The Contracts For Difference (CFD) are derivative financial instruments that allow you to hedge your risk or speculate on assets' price variation, market index, commodities or other underlying assets.
Since CFD are traded Over-The-Counter (OTC), price is defined by the market-maker with reference to the underlying asset's market value. Purchase and sale prices of a specific CFD will deviate from that value in a differential set by the commission also defined by the market-maker. The spread is calculated on the market bid values.
Since leverage is one of CFD' features, trading is done through margin reserve, so that the necessary margin value for opening a position (long or short) is "retained". The margin value is calculated automatically on the nominal exposure of the position and the required percentage for the underlying asset – ranging from 5 to 100%. Each underlying asset has its set margin value, which can be changed at any moment, given volatility, liquidity and other issues. Leverage investment can generate huge losses, which might exceed the amount invested, as well as substantial gains in a short period of time.
If you are expecting a valuation in the underlying asset open a long position, so that you can profit from rises in the assets' value, and then close your position and cash the difference.
If you have a negative perspective on a certain asset, you can profit from it's devaluation by investing in CFD and opening a short position. If the price rises (instead of falling as you assumed) you will lose money.
Trading time in CFD refers to the underlying asset's trading time, but there may be differences. For more information call our Trading Desk on 707 254 254.
You may trade in CFD on stocks in 25 markets, including 21 CFD on futures from major indices.
- Interest on finance: CFD are leverage tools so there will be payment of interests, according to the type of operation and interest rates. If operations are closed on the day there will be no calculation of interest.
- Spread: the difference between buyers' price and sellers' price.
- Commission for small amounts: if the value of the transaction is lower than the minimal values.
- Cost of borrowing: in CFD' short positions over stocks there may be a short-selling cost of borrowing.
- Currency cut there will be exchange rate conversions whenever there are operations in a currency different from the investor's currency.
Talk to our Trading Desk, available from 8h to 21h WET on business and trading days, at these numbers:
218 507 758
965 999 254
912 996 254
935 999 254