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Benefits of CFD Trading

Increased leverage
By using CFDs you are able to control up to 10 times the stock compared with an outright purchase. This higher gearing creates greater profits if you correctly anticipate movements in the stock price, however the risk of loss also increases proportionately if the stock moves against you.

No stamp duty*
In some jurisdictions share trading attracts stamp duty however because no physical stock transaction takes place there is no stamp duty payable on CFD transactions under the current legislation. This creates opportunities to day trade stocks without the need to cover the cost of stamp duty.

Easy to sell short
In many jurisdictions it is a complex and difficult process to go short in an individual share. CFDs create the ability to sell quoted shares and the potential to benefit from share price declines.

Risk Management
You have the ability to protect a multi-national portfolio against short-term market falls by selling sufficient CFDs to cover your exposure. If the CFDs are bought back after a decline then the profit achieved should offset the loss incurred on your portfolio.

*UK Tax laws subject to change.
 

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Futures, CFD, Margined Foreign Exchange trading and Spread Betting carries a high level of risk to your capital. A key risk of leveraged trading is that if a position moves against you, the customer, you can incur additional liabilities far in excess of your initial margin deposit. Only speculate with money you can afford to lose. Futures, CFD, Margined Foreign Exchange trading and Spread Betting may not be suitable for all customers, therefore ensure you fully understand the risks involved and seek independent financial advice if necessary.

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