Contract for Difference (CFD) trading has gained popularity in the financial markets due to its unique features and opportunities it offers to traders. Here’s a comprehensive guide to understanding what is cfds and how they work.
CFDs are derivative financial instruments that allow traders to speculate on the price movements of various assets without owning the underlying asset itself. These assets can range from stocks and commodities to currencies and indices. When trading CFDs, investors are essentially entering into a contract with a broker to exchange the difference in the asset's price from the time the contract is opened to when it is closed.
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