trading plan that will help you stay on track and meet your goals.

Want to go deep on strategy?

Great, we have guides on specific strategies and how to use them.

Not sure where to start?

Take our short quiz and get matched resources that fit your trading style.

Open an account in as little as 5 minutes

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Please note that foreign exchange and other leveraged trading involves significant risk of loss. It is not suitable for all investors and you should make sure you understand the risks involved, seeking independent advice if necessary.

Contracts for difference (cfds) are not available to US residents.

FOREX.Com is a trading name of GAIN global markets inc. Which is authorized and regulated by the cayman islands monetary authority under the securities investment business law of the cayman islands (as revised) with license number 25033.

FOREX.Com may, from time to time, offer payment processing services with respect to card deposits through its affiliate, GAIN capital UK ltd, devon house, 58 st katharine’s way, london, E1W 1JP, united kingdom.

GAIN global markets inc. Is part of the GAIN capital holdings, inc. Group of companies, which has its principal place of business at 135 US hwy 202/206, bedminster, NJ 07921, USA. All are separate but affiliated subsidiaries of stonex group inc.

So, let's see, what we have: meta description: contract for differences (cfds) offer european traders and investors an opportunity to profit from price movements without owning the underlying assets. At cfd online trading