Retail Investors can now use CFD to trade on the financial markets. CFDs are relatively new on the investment market. In a short time, the demand for CFD trading has exploded. But what is a CFD and where can you trade it?
What is a CFD?
CFDs or Contracts For Difference are investment instruments with which enables investors to respond in a straightforward manner to price fluctuations in multiple markets. The underlying asset can be a share, index, commodity or currency. CFD is a leveraged product.
The investor enters into a contract with the CFD with the broker. He speculates on an upward or downward movement of the underlying value. The contract has no end date. The investor can conclude the contract after a few seconds or after a few years, depending on his objective. However, CFDs usually used for short time periods.
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