Providers
CFDs Trading and Brokers
When trading in global markets, specialization leads to better information and improved performance.
🔄 What is a CFD?
A CFD (Contract for Difference) is a derivative product that allows investors to trade the direction of global markets (Forex, Equities, Cryptocurrencies, Commodities) without owning any physical assets. CFDs are straightforward to trade and offer the opportunity to speculate on future market movements across a broad range of underlying assets.
- By trading CFDs, you can speculate on any financial instrument without owning it.
- Trade 24/5 in rising or falling markets, with a wide selection of trading orders.
- Access markets through a user-friendly WebTrader or the more advanced MT4/MT5 platforms.
- Choose from thousands of financial instruments (Forex, Indices, Stocks, Crypto, Commodities, etc.).
- CFD brokers typically do not charge commissions but apply a trading spread (minimum 1 pip).
⚖️ Compare Popular CFD Brokers
These are regulated CFD brokers offering segregated client bank accounts. All the companies listed have been active in the market for at least five years.
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CFD BROKER |
SAFETY OF FUNDS |
TRADING TERMS |
PLATFORMS / ASSETS |
ACCOUNT INFO |
BROKER'S INFO |
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■ TITANFX
US TRADERS: NO ISLAMIC ACCOUNTS: NO EXECUTION: ECN/STP |
REGULATION:
ACCOUNT SEGREGATION:
CORPORATE INFO: The broker was founded in 2014 and it is based in Vanuatu CUSTOMER SUPPORT:
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SPREADS EURUSD: 0.2 GBPUSD: 0.57 USDJPY: 0.33 COMMISSIONS: $7.0 per full traded lot SCALPING: YES AUTOMATED TRADING: YES SLIPPAGE: (N/A) |
PLATFORMS:
PAMM: NO DEMO: YES (Including Competition) FREE VPS: YES Welcomes scalpers and algorithmic traders ASSETS:
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MIN. DEPOSIT: $200 DEPOSIT FUNDS:
TRADING PROMOTIONS:
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KEY POINTS
Review Broker: |
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■ ROBOFOREX
US TRADERS: NO ISLAMIC ACCOUNTS: YES EXECUTION: ECN/STP |
REGULATION:
ACCOUNT SEGREGATION:
CORPORATE INFO: The broker was founded in 2009 and it is based in Belize CUSTOMER SUPPORT:
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SPREADS EURUSD: 1.3 GBPUSD: 1.4 USDJPY: 1.4 COMMISSIONS: No SCALPING: YES AUTOMATED TRADING: YES SLIPPAGE: 0.3 pip |
PLATFORMS:
PAMM: NO DEMO: YES FREE VPS: YES RoboForex welcomes scalpers and algorithmic traders ASSETS:
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MIN. DEPOSIT: $10 DEPOSIT FUNDS:
TRADING PROMOTIONS:
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KEY POINTS
► Open a Real/Demo account with RoboForex
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■ IC MARKETS
US TRADERS: NO ISLAMIC ACCOUNTS: YES EXECUTION: CFD Provider
Note: IC Markets will not allow European Traders and traders from Brazil. |
REGULATION:
ACCOUNT SEGREGATION:
CORPORATE INFO: The broker was founded in 2007 and it is based in Seychelles. CUSTOMER SUPPORT:
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SPREADS EURUSD: 0.0 GBPUSD: 0.0 COMMISSIONS: $7.0 / lot SCALPING: YES AUTOMATED TRADING: YES SLIPPAGE: 0.8 pip |
PLATFORMS:
PAMM: NO DEMO: YES FREE VPS: YES (100 round turn lots per calendar month are required) ASSETS:
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MIN. DEPOSIT: $200 for the MT4 account and cTrader accounts. FUND METHODS:
TRADING PROMOTIONS:
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KEY POINTS
► Register a Real or Demo Account with IC MARKETS
Note: IC Markets will not allow European Traders and traders from Brazil.
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💻How do CFDs work?
A CFD contract is designed to mirror the price movements of a financial instrument. This means a CFD can replicate the price fluctuations of nearly any traded financial asset. When a position is opened, the profit or loss is determined by the movement of the underlying asset’s price.
A CFD trade can be closed in three ways:
(i) If the price of the underlying instrument reaches the take-profit level (a predetermined profit)
(ii) If the price of the underlying instrument hits the stop-loss level (a predetermined loss)
(iii) If the trader manually closes the trade at any time
Example of a CFD Trade on EUR/USD (Calculating Profit/Loss)
Assume a Forex trader buys 1 lot of EUR/USD at 1.1002 and later sells it at 1.1022.
Initially, EUR/USD is quoted at 1.1000 / 1.1002 (bid/ask).
To buy 1 standard lot (worth $100,000), the trader needs about $500 in the account (indicating 200:1 leverage).
Upon opening the position, the trader sees a $20 charge, reflecting the 2-pip spread between bid and ask prices.
As EUR/USD moves 20 pips higher, the trader decides to close the position.
The new quote is 1.1022 / 1.1024.
The position is closed at 1.1022.
The profit is calculated as 1.1022 – 1.1002 = 20 pips.
