What is a CFD?
Contracts For Difference (CFDs) are popular Over The Counter (OTC) financial derivative products which enable you to trade on the price movement of financial assets like Currency pairs Indices Futures, Commodity Futures, Cryptocurrencies, Shares and Exchange Traded Funds.
With CFDs, you can trade freely on price fluctuations 24/7, without actually owning the underlying asset or acquiring any rights or obligations in relation to the underlying asset. The main benefit of trading CFDs is the flexibility to trade against the price movements without actually buying or selling the physical instrument. That means never having to take ownership of barrels of oil or blocks of Gold.
Capstonemarkets’s CFDs derive their price from the underlying asset, so for example, if the price of Facebook stock or Gold goes up, the CFD price which tracks it will go up too. You can trade CFDs if you believe the price of a financial instrument is likely to go up in value (strengthen), and if you think it is likely to go down (weaken). Your profit or loss in online CFD trading is determined by the difference between the price you buy at and the price at which you sell, minus your spread, which is the broker’s fee.