Contracts for Difference trading are growing in popularity these days. This is because these derivatives provide participants to benefit from certain assets without even owning them. For instance, you don’t need to acquire ownership over shares of international companies to speculate on the financial market of stock CFDs.
This is an interesting concept for speculating on the financial instruments of the world's biggest companies. With DotBig, you can trade CFD efficiently. All you have to do is to improve your investment skills and use the tips of our professional analysts. The DotBig trading platform has all the necessary tools to help you benefit from CFD trading!
Basics of CFD trading
A CFD contract is a special agreement. They might be applied for types of financial products, for example, there are CFD shares. A CFD is a financial instrument with which a trader speculates the directions of the assets’ values. This instrument remains relevant in different market conditions, whether it goes up or down. The major reason why traders rely on CFDs is risk hedging. There are several more considerable advantages you will learn further on.
When trading CFDs, participants may enter both long and short positions. The ones who enter long positions buy assets when their costs are expected to go up in the future. If you expect a fall in the stock, you go short CFD trading. However, as we think, you should take the best of both worlds. Inter-trading is supposed to be the most profitable strategy when trading CFDs because here traders open both long and short positions.
Types of CFDs
With DotBig, you can benefit from different types of CFD trading. Choose the markets you are the most experienced in. See the types of CFDs offered by our online broker:
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Forex: Foreign exchange is where you try to benefit from fiat currency pairs. With our broker, you can speculate on either major, minor, or exotic pairs. Choose the assets with the appropriate trading volumes and define whether it’s better to go long or short on them.
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Share CFDs: These contracts for the difference are to speculate on the stock market and benefit from changing prices on shares of the most popular companies.
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Indices: Contracts for the difference in indices provide you with the possibility to use changing prices on indices.
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Cryptocurrency: we offer a very extensive selection of CFDs that are available in the crypto space. It’s your chance to benefit from the most volatile financial market. Commodities: Examine the global event that might cause prices on certain commodities to go up or down and choose whether it’s better to enter long or short positions.
How to trade CFD contracts?
To benefit from leverage trading stocks CFDs, you should explore more about this activity for day traders and take several simple steps:
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Create a live trading account with DotBig. Or online broker gives you the possibility to speculate on various financial markets without acquiring ownership over certain products.
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Make a deposit, required by your minimum plan.
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Decide which financial market will be the most profitable when trading CFDs for you. We offer exposure to a wide selection of markets, including stocks, forex, crypto, indices, and commodities.
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Decide if you trade long or short or if you choose inter-trading strategies.
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Determine your budget and don’t exceed pre-set losses. Stick to your plan and follow the key principles of risk management.
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Use advanced tools of DotBig to monitor your positions and close them.
Pros
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You don’t need to acquire ownership over underlying assets because you can benefit from rising and falling markets. If you have strong analytical skills, you can predict some market changes.
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CFD trading with DotBig gives you exposure to the wide selection of financial markets and a big diversity of assets.
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You don’t pay stamp duty.
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CFDs markets aren’t regulated as strictly as others.
Cons
Your access to world markets – DotBig
You can choose different financial markets to speculate on by using contracts for the difference. However, you should always remember that trading involves risk and it’s never completely safe in terms of potential losses. That’s why you should rely on verified sources and trust experienced DotBig analysts.
Risk management is very important when you try to benefit from CFDs markets. That’s why you should never neglect our professional recommendations and the possibility to use automated robo-advisors available on DotBig. Stick to your budget and take your time learning more relevant information about financial markets and different tradable assets.
