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CFD Trading FAQ

  1. What are Contracts for Difference (CFDs)?
  2. How do I trade CFDs?
  3. Where can I trade CFDs?
  4. Why should I trade CFDs?
  5. Why should I trade CFDs with easy-forex?
  6. Which CFDs do you offer?
  7. What is the margin required to trade CFDs?
  8. Can I specify the leverage for my CFD trades?
  9. How do I calculate my profit and loss for index and commodity CFDs?
  10. When can I trade CFDs?
  11. What are the expiry dates for CFDs?
  12. What are the costs of trading CFDs?
  13. Are there any rolling fee charges for CFDs?
  1. What are Contracts for Difference (CFDs)?
  2. A contract for difference (CFD) is a contract between a buyer and a seller. When you open a CFD you are either buying or selling a contract with easy-forex. CFDs are the easiest and most popular way to trade commodities and indices due to their simplicity, ease of trade, leverage, ability to short sell and cost effectiveness. You can diversify your portfolio by trading CFDs on all easy-forex platforms as both spot deals and options.

    Like forex, CFD trading is cash-settled. When you buy a CFD you are buying a contract for a certain price; you don’t take possession of the physical product, e.g. when you buy 100 barrels of oil these will not be delivered to your door. And when the time comes to sell it back, you make a profit (or loss if the market is not in your favour).

  3. How do I trade CFDs?
  4. By trading CFDs, you can potentially profit whether a market moves up or down. If you believe an asset’s price is going to rise, you open a buy position (known as ‘going long’). If you think the asset’s price is going to fall, you open a sell position (known as ‘going short’). The performance of the market governs not just whether you make a profit or loss, but also by how much. So let’s say you think a particular market will rise, and you buy a CFD - your profit will be greater the further the market rises, and your losses greater the further it declines. The same rule applies if you expect a market to fall; you’ll make more the further the market drops, and lose more the further the market rises.

  5. Where can I trade CFDs?
  6. You can trade a range of CFDs on your easy-forex web trading platform, mobile platform and on MT4 and TradeDesk.

    CFDs on the easy-forex web trading platform

    Login to the trade zone of your web trading platform. You will find the different CFDs under their individual category tabs on the trade ticket - Currencies, Commodities, Indices and Options.

    CFD trading - easy-forex web platform

    CFDs on the easy-forex mobile platform

    Login to your easy-forex account on your mobile phone. When you select ‘Quotes’ from the top menu you will get a drop-down list of products to trade - currencies, commodities, indices and options.

    CFD trading - easy-forex mobile platform

  7. Why should I trade CFDs?
  8. CFD trading gives you a wider choice of products to access the excitement of the financial markets. Whether you have insights into agriculture, energy products, global currencies or equities, you can now get easy access to trade them. Trade CFDs with a low margin requirement (remember - with greater leverage comes greater profit or loss). CFDs provide an excellent alternative to suit a variety of trading styles or methods e.g. short or long-term investors can find the right product to complement their preferences.

  9. Why should I trade CFDs with easy-forex?
  10. easy-forex has one of the broadest selections of commodities and indices available as CFDs on the market and offers some of the most competitive spreads. Combining that with top class customer service and education makes us the preferred platform for both new and experienced traders.

    As well as being able to trade over 70 currency pairs, you can trade 15 indices, 5 metals, 5 energy and 7 agricultural commodities on our trading platforms - the same way you trade forex. Your trades are executed automatically, with absolutely no requotes and you get fixed spreads and guaranteed stops on the web-based platform.

  11. Which CFDs do you offer?
  12. At the time of publishing, you can trade the following CFD products. We are always working to expand our range of products so contact us for any questions or for product updates.

