With your City Index account, you can trade CFDs on thousands of shares worldwide including those listed in Asia, as well as the UK, US, Europe, Australia and New Zealand.
We offer especially low commissions on our share CFDs, with a 0.08% rate on all SGD share CFDs (minimum SGD10) and low minimum commission rates on global shares including HKD shares, AU shares, JP shares and US shares. The net result of a CFD trade is the difference between the opening and closing value of a contract.
Barclays (LSE) are currently trading at 180p, with an underlying market spread of 179p/181p (sell price/buy price).
You think Barclays are set to announce some strong trading figures and decide to buy (go long) 1000 CFDs at 181p (buy price).
You were right: Over the coming days, Barclays' share prices rally after a stronger-than-expected trading performance, with share prices reaching 195p. The underlying market spread is now 194/196p. You decide to cash in your profits and sell 1000 CFDs at 194p.
Result: The opening value of the CFD trade is £1810 (1000 CFDs x 181p). The closing value of the CFD trade is £1940 (1000 CFDs x 194p). This nets you a £130 gain (£1940 - £1810).
Alternative scenario: If however, you were wrong and Barclays shares had declined to 161p, this would net you a £200 loss (181 - 161 x 1000 CFDs).
You think Barclays shares are overvalued and decide to sell (go short) 1000 CFDs at 179p (sell price).
You were right: Over the coming days, Barclays' share prices fall as other investors sell their shares, causing prices to fall to 163p. The underlying market spread is now 161/163p. You decide to cash in your profits and buy back 1000 CFDs at 163p.
Result: The opening value of the CFD trade is £1790 (1000 CFDs x 179p). The closing value of the CFD trade is £1630 (1000 CFDs x 163p). This nets you a £160 gain (£1790 - £1630).
Alternative scenario: If however, you were wrong and Barclays shares had rallied to 199p, you would net a £200 loss (199 - 179 x 1000 CFDs).
For the purpose of simplicity, commission, financing charges and payments have been omitted from these illustrations. Find out more about our financing charges.
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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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