What is CFD Trading why is it so popular?

Alfa-Forex offers a wide range of CFDs instruments for trading such as currencies pairs, commodities, indices, stocks and eurobonds.

What is a CFD?

Contract for Difference (CFD) is an agreement between a buyer and a seller to pay the future price of an asset, without physical delivery. The difference between the opening and closing price results in profit or loss.

CFDs are available for currencies, metals, including gold, silver, platinum and palladium, oil, equities, market indices and eurobonds.

Our full list of CFDs are available here:

Trading Terms on CFDs

Why traders
choose CFDs?

To buy shares of a company listed on stock exchange, investors must use services of a brokerage and purchase at least one full share. Brokerages usually charge commission for both, purchase and sales transaction and require a significant minimum investment to open a trading account. CFDs solve all these problems, allowing to

Trading is risky. Trade Wisely.

Trading in both directions

Unlike assets that require the value to go up in order to result in profits, CFDs allow to trade in any market direction. When the trend is bullish and the value of the asset is rising, a trader can enter a long position to buy. If position is closed at the time when the market value is higher than the purchasing price, the position will generate profit. If the trend is bearish and price of the asset goes down, trader can enter a short position to sell. In this case, closing position below the purchasing price will also result in profits. Note that in case if the market goes in the other directions, the trade may result in loss.

Marginal trading
with leverage

CFDs are margined products, which means that profits and losses are magnified according to the leverage offered for each instrument. A leverage 1:30 allows to magnify your investment 30 times. If you invest 1000USD, you will be able to trade up to 30,000USD. Leverage is risky because it magnifies your risk exposure proportionally. Traders must exercise caution and employ risk offsetting strategies at all times.

At the moment, maximum leverage on all CFD products allowed under ESMA regulation is 1:30. All brokers legally operating in Europe adhere to this regulation.

Alfa-Forex offers the following CFD classes:

Currency market FX

Clients can buy and sell a wide range of majors, minors and cross currency pairs via MT4 and MT5 platforms available on desktop and mobile apps. Minimum contract size 0.01 lot.

Stock Indices

Alfa-Forex offers CFDs on DJI (US Wall Street 30 index) and FTS (Uk 100 Index), available for trading via MT4 and MT5 trading platforms on desktop and mobile devices.

Equities of UK and Russian companies

CFDs on equities allow to speculate on prices of underlying assets without large minimum investment or brokerage fees. Alfa-Forex offers a unique opportunity to invest in CFDs of stocks of Russian companies such as Alfa-Bank, Gasprom, Lukoil, Sberbank and others.

Eurobonds

CFD on Eurobonds is a unique product designed for Alfa-Forex investors. The main advantages are no clearing costs, low minimal investments entry level and daily coupon payouts. Clients can purchase CFDs on Eurobonds directly through Alfa-Forex mobile application or Personal Area, without a necessity to install trading software. More about CFDs on Eurobonds.

Commodities

Alfa-Forex offers CFDs on oil, gold, silver, palladium and platinum via Metatrader terminal on desktop and mobile devices.

How to decide if trading CFDs is for you?

CFDs offer many advantages:

  • Flexibility
  • Trading size doesn’t linked to actual assets
  • No brokerage fees
  • Instant online transactions
  • Leverage increasing trading power

Trading is risky. Trade Wisely.

With many advantages, such as multitude of instruments, low entry volume and low commissions, CFDs are risky marginal trading products and may not be suitable for all traders. Alfa-Forex protects traders from negative balance and recommends to always test your strategies on Demo account, which you can open here, before commencing trading on real accounts.

Familiarize yourself with trading conditions on CFD products and Terms of Business of Alfa-Forex or register here to try CFD trading on Demo or Live accounts.

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Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read full risk disclosure.

Risk Warning: 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read full full risk disclosure.

Risk Warning: 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read full full risk disclosure.