CFDs are also known as Contracts For Differences. A phrase which in its broadest sense describes any financial contract that is settled in cash, rather than via the delivery of the underlying securities or instruments, that the contract is over. The first CFDs were exchange traded futures, on stock indices and interest rates. It had been realised that many participants in financial futures markets would not necessarily want, or need to make or receive delivery of the underlying instruments. For example the individual UK top 100 shares. But rather that the participants would prefer to be exposed to just the pure economic benefits of ownership. Or in plain english to changes in the price and value of the contract.

A Great Insight

The idea sounded complicated but it was in fact quite a simple premise. Counterparties (the buyer and seller) to a trade paid each other,via the exchange /clearing house, the difference between the opening and closing levels of a trade. So for example if you were long I.E. had bought the contract and the price rose above your entry level, then you had running profit. Close that position and you would receive the monetary difference between your opening and closing prices, multiplied the number of contracts you had traded. Of course conversely if you bought the index and the price moved against you, I.E. went below your entry price. Then you would have a running loss and if you closed the position at that point, you would then owe the clearing house the monetary difference between the opening and closing prices of your trade, multiplied by the number of contracts you had traded.

Brilliant Timing

In the late 1990s it became apparent that this CFD structure was applicable to a whole range of other financial instruments. That included Forex ,Commodities, Precious Metals and more. Further that CFDs need not be exchange traded and could in fact be traded OTC or Over The Counter electronically between traders. That insight would give rise to massive growth in the popularity of CFDs as a product. Coinciding as it did with the emergence of the World Wide Web and ready access to the internet from people's homes and places of work. There was more innovation as well. CFDs were offered as leveraged products. Meaning that CFD traders could “gear up” their capital via their broker and then trade and control much larger positions than their account size would otherwise allow. Add this to the fact that CFDs allowed traders to take long or short positions with equal ease, without the need to worry about delivery or settlement and you have a winning formula. In return for the provision of leverage the CFD broker charges their clients interest on the money that they have leant to them. These charges are known as rollover swaps and are applied on a daily basis to CFD positions, held open “overnight”. Further details about these charges can be found here under CFD Spreads and Swaps .

Leveling the Playing Field

This was nothing short of a revolution as far as retail traders were concerned. The combination of internet connectivity, state of the art trading software, the flexibility of CFDs and the availability of leverage, meant that private individuals now had access to the same information and tools, that prior to this point, had been the preserve of institutional and professional traders. Retail traders could now trade in the same way that “ hedge funds” did I.E. take on long (buy) and Short (sell) positions, across multiple asset classes (Equities, Commodities,Forex and Metals) and use leverage to magnify their resulting profit or loss profile. Of course access to such sophisticated strategies and or the means to create them, meant that retail investors had to take the time to learn about the markets and their relationships with each other. About how leverage works for and against you. As well as familiarising themselves with the functionality of their trading platform.

Help Is At Hand.

That's quite a learning curve (but then every day in the markets is) but it is not an insurmountable one. Particularly when you are offered the right support in the right environment. In fact Blackwell Global offers its clients access to dedicated resources that are specifically designed to help them learn about and familiarise themselves with the financial markets. These include a free Demo Account in which clients interact with the markets in a highly realistic simulation of live trading. But without risking any real money. Clients can open and close CFD positions, place pending CFD orders, create CFD price charts and develop their broader CFD trading strategy risk free. Blackwell Global also provides its clients and prospective customers with access to trading guides, such as this CFD starter kit. Alongside regular research and analysis from both inhouse and external analysts.

Plugged In

As we noted above CFDs are today mostly traded OTC (or over the counter) electronically between the counter-parties to a trade. To participate in this electronic marketplace you need access to a brokerage account and trading software. Blackwell Global has just such a platform in the shape of Blackwell Trader MT4 The platform displays real time prices for all CFDs and Forex pairs and crosses, offered by Blackwell Global. It comes pre-loaded with sophisticated charting tools and indicators. Many of which can be applied to CFD trading strategies. Why not register for and download our free CFD starter kit and a free Demo CFD Trading Account to find out for yourself just what CFDs are and how they could work for you as part of your investment strategy.

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CFDs or Contracts For Differences and margin Foreign exchange are by their nature geared or leveraged products. That is the provider offers its customers leverage on the accounts they open to trade these products. Leverage ratios may vary by product, or as here at Blackwell Global by account size and clients will need to maintain a minimum amount of cash and free equity to operate their account. However clients can minimize the amount leverage that are exposed to or utilise when trading CFDS or Forex.

