1. Trade long and short positions
Unlike traditional stock trading, investors trade CFDs in either long or short positions. This means that they can easily buy or sell without the need for contract signing.
CFD Trading
Opening a CFD trading account with ATFX today is a great way to start trading a wide range of products with competitive spreads. You can trade forex, indices, cryptocurrencies, commodities, shares, and more.
Why Trade CFDs with ATFX?
Enjoy competitive spreads
Access to free trading tools
Trade on MT4, one of the world’s most popular trading platforms
Trade with a regulated broker
Fast execution
Zero commission
CFD Trading vs Normal Trading
A CFD (contract for difference) is an online trading instrument that allows investors to speculate on the price movements of a security without owning the underlying asset.
Profits come from changes in the security’s price, not from owning the asset itself.
CFDs are appealing to investors because they are traded on leverage, which means that trades can be opened with a smaller amount of capital than they would need if they bought the underlying asset outright.
The two main differences between stock trading and CFD trading are leverage and asset ownership.
When buying a stock,
- You purchase a share of ownership in a company.
- You are entitled to a portion of the company’s profits and you have the right to vote on company matters.
In CFD trading,
- You do not own the underlying asset. You are simply speculating on the future price of the asset.
- You can make money if the price goes up or down, but you do not have any ownership rights in the asset.
You can make money if the price goes up or down, but you do not have any ownership rights in the asset.
Leverage is a powerful tool that can be used to increase your profits, but it can also be used to increase your losses. It is important to understand the risks involved before you start trading CFDs.
Beginner traders can now trade a wider range of financial markets with lower capital requirements. CFD platforms like ATFX make it easy to get started with user-friendly interfaces and educational resources.
6 Advantages of CFDs
2. Access to plenty of markets
Traders have real-time access to a wide range of trading instruments across multiple asset classes, including local and offshore stock CFDs, commodities, and indices. This allows them to trade on the latest market movements and capitalise on opportunities as they arise.
3. Trade CFD 24 hours a day, 5 days a week
CFD markets are open 24 hours a day for online trading, making them more accessible to international investors who might feel restricted by conventional stock exchange hours
4. No stamp duty on a CFD trade*
This is because you are not taking physical ownership of the underlying asset.
5. CFDs require less margin than traditional trades to open a position
By being able to trade without having to deposit the full price of the product, your money will not be tied to a single transaction. It is important to note that when trading on margin, any losses are magnified.
6. Trade on rising and falling prices
CFDs allow you to short-sell, which means you can profit from both rising and falling markets.
* Tax laws are subject to change and depend on your individual circumstances. You should seek independent tax advice before making investment decisions.
CFD trading vs Stock trading
For example, if Tesla stock (TSLA) is quoted at $221.72:
- A stock trader would purchase 10 shares for a total of $2,217.20.
- A CFD trader would purchase 10 CFDs, but only needs to pay a 10% margin, for a total of $221.72.
Note: 1 CFD represents 1 unit of the stock. The minimum purchase units and margin requirements for each underlying asset can be confirmed on its order ticket before purchase.
| Properties | Contracts For Difference (CFD) | Stocks |
|---|---|---|
| Ownership | None | Ownership rights |
| Use of leverage | Yes | Not possible |
| Trade long or short | Allowed | No |
| Markets | Variety | Equities & ETFs only |
| Costs | Spreads, Rollover costs are charged | Commissions |
| Trading sessions | 24 hours every weekday | Only during exchange hours |
| Dividends | Cash adjustments | Dividends paid |
| Loss exposure | Loss can exceed deposit | Lose invested amount |
| Voting benefits | None | Full voting rights |
CFD Broker
Contracts for difference (CFDs) enable a wider range of traders to invest in a variety of asset classes without having to purchase the underlying assets. As more CFD products are created each day, an intermediary is required to facilitate these transactions. There is no central exchange for all CFD traders to go to when they need to conduct their trades. Instead, each CFD trader must go through an intermediary, known as a CFD broker. A CFD broker offers hundreds of financial products for investors to choose from.
