CFD Trading Online: Play the Market from Home


CFD trading onlineCFD trading online is a major industry in itself. While CFDs have always been a valuable source of income for clever players in the financial sector, modern IT means that all kinds of people are learning to trade CFDs from their own homes.

What does CFD trading online involve?

A contract for difference allows traders to speculate about the value of shares in the future and to stake money on their predictions. CFDs involve buyers and sellers; the buyer offers to buy the shares from the seller (the CFD provider) in the future at their current value. If the value rises then the seller has to pay the buyer the difference between the original value and the current value. This kind of CFD is called ‘going long’.

It is also possible to ‘go short’ if a trader thinks the value of a share is going to fall. In that case the trader ‘sells’ the share at the original value; this means that the CFD provider has to pay the difference between the original and current values.

Do CFD traders own the shares they buy and sell?

No, CFD traders don’t literally buy and sell the shares they speculate about. The CFD provider always owns the shares in question; the CFD trader stakes their assets on the value of the shares but never actually buys or sells them.

How do I start CFD trading online?

The first step is to get in touch with a brokerage. Be wary of new, unknown brokers; unfortunately the world of Forex and CFD trading is home to its fair share of scams. Once you’ve opened an account your broker will provide you with the software you need to trade. CFDs are a high risk game; when starting a new career it’s always a good idea to take your time and discuss the fundamentals with an experienced professional.