Just Ask

The first thing you can do if you would prefer not to trade on a highly leveraged basis is ask your provider to reduce the margin level they have allocated to your account. If they are able to vary the leverage at an account level, then they should be a happy to do.

Manage Your Risk

The second course of action you can take is to follow a disciplined approach to your own risk and money management and to apply this discipline to every trade you make .To do this you will need to gain an understanding of the contract sizes and margins for each of the products you trade or intend to trade, because you will need to relate this information back to your account size and available resources. To put it another way in order to trade Forex and CFDs with minimal or no leverage you will need to ensure that your total exposure is less than the free equity or better still free cash on your account. So if you have a $10,000 on your account and wish to trade leverage free. The maximum total exposure you should allow yourself is $10,000 or other currency equivalent of underlying value.

Caveat

There is a caveat here - because whist it should be possible to define your risk / exposure when trading on the long side - where the maximum loss you could suffer would be the difference between your entry price and Zero, multiplied by your trade size. But if you are trading on the short side, you face a theoretical open ended exposure or risk of loss. Because there is no upper bound or maximum value that the price of the instrument, we are short of could reach. Of course this is true of nearly all short positions leveraged or otherwise, but is a factor that we must take into consideration.

Stop Losses

One way we can seek to limit our exposure and by extension our use of leverage is through the application of stop losses. Stop loss orders set a floor or cap on the amount of risk you are exposed to. For instance if we are long of $5000.00 worth of an underlying instrument and you place a stop loss 10% away from the trade entry price, then your maximum theoretical loss would be $5000.00 * 10% or $500.00. I say theoretical because the stop loss order, as when and if it is triggered, will be executed at the next available price. In adverse or illiquid market conditions however that price could be very different from the stop out level that was nominated. Which would therefore increase your maximum potential loss, through a process known as slippage.

Risk versus Reward

The reason that CFD and Forex traders like to use leverage is because leverage has the potential to magnify the profits that they make. It also allows them to trade from a smaller capital base or to take on a larger number of positions than they might otherwise be able to do. Of course leverage can just as easily magnify trading losses.This is part of the trade off between risk and reward. In general it's accepted that higher risk should be accompanied by a higher reward. This concept is not cast in stone but it should be a building block of your trading strategy. You should build a favorable risk reward ratio of at least 2:1.Such that you can profit by at least twice the amount you risk in every trade you open. If we adopt this risk & reward based approach then we should have fewer problems in managing our exposure and therefore our use of leverage.

A Loss Greater Than Your Deposit

However if we use undisciplined approach to trading Forex and CFDs we could quickly find ourselves on the other end of this equation. If for example we have taken a position which is “too large” for our account balance we have severely limited our ability to absorb running losses or if you prefer to maintain the required margin or deposit to support the position. The larger the underlying position relative to the free equity / free cash on our account then the smaller our tolerance to a running loss is. If the size of of our underlying position is greater than our free equity or free cash balances then we are, by definition in a leveraged trade. The bigger this multiple is, then the smaller the price move required to take us initially to a margin call situation and then to a stop out. Whilst brokerages such Blackwell Global operate a strict margin and stop out policy in order to try and prevent negative equity . As we noted above, illiquid and adverse market conditions can result in slippage and or gapping in price formation and therefore to losses that are larger than anticipated. In a worst case scenario, with a highly leveraged account your losses could significantly exceed your deposit and you would be liable for the balance.

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This a question or comparison that often crops up when people are deciding what to trade. People usually lean towards one side or the other and their decision is probably influenced by the factors that got them interested in trading initially. Perhaps this was a conversation(s) with friends or family members. Or a documentary, book or or article that they came across about the markets, which piqued their interest. Having made their decision they are unlikely to change direction easily. But as they grow as a trader they may come to take a more holistic approach. For the purposes of this discussion let's assume that the reader is interested in trading but has no immediate preference for either candidate. That being the cases let's look at the credentials of each of them.

