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Back to Glossary
Instruments

CFD (Contract for Difference)

A CFD is a financial derivative that allows you to speculate on the price movement of an asset without owning the underlying asset itself. You profit or lose based on the difference between the opening and closing price of the contract. CFDs are available on forex, metals, indices, commodities, crypto, and more.

Example

You open a CFD to buy 1 lot of US30 (Dow Jones) at 39,500. The index rises to 39,600 and you close the position, earning the 100-point difference multiplied by the contract value — without ever owning shares in any Dow Jones company.

Related Terms

Forex Pair (Currency Pair)LeverageMarginCommodityCrypto CFDFuturesIndex (Stock Index)

Learn More

Markets OverviewIndices Trading

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