CFDs: Contracts For Difference - Trading-Lab

charlesK · #1 09-14-2007, 02:41 PM

does anybody trade or know about Contracts For Difference as a trading vehicle to speculate on non-US equities and indices? I understand they are not allowed in the United States due to restrictions by the SEC, but they are widely traded overseas. They seem to be a good alternative to futures since they have no expiry date or contract size.

Alchemist · #2 10-01-2007, 08:53 PM

as the name implies, CFDs are basically a contract between 2 parties saying that the difference between the current value of an asset and its value at contract time will be settled and paid to the buyer if the difference is positive, or to the seller if the difference is negative. in other words, CFDs can be classified as equity derivatives. as you mentioned, the good thing about CFDs is that, contrary to futures contracts, they have no fixed expiry or contract size.

FabMav · #3 10-04-2007, 07:45 PM

I also looked at some point in time at alternative trading vehicles to traditional outright ownership to speculate on overseas markets, and CFDs were among them. However, I understand commission on CFDs are quite high. Is it true?

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#1 09-14-2007, 02:41 PM
charlesK Junior Member Join Date: Jun 2007 Posts: 26	CFDs: Contracts For Difference does anybody trade or know about Contracts For Difference as a trading vehicle to speculate on non-US equities and indices? I understand they are not allowed in the United States due to restrictions by the SEC, but they are widely traded overseas. They seem to be a good alternative to futures since they have no expiry date or contract size.

#2 10-01-2007, 08:53 PM
Alchemist founder of Trading-Lab Join Date: May 2007 Location: New York, NY Posts: 296	as the name implies, CFDs are basically a contract between 2 parties saying that the difference between the current value of an asset and its value at contract time will be settled and paid to the buyer if the difference is positive, or to the seller if the difference is negative. in other words, CFDs can be classified as equity derivatives. as you mentioned, the good thing about CFDs is that, contrary to futures contracts, they have no fixed expiry or contract size. __________________ Happy Trading!

#3 10-04-2007, 07:45 PM
FabMav Member Join Date: Jun 2007 Posts: 33	I also looked at some point in time at alternative trading vehicles to traditional outright ownership to speculate on overseas markets, and CFDs were among them. However, I understand commission on CFDs are quite high. Is it true?