What are CFDs

What are CFDs?

CFD comes from the English acronym Contract for Difference.
CFDs are simple, inexpensive contracts that allow trading on a broad range of financial instruments, trading on the difference of the value of a specific security or underlying security that matures from the date the contract is stipulated to the date it terminates.

Equity CFDs

CFDs on Shares are a simple and convenient way to invest in the stock market*, also called equity market, where company stocks (shares) are traded. They reflect official market prices and allow the investor to speculate on those markets using leverage and without the need for ownership of the underlying security.
They allow a trader with a LONG position to receive any dividend earned from the equity security to which the CFD is linked. Additionally, they ensure the right to adhere to any TAKEOVER BID, as well as to participate in an increase of capital.

See the page trading example for more information on how CFDs function.

What are the advantages of trading with CFDs?

CFDs allow bidirectional market operability, i.e. they allow long and short positions, obtaining profits even during bear markets.

Through margin and leverage, a smaller part of the value of the underlying security on which you are trading is sufficient, thus allowing more capital to be traded than is available, extending any results (both positive as well as negative).

Trading using CFDs means the trading of contracts on the price differences: Profits are earned or losses generated based on the difference between the purchase price and the sale price of the underlying security, multiplied by the number of CFDs on shares.

We encourage you to review the section margins for more information on SwissCayTrades’ system of margining and the commissions applied, where you can find all of the information required for your trading.

Margin and leverage

Equity CFDs are leveraged products, meaning the trader is required to pay only a fraction of the overall value of the transaction.

For example, if the margin required on the CFD of Eni stock is 5%, it is possible to trade with a leverage of 1:20, buying Eni stock amounting to 20,000 Euro with just 1,000 Euro of margin.

CFDs are derivatives that can be extremely risky because they are leverage tools. They are therefore only available for expert clients who have sufficient resources to be able to trade this type of financial instrument.

Trading guidelines

All our transactions are structured like a CFD; therefore they are cash settled and do not result in the delivery of the underlying shares.

CFDs on shares are available on the MT5 platform; to access them please send your request via email to: [email protected]

CFDs on shares are offered for the SwissCayTrader.

Trading hours of stock exchanges

Italian Stock Exchange:09:00 – 17:30 (CET)
English Stock Exchange:09:00 – 17:30 (CET)
French Stock Exchange:09:00 – 17:30 (CET)
Spanish Stock Exchange:09:00 – 17:30 (CET)
Belgium Stock Exchange:09:00 – 17:30 (CET)
Portuguese Stock Exchange:09:00 – 17:30 (CET)
Dutch Stock Exchange:09:00 – 17:30 (CET)
German Stock Exchange:09:00 – 17:30 (CET)
US Stock Exchange:15:30 – 22:00 (CET)

(*) In compliance with regulatory provisions.