CFD Trading Strategies

The CFD NYSE is currently the world’s largest and most liquid foreign exchange marketplace. Many people are attracted to CFD trading since there are no margin requirements. CFD trading does not require the same mandatory annual maintenance records as stocks and derivatives do. CFD traders can enjoy complete anonymity, while also enjoying significant cost savings. CFD trading offers a number of advantages, but there are also some disadvantages.


CFD trading on the CFD NYSE can be leveraged up to 100 times; however, there are several restrictions and limitations placed on this. Since CFDs are futures contracts, they cannot be traded by retail traders nor individuals under the age of 18 years old. This restriction was put in place to protect the interest of major financial institutions and banking groups.

CFD NYSE options can be used to speculate on underlying stocks or indexes. Stocks and indexes are considering safe investments, especially over short term periods. Long term trends in these investments are quite reliable, so investing using CFD trading strategies can be quite profitable. When stocks and indexes reach new highs or lows, CFD trading strategies can provide a good profit. In the case of CFD trading, this would translate into higher stock prices and more profit for the CFD trader.

CFD trading on the forex and exchanges offers greater flexibility and opportunity for CFD traders compared to trading stocks and indices directly on the exchanges. CFD trading can be leveraged up to 100 times; however, there are several restrictions and limitations placed on this. CFD trading is done through ‘open outcry’, which means that any open position that is taken before the market close can be closed before the market open.

CFD Trading strategies that are based on fundamental analysis can be leveraged up to ten times of the strike price. The larger the margin, the greater the leverage, and hence the greater the potential gain. There are three types of CFD trading, which are either based on a fundamental index, a fundamental commodity or a floating index. A primary index is determined by speculations on factors like industrial production, interest rates, G7 inflation, consumer sentiment and other economic indicators.

The most widely traded among the three types of CFD are those indices associated with energy, gold and silver. Commodity indices include oil, gold and other precious metals, agricultural commodities such as sugar and corn, the petroleum industry, and various indices of the stock market indices. Floating indices are traded on futures contracts. These are generally longer term investments. It is important that you check out all the information about the CFD before you buy.

CFD trading strategies will depend on whether you are speculating on fundamental indexes or commodity-based indices. You can also choose between two strategies – short call and long call. Short call CFD trading strategy involves the purchase of a CFD from an investor on an existing CFD exchange platform. The CFD will be sold at a higher premium when the prices move in your favor. In short call CFD trading strategy, the risks related to CFDs are comparatively lower than the risks involved in the forward trading strategy.

CFD trading is definitely the fastest growing trading instrument in the equity market today. It has the potential to deliver significant gains to traders and investors. You can also use CFD trading strategy in order to make profits even if you do not have the experience in the equity market. CFDs are tradable instruments with clear registration. The liquidity of CFD trading is very high – one CFD can trade on multiple exchanges at the same time.