The Contract For Difference (CFD) is a type of contract between a buyer and seller that requires
the buyer to pay the difference between the current value of an asset and its value at the time of
the contract to the seller. CFDs give traders and investors the opportunity to profit from price
action without owning underlying assets. The value of a CFD contract does not take into
account the underlying value of the asset, only the difference between the moment of entry and
exit to the trade.
Investments in Contracts For Difference do not physically own the underlying asset but
transactions involve leverage. The most common products that deal with Contracts For
Difference are stocks, commodities, stock indices, exchange traded funds and Forex contracts.
Thanks to the Stock Contracts for Difference, investors can access more than 100 stocks on
three exchanges (NASDAQ, NYSE and ASX). Equity Contracts For Difference are only available
on MT5 and this platform gives investors much more flexibility.