Have you been looking for financial freedom in your life? Then look no further because the best way to get there is to trade CFDs. No matter what market conditions are currently around the world, there are always great opportunities out there in financial trading. With low volatility, high leverage and high liquidity, the potential returns when you trade Contracts For Difference are absolutely astronomical. In this article, I'll talk about why CFD trading is the single greatest investment vehicle so that you'll have the confidence to start trading immediately.
Why trade CFD? There are a number of reasons and it all depends on what your personal objectives are. Some of the reasons why it's so popular is because there are no clients or suppliers to deal with and no customers to worry about. It's just you, your computer (or mobile device), your online CFD broker and the market itself. To be honest, when I trade CFD, the toughest aspect to manage is actually myself. My emotions, behaviors and greed are at times much harder to control than any client or customer. Obviously, trading is a skill that develops over time. As soon as you master your own emotions and become disciplined, it's very easy to make money and become a very successful.
Aren't there huge risks when you trade CFDs? Of course there are but that's only if you trade blindly and don't follow certain rules. A rule of thumb in CFD trading is to only put up 1-2% of your capital (known as margin) and use leveraging to make greater returns. For example, when you put up 1% and leverage it by 100 times, all it takes is small movement in the market (depending on the market) to make 100% or more profit. How great does that sound? The real test actually comes after you've made your first profit. At this point, people quite commonly put up more capital (often far beyond 2%) and take bigger risks. There's nothing wrong with this, just as along as you're aware of the risks involved and have stop losses in place.
Some of you may be asking "why should I trade CFD as opposed to stocks"? For one thing, stocks are very volatile and by comparison the CFD market has very low volatility. The market is far too large and liquid for it to have the drastic market fluctuations of stocks and other assets. Remember, these are markets for every nation or region around the world. So it would take something huge to move the price of a nation's market, such as a change in interest rates. Whereas in the case of stocks the slightest news, rumors or misconception can easily cause stock prices to drop dramatically. The advantage is you wont get that type of stress and anxiety when you trade CFD. The other benefit CFD has over stocks is that it's available to trade 24 hours Monday to Friday, while stock markets open and close everyday (closed on public holidays and weekends).
So in a nutshell, it's actually quite safe and very convenient to trade CFDs. It's one of best investment vehicles out there, whether you're after capital gains or extra income because of the greater potential returns. As we all know, the only obstacle in trading is ourselves and getting ourselves to take action is the first step. Usually the best way to start is either paper trading or putting up a few hundred dollars to test the waters.