    CFDProduct
    Indices
    US Equity IndicesUS 500 (SPI)
     US 30 (DOW)
     US Tech (NDQ)
    European Equity IndicesUK 100 (FTS)
     Germany 30 (DAX)
     EU Stocks 50 (ESX)
     France 40 (CAC)
     Swiss 20 (SWI)
    Asia-Pacific Equity IndicesAustralia (ASX)
     Japan 225 (NKI)
     Hong Kong 50 (HSX)
     China 50 (CNX)
     India 50 (IND)
    Financial IndicesUSD Index (USX)
     VIX 500 (VXX)
    CFDProduct
    Energy Commodities
     Brent Crude (BRT)
     WTI Crude (OIL)
     Gasoil (GAS)
     Heating oil (HEO)
     Natural Gas (NGS)
    CFDProduct
    Agricultural Commodities
     Wheat (WHT)
     Corn (CRN)
     Cotton (CTN)
     Soybeans (SOY)
     Coffee (CFE)
     Sugar (SGR)
     Cocoa (CCO)
    CFDProduct
    Metals
     Gold (XAU)
     Silver (XAG)
     Platinum (XPT)
     Palladium (XPD)
     Copper (CPR)
  13. What is the minimum margin required for a CFD?
  14. USD 25 is the minimum margin required to open a CFD contract.

  15. Can I specify the leverage for my CFD trades?
  16. Like all products the leverage is flexible, although this may vary among different CFDs.

  17. How do I calculate my profit and loss for an index and a commodity CFD?
  18. Indices Example:

    You would like to speculate on the level of the US 500 (SPI), an index tracking the 500 largest US stocks. Note: all prices are in USD.

    The index trades currently at 1860.00 points.

    A standard contract for the US 500 is 50 times the index trade rate. So the current value of a US 500 contract is 50 x 1860.00 = $93,000.

    You decide that the American economy will improve and that US stocks will appreciate.

    So you buy one contract and as you predict, the US 500 rises to 1865.00.

    As you are trading on margin (with leverage), you only need to put up a fraction of the whole price as collateral.

    The contract is now worth 50 x 1865 = $93,250.

    You close the position at 1865.00 and make a profit of $250.

    Commodities Example:

    You would like to speculate on the price of oil and decide to trade Brent Crude (BRT). Note: all prices are in USD.

    BRT currently trades at $108.00 per barrel.

    A standard contract for BRT is 1,000 barrels.

    So the current value of a BRT contract is 1,000 x 108.00 = $108,000.

    You decide that consumers are moving to more fuel efficient cars and that demand for BRT will drop. So you expect that this may push down the price of BRT.

    You sell one contract and as you predicted Brent falls to $107.00 per barrel

    As you are trading on margin (with leverage) you only need to put up a fraction of the whole price as collateral.

    The contract is now worth 1000 x 107.00 = 107,000.

    You close the position at 107.00 and make a profit of $1,000.

  19. When can I trade CFDs?
  20. The trading hours depend on the individual CFD product. Click here to go to trading hours and expiration page on our site.

  21. What are the expiry dates for CFDs?
  22. Futures contracts, on which CFDs are based, have an expiration date and our traders will be able to close their CFD positions any time until that date. Click here to go to trading hours and expiration dates of our CFDs.

    Like forex, when you trade CFDs you don’t take possession of the physical product, e.g. when you buy 100 barrels of oil these will not be delivered to your door. However as CFDs are based on the underlying oil market, each contract has a set delivery date. Once we reach that date, trading stops for that contract and the next contract starts trading immediately. However any positions on the expired contract will be closed on that date, in either profit or loss.

    You can check the expiry dates for your deals on the trading platforms (see images below). Please check expiry dates before opening any positions. easy-forex will also send you an email notifying you of upcoming expirations of your open trades one day before.

    Expiry dates on the trading ticket of the easy-forex web platform

    See the expiry date of your deal on the central trading ticket under ‘Open Deal’.

    CFD trading - easy-forex web platform

    Expiry dates on the easy-forex MT4 platform

    On your easy-forex MT4 platform, hover over the specific product to get more detailed information including the expiry date.

    CFD trading - easy-forex MT4 platform

  23. What are the costs of trading CFDs?
  24. easy-forex has no fees or commissions when trading commodities or indices. However a trader will have to trade on a spread between the buy and sell price. Each product has its own spread depending on its trade characteristics. easy-forex has some of the most competitive spreads on the market. Please contact your ASM for further information.

  25. Are there any rolling fee charges for CFDs?
  26. Most CFDs have no rolling fees or swap charges. However CFDs have fixed expiry dates. Click here to go to trading hours and expiration page on our site.

    Note: Gold (XAU), silver (XAG), platinum (XPT) and palladium (XPD) are spot based which means they do incur a rolling fee and do not have expiry dates.

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