Glossary

Stock CFDs

Definition

A CFD, or contract for difference, is a financial derivative product that enables traders to have exposure to the price movement of an underlying asset, such as stocks, without owning the asset itself. CFD prices track the underlying asset's price, and trading CFDs offers advantages such as margin trading and typically immediate execution, as opposed to traditional stock trading on exchanges. It is important to note that CFDs are settled upon closure of the position, and trading costs can be spread based, commission based, or a combination of the two. Additionally, clients need to have funds to support the margin requirement to enter and maintain the position.

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