CFD Trading: What You Need To Get Started
CFD Trading: What You Need To Get Started
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CFD Trading: What You Need To Get Started - By:[removed]// // ]]>[removed]Robert Thomas [removed]// // ]]>[removed]CFDs are financial derivatives products and can be traded on a number of different markets, such as the Dow Jones, Dollar/Sterling, Google and gold. They function as an agreement between two trading partners to exchange the price difference between the opening and closing value of the contract. CFD traders can take advantage of going short or long, which means profits can be made in both a rising and a falling market.Furthermore, CFDs use leverage. You can buy a position in the market using a deposit that is only a fraction of the total value of your exposure. On the upside, and with a successful trade, this means that you can potentially magnify your profits. On the downside, losses are also magnified, potentially beyond the value of your initial deposit.As traders do not own the underlying financial instrument their CFD is derived from, you don't pay any stamp duty* and that can help to make CFD trading a tax efficient form of trading.Learning the BasicsWhen you first set out to trade CFDs, it is sensible to learn the basics of how financial derivatives work, how the markets in which you intend to trade operate and which company to open your CFD account with. An important thing to remember about the nature of CFDs is that you do not actually own the underlying financial instruments you are trading. You will not, for example, receive dividend payouts, as is common in share ownership.There is a vast amount of information available regarding the possible markets for CFD trading. Whether you want to trade in the FTSE 100, the NASDAQ 100, the German DAX or other financial markets, there are numerous financial trading blogs across the web. These are published by various information sources and may help to keep you abreast of key financial, economic, political, corporate or other news events. As markets are essentially driven by human behaviour, expressed in the buy and sell decisions by traders, it is important to understand what drives market sentiment.Choosing a CFD Trading PlatformIn the UK there are many companies offering access to CFDs. They tend to charge different commissions and fees (some even offer commission free trading), provide different technological trading tools and indicators and operate using different terms and conditions. Generally speaking, it is difficult to state which firms are the best because that often depends on how frequently you want to trade, which markets you want to access and which trading tools you require. Whichever company to choose, note that all accounts are subject to terms and conditions. CFD trading is a geared investment product, it carries a high level of risk to your capital and you may lose more than your initial investment. Please ensure that it matches your investment needs as it might not be suitable for all types of investor. Before you start trading, make sure that you fully appreciate the risks that are involved. Only speculate with funds that you can afford to lose. Where necessary obtain independent financial advice.* Tax law is subject to change or may differ if you pay tax in a jurisdiction other than the UK.[removed]// // ]]>[removed]http://www.articlesbase.com/personal-finance-articles/cfd-trading-what-you-need-to-get-started-4544285.html An Introduction to Trading Crude Oil Motorola Trains Retailers to Advocate Customer Loyalty Programs Investors' appetite for risky assets declines on DAX - Spread Betting and CFD Trading News The Hypothyroidism Solution Rapidshare-The Hypothyroidism Solution Pdf Automotive Equipment & Tools - Online Retailers Offer the Best in Automotive Equipment The Sonic Producer Rapidshare-The Sonic Producer Rapidshare Buy trading Pins through Good Trading Pin Maker What is CFD Trading? Are You Searching For The Holy Grail In Trading? S&P 500 'expected to continue trading decline' - Spread Betting News AU Trading: Try Grabing It Be Taught Foreign Exchange Trading CFD Trading Update: ITV share prices soar as earnings rocket for shareholders