While CFDs are ideal for short-term traders and hedge investors, finding the best CFD broker can be a challenge for new investors. There are hundreds of CFD brokers offering competitive services, which makes it difficult to choose one. It is also important to conduct thorough research before settling on a firm.
Here are some factors to consider when choosing a CFD broker:
- Regulation: Ensure that the broker is regulated by a reputable financial authority.
- Fees and spreads: Compare the fees and spreads offered by different brokers.
- Customer support: Ensure that the broker offers good customer support.
- Trading platform: Choose a broker that offers a user-friendly trading platform.
- Asset selection: Choose a broker that offers a wide range of CFDs to trade.
- Demo account: Practice trading with a demo account before you start trading with real money.
By considering these factors, you can find the best CFD broker for your needs.
Brokers strive to develop service packages and benefits that are appealing to their clients. Some brokers focus on features that assist institutional investors, while others focus on individual retail investors. The best brokers offer tailored benefits for everyone.
A proprietary platform that is suitable for all types of investors demonstrates how much a CFD broker values their clients. The broker, in turn, benefits from charging some fees to the traders.
As a forex trader, you can expect to be charged by your forex CFD broker for the following:
Fixed spread
A constant amount that is charged for each trade.
Floating spreads
A variable amount that is charged for each trade, depending on market volatility and hours.
Commission fees
A percentage of the trade value that is charged for each trade.
When you trade CFDs (contracts for difference), you are purchasing the difference in price from the point at which you open the contract until it is closed.
Traders are advised to only deal with regulated brokers if they want to safeguard their portfolio. Regulators set the competitiveness and security standards that brokers must meet in order to be licensed. They are mainly clustered into jurisdictions, and brokers from a specific region will typically have a preference for one regulatory body. CySEC, ASIC, ESMA, BVIFSA, IFSC, FCA, FSA and the CIMA are some of the best regulators. Regulators like CySEC are an excellent choice because they offer a good mix of security and competition.
You can confirm your broker’s regulatory status by reading the footnotes at the bottom of their platform’s homepage.
Register for an account
1.
Open your account
Complete the Live Trading Account application form. Once we have verified identity, we will set up your account.
2.
Fund your account
Deposit funds from a credit card, E-Wallet or bank transfer to start trading.
3.
Start trading
Trade on every device, including PC, Android, iPad and iPhone or via web browser.
CFD Trading Platform
A CFD trading platform is a software solution that brokers and financial institutions offer to enable digital trading from remote locations. It allows you to trade CFDs without having to physically visit an exchange or make phone calls to a broker. Investors can buy or sell securities from anywhere as long as they have access to a computer or compatible phone.
The most basic trading platforms are downloadable Android or iOS apps that can be run on your smartphone. These are the essential tools you need to understand how the markets work. Traders can also download and install expert-level trading platforms on their computers and customise more trading tools to their needs.
The trading platforms are free once you register an account with a broker. You can also download demo versions of these platforms and test them before opening real accounts. Demos allow you to experience the platform before you make your first deposit.
- CFD trading platforms are financial software that enable users to trade contracts for difference (CFDs) on a variety of assets, including stocks, indices, currencies, and commodities.
- CFD platforms provide real-time market data, charting tools, order execution, and risk management features.
- When choosing a CFD platform, it is important to consider the fees, spreads, and leverage offered, as well as the platform’s customer support and educational resources.
- It is also important to remember that CFD trading is a high-risk activity and that you could lose more money than you invest.
What to look for when choosing the right platform
To select the most appropriate CFD trading platform for your requirements, ensure that it fulfils the criteria on this list.
I. Affordable fees
Trading platforms incur costs to keep running, which they cover by charging traders small fees. These fees can take the form of withdrawal fees, commissions, or spreads. Choose brokers with low commissions. ATFX offers traders fee advantages, including the following:
- ATFX is proud to offer its customers highly competitive spreads that give them an advantage in the market. Our tight spreads allow you to open a trade while paying less, and there are no additional fees aside from the difference between the Bid and Ask prices.
