What are CFDs?

A CFD (Contract for Difference) is an agreement between a buyer and a seller where the seller will pay the buyer the difference between the value of an asset at the time the agreement was made and its value at the present time. CFDs have become increasingly popular amongst traders.

MT4Quotes offers you a wide range of CFDs to choose from.

Based on how a CFD works, many investors use it as a hedging instrument for their existing portfolios through periods of short-term volatility. If you have a long-term portfolio you want to maintain, there may be a short-term risk to the profit of your investments, so you can use CFD contracts to mitigate a short-term loss by hedging your position.

When your portfolio decreases in value, the profit you gain from CFD contracts could help you level out those losses and you can continue holding on to your portfolio without the risk of provoking big losses in value.

What are the advantages of trading CFDs?

  • You can take both long and short-term positions.
  • You can trade on a product price going down or going up. That’s how a CFD operates.
  • You can profit from a bearish market by selling or from a bullish market by buying.
  • Margin requirements for CFDs are considerably lower.
  • Immediate execution ensures that your transaction will be fast and effective.

Why trade CFDs with MT4Quotes?

MT4Quotes has three trading platforms you can use to trade online easily, from any device, including MetaTrader 5, Mobile trader and Web Trader.

For the best performance, always stay well informed on market news to feel the movement of the CFD contract that you are trading, as well as consider CFD trading strategies and tips.

Trade the following CFDs with MT4Quotes

Gold (spot) Crude oil (spot) S&P 500, Dow Jones 30, USTECH100 (NASDAQ)
Silver (spot) Brent crude oil (spot) DAX
Palladium Natural Gas CAC 40, EUROPE50 (Eurostoxx), FTSE100
Platinum JAPAN 225 (NIKKEI)

A Detailed Analysis on CFD Trading

There are many reliable strategies available to traders when choosing CFD trading. MT4Quotes will show you the many benefits CFD’s has to offer and much more.

What is CFD Trading?

CFD trading, or contract for difference trading, lets you trade on the instrument’s movement rather than the instrument itself. CFD offers one unique benefit- you can gain funds if the price goes up as well as when it goes down. You need to have an accurate prediction and to buy accordingly.

If you believe a rise in the price of the underlying instrument is imminent, you go ‘long’ and buy. This allows you to generate profit on the coming gain. If you believe the price will fall, you go ‘short’, and when the price falls, you will still profit from the correct prediction.

CFD trading offers a unique approach to trading, because you can sell short. The gains/ losses will depend on how reasonably and accurately you estimate the movements, the of your lot (‘position’) and how major the market movement actually is.

CFD trading is fairly similar to the Forex market, if you have experience in that area. Many brokers and trading platforms also allow leveraged buying and selling for CFDs. It is a strategy that can bring good results if used correctly.

What markets can you trade CFDs on?

You can trade CFDs on the following markets:

  • Forex
  • Commodities
  • Shares
  • ETFs
  • Indices

On the whole, CFD trading works the same way on any of the above platforms. However, it doesn’t replace getting familiar with each and every platform, as they vary to a certain extent from one another.

The Advantages of CFDs Trading

  • One of the main advantages of CFD trading, and the reason why it’s becoming so popular, is that you can gain profit both when the market goes down and when it goes up. You can sell short yet still make a profit.
  • CFD trading allows you to utilize leverage, which means that you can enter the market for only a fraction of the cost of the actual transaction.
  • Convenience and the lack of a fixed lot in another benefit causing many traders to opt for CFD trading. You don’t own the actual commodity and the risk reduces greatly.
  • Like most financial strategies, CFD trading offers a good opportunity for portfolio diversification, which is always an advantage.

Are you ready to try it? Test your CFD strategies and start trading CFDs with MT4Quotes now!

MT4Quotes International Limited (www.MT4Quotes.com) is duly regulated and registered with the Financial Service Provider Registry in St Vincent and the Grenadines (SVGFSP Comp. License Number ID : 23598 IBC 2016). The Company are all subject matters not forbidden by International Business Companies (Amendment and Consolidation) Act, Chapter 149 of the Revised Laws of Saint Vincent and Grenadines, 2009, in particular but not exclusively all commercial, financial, lending, borrowing, trading, service activities and the participation in other enterprises as well as to provide brokerage, training and managed account services in currencies, commodities, indexes, CFDs and leveraged financial instruments.
Trading in forex is speculative in nature and not appropriate for all investors. Investors should only use risk capital when trading futures, options and forex because there is always the risk of substantial loss up to your invested capital and may not be suitable for everyone. Please ensure that you fully understand the risks involved and do not invest money you cannot afford to lose
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