Current location - Trademark Inquiry Complete Network - Futures platform - What is the foreign exchange contract for differences (CFD) transaction?
What is the foreign exchange contract for differences (CFD) transaction?
Contract for difference (contract for difference)

The spread (CFD) is an over-the-counter trading tool. Traders can use the leverage of the spot market to trade in the index and commodity markets without actually buying foreign exchange.

The advantage of contracts for differences (CFD) trading is that customers can conduct margin trading, with the margin ratio ranging from 0.25% to 2%. Customers can buy and sell all stocks, indexes and commodities without investing a lot of money, and enjoy all the benefits and risks brought by market fluctuations. For example, if you invest $65,438+00,000, you can make a currency pair product equivalent to $4,000,000 at most, thus amplifying your investment income.

Contracts for differences can be long or short, and the international derivatives market has the same profit opportunities in both bear market and bull market.

CFD is an ideal trading tool for short-term technology trading and hedging spot market positions. Meanwhile, CFD is an open contract. If you don't close your position at the end of the trading day, hold the position until the next trading day and pay interest or get interest (depending on whether you hold multiple orders or empty orders). As long as you keep enough available margin, you can hold positions indefinitely.