A contract for difference can reflect the price change of a stock or index, and provide the profit or loss caused by the price change, without actually owning the stock or index futures. CFD of the contract for difference is traded together with the deposit. Just like the physical trading of stocks, the profit and loss are determined by your buying and selling price. CFD of contracts for differences has many advantages over traditional physical trading of stocks.

CFD's historical contracts for differences appeared in 1970s, and became a relatively mainstream trading variety in 2000. CFD appeared in the form of swap transactions, and in the 1980s it mainly focused on transactions between banks and large institutions. 1999 was officially traded in overseas retail markets, and in 2000, the British stock contract for difference was launched in the UK.

At first, the contract for differences was only an effective tool for large institutions to avoid securities risks. Now, it has become a common investment tool for global retail investors.

More and more retail customers use CFD as a part of trading portfolio, and get substitutes for physical trading of stocks. Investors who use CFD trading contracts to obtain the price difference include short-term traders who trade in the day and long-term investors who look for more flexible trading tools to replace financing stock trading.

Trading advantages of contracts for differences.

CFD allows you to trade the "price" of the basic market.

Trading stock CFD will not become a shareholder, and the price of stock CFD changes synchronously with the price of the underlying stock.

Margin trading

CFD has margin trading. The margin ratio ranges from 3% of the stock contract spread CFD to 1% of the index contract spread CFD. In this way, your capital utilization efficiency will be higher, because you only need to invest a small proportion of your total position to conduct a transaction, and at the same time enjoy all the benefits and risks brought by market fluctuations. In other words, you can amplify your investment income.

Whether the market goes up or down, it will be profitable.

CFD gives you the same chance to profit in a bear market, and you can also use short selling to hedge the long risk in the real stock market.

You can go long or short.

Using CFD to hedge the risk of the stock spot market, so as to profit from the falling market.

Share the global market

The transaction covers more than 20 major exchanges around the world, with more than 2,500 varieties. CFD trading varieties include:

Precious metal price difference contracts: gold, silver, palladium, platinum stocks and stock index price difference contracts: North American, European and Asian stocks, agricultural products futures price difference contracts: agricultural products: wheat, soybeans, oats, corn ... metal commodity futures price difference contracts: copper and aluminum energy commodity futures price difference contracts: crude oil, natural gas economic crops commodity futures price difference contracts: coffee, cocoa, sugar national debt futures price difference contracts.