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Trade CFDs Online

CFDs on Metals, Commodities & Stock Indices

Contracts for Difference (CFDs) are specialised and popular Over The Counter (OTC) financial products that allow you to easily take broad market positions in a variety of different financial markets including Stock Indices, Commodities, Metals, and more. With FXTRADING.com you can trade CFDs and Forex from the same platform login.

What are CFDs and How do They Work?

CFDs are leveraged derivatives products that allow you to trade on live market price movements without actually owning the underlying instrument on which your contract is based. You can use CFDs to speculate on the future movement of market prices regardless of whether the underlying markets are rising or falling. (go long or short)

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How CFDs Work

If a stock has an ask price of $25.26 and 100 shares are bought at this price, the cost of the transaction is $2,526. With a traditional broker, using a 50% margin, the trade would require at least a $1,263 cash outlay from the trader. With a CFD broker, often only a 5% margin is required, so this trade can be entered for a cash outlay of only $126.30. 

If the underlying stock were to continue to appreciate and the stock reached a bid price of $25.76, the stock can be sold for a $50 gain or $50/$1263=3.95% profit.

Alternatively, if you owned the CFD over the stock, at the point the underlying stock is at $25.76, the CFD gain is an estimated = 39.5% return on investment. 

Why Trade CFDs?

You can use CFDs to speculate on the future movement of market prices regardless of whether the underlying markets are rising or falling. You can go long (buy) or sell short (sell), allowing you to profit from falling prices, or alternatively you can hedge your portfolio to offset any potential loss in value of your physical investments.

You can gain exposure to markets you may not have had access to before. We offer prices on forex, metals, indices, commodities and more. 

Competitive Spreads/Margins on CFDs

The spread is the difference between these two prices. If you think the price is going to go down, you use the sell price. If you think it will go up, you use the buy price.

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Example: For example, if you were viewing the Australia 200 Index price, it might look like this:

  • Australia 200 Index 5069/5070
  • Buy at 5070 if you think Australia 200 will rise in value.
  • Sell at 5069 if you think Australia 200 will fall in value.

In this example, the spread for the Australia 200 is 1 point.

Learn More about CFDs

As with traditional dealing, CFD prices are quoted as a buy (‘offer’ the price you go long at) or sell (‘bid’ the price you short sell at). The price of your CFD replicates the price of the underlying instrument and you are charged a small commission and/or swap charge for each trade that you place with us. 

You can take a short course on CFD’s here (coming soon)