Learn CFD Trading (19)

There are a number of benefits from trading CFD’s, including:

1. Accessing the underlying asset at a low cost with leverage
2. Trade on the price movements of the asset without the need to purchase them outright
3. Access to a massive range of global markets
4. Understand how prices mirror the underlying asset class
5. Hedge the underlying portfolio
6. No expiry dates
7. In countries like the UK, CFD trading is exempt from stamp duty

Yes, you can make money by learning to trade CFD’s. The primary difference between CFD’s and the other financial products concerns ownership of the underlying asset. With CFD’s, you trade the underlying asset with margin as opposed to purchasing it outright.

However, to become a successful trader, it takes a lot of time and effort, which is why only a small percentage of traders are profitable. One approach to making money in CFD’s is to recognise the risk inherent to the markets and capitalise on it.

CFD trading is legal in a majority of countries, albeit a few exceptions. In the US, CFD trading is illegal because of the restrictions imposed on OTC financial instruments by the Securities and Exchange Commission (SEC). Besides the US, CFD brokers generally do not offer services in countries like Syria, North Korea and Iran, since they are politically exposed and due to the risk of getting entangled with anti-money laundering agencies.

It’s not very difficult to master CFD’s if you already have the experience of trading or investing in the other asset classes like equities and commodities, or if you’re familiar with derivatives. However, if you are a beginner, depending on the time frame you set to learn about these markets, you can choose between a financial markets trainer – a speedier option – and self-learning.