CFD Futures Trading Example

  • With CFD trading you buy a CFD based on a certain amount of the underlying asset. In this case, we will examine how to trade futures.
  • The following worked examples show how you can use CFDs to trade a number of different markets.
  • These examples show trades that result in both profits and losses.
  • CFD trading example (Index) - Selling the US TECH 100
  • You believe that the US TECH 100 will fall so you decide to sell a CFD based on 100 underlying futures contracts for that market.
  • Tradeview Forex quotes you a spread of $13.47/$13.49 for Yahoo (YHOO).
OPENNING TRADE  
Price of US TECH 100 is $1,280 1280
Number of underlying shares 100
Value of total position ($) 128,000
Transaction Fee $.75 per contract 75
Margin requirement @ 5% (US$) 6400

After 2 days the market has fallen and you decide to close your position.

CLOSING TRADE (2 days later)  
Price of US TECH 100 is $1,250 1250
Number of underlying contracts 100
Value of total position ($) 125,000

PROFIT (loss) ON TRADE  
Opening value ($) 128,000
Closing value ($) 125,000
Gain on position ($) 3,000
Transaction fee ($) (75)
Overall loss on trade ($) 2,925


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