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What are the differences between CFD trading and share trading?


Kelvin
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Hello Kelvin,
One major difference between CFD trading and share trading is that in CFD, you gamble on whether the market price will rise or fall and therefore decide on whether you will buy or sell an underlying asset. Here, however, you do not own the underlying asset.
While trading shares, however, you own the underlying asset.
In CFD, you make use of leverage; this means that you will only contribute only a part of the whole amount for the trade known as the margin so that you can get exhaustive market exposure.
While trading shares, however, you will suffer the whole amount for you to get full market exposure; this will be great for you since you hardly lose more than what you infuse.
CFD is more suitable for short term trading. Share trading, on the other hand, is most suited for long-term purposes.
In CFD, also you have to pay the price for you to keep your position in the market, which is not the case in share trading.

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