A 20-pip profit equals approximately $200.
💼 CFDs and Cost of Trading
These are the main fees and commissions charged by CFD brokers that you should be aware of before opening a trading account.
(1) Trading Spreads
You can find information about trading spreads on each CFD broker’s website or through third-party services that compare spreads.
The spread is the difference between the ask and bid prices. Most CFD brokers apply spreads without additional trading commissions. The minimum spread when trading CFDs is typically around 1.0 pip on EUR/USD. A smart way to
reduce trading costs is to join a rebate program.
Be aware of re-quotes if you plan to trade intraday.
A re-quote occurs when the execution price of a trade is worse than the price you initially selected—resulting in additional cost. Re-quotes usually happen in fast-moving markets, such as during major news events. To avoid this, use pending orders (limit orders) instead of market execution orders. A limit order ensures your trade will be executed only at your specified price or better.
(2) Trading Commissions
Information on trading commissions is available on each broker’s website.
CFD brokers generally do not charge commissions, but when they do, fees are calculated on a round-lot basis.
(3) SWAPs / Overnight Financing
You can check SWAP rates on your broker’s website.
SWAP rates reflect the cost of holding a position overnight and are based on the interest rate differential between two currencies. These charges apply daily at midnight (according to the broker’s server time) and are tripled on
Wednesdays to cover the weekend. SWAPs apply 365 days a year and can be either credited or debited depending on the asset and trade direction.
For example, if you trade AUD/USD or NZD/USD, the rate difference may be positive and credited to your account. If you trade USD/ZAR, the rate difference is likely negative and will be deducted from your account.
Explanation of SWAP Rates in Forex:
Forex transactions involve buying one currency and selling another. Some currencies (like NZD, AUD) have higher interest rates, while others (like USD, EUR) have lower rates. The interest rate differential determines the SWAP:
(i) A positive difference results in a credited SWAP amount
(ii) A negative difference results in a debited SWAP amount
Note: When trading commodities or equities, SWAP charges are always negative.
TIP: Avoid paying SWAP fees by trading CFDs on Futures.
Buying CFDs on Futures eliminates daily SWAP charges, though spreads may be slightly wider. For example, trading the USD30 Index via a Futures CFD avoids overnight fees until the contract expires (usually within 2–3 months).
Futures CFDs still track the underlying asset’s price movement accurately. For swing or long-term traders, they offer a cost-effective alternative.
(4) Funding (Deposit/Withdrawal) Fees
You can inquire about these fees via each broker’s live chat support.
Some brokers may apply fees for deposits and/or withdrawals.
(5) Maintenance/Inactive Fees
Details about these fees are also available through broker live chat.
Some brokers charge a maintenance or inactivity fee on dormant accounts.
🎯 Basic Tips When Trading CFDs
Here are some key tips to keep in mind when trading CFDs:
(1) Limit your deposits
Only deposit the amount needed to cover your initial positions. Avoid depositing more than necessary.
(2) Limit your portfolio risk
Avoid using capital leverage greater than 5:1. Excessive leverage increases your exposure beyond what most traders anticipate.
Also, never risk more than 2% of your total capital on a single trade. For example, if your account balance is $10,000, limit your risk per trade to $200.
(3) Place small pilot orders
Pilot orders are especially helpful for beginners.
If you plan to risk $200 on a trade, start by opening a small test position (e.g., 0.01 lot) to measure the actual dollar loss at your chosen stop-loss level. If the 0.01 lot results in a $20 risk, you know you can scale the position up to 0.10 lots to stay within your $200 risk limit.
Alternatively, test your pilot orders on a demo account before using real funds.
(4) Trade what you know
Focus on assets you understand well. Avoid trading unfamiliar instruments, and when you do, use small pilot positions.
Professional traders often specialize in specific markets—such as Gold, Crude Oil, US30, or EUR/USD. Specialization provides deeper insight, and better insight leads to improved performance.
■ CFDs Trading and Brokers
TradingFibonacci.com
▶️ FIND OUT MORE AT TRADINGFIBONACCI.COM
COMPARING TRADING SIGNAL SYSTEMS
A trading signal serves as an indication of an important upcoming market movement. It alerts traders to buy or sell the market early in the movement.
⚙️How Trading Signals Work: The Mechanics
A trade signaling service usually operates on a monthly subscription basis. However, there are also trading systems programmed to generate trade signals using complex algorithms. These systems are typically purchased outright and can be used on unlimited MT4/MT5 accounts.
These are the basic features of trading signals:
1. Detection: Signals are generated when multiple technical indicators align—such as a Fibonacci level, RSI divergence, and a volume spike at key support or resistance zones.
2. Alert: These signals are delivered through various channels like SMS, email, platform pop-ups, or directly via APIs to brokers and automated trading systems.
3. Action: Signals provide clear trade instructions:
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Buy: Enter a long position
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Sell: Enter a short position
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Take Profit: Exit to secure gains
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Stop Loss: Exit to limit losses
✅ Example: A bullish breakout signal for EUR/USD at 1.1950 allows entry before momentum buyers jump in. Waiting until 1.2050 means potentially missing out on 100 pips of upside.