A beginners guide to trading index CFDs

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  When it comes to trading, there are a variety of different assets that you can choose from. These assets can be divided into two main categories: forex and CFDs.   CFDs (contracts for difference) are derivatives that allow you to trade on the price movement of an underlying asset. It means that you don’t have to own the asset to trade it. Instead, you trade CFDs as contracts between yourself and the broker.   Index CFDs are one of the most common forms of CFD trading. Index CFDs enable you to trade on the price fluctuations of various indices, Continue Reading →

What spreads do retail brokers offer in forex?

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Retail brokers are all the same, aren’t they?   It is usually not true when it comes to forex spread betting. While all retail brokers offer the standard market spreads on major currency pairs, there are often significant differences in offering other financial instruments.   It can help you tremendously when deciding which broker to adopt because you will be able to trade different instruments at much tighter spreads than many of your competitors.   Some firms have much more comprehensive offerings than others, so having tight spreads could prove very beneficial over time if you use any of these Continue Reading →

The Difference Between Forex and Commodity Trading

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What’s the difference between commodity trading and forex trading, you ask? Commodity Trading It’s simply that commodities are agricultural products such as cocoa beans, pork bellies and rice. In contrast, forex or foreign exchange is the trade of any financial instrument that has monetary value.   Commodity traders deal in so-called commodities. These are raw materials that have a variety of different uses, such as oil or precious metals. Commodity traders work together with large companies to provide them with these raw materials.   A commodity trader will generally buy something when there is an abundant supply and then sell Continue Reading →

Options when Trading

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Options are financial products giving you the ability to trade on a market’s future value. When an option is purchased, a premium is bought for rights to trade any market at set prices. This is to happen before the expiration date reaches. Options are also the same as futures in this regard. However, unlike futures, options do not come with a trade obligation, so you don’t have to if you don’t want to trade. For example, if gold sells at $1300 this entire week, and the price hits $1325, you can choose to exercise the options you have to purchase Continue Reading →

CFD Trading – Understanding The Risks Of CFDs

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Contracts for differences (CFDs) are contracts between a buyer and a seller. The two parties agree to exchange the differences between the price of an underlying asset at the opening and closing of the contract. This is where the form of trade derives its name. CFDs are a type of derivative. This means they get their value from their underlying assets. So those who tease CFDs don’t trade any assets directly i.e. they don’t buy or sell the assets. They simply speculate on the price movements of the underlying assets. CFD contracts are usually settled in cash meaning that no Continue Reading →