Times of low volatility in the foreign exchange market can be frustrating for traders, especially for intraday traders and scalpers. Luckily, there are CFDs which can give traders the ability to find opportunities in other markets when there are none in the currency market.
A contract for difference (CFD) is a contract between a trader and a broker. At the end of the contract, which is when the trader closes the position, the two parties exchange the difference between the opening price and the closing price of the position. There are CFDs based on a variety of assets, from shares to stock indices and commodities.
The main advantages of CFDs are their simplicity and low cost of trading. Trading futures on exchanges like the CME or ICE requires significantly more capital, there is less flexibility and the terms & variety of order types used may be overwhelming to someone who is not a professional trader. With AxiTrader, you can have access to a wide selection of CFD contracts and the low spreads will especially benefit short-term traders.
CFDs also give you the opportunity to hedge your exposure to other asset classes. For example, if you own stocks in your long-term portfolio, but think that the stock markets will have a correction in the near-term, you can take advantage of this by going short a specific stock index (e.g. the S&P 500 if you own stocks which are part of the index). Trading commodities through CFDs is simple as well. When trading precious metals CFDs, there are no physical transactions, you are only speculating on the price of the underlying asset.
Here is an overview of the CFDs AxiTrader is currently offering:
Trading global markets – from stock indices to precious metals and oil – has never been easier than today. Take advantage of it.
For more information please visit our CFDs page.
Contributed by Milan Cutkovic
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