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13 Sep, 6 tweets, 4 min read
Disadvantages of CFD Trading
Although the benefits of CFD far outweigh the drawbacks, still as an investor, you must understand the risks involved
This thread looks at the disadvanages and pitfalls of trading CFDs.
#cfds #forex #cfdtrading
cfdspy.com/guide/cfd-disa… Image
Leverage
Are you surprised to see leverage as a disadvantage? It is like a double-edged sword! On the one hand, it allows investors to open positions with a smaller initial deposit, but at the same time it carries an element of risk. Even a little price movement can wipe you out
Long-Term Costs
Generally, CFD trading is a cost-effective method of investing, but if you leave the position open for long periods, it may become a big burden. Effective management is crucial to take advantage of CFD trading, and investors should consider the additional costs.
Lack Of Ownership
You should be clear that CFD is about speculation and not the actual purchase of assets. As an investor, you will only own the contract and not the share or currency.
#investing #trading
cfdspy.com
It is critical that as an investor you must fully understand the risks of CFD trading to take full advantage of it. With the right strategy, it is possible to make outstanding profits on CFD trading.
#strategy #CFD
cfdspy.com/strategies/cfd…

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More from @cfdspy

12 Sep
Are you already trading in CFD or a beginner? CFD is a popular derivative trading product. It allows you to speculate on the financial markets, which include shares, forex, commodities, etc.
This thread show the advantages of CFDs.
#cfd #cfdtrading
cfdspy.com/guide/cfd-adva… Image
Trading In Rising & Falling Market
When you can trade in both directions, it opens up more trading opportunities for you. For example, if you buy shares, you only make money when the price goes up. With CFD trading, you can also profit by selling shares when the price go down.
Invest In Range Of Markets
Traders get a chance to invest in various financial markets through one singular online trading platform. With CFD, trading in forex, shares, commodities, bonds, and others are possible from a single account.
#market #StockMarket
cfdspy.com/markets/range-…
Read 6 tweets
11 Aug
When it comes to CFD or forex trading, it's important that you deal only with reputable and regulated brokers; there's no need to cut corners and hope for the best, just go with the best.
Where's what you're looking for:
#CFD #cfdbroker #forexbroker

cfdspy.com/cfd-brokers/ Image
1. How are the spreads? are you satisfied? Shop around as there are so many brokers to choose from. A bit of leg work will save you time and money.
2. Happy with the range of markets? That's where you really have to dig in and investigate. If your CFD or forex broker does not provide the markets you trade then what's the point even if they have low spreads?
Read 8 tweets
17 Jul
You may often hear professional and successful CFD and forex traders talk about a trading plan. What what is it? Do you really need one?
The short answer is "yes", you need a trading plan.
In this thread we cover a few fundamentals.
#trading #cfds #forex
cfdspy.com/tips/trading-p… Image
1. You need to set up your trading targets. What do you want to achieve trading forex or CFDs (or any other financial market)? You need to set realistic and feasible objectives and adhere to your plan throughout your trading.
#forex #cfd #target
2. Once you're ready to trade, surely you'll need to employ some strategies, they might be short and long term strategies depending on the time you have but it's vital to come up with the strategies you'll be using for your CFD trading.
#strategies
cfdspy.com/strategies/cfd…
Read 5 tweets
16 Jul
Why is it that some CFD traders manage to make profit consistently when most of the retail traders lose money?
Are experienced traders better at research or sticking to the trading plan?
A few essential CFD trading tips in this thread.
#cfds #trading
cfdspy.com/tips/cfd-tips/ Image
1. Have a trading plan.
What is that you want to achieve? What instruments you want to trade? Do you set out your entrance and exit levels before you enter the trades? It's important to have a trading plan and stick to it no matter what.
#tradingplan #plan
2. Don't over-leverage.
Keep your leverage in check. If you have only enough money to risk 1 trade then you're definitely over-leveraging and just one bad trade will wipe you out. Ideally, you don't want to use more than 5% of your funds on any one trade.
Read 6 tweets
4 Jun
Currently, there are over 100 forex and CFD brokers on the market, all with their offerings and trading platforms. So how do you find a great broker? What to look for and what what providers to avoid?
cfdspy.com/cfd-brokers/
#cfd #cfdbroker #trading #trader Image
Regulation. Make sure your CFD broker is regulated by some prominent regulator such as FCA (UK), ASIC (Australia), Cysec (Cyprus), or FSB (South Africa), your CFD provider should be regulated by at least one of those regulators.
Avoid unregulated brokers at all costs.
Range of markets. With so many CFD trading companies, you are spoiled with choices and have the right to go for a broker which offers all the financial markets you want to trade but remember, just because a brokerage offers over 10k markets doesn't mean it's the best.
#brokerage
Read 5 tweets
24 May
When it comes to financial markets and CFD trading, it makes you wonder how some traders manage to consistently make profit while so many around fail miserably.
This thread looks into what successful CFD traders have in common.
#CFD #investing #stockmarket
cfdspy.com/guide/who-trad… Image
Successful traders tend to specialise and know their traded markets upside down, just think of hedge funds, each fund specialises in 1 particular market and thoroughly researches it.
Know your market
#market #cfdtrader #trader
cfdspy.com/markets/range-…
Manage the risk. CFDs and other leveraged products are very risky and thus should be treated as such. Never underestimate the risks and tread with caution. Risk management should be high on your agenda if you want to consistently make money on the financial markets.
Read 5 tweets

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