Hedging your losses, and making profits, using CFDs
Not everyone lost money in the past couple of weeks of market gyrations. Plenty made tidy profits short-selling CFDs on stocks or indices they guessed would be sold down as the market over-reacted to the bad news on sub-prime mortgages. Others used CFDs to protect the value of their existing share or CFD holdings. Harley…
Trading CFDs full-time
Full-time traders used to be slick young traders on too much coffee who traded big sums for the big banks. Today, full-time traders come from all walks of life such as Newcastle-based mother of two, Justine Pollard, who trades Contracts for Difference (CFDs) from home. CFDs are criticised by many commentators as being too risky…
Battle of the CFD providers
The Australian contracts for difference (CFD) market is estimated to be worth up to $400 billion – not bad for a market that did not exist six years ago. But this very lucrative market is being competed for by providers of two different CFD trading models – the market-maker model, and the direct market access…
How to trade CFDs without losing your shirt
Trading is a great occupation if you don’t lose money doing it. Once losses are made – and start to pile up – trading can begin to lose its appeal very quickly. Amateur traders who try their hand on Contracts for Difference (CFDs) can find that a small loss can escalate into a more serious…
How to trade CFDs without losing your shirt
Trading is a great occupation if you don’t lose money doing it. Once losses are made – and start to pile up – trading can begin to lose its appeal very quickly. Amateur traders who try their hand on Contracts for Difference (CFDs) can find that a small loss can escalate into a more serious…
$65,000 in a week trading CFDs
Will Kraa recently enjoyed a stellar run trading CFDs – pulling in $65,000 in just one week. Kraa, a former teacher and avid trader for the past six years, isn’t new to the sensation of multiplying his money trading CFDs. Back in 2003 when Kraa first tried his hand at the highly leveraged derivative, he…
Can you please explain how instalment warrants are priced?
A number of factors are taken into account when determining the price of an instalment warrant. Not only are there pricing components to consider, but influences affecting price movements also need to be factored in. Let’s look at the four components which make up the price of an instalment: 1. Capital component this is equal…
Why buy an instalment warrant instead of a share?
What are the advantages and disadvantages of buying an Instalment Warrant rather than just buying a share? Response: Instalment warrants are listed securities which trade on the ASX and each instalment warrant evidences a beneficial interest in an underlying security. Instalment warrants enable investors to acquire the underlying share by paying “instalments” over time. An…
What are the pros and cons of instalment warrants
Instalment Warrants are listed securities which trade on the ASX and each Instalment Warrant evidences a beneficial interest in an underlying security. Instalment Warrants enable investors to acquire the underlying share by paying “instalments” over time. An amount is payable up front to acquire the warrant and a final optional instalment is payable if an…
Why do futures prices converge on spot prices during the delivery month?
Prior to expiry, the price of futures contracts will most likely either be at a premium to the physical or a discount. As the contract approaches expiry these two prices will converge, or meet. Why does this happen? There are a number of factors involved here; one of the main reasons is what’s called cost…