- We want you to have the best possible trading experience, which is why we offer competitive spreads on all CFD products. This, combined with our zero bank fees policy, ensures that you get the most out of your trading.
II. Trade instruments
Some platforms offer hundreds of CFD pairs to trade, while others limit you to a few choices. The advantages of ATFX CFD instruments include:
- Diversification is key to successful portfolio management.
- CFDs allow traders to diversify their portfolio without owning the underlying asset.
- ATFX offers a wide range of CFDs, including exotic markets.
- CFDs allow traders to apply leverage, which can magnify profits and losses.
- ATFX offers negative balance protection, which means traders cannot lose more than their account balance.
III. Ease of use
It is advisable to choose trading platforms that are user-friendly for both beginners and experts. Some of the trading tools available to ATFX members include:
- Long and short entry/exit signals based on technical analysis.
- 24-hour global coverage of market news.
- Hassle-free delivery of data directly to traders’ inboxes.
- Long-term forecasts on pivot levels.
- Timely analyst view tips for direction and key levels.
- Slow and fast price indicators to guide traders’ entry and profit targets.
These tools can assist traders of all levels in making informed trading decisions and achieving success in the financial markets.
IV. Broker reputation
The platform you choose should be reliable. To learn about the platform’s common advantages and disadvantages, go through rating websites or read reviews. The platform should be licensed and regulated.
ATFX is a well-regulated financial services provider with a global reach. The company is authorised and regulated by different regulatory bodies in each country where it operates.
In the United Kingdom, AT Global Markets (U.K.) Limited is authorised and regulated by the Financial Conduct Authority (FCA). In Cyprus, ATFX Global Markets (C.Y.) Limited is regulated by the Cyprus Securities and Exchange Commission (CySEC), while AT Global Markets Intl Ltd is licensed by the Financial Services Commission (FSC) in Mauritius.
These regulators monitor ATFX activities to ensure that they follow the applicable laws and regulations and safeguard the interests of their customers.
ATFX is a global forex broker that has been recognized with numerous awards for its excellence in customer service, trading solutions, and overall performance. The company has a strong presence in Europe, Asia, South America, and the Middle East, and is committed to providing its clients with the best possible experience.
Some of the awards that ATFX had won include:
- Best Institutional Forex Broker at the Global Forex Awards 2022
- Best Global Broker 2022 at the Ultimate Fintech Awards 2022
- Most Trusted Broker 2022 by JFI Awards
These awards are a testament to ATFX’s hard work and dedication to its clients. The company is committed to providing a safe and secure trading environment, and ensuring that its clients have access to the best tools and resources to help them make informed trading decisions.
ATFX’s dedication to its clients has earned it a reputation as one of the most trusted and reliable brokers in the financial services industry.
V. Demo trading
Demo trading allows you to simulate trades with real-world prices on a practice account.
The ATFX MT4 demo account allows traders to experiment with new techniques and build confidence before trading with real money. Using virtual funds, traders can familiarise themselves with the platform and test their strategies without risking any capital.
Chart packages on the MT4 demo account are free, and the account can be accessed on a desktop, tablet, or mobile device, with compatibility for Windows, iOS, and Android devices. This allows traders to practise trading on their preferred device and become comfortable with the platform before transitioning to live trading.
Key benefits of the ATFX MT4 demo account:
- Try new techniques and build confidence before trading live
- Familiarise yourself with the platform risk-free
- Access an investment of virtual funds to experiment
- Leverage restrictions on demo accounts are the same as on live accounts
- Insufficient funds will result in rejected trades, just like on a live account
- Chart packages on MT4 demo account are free
- MT4 demo is available on desktop, tablet or mobile
- Compatible with Windows, iOS and Android devices
VI. Customer support
- When technical issues arise, reliable customer support is essential. ATFX provides 24/7 customer support in over 20 languages, so clients from all over the world can receive personalised advice and assistance whenever they need it. The customer support team is known for its responsiveness and reliability, making it a trusted partner for traders of all experience levels.
