Contracts for difference (CFDs) aren't just for trading shares. You can also use CFDs to trade exchange traded funds (ETFs).
This means you're not relying on the performance of a specific share with your CFD trade. You can potentially profit from the performance of a particular market, index or sector.
So how does this work?
Read on to find out…
The benefits of using CFDs to trade... ››› more
When you decide to trade a derivative instrument like contracts for difference (CFDs), you need to get to grips with gearing and trading on margin.
It's these aspects that give CFDs their money multiplier effect, which boosts your potential profits (and losses). And it's vital you understand how they work before you start trading.
Read on to uncover what you need to know about gearing and tr... ››› more
Trading contracts for difference (CFDs) has a number of benefits. One of these key benefits is the money multiplier effect at work because you trade on margin.
But it's this aspect of CFD trading that also makes them risky. If a trade doesn't work out, your losses can quickly mount up.
So how can the margin work against you when you trade CFDs?
Read on to find out…
The downside of... ››› more
One of the reasons that traders choose contracts for difference (CFDs) is the gearing aspect they offer.
Gearing amplifies the movement of the underlying share price. This can work for you by multiplying your potential profits, but against you too as it also multiplies your losses.
Gearing comes from trading on margin.
Read on to find out how this work…
The impact of trading CFDs ... ››› more
If you've decided that trading is for you, there are a number of different instruments you can use to do it.
For example, if you want to trade the price movements of shares you could trade contracts for difference (CFDs) or you could spread trade.
So what is the difference between these two forms of trading?
Read on to find out…
The similarities between CFDs and spread trading
... ››› more
One of the benefits of trading contracts for difference (CFDs) is you can put short trades on.
This means if you think the price of a share is going to fall in value, you can potentially profit from this move by selling CFDs instead of buying them.
But short selling has its risks. So how can you improve your chances of success?
Read on to find out…
Follow these six rules to impro... ››› more
The gearing aspect of trading contracts for difference (CFDs) is one of the reasons traders find them attractive.
But gearing can work against you. And that's why you must understand the risks you take on when trading CFDs and take steps to control this risk.
So what is the effect of gearing on you as a CFD trader? And how can you control the risks of trading CFDs?
Read on to find out… ... ››› more
One of the benefits of trading contracts for difference (CFDs) is you can potentially profit from the drop in the price of a share. This is known as going short or short selling.
The problem with shorting a share is that if it doesn't go your way, it has the potential to keep rising, increasing your losses.
So what happens in you put a short CFD trade on and it goes wrong?
Read on to find... ››› more
If you're thinking about trading contracts for difference (CFDs), you may be wondering how they differ from investing in shares.
There are a number of differences. And it's vital you understand these differences before trading CFDs.
Let's take a closer look at what these differences are…
CFDs versus shares difference #1: Risk
The risk of trading CFDs is much greater than investing... ››› more
Contracts for difference (CFD) appeal to traders thanks to the money multiplying effect of gearing.
But this gearing also works against you. If you don't run tight stop losses, you're at risk of hefty losses.
Let's take a closer look at how you can rack up significant losses if a trade doesn't work out as you hoped…
The gearing aspect of CFDs comes from trading on margin
When you ... ››› more
By trading contracts for difference (CFD) you can take advantage of trading on margin. This translates into gearing.
Get a trade right and gearing multiplies your profits.
Let's take a closer look at how this works when you trade…
How CFD trading works when you go long
Let’s say you’ve been analysing Company ABC and you’re sure the share price is going to rise. Instead of go... ››› more
One of the advantages of trading contracts for difference (CFDs) is you can put on short trades if you think a share price is going to fall.
So how does this work?
Read on to find out…
The workings of a short CFD trade
After conducting some analysis, you think shares in Company ABC are due a fall. So you decide to put a short CFD trade on.
Let’s say that Company ABC is tradin... ››› more
If you glance at your bank statement for the month, chances are it's full of outgoings. Your monthly bills and expenses all chipping away at your bank balance.
The only light at the end of the tunnel is your salary's appearance on pay day.
What if there was a way you could earn money between pay days? Boosting your bank balance and giving you extra money to do with what you like.
The good... ››› more
Contracts for difference (CFDs) are geared products. This means there's a money multiplier effect at work.
Gearing is both an advantage and a disadvantage. Whilst it multiplies your gains, it also multiplies your losses.
So what is gearing when trading CFDs?
Read on to find out more…
How gearing works when you trade CFDs
When you trade CFDs, gearing comes from only putting down... ››› more
If you want to trade contracts for difference (CFDs), one vital step is opening a trading account. Without one of these, you won't be able to trade.
So where do you start?
Read on to find out what you need to do…
Where to open you CFD trading account?
If you’re serious about trading CFDs, you need to find a company to trade them through.
You have two options:
Open a... ››› more
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