CFDs Vs Stocks

CFDs vs Stocks

CFDs

CFDs are financial derivative instruments of stocks & commodities, similar to that of futures contracts.


They reflect the price movements in the underlying asset & allow investors to trade a contract without actually buying or selling equity. 




STOCKS

Stocks are ownership shares of a company, requiring investors to buy or sell the actual stock in order to execute a trade. 

Stocks are good for Long-term investing, Dividends & access to Shareholder Privileges.

CFDs are suitable for short term trading, access to more markets. 




CFDs vs stocks: Comparison



Pros of CFDs vs stocks

Leverage

Leverage offers the ability to enter larger positions with a smaller amount of capital. This exposes the trader to greater risk and potential reward.

Go long and short

To go long a stock CFD you click the buy button and to go short you click the sell button, the process is exactly the same.

Access lots of markets

There is CFD trading on most major asset classes including Stocks, foreign stocks, Forex, Commodities, Indices, etc.

24-hour trading

CFD trading is generally available 24 hours per day, making it more accessible to international traders. Most stock CFDs trade only during stock exchange hours.



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