CFDs are a high-leveraged alternative to traditional forms of trading.
CFDs let you trade rising or falling markets, so you can profit even when prices are on the decline.
Develop your shares, indices and FX trading ideas with the help of our experts' predictions for 2015.
Contracts for difference (CFDs) allow you to trade on the price movement of shares, indices, currencies and commodities without owning the underlying instrument.
Because CFDs are leveraged products, a trade only uses a fraction of your trading capital – meaning you can gain a larger exposure for a relatively small investment amount, giving you a more efficient and effective way to invest across a range of global markets.
With CFDs, you can potentially profit from both rising and falling markets.
If you believe the price of a market will rise, you 'go long' or buy.
If you believe the price of a market will fall, you 'go short' or sell.
For example, if you think the US SP 500 Index will fall in the coming days because some major US firms are expected to report weak earnings, you can go short. If the index moves in the way you’ve predicted, you can profit from every point the US SP 500 Index falls.
Remember, however, that while leveraged trading allows you to gain a larger market exposure, magnifying any potential profits, your losses could be magnified in the same way. So, if the S&P moves in the opposite way to your prediction, you may incur losses that exceed your deposit.
Find out how to manage your risk here.
At City Index, we offer low commissions, tight spreads and low margins on thousands of financial markets, including indices, shares, currencies, commodities and more.
1With leverage, your losses are magnified in exactly the same way as your gains if the market moves against you and can result in losses exceeding your initial outlay. Please ensure you fully understand the risks involved.
Trading CFDs and FX on margin carries a high level of risk, that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit cityindex.com.sg for the complete Risk Disclosure Statement.
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