There are two distinct pricing models:
Market Maker model
(MM) – This is where the cfd
provider acts as the principal, providing a two way spread based on the
market price. This spread is usually above or below the price traded
for the physical equivalent. The client trades directly with the CFD
provider.
Direct Market
Access Model (DMA) – where the CFD
order is mirrored by the CFD provider and placed as a physical stock
order on the underlying market. There is no spread imposed between the
transaction.
The new exchange
traded contracts for difference will
remove third party intervention and faciliate trading under exchange
based conditions.
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to learn to trade? Discover how with a proven system.
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