Forex

The Forex market is the world's largest financial market by turnover, according to data compiled by the central banks banker the Bank for International Settlements or BIS. More than US $5 trillion worth of Foreign Exchange or Forex is turned over each business day..This is a phenomenal amount of money ! To put this into perspective the daily turnover in Forex is approximately equivalent to 10 times the combined wealth of the world's 10 richest individuals. The weekly figure of US$25 trillion is the equivalent of 1.5 times the annual GDP of the USA. The monthly turnover figure of U$100 trillion is considerably in excess of the total market cap of all the stocks listed on Global Stock Exchanges,which is around US$70 trillion. I think you get the idea. Furthermore the Forex market operates 24 hours a day, 5 days a week, as trading seamlessly moves across Asia, Europe and the Americas. Once inaccessible to retail customers the advent of online trading and direct market access, democratised Forex trading and the introduction of cash settled Contracts For Differences in Forex opened up the market to all investors and traders. As it steered retail trading away from the credit line driven, deliverable trading, conducted between banks and other institutions. Flexible deal sizes and smaller accounts are some of the other attractions that Forex trading offers to retail customers.

Stocks

Though the need for a medium of exchange to facilitate cross border commerce is as old as human civilisation. It is the stock market that can lay claim to being the oldest of the world's organised financial markets. The Dutch East India company established in 1602 was the world's first joint stock company. The immensely successful venture opened up and capitalised on the international trade in spices alongside other exotic commodities and food stuffs. Setting up operations across what is now modern day Indonesia. The idea of raising capital for new ventures, or to expand existing ones caught on. Particular in the United Kingdom as it went through the industrial revolution and then, later on in the USA, as it consolidated into single country, as opposed to a series of separate states and territories. There are stock exchanges right across the developed world today and many in developing economies as well. There are approximately 16 stock exchanges globally where the companies listed on them have a combined a market cap of US$1.00 trillion or greater. More than 43,000 companies are listed on stock exchanges across the globe, according to data from the World Bank. Trying to choose between 43,000 instruments, in which you could trade is a bewildering prospect and so some of kind of selection or filtering process is required.

Stock Indices

One such process in the idea of indexation. Whereby the performance of the largest companies, or those that meet other specific criteria, are pooled together to create a benchmark. That will track the performance of the group as a whole and by extension reflect the “mood “ of the broader market. The innovation behind stock indices came from the financial press. US newspaper publisher the Dow Jones Company created the world's first notable stock index in 1884. This would evolve into the thirty share index that is so familiar to traders today. In the modern world there is an increasingly wide variety of stock indices. Here at Blackwell Global we offer clients access to and the ability to trade in more than 10 of the most important stock indices from across the globe. What's more we offer these indices as Contracts for Differences or CFDs. Which are cash settled and non deliverable and which confer all the other benefits and opportunities associated with trading CFDs on a margin basis. For details about our products please see here and here

Practicalities

As we have already noted people tend to trade what they know, are attracted towards or understand. So for example if in your day job you are involved in the tech or social media industries you may have an affinity with and understanding of technology stocks and the drivers of their share prices. If so, you may like to trade the US 100 stock index CFD which tracks the performance of the top 100 US technology stocks. Conversely you may have lived and worked abroad and seen first hand, the difference that fluctuating currency rates can have on the cost of living and your effective salary. In these circumstances you might well be drawn towards Forex trading.

Other considerations

There are other considerations to take into account when deciding what to trade. Not least of which is when will you be able to trade. If the answer is not until I finish the “9 to 5” then trading the local stock market or stock index is probably not going to work for you. As you will miss the majority, if not all of the trading session on local stock exchanges. Of course you could trade US stock indices from after 5 pm until the close of business in New York. Or get up at a fiendishly early time in morning, to trade Asian stock indices before work. But that is probably something you want to be doing long term on top of a full time job. The 24 hour a day nature of the Forex market offers more flexibility here and rather than having to focus on hundreds of individual stocks and their performance, you can trade the half dozen or so FX majors. Or just two or three of the most active pairs, such as Euro Dollar, Dollar Yen or Cable, as Sterling Dollar is known. When these are combined with commodity centric currencies such as the Australian Dollar you get a fairly comprehensive global exposure.

Both sides of the coin

Stock Indices on the other hand allow for more targeted approach to trading, and to be able benefit from the opposite side of a trade. For example, the fall in the value of Sterling against the US Dollar, in the wake of Brexit referendum. Was ultimately beneficial for the value of the UK 100 stock index. Which rose sharply in the weeks that followed the vote. This was because its constituent stocks are mostly exporters and the fall in the value of the Pound Sterling made their products cheaper to foreign buyers. If you spotted that opportunity you could have sold the GBP USD Forex pair and bought the UK 100 stock index. Of course you would still have had to have to get the timing of the trades right. But if you did, you would have benefitted from moves on both sides.

