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Exchange Traded Contracts for Difference (CFDs)
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CFD's are a financial instrument used by traders for over twenty years
but have recently gained traction in the retail market initially in the
United Kingdom and more recently in Australia. This form of financial
instrument has gained popularity as an instrument for hedging and
because of the leverage available from initial margin requirements.
Until the introduction of exchange traded cfds, scheduled for release
in Australian, over the counter (OTC cfds) are the only form of cfd
available through either the direct market access (DMA) or market
marker (MM) models.
Discover
how to compound your money via ETF trading.
Exchange traded cfd's will incorporate many of the same characteristics
as OTC cfd's including flexibility and and leverage. Traders will enjoy
reduced costs associated with these new instruments as spread costs and
financing charges traditionally charged by third party providers are
reduced. The new exchange traded contracts for difference will
facilitate trading under exchange based conditions. More transparent
pricing, greater regulatory supervision, and the security of contract
performance typically associated with exchange traded products will be
evident.
Learn more about the features
of exchange traded contracts for difference
(cfds).
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