A Contract For Difference (Cfd) Is A Contract Between A Buyer And A Seller That Stipulates That The Buyer Must Pay The Seller The Difference Between The Current Value Of An Asset And Its Value At Contract Time. Cfds Allow Traders And Investors An Opportunity To Profit From Price Movement Without Owning The Underlying Assets. The Value Of A Cfd Contract Does Not Consider The Asset's Underlying Value: Only The Price Change Between The Trade Entry And Exit.
In A Cfd Trade, The Trader Expects The Asset Price To Rise Or Fall. The Trader Trades The Asset With The Broker, All Without A Physical Delivery Of The Underlying Asset. When The Trade Is Closed, The Trader Experiences A Profit If The Price Of The Asset Has Risen Or A Loss If The Price Has Fallen. Traders Speculate On Price Movements. Cfd Trading Allows For Speculation On The Movements In Either Direction.
