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Advantages/Benefits of CFD Trading

Trade Tools > CFD Trading > Benefits of CFD

Advantages/Benefits of CFD Trading

Go Short or Go Long With CFD Trading

NoaFX CFD trading allows you to choose between going long (buying) or going short (selling), depending on how you think the market will react. If you expect the market to rise then you will buy, and if you expect it to fall then you will sell. When you trade CFDs then you can benefit no matter what direction the market moves if you predict these movements correctly. If you think a short term loss will occur for that market or investment vehicle then you will sell, and if the price falls then your profits will go up. If you predict wrong and the market moves against you then you will see bigger losses. CFDs offer flexibility that few other vehicles can provide.

Use CFDs as a Portfolio Hedge

If you think that your current portfolio may experience a loss in value then short selling by utilizing CFDs can help you offset any portfolio value losses. CFDs can be a great hedging tool for traders, and many individuals and organizations use these vehicles to hedge against portfolio losses. This is especially true when the markets are volatile. If you have $10,000 in XYZ company shares and you short sell this amount through a CFD trade then any portfolio loss is offset by the CFD gains that you will get.

Extended Trading Hours

NoaFX recognizes how important it is to access your account and trade when it is convenient for you, no matter where you may be. This is especially important when the markets are moving at a rapid pace. With NoaFX you have unrestricted access to your account 24/7. In addition a number of our markets operate up to 23 hours out of a 24 hour period, and these include major indices like Wall Street and the UK 100. This means CFDs can be traded even when the markets underlying them are closed.

High Levels of Leverage

Trading CFDs involves leverage, and this means that traders are only required to pay a fraction of the total value that the trade has in order to open a position. This is what margin is, and usually a small percentage of the full trade value is required up front. Leverage can help traders magnify any profits that they see, but it also means that any losses are also magnified as well. It is important that any trader understands the risks that margin and leverage entail before they take advantage of these. Independent advice should be sought if this is not the case.

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