CFD’s Level 1
Agenda •What are CFD’s? •Why do they exist? •How do they work? •Trading CFD’s using Saxo Trader II
What are CFD’s? (Contract For Differences)
• • • •
Enables investors to participate in the price movements of stocks without ownership of the underlying share Based on either individual stocks or indices Invented in the UK CFDs enable leverage of stock-related investments
Nominal Value Margin required
Nominal Value
Why do they exist? • Potential tax breaks • Leverage • Diversification
How do they work? • • •
A CFD is a derivative of either a stock or an index A CFD reflects the value of the underlying asset/share +/- 0.1% - (this is the risk premium) You trade the amount of shares you want, but only use a fraction of the capital
Green prices. What you see is what you get.
Price difference is +/- 0.1%
Trading CFD’s using Saxo Trader II • Trading made simple with our easy-to-use interface • Clearly defined pricing, margins and costs
Account Summary
Trading CFD’s with Saxo Bank
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