Contracts for Difference (CFDs) are a versatile way to trade financial instruments, and are offered on a broad range of assets. A CFD is an agreement to exchange the difference in the value of an asset from the time the contract is opened until the time at which it is closed. CFDs are derivative products, allowing you to trade on market price movements of financial assets, giving you the opportunity to profit from falling as well as rising markets, without owning the underlying instrument you have chosen to trade. Overall, Contracts for Difference are a great way to maximise your trading flexibility as they are not bound by minimum amounts of capital.
At JFD, CFDs can be traded on 6 asset classes (stocks, indices, commodities, bonds, ETFs & ETNs, cryptocurrencies). You also have access to mini CFDs on major indices such as the DAX and DOW. Our Brokerage team is constantly updating our instruments to ensure your trading needs are met.
CFDs are traded on leverage, meaning you need only a small fraction of the total trade value to open your position. Therefore, you have to spend less capital which will free up more of your money to invest.
CFDs are very flexible and in general you can trade long (buy) or short (sell). It is easier and less complicated to short sell with CFDs. An instrument may be short-sold at any time, and since there is no ownership of the underlying asset, there is no borrowing cost.
It is possible to trade or define your position size in a more detailed way with CFDs, which helps with your money management. At JFD, for some indices, such as the DAX and DOW, it is even possible to trade mini lots on them, at an incremental trade size of 0.1 CFD per index, to maximise your risk management even further.
You can use CFDs to offset any losses in your portfolio by short selling, especially in volatile markets. Reduce your exposure by using CFD trading to hedge the risk of your investments. For example, if the price of the stock you are investing in drops, you can use a stock CFD to off-set any losses in your stock portfolio by short selling without selling any real stocks (by using such a hedge setup you don’t sell the physical stock).
With CFDs you get maximum transparency in pricing, as they reflect 1:1 the price change of the underlying instrument. So a share CFD for example usually has the same pricing as the share itself. Also with CFDs, unlike other leveraged products such as options, knock-out barriers do not matter.
CFDs on single stocks, ETFs, ETNs, cash indices and crude oil (Brent & WTI) do not have an expiration date. Thus, you can keep your open positions running for as long as you choose. However, CFDs on futures contracts are an exception as they have maturity dates.
Since with CFDs you don't actually own the underlying instrument, this means that you are not obliged to pay a stamp duty to the government, enabling you to save on each trade (please note that tax laws vary according to each country and are subject change). In this way, CFDs are a more cost-effective form of trading, than if you were going to buy/sell the asset class directly on the exchange. You can benefit on the price movement without having to worry about stamp duty.
Our CFDs can be traded during the opening times of the reference stock markets, but some are also tradable during times when the reference market is closed. You can find the current trading times of indices, commodities, and bonds that can be traded with JFD Brokers in ourContract Specifications
An index is a statistical measure of the changes in a portfolio of stocks representing a portion of the overall market. As they are a smaller sample of the market that is representative of the whole, investors use indices to track the performance of the stock market. With JFD Brokers you can trade 15 of the world's most prolific cash indices covering Asia, North America and Europe, including the renowned Dow Jones Industrial Average (DJIA) which is extremely popular with traders worldwide.
When it comes to investing, shares are one of the principal asset classes. You have the booking value of a stock (also known as share or equity) after deducting the liabilities from the company’s assets and dividing the result by the number of shares issued. Stocks are important because they represent the real value of one’s stake in an investment. At JFD Brokers, you can trade 400+ Stocks CFDs.
Bitcoin is a peer-to-peer digital currency launched in 2009, a cryptocurrency which has become a unique and popular financial vehicle, unlike anything the world has ever seen. We offer you the opportunity to capitalise on the recent crypto trend and invest in Bitcoin, Bitcoin Cash, Ethereum, Litecoin and Ripple. We also allow partial trading on these symbols, which gives you the opportunity to test these volatile instruments in smaller amounts, thus enabling better risk management.
Commodity markets have had major impact on nations and people throughout history. There are different categories of commodities, all supported by the same basic economic principles: lower supply equals higher prices. With JFD Brokers you can trade up to 7 Commodities on very favourable terms.
Bonds may seem less of an exciting investment choice compared to stocks for example, but there are benefits to bonds as a stable and low-risk way of diversifying a portfolio. All it takes is a bear market to remind investors of the virtues of a bond's safety and stability. In fact, for many investors it makes sense to have at least part of their portfolio invested in bonds. With JFD Brokers you can trade CFDs, based on 2 futures of bonds, ranging from North America to Europe.
Exchange traded funds (ETFs) are a popular asset and emerging to replace mutual funds with their usually lower fee structure and easier-to-understand price action. Exchanged traded notes (ETNs) are something that many retail investors may not be familiar with, but in practice they work in a similar way to ETFs—both track an underlying asset, often have lower expense ratios than actively managed mutual funds, and both trade on the major exchanges just like stocks. The main difference is that when you invest in an ETF, you are investing into a fund that holds the asset it tracks, whereas an ETN is more like a bond, and can be held to maturity, bought or sold at will. At JFD, you can trade 21 ETFs and 4 ETNs.