Learn about the individual advantages of CFD trading. CFDs are a type of economic instrument that allows you to trade with the use of plastic leverage in economic markets, including indices, Forex trading, commodities, and promotions. Discover the key advantages of CFD trading in our online platform and learn about the associated risks of CFD trading before you sign a transaction.
What are the main benefits of CFD trading?
No stamp duty
In contrast to classic trading promotions, the presence of CFD trading does not need to pay a stamp receipt, as you do not acquire any physiological authority of the property in the underlying assets. However, the customary order is dependent on personal factors and is also able to change. Learn more about CFDs and trading promotions.
Trade on both rising and falling markets
Together with the support of contracts in the difference is possible to trade as well as in the decrease, as well as in the increase in the cost of provisions, which makes it possible to benefit as well as from trading (shorting), so as well as from purchases. Almost all traders use CFDs as a method of hedging their portfolios during short-term volatility.
Efficient use of your capital
One of the main advantages of CFD trading is the chance to trade on margin, which gives you the chance to use “plastic leverage”. This means that you can trade without the need to enter the absolute price of the view. Since your funds are not paired in one transaction, you will be able to use them for other investments. More about trading together with the use of plastic leverage.
For example, to purchase with us the colored equivalent of ten thousand CFDs in the promotions of telecommunication companies, you will need to bring in a total of 5% of the single price of the view, which you would have the opportunity to pay, in case you would have purchased physiological promotions with a stockbroker.
In case any event costs 150 pence, in this case, you would need to bring in a total of £750 of position margin (5% of £15,000 = £750) advantage of the appropriate commission, which in this case would collect £12.
To carry out a similar transaction with a stockbroker, you would need to pay the absolute price of £15,000, the benefit of commission due to CFDs as well as tax.
Comment: trading activity together with the use of margin allows increasing the profitability of investments, but it is important not to forget that the presence of this increases and losses. There are a large number of order types and execution devices in our platform, which can help to manage risks efficiently. Learn more about our software, which has been consistently recognized as the best platform for CFD* trading for several years.
Are CFDs tax-free in the UK?
Unlike spread betting, Contracts for Difference (CFDs) are tax-free in the UK* as you must pay capital gains tax. However, CFD transactions are not subject to stamp duty. Read about comparing spread betting and CFDs.
Can I use CFDs in short positions?
When trading CFDs, you can take a position on either side of the market and either buy or sell. Short selling is a particularly popular strategy among traders who want to take advantage of falling asset prices in volatile markets. Read about how to short-sell stocks as an example.
What markets can I access with CFD trading?
We offer CFD trading on over 12,000 financial instruments in markets such as indices, forex, commodities, stocks, ETFs, and Treasuries, as well as our exclusive equity CFD baskets. Familiarize yourself with our wide range of markets.
Is there an expiration date for CFDs?
Most CFD trades do not have an expiration date, which means you can hold positions for a long period. Some traders prefer to use position trading strategies to trade instruments for the long term rather than investing directly.
How can I trade CFDs?
To start trading CFDs with us, you can sign up for a live CFD account, deposit funds and get access to the real markets. If you want to practice first, you can open a demo CFD account and trade with virtual funds of £10,000.