What Is A Contract For Difference

What Is A Contract For Difference

Forex Ltd offers its Clients an alternative financial tool – CFDs – contracts for difference. The broker can arrange an automatic rollover when the settlement date of the associated futures contract is reached or deduct a cash settlement fee from the CFD position, which could also significantly reduce profits if you keep the trade open for a long time.

There are a number of risks associated with this product, please carefully consider the information provided in the CommSec CFDs Product Disclosure Statement and Hedging Policy A Product Disclosure Statement for CommSec CFDs issued by Commonwealth Securities Limited ABN 60 067 254 399 AFSL 238814 is available from and should be considered before making any decision about the product.

You can either double click on the trade itself to launch the trade ticket and select Close Position” from the tabs along the top or alternatively, click on the drop-down icon (TradeDirect365 Drop-Down icon) next to the trade and select Close Position” from the drop-down menu and this will launch the closing trade ticket.

Holding costs: at the end of each trading day (at 5pm New York time), any positions open in your account may be subject to a charge called a ‘ holding cost ‘. The holding cost can be positive or negative depending on the direction of your position and the applicable holding rate.

What’s more, leverage is higher with CFDs than it is with traditional trading, and the margin requirement for Share CFDs often starts from just 3%. Traders will still need to apply proper risk management into their strategies however, because using leverage and margin can potentially amplify losses as well as profits.

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