- ATFX’s commitment to providing top-quality customer support has been recognized with over 80 prestigious international awards. These awards are a testament to the company’s dedication to its clients and the high level of service that it provides.
- Whether you need help setting up an account, navigating the trading platform, or have any other questions or concerns, the ATFX customer support team is always available to assist you. With its extensive experience and expertise, the team can offer valuable insights and guidance to help traders succeed in their trading endeavours.
Register for an account
1.
Open your account
Complete the Live Trading Account application form. Once we have verified identity, we will set up your account.
2.
Fund your account
Deposit funds from a credit card, E-Wallet or bank transfer to start trading.
3.
Start trading
Trade on every device, including PC, Android, iPad and iPhone or via web browser.
FAQ
You can trade CFD in both rising markets and declining markets. Speculators will place ‘buy orders’ (long positions) when they anticipate the prices will appreciate and place ‘sell orders’ (going short) when they expect a decline. CFDs offer the opportunity to profit from rising and declining market trends. As the standout advantage of trading CFDs, you can immediately realize profits. Investors, in turn, have lesser risks of potential loss when the markets are mostly bearish. Like all forms of trading, always not that you are still exposed to some risks while trading CFD. Choose a trading style that you are comfortable with and one that will still keep your bankroll manageable if your price prediction does not materialize. Here are some practical trading styles you can use to make consistent profits while having manageable risk exposure.
1. Day trading CFDs
Day trading is a trading choice where investors only keep positions running for a maximum of a day. Most traders may also open and close positions on one instrument multiple times within one trading session. Day trading works best with more volatile price action on a liquid instrument. Because of cost implications, the best CFD broker offers low transaction charges Short-term traders give priority to CFDs because speculative trades only need a small price movement for there to be profit opportunities. Because of the hunt for small price differences, short-term traders rely on technical analysis more than fundamental analysis. They focus more on the price trend than the company’s actual performance or currency. A common variation of day trading is scalping. It is very short-term and can have positions that only remain open for seconds. You can trade CFD with small, consistent profits, which add up to a substantial amount if you stay focused. The rationale behind closing the losses as soon as they occur is that, hopefully, the winning trades will cover the losses. Day trading and scalping are high-probability trading techniques that bear minimal risk. Use them with tight stops and clear profit objectives always. Consider them as a trick to make 100 trades to get $100.
2. Position trading
Position trading of CFDs requires a long-term approach to how the investor determines the likely price movement. Position trading, unlike scalping, gives the long-term price trend higher priority than how the market fluctuates in the short term. For example, the bullish trader will keep a position open even if the day is closed on a bearish note. The strategy prescribes making more significant gains over a more extended period as long as a stop loss is not hit. The fundamental analysis of picking the trades involves more profound research into the underlying companies’ financial performance and management track record. It involves more news-tracking than short-term strategies. To get started, use the charts to find the trend direction and strength. It is more profitable to trade CFDs in the direction of the trend. Place the trade and keep monitoring open positions to guard against trend changes. Long-term trades attract margin costs Margin interest is the cost of borrowing money from a broker to trade, and it accrues daily based on the amount of margin used by the trader. Trading CFDs with a long-term perspective, therefore, has some cost implications. CFDs are margined instruments that will attract interest over the duration you hold the positions. When a trader holds a long-term position, they are essentially borrowing funds from their broker to maintain the position until they decide to close it. As long as the position remains open, the trader will be charged margin interest on the borrowed funds. The amount of margin interest charged is typically calculated based on the size of the position and the amount of time that the position is held open. Always incorporate the margin costs into the trading strategies to judge whether some trades will be profitable. An excellent way to compensate for the daily interest is to invest a higher ratio of your trades in CFD stocks with a strong trend. The price changes will cover the interest charges. Qualities of a good trading system If you still feel unsure about your trading strategy, consider using the following 4 characteristics to test if it is good.
- Pick trades that have a higher reward per dollar risked.
- Have a reliable way of identifying entry points.
- Have a steady rule to exit running trades. This should apply to winning and losing threads. (You should cut losing trades early enough to avoid wiping out your account.)
