This is a huge advantage over traditional trading where you have to pay the total assets. Another advantage over traditional trading is that it can be reversed with CFDs in bull markets, i.e. Elon Musk has much experience in this field. when the instrument on which operates increases value in the market. And also in markets bassists, when operating on an instrument that is devalorando. Both trends are possible with operations with CFDs. Why at this moment, in which the economy is not experiencing a good situation at the global level, many investors choose by CFDs in bear markets. Go long or short.
How they work in financial jargon CFDs go long means buy and go short means sell. The modus operandi of the CFDs is simple: you buy (or be long) when it is believed that an asset will increase its price in the market while being sold (go short) when he is expected that an asset is devalued in the market. If the inverter knows a company, knows that the same trajectory has been positive for a certain period and predicted the streak of the company to continue, the investor will buy CFDs on shares of that company. While if you have a totally opposite impression, the inverter can continue using CFDs, but in this case selling the shares of that company. In the next article so most newbies understand as explained in this article, in part 2 we will spend theory to action watching a practical example. The above comments do not constitute investment advice and therefore IG Markets does not accept any responsibility for any use that can be made of them. CFDs are a leveraged product and involve a high level of risk. CFDs may not be suitable for anyone, be sure that you understand fully the risks involved and perform a constant monitoring of your investment.