Why trade CFDs?

CFD related trading and hedging is one of the fastest growing areas in the Australian and European derivatives markets. This popularity has arisen from the following main features:

Buying power (leverage)

With a low Initial Margin, you can gain much greater exposure from your funds.

Simplicity

CFDs are easier to use and understand than most other derivatives.

The ability to 'short'

CFDs allow traders to take advantage of falls in prices.  This means that traders can profit when prices are going down, not just up.  CFDs are thus an excellent trading and hedging tool. 

Note that CFDs are leveraged instruments. This means that you are fully exposed to price movements of the ASX Listed CFD without having to pay the full price of the contract.

Leverage creates the opportunity for greater gains and losses than a direct investment in the underlying instrument. It is therefore important to understand both the upside benefits as well as the downside risks.