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What risks am I prone to while trading CFD?


Linah

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Hello, I have an interest in trading CFD, but I'm having second thoughts because I don't want to lose my money in trading. I want to create a career out of trading because I want to be a freelancer. Trading CFD will be a form of investment for me. So, I want to understand the kind of trading I'm about to engage in and if it has risks. Advise me accordingly, please.

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Hello Linah, 
CFD being a suitable investing alternative to other traditional investments, has attracted so many people to be part of it. It's easy to open an account and operate it using CFDs, amongst other benefits that come with it.
Therefore, you need to do thorough research about its markets, understand when it is right for you to place a trade and some risks which you might face while engaging in this trade.
In as much as CFD gives you an opportunity to diversify your risks, some traders, especially the new ones, often risk way much than they are supposed to and end up making major losses. You are therefore required to manage your risks appropriately and avoid over-leveraging.
Your account also is on the risk of being closed if you do not manage it well and deposit the additional amounts that will offset the margin requirements.
 This market is also highly volatile.

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