Never lose money on shares – using CFDs, but how?
Question: Can investors/traders use CFDs to protect themselves from market losses on their ordinary share portfolios? And how? Thomas Roberts, Financial Writer, IG Markets Answer: This is an extremely relevant question given the current economic climate. After all the rate cuts, the Aussie Dollar depreciating in its currency pairs, the continuing Eurozone crisis and…
Do I get dividends from CFDs? And how does the process work?
Question: Do I get dividends from CFDs? And how does the process work? Answer: One of the attractive things about CFD share trading is that, by holding a CFD, you are eligible for many of the benefits that you would receive if you held the shares outright through a traditional means of trading. This includes…
How do I maximise returns using share price divergence?
I am happy with the pairs trade concepts but everyone seems to talk about stocks that have close /familiar relationships. Is there some advantage in associating a long positive momentum position with a short negative one even when they may come from different sectors of the same market? As an example I have recently associated…
How should I set up my margin lending account to protect against losses while the markets are so volatile?
Question: How should I set up my margin lending account to protect against losses while the markets are so volatile? Response: It is important to maintain a well diversified portfolio to weather any falls in the market , most importantly, the portfolio needs to be also diversified against different sectors in the market. This is…
Can I remove the initial cash or sell the shares and still have the margin loan sitting there?
Question: Can anyone answer my question regarding the initial cash or shares required as security for the establishment of a margin loan: Once the loan is established and becomes like a flexible line of credit, can I remove the initial cash or sell the initial share security and still have the margin loan sitting there?…
Can I use a margin loan to buy just one stock?
A Margin Loan can be utilised to purchase just one stock. However, before considering in investing in just one stock, you will need to consider how much you wish to borrow. In the case of the top 20 shares listed on the ASX, brokers can lend up to 65% of the current value of these…
How are CFDs taxed?
Search the net for guidance on how profits and losses on CFDs are treated for tax purposes, and what you can and can’t claim as deductions, and you’ll find plenty of “information,” not all of it useful and much of it misleading. Discussions in stock trading forums typify the confusion that surrounds CFDs and tax,…
When is the best time to trade CFDs?
Question: I was wondering if you could tell me the best times of the day to trade CFDs. Are there certain times of the day that breakouts would be more likely etc? Response: Knowing what time of the trading day presents the most opportunities is particularly important for day traders. A day trade has a…
What is momentum trading? And how does it work?
For the purpose of this article momentum refers to the rate of acceleration of a security’s price ie how quickly it builds up speed in terms of price. Healthy price trends tend to display strong momentum while weakening price trends often have decreasing momentum. Momentum trading aims to identify explosive share price moves for the…
Can anyone take out a margin loan, or do you need assets?
A margin loan allows you to borrow money, giving you a wider range of investment opportunities and increases your potential returns. It allows investors the opportunity to combine their existing equity with borrowed money to expand their portfolio into shares and managed funds. The three main forms of security used on a margin loan are:…