- Select lot sizes that will not adversely affect your balance if you have a few bad trades.
Regardless of the system, always confirm how much you can lose with a single trade, as CFDs are leveraged products. When setting a profit target, set a reasonable stop-loss distance. Your stop-loss distance should be at least half the number of pips you set as the take profit.
Even as we know the importance of a trading platform and how to trade, it is vital to know the CFD broker meaning and their role in the equation. CFD brokers are intermediaries who play the market maker role. They will match orders from clients and take asset positions to hedge exposure. Brokers would profit from clients’ trades, even if they were not winning trades. A financial institution will offer value-added services to give the clients the best value and set themselves apart from competitor brokers. Give priority to brokers who provide services such as free market analysis and trading signals. Due to competition, most of these services are free, but for the benefits you get in return, it is okay to pay a small fee. Most of the fees charged for those services are negligible to your trades. It is fair for brokers to request a minimum deposit if they want a CFD trading platform that offers the services. Some value-added services that you should look out for from a broker include
1. Live charts:
These help traders monitor trends and deal directly from an HTML5 browser or MT4 platform without having to rely on a list of quotes like traditional exchanges.
2. Trading alerts and signals:
Even if you cannot access your computer for long periods, trading alerts let you receive updates on economic events and critical economic indicators via phone texts.
3. Quick trade execution:
Brokers have different performance speeds on their platforms. Good brokers ensure there is minimal slippage or lag. Withdrawals are executed quickly to get your money in your hands when needed.
4. Access to a wide range of markets:
Instead of just a handful of popular demands and instruments, you can access exotic markets from your CFD broker online. These still offer reliable execution time.
5. Trust and security:
Select a trustworthy broker who updates the platform with the latest security standards. In summary, most top-ranked brokers can meet the needs of short and long-term traders. Day traders prefer shorter periods to find opportunities, so they need to sign up with a broker who offers a more extensive range of instruments to trade daily. Short-term traders benefit more from the scouting tools that make it easier to find trading opportunities. Professional traders are more likely to register for a signal service and a detailed economic calendar. CFD brokers like ATFX provide formidable tools and training for professional CFD traders.
Trading CFDs needs traders to have a way to monitor opportunities and analyze opportunities in real-time, or else they will bag losses. Online CFD accounts make opening positions and managing risk parameters easy.
What is a CFD trading account?
CFD trading accounts are portals through which traders can access the market. Your account shows your trades, cash balance, and any correspondence history between you and the broker. Thankfully, you can access your account through applications you download and install on a mobile phone or PC. An easy-to-register platform allows you to access your trading account and participate in thousands of markets from anywhere. Expect more convenience from your trading account, with additional features like educational materials, expert coaches, and round-the-clock customer support. Traders must register an online CFD account to make their trades online. Registering a CFD account with an online broker is no longer difficult. CFD brokers are outshining each other with new features that make it easy for traders to participate in the market profitably. ATFX has a simple and quick account creation process in place. It only takes a few minutes to create an account, register, and fund it. Now, you can have your first trades running on a top-notch CFDs trading platform.Registration steps for a new CFD trading account
All platforms require you to visit their sign-up pages and provide basic details about yourself. Once you are done giving your details, your trading broker will send a confirmation email to your inbox to verify that nobody else is using your email to create an account. Authenticate your account and sign in to customize your account with a few more tools and essential onboarding. The onboarding process takes you through all the basics you need to know about accessing trading tools, contacting support teams, and depositing funds. Follow these simple steps if you have been thinking of opening an account at ATFX.com:- 1.Visit ATFX.com and click on the “Open Account” button.
- 2.Fill in your personal details like your name and contact information.
- 3.Choose the type of account you want (Micro, Premium, or Raw) and your preferred currency.
- 4.Provide any required information like your work status, financial background, and trading experience.
- 5.Upload your ID documents and proof addresses to verify your identity.
- 6.Read and accept the terms and conditions, and then submit your application.
- 7.After your account is approved, you are ready to make a deposit and start trading.
