Why trade CFDs?

Over the last 15 years traders and investors have become increasingly sophisticated and knowledgeable about managing their own finances. CFD trading has increased in popularity as self-directed investors have realised the benefits over more traditional forms of investing. These are some of the reasons to consider trading CFDs online with CMC Markets.

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Cross-market opportunities

With CFDs, there are thousands of products you can invest in across all the major shares and indices in Australia, the US, UK, Europe and Asia. Below is a selection of different asset classes and products you can choose from when trading CFDs on the CMC Markets trading platform:

  • Foreign exchange covering over 70 different currency pairs from developed and emerging markets.
  • Cash commodities including agricultural, precious metals, industrial metals and energy.
  • Global indices covering most regions including the UK100, US30, German30 and Japan225.
  • Companies from across the globe – you don’t have to stick with just Singaporean shares.
  • Trade Treasuries such as Government Bonds like US T-Bonds from major global markets.
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Your capital can go further

Trading with leverage can be an efficient way to use capital – it means you can have 100% market exposure for a fraction of what you’d pay to own physical shares. Of course, this also means it’s possible to experience losses that are greater than your initial investment. One of the major benefits of trading CFDs with us is that you can control your leverage by dialling it up or down. On our Next Generation trading platform, this is called customisable financing.

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Potential to profit whether the market goes up or down

Your profit or loss is determined by the difference between the price you buy at and the price you sell at multiplied by the number of CFDs you hold, which means you can still trade CFDs whether the market’s going up or down. In fact, shorting is often used to hedge physical share positions in volatile market conditions.

For example: To 'buy' the equivalent of 1,000 CapitaLand company CFDs you would only need to deposit 10% of the total transaction amount you might have to pay if you were buying physical shares from a stockbroker. If each physical share costs $3.00, then you would only need to place an initial deposit of $300 with CMC Markets (10% of $3,000 = $300) compared to the full value of $3,000 plus commission and taxes, which is what it would take to complete the equivalent transaction with a broker.
Click here for a more detailed example of a CFD trade.