CFD Online, CFD Forex & CFD Trading
A contract for difference (CFD) is a derivatives product, which means that you do not directly own the underlying asset which is being traded. For Single Stock CFDs in Europe and APAC (all non US) where Standard Bank’s appointed service provider or agent acts as a Market Maker, client orders in these instruments are routed to the exchange closing auction by the order management system and participate in the closing auction on the exchange.
Against your expectations, the US Tech 100 falls and the Core Spreads price is quoted at 5,390.2 – 5,390.6. You decide to close the trade, selling 10 CFDs at 5,390.2. The difference between the opening value of the trade ($540,060) and the closing level of the trade ($539,020) is $1,040.
That means even while the concept of CFDs applies equally across different assets (i.e. you pay the difference between the price at opening position and the closing position), the underlying assets that determine the value and volatility of the CFDs are drastically different.
What makes CFD trading really attractive is that you don’t have the same major financial outlay that you would have if you actually bought the financial asset you’re speculating on. The price you pay depends on the margin, which is generally a fraction of the value of the asset.
The market falls in value and at the Core Spreads quote falls to 7,290.4 – 7,291.2 and you decide to close the contract at a price of 7,291.2. The difference between the opening value of the trade (£730,010) and the closing level of the trade (£729,120) is £890.