1. Fill out forms
The first instance involves filling out a simple form that gets unique details about your identity. Typically, it would help if you filled in your name (as they appear on your ID card) and email address. The secondary part of the registration forms needs your address, preferred password, and confirmation that you are over 18 years. Tick the checkbox that confirms that you have read and agree with the terms and conditions.2. Documentation and ID
For your safety, brokers ask for your identification documents. This information reduces the loopholes that money launderers are out for. Identification prevents your account from being hijacked by intruders. It’s not that often that an online stranger in a different country will know your exact residence, birth date, and such private information. As a precaution to ensure that you are the one opening the account, brokers will ask for a scanned copy of your ID or Driving license. A driving license or a recent bill proves that an applicant uses his actual address. The identification documents ensure that the ID matches the photos uploaded in the verification process. Other documents that can be used as alternatives include stamped bank statements, tax PINs, or recent utility bills. These are last-resort documents if there are problems with other document submissions. To avoid any doubts, always ensure that the names used in your application are the names that appear in the supporting application documents. Conflicting documents prolong the application process.Select and configure your platform tools
Once you have an account under your name, the next step is selecting the software platform that you will log in to trade. Metatrader 4 (MT4) is the go-to platform for most beginners. It has all the charting tools and trade placement buttons you need. It is arguably the best platform because most other platforms are variations of MT4. Furthermore, MT4 and MT5 are customizable to your trading styles and are good for testing how well trading strategies work. Online CFD brokers provide a variety of trading widgets and tools to link to your MT4 or browser platforms to help you easily identify chart patterns. Some examples include ‘auto-chartist’ and links to news sources. The compatibility with third-party analysis gives you a broader view of the market’s behavior and upcoming events and lets you collaborate with other traders. Confirmation tools give you a more direct approach to technical analysis, giving you an extra edge in decision-making.1. Log into your demo or live account
Once you have verified your account, an email containing your account login details is forwarded to your inbox. Use the exact login details on any of your chosen platforms. We recommend keeping one or more demo trading accounts while operating a live account. A demo account helps CFD traders trade better before applying them in your live trading account. When using the web browser platform, click the login button on the website’s landing page. There is usually a demo login button and a live trading button to avoid confusion. Start the program and key in the login details if you already have an MT4(5) platform installed. The login details include a server IP address to link you to keep you connected to the same broker if you ever need to use multiple gadgets from different locations.2. Fund the live account and start trading
You can open a CFD trading account without funds, but you need to fund it first to make your first CFD trade. A good CFD trading platform offers flexible payment options alongside promotions like deposit bonuses. Common account funding methods include bank and card transfers, e-Wallets, and money orders. E-wallets are the fastest way to deposit or withdraw funds from your new CFD account. Expert tip: Only deposit what you can afford to lose. To cushion yourself from potential risks, begin trading a small percentage of your capital as you gain experience in live CFD trading. As you gain confidence and polish your trading skills, increase trade sizes on new orders using familiar trading strategies.In the world of financial trading, there is an entire subculture devoted to taking advantage of small fluctuations in the price of certain stocks, commodities, or currencies. These derivatives – commonly called CFDs or contracts for difference – enable individuals to trade large amounts of stock, currency, and commodity without having to physically own the underlying security. While CFDs were originally developed for use by experienced speculative traders, later generations of retail investors found them invaluable for entering the market on a budget and without requiring large amounts of capital. A CFD (contract for difference) is a derivative that gives the buyer the right to buy or sell a predefined amount of an underlying security at a fixed price over a specified time. In general, CFDs are considered leveraged contracts because they carry a high degree of leverage and can be extremely profitable for experienced traders. They are also considered to be high-risk instruments since their value can fluctuate wildly due to changes in the price of the underlying security – often referred to as the ‘basket’ – during the life of the contract. A CFD that is based on a stock will typically have its price adjusted every three minutes to keep up with changes in the market price of the underlying stock. Just keep in mind that you can trade CFD online and most brokers now offer CFD trading platforms for beginner traders.