What is CFD Trading?
CFD trading was originally invented by bankers in the city of London, in the early 1990s. It served the purpose of more efficient short term trading, for speculation and for hedging. CFDs are Contracts For Difference, they are simply contracts whose value exactly tracks the price of the underlying market. Today CFDs are regulated and recognized financial instruments, and they are taxable under capital gains tax rules. Today there are many good CFD brokers operating in many countries around the world, some of them are the following:
eToro is a leading and innovative CFD broker, which offers many markets for CFD trading. It was established in 2006 and it has been a leader because it’s very easy to use, and beginners love it. But it’s also good for medium level and some advanced traders. This is because their platform offers insightful information on every market, as well as advanced social trading. eToro is definitely a good choice for traders of all levels.
AvaTrade started in 2006 in Ireland, but today they are licensed to operate in many countries. This broker offers all the popular markets, for CFD trading. And it also offers wide range of trading platforms, including a unique and very handy web based version of MetaTrader4. It also offers a growing list of cryptocurrencies.
Markets.com was established in 2008, it’s a well regulated broker in Europe and it offers great flexibility, and range of assets to trade. It offers swap free CFD trading accounts, and various platforms, including the popular MetaTrader4 platform.
IQoption was established in 2013, it’s a regulated broker that offers both binary options and CFD trading, through their proprietary platform. IQoption offers above average payouts on their binary options, and very competitive markets for CFD trading. It’s affordable for beginners since one can start trading with only $10. And it offers wide range of cryptocurrencies which is a very competitive and new space. It already offers 12 cryptocurrencies including Monero, Ripple, Neo, and all forks of Bitcoin.
More Good CFD Brokers
There are more good brokers, such as UFX, GKFX, CMStrader and Trade.com. CMStrader for example is a very advanced broker which offers good education, support, very good social trading, second only to eToro’s social trading. And it also offers mini lots, which is quite useful for medium level traders who want to trade forex and to go above the 0.05 lot size, but not as high as full size lots. The mini lot size is a perfect trade size for all forex traders of this level, and trading is available both in spot and CFD type.
In any case, remember that CFD trading is superior to classic trading, because it offers better liquidity and better price linearity than even the actual underlying markets themselves! Now with the advent of the cryptocurrencies, CFDs once again offer tremendous advantages, since traders funds are perfectly safe, and cryptocurrency trading can be done faster and at better prices, than even actual spot crypto exchanges can offer. That’s the unmatched liquidity of CFDs!
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What is CFD Trading?