Open minded

I think that last example serves to show that you should not be too dogmatic about the instruments you trade and that you should try to adopt, or be open minded about, a holistic approach to trading. Because if you don’t have that the you may be missing out on a significant percentage of trading opportunities that present themselves . The good news is that Blackwell Trader MT4 is a “one stop shop” for trading Currencies, CFDs on Stock Indices, Oil and Precious Metals. The platform is offered free of charge and comes in desktop and mobile variants. Its packed with high quality charting tools and indicators and a single login works across all of the qualifying devices. Why not take a closer look today ?

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This question should probably read which Forex trades should I make today? Because one the principal attractions of Forex and CFD trading is the fact that they offer traders the ability to trade long (buy) or short (sell) with equal ease. Allowing them to take advantage of trading opportunities, in both directions, as and when they present themselves. But, however we word the question, as with all things related to the Financial Markets, there is not one hard and fast answer. Not least because each day in the markets presents its own challenges and opportunities, whilst each trader's mindset, circumstances and trading strategy will also vary.

Momentum

One approach that we could adopt might be to let the market tell you what to trade. What this effectively means is to let momentum (price action) guide you. For our purposes here let's assume you are based in Europe or trade the European session. Remember that Forex trading takes place within a 24 hour a day, 5 day a week market. But within each trading day there are said to be three distinct sessions. These are the Asian, European and US sessions. As the business day in one region moves into the afternoon and towards its close, so the next region opens for business. In this way the markets overlap to form a continuous trading and liquidity infrastructure. The European, or London session (for that's what it really is) straddles the later part of the Asian session and the opening of the American markets. Given the Global Macro nature of FX trading (Forex markets are often affected and driven by data and news flow that is “ top down” or Macro and Global in nature, rather than localised or “Micro” or bottom up) Then the price action trends or momentum, that have shown themselves in the Asian session, may continue into London trading. And because more than half of each days global Forex volume can be traded in London, those moves may even accelerate during this session. For example research from the Bank for International Settlements (or BIS) shows that a large proportion of Yen trading and by extension therefore Dollar Yen trading, can take place outside of Japan and the Asian session. So price changes in Dollar Yen, that create an upward or downward trend, during the Asian session, could gain additional momentum in London trading.

Contra Views

Looking for, identifying and joining these trends in the Yen, or other Asian pairs and crosses, is one way to answer the question posed at the top of the page. Of course we can't just assume that what started in Asia, or indeed any other session, will automatically continue into subsequent sessions. Indeed some traders will take the view that that these type of trends may in fact lose momentum, or if you prefer run out steam. As the trading day progresses and they move farther away from their home markets. These traders contrarian strategy would be to oppose the trend or more specifically to look for confirmation that the trends momentum is fading and then oppose it.

Lines in the Sand

Another approach to picking out what to trade on any given day might be to look for prices that are approaching “ lines in the sand”. For example horizontal support and resistance, or indeed session or period highs & lows. A break of, or failure at one of these key price levels could be the just the kind of call to action that traders are looking for. As they can inform their trading and give them a price point or levels to base a fresh position around. For example, a retest to an area of horizontal resistance, that was in play for several weeks earlier in year. (Particularly if it remained intact during that period) presents a really interesting opportunity. If the current price tests to this resistance, but fails to make further headway. Then logic suggests that this testing and rejection could signal a selling opportunity. Whilst if the price moves above the historic resistance or high, sustains that move (and in an ideal world prints higher still) then we have the makings of potential breakout to the upside.

Other Measures

Forex traders are famous for their use of indicators, which they usually deploy in conjunction with price charts. There are quite literally hundreds of these indicators but they largely all serve the same purpose. Which is to highlight the points where price action could change direction or under certain specific circumstances over or under shoot. One of the most popular indicators, particularly amongst those that are relatively new to trading and or technical analysis, is RSI or the Relative Strength Index. This indicator compares the characteristics of current price action to those of historic price action. In doing so the indicator endeavours to show traders when a price is exhibiting overbought or oversold behaviour, from which it could well correct. To do this the indicator sets upper overbought) and lower (oversold) boundaries, within the maximum and minimum indicator values of 0 &100%. These boundaries are set at readings of 70% and 30% respectively and the indicator plots a line between these values. That line represents the current price in ratio to the historic price period. Usually a rolling calculation of 14 prior periods, be they days, hours or minutes. Traders might choose to open a trade as the RSI indicator line approaches the respective overbought (70) or oversold (30) boundary. Particularly if the move to the RSI boundary coincides with a test, by the underlying price, of support or resistance levels or of period highs and lows. Note though that indicator line can move through the upper or lower boundaries without the underlying price correcting and that RSI readings vary depending upon the duration of the periods being measured.To the extent that a 1 minute RSI reading may suggest a price is oversold whilst the daily measure could indicate a price remains overbought. Which signal you choose to follow will depend on your trading style and time horizons.

Data driven

Of course you may prefer not to use Technical Analysis at all to generate or identify trade ideas. But prefer to rely on Fundamental Analysis instead, as many traders choose to do.The good news is that if you do adopt this approach there will be plenty of potential trading opportunities for you. Remember that we noted above that Forex is driven by Global Macro data. That is big picture, top down news and information. Much of this Macro information comes in the form of economic data releases that track the performance of key metrics within an economy or groups of economies. Many of these data points are common to both the developed and developing economies and are calculated using the same methodologies. Which means that direct comparisons can be made between the data for various currencies / countries. What is more, this data, is for the most part, released in an orderly fashion at pre-announced dates and times.That information is collected and displayed in an economic calendar, which Blackwell Global clients can access for free here. The data releases are also classified in terms of their expected market impact. From high to low and the calendar can filtered by this metric, as well as by individual currencies. So for example if you are only interested in upcoming “high impact events”, in three or four FX majors. You can set the filters for this and exclude all other events from the calendar view. Previous data points and where available, a consensus forecast for the upcoming release are also displayed. Armed with this data users can literally trade the calendar. Though of course a correct interpretation of what the data release really means for price action is essential. It’s important to note as well that liquidity may be reduced and volatility heightened around major news events. Such as Non Farm Payrolls (US unemployment data) and key central bank meetings, as many market participants move to the sidelines for a few minutes before and after the data release. Whether you utilise Technical Analysis and indicators or follow data driven Fundamental approach to trading one of the best ways to refine your strategy, before you trade it in the live market, is via a Demo Forex trading account .This offers users a risk free, yet highly realistic simulation of the live trading environment. Once you have honed a strategy that works for you. You can apply for Live trading account, make a deposit and start to trade for real.

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As we discussed in our article “What are CFDs and how do they work ? “ CFDs were first developed as part of the evolution of Financial Futures markets. But in the decades that have followed their creation, the protege could be said to have eclipsed its creator. In this article we will look at what makes CFD trading such a popular alternative to trading Futures.

OTC

One of the main drivers of the growth in CFDs was the fact that they could be traded OTC or Over The Counter. As opposed to being traded via an exchange, as is the case in traditional Futures trading. Whilst that is much less of a distinction in today's all electronic markets. At the outset of CFDs this was a big deal. Because it meant that CFD prices could be created and disseminated by the contract provider in real time. Rather than relaying an essentially delayed or indicative price from the trading pits on various exchanges, as was the case in Futures trading at the time.

Direct Market Access

Because CFDs could be traded OTC in real time, at prices generated by the CFD provider. They were the perfect candidate for electronic trading and DMA or Direct Market Access. A process through which clients trade directly with the market via trading software, without any intermediation, unless specifically requested. The internet and specialist trading software connected CFD traders from their homes and offices and ultimately anywhere they found a reliable internet signal. Futures markets would eventually evolve into electronic exchanges and mouse clicks replaced face to face,open outcry trading. But the Futures exchanges were and still remain, largely focused on their traditional institutional, wholesale and professional customers. And not on the needs and requirements of the retail investor. A niche that brokerages such as Blackwell Global sprang up to fill.

Standardised, Not Flexible

Futures exchanges were by and large created to service the needs of Producers and large scale Consumers of commodities and agricultural products. Both of these groups wanted certainty around the price, the quantity and quality of the commodity traded. As well as the timing and location of its ultimate delivery. Standardised contracts, that were traded on a monthly or quarterly basis, which controlled a known amount, of a specified quality of the underlying. That had to be delivered by a fixed date, at a specific location, met these requirements perfectly. And though the advent of Financial Futures in the early 1970s moved trading away from the Producer and Consumer relationships of the past. It did not change the Futures exchanges focus on the wholesale end of the market. Contract sizes remained broadly fixed and were usually far too big for most private individuals to even consider trading.

Long or Short

Because CFDs were and are Contacts For Differences and are therefore settled in cash and not the delivery of the underlying instrument, which the contact is over. Users do not need to have delivery arrangements in place. Nor do they need to have access to a supply of the underlying in order to sell a contract on that instrument. In Futures markets, particularly in Commodities and Metals, traders need to be able to demonstrate they can take or make delivery of say Crude Oil or Gold, at the locations specified by the exchange or clearing house. True these services and facilities are usually provided by Futures brokers or their clearing agent. But they are provided at a cost and are subject to the rules and policies of the relevant exchange and clearing house. CFD traders do not need to consider these matters for one second as the contracts they trade are non deliverable. Instead they can focus solely on their trading and money management strategy and getting that right.

Simpler Pricing

As there is no delivery in CFD trading, just settlement in cash between buyer and seller. It also follows that there is no real need for multiple prices for each instrument, that clients need to keep an eye on, unlike Futures trading. For example a leading US Futures exchange is currently offering 14 or more separate delivery months and associated prices on its US Crude Oil contract. This is just the kind of thing major Oil Producers and Consumers, who need to hedge their exposure want to see. But for retail traders and others that are purely interested in near term price movements, this information is likely to be a distraction and just so much market noise. Blackwell Global offers it clients a single rolling spot price on its US Crude Oil CFD contract.This means you have just one price and one chart to watch in US Crude Oil. Though in truth you will likely want to keep an eye on the price of UK Crude Oil and the US Dollar as well, as and when you are trading Crude Oil CFDs. Because CFDs are open ended contracts, without any fixed expiry date. Their pricing is also often more straightforward, than that of monthly or quarterly Futures contracts. Futures contract prices are calculated inclusive of the cost of carry to their expiry date. Put another way they are priced to reflect the cost of borrowing the funds necessary to hold the assets that make up underlying contract, until the day on which it expires. So for example the cost of holding a Futures contract for one month, will usually be less than that for holding it for three or six months into the future. This is one of the reasons that creates a differential in the price of far month contracts, over nearer delivery months, within Futures trading. In CFD Trading the financing or cost of carry is calculated and charged on rolling basis. But only if you hold those positions overnight. Intra day traders do not pay financing charges on their CFD Trading.

Smaller Deal Sizes

At the beginning of this article we noted that CFDs are today mostly traded OTC or Over The Counter and that their prices are calculated and distributed by the CFD provider. In effect it's their price rather than an exchange's price. The ownership of that price means that the CFD provider can also set the parameters of trading in that contract. One of these parameters is the minimum deal size. We also noted earlier that Futures exchanges and their contracts evolved to serve the needs of the wholesale markets and institutional customers, which they largely still do. For example the lot size (or standard minimum deal size) for one of the world's most popular US Crude Oil Futures contracts is for 1000 barrels of Oil. Whilst Blackwell Global's US and UK Oil CFDs have a minimum size of a 1 /10th of standard lot or just 100 barrels of Oil. This is just another example of the flexibility that CFD trading offers when compared to Futures trading.

Availability of Leverage

Both CFDs and Futures are leveraged products. That is to say that traders place a deposit or initial margin on each trade and post variation margin as required, to meet any running losses during the lifetime of a trade. But this is another area where CFDs offer more flexibility than their exchange traded peers. The leverage or margin level for a given Futures contract / delivery month and is set by the relevant exchange and or clearing house. This margin rate will apply to all participants. The phrase margin refers to the deposit per lot that a trader must lodge to open and hold a position. Such that a margin requirement of say 20% implies a leverage ratio of 5 : 1. That is 5 * 20 = 100. Margin requirements per lot on the leading US Crude Oil Futures contracts are, at the time of writing circa $2800.00 per lot. which is equivalent to an approximate leverage ratio of 17:1. In CFD Trading the margin or leverage levels and their application are set by the CFD provider. At Blackwell Global we set our margin levels based on the client's account size rather than the individual products they are trading. Blackwell Global offers margin ratios of up to 400: 1. * *For further details about leverage & account operation please see Account Overview. What's more if a client decides they would like to trade with us using a different level of leverage to that which is allocated to them, they can request to do so. Remember though that leverage, wherever it's applied is a powerful trading tool. But is one that cuts both ways. It can magnify trading profits but it magnifies trading losses just as well. Please ensure that you fully understand the risks involved before you engage in any form of margin trading. To see the benefits that CFDs offer to traders for yourself why not register for a free Demo Trading Account with which you can experience highly realistic simulated trading without risking any of your capital. When you are ready you can apply for a Live Trading Account make a deposit and trade the markets for real.

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