COMPARISON OF THE ADVANTAGES OF THE TRADING CFDS WITH CLASSICAL COMMODITY FUTURES



In the frame of trading CFDs you can trade with the instruments on stocks, futures stock indices and the most liquid commodities. Basically we are speaking about Online trading at the electronic exchange with the real data. The trading is there realized without any brokers´ charges. Software, data, quotations and charts with the possibility of the technical analysis are free of charge! You can trade with smaller accounts, distinctly lower margins and 5-10 times bigger leverage than at the classic futures accounts! Trading there is beyond compare easier, online trading platform has the best tools for risk management (orders Stop, Limit, Trailing stop, orders management, realization of the stop and limits without any slippage etc.)  

This trading online with 5-10 times bigger effectiveness is absolutely the best way for the scalpers and hedgers at the financial markets. You aren’t thinking out complicated selection of the assets, contract months, expiration, rollovers, brokers´ charges and many other difficulties. You can focus solely on your financial speculations! Using one platform you can trade not only the most valuable stocks of the USA, Europe, Asia, the most liquid commodities like crude oil, natural gas, gold, silver and others, but the cross currencies at the Forex too.

 

Moreover it is the only one trading, where you can learn free of charge on Demo versions with real data from the exchange, where you can try Live trading on the live mini accounts! Together with the usage of the software for effective money management you can learn this business safely and start your performance in this profitable Online business! In the following table you can see some selected comparison characteristics of the trading assets in the frame of CFds and Futures.

 

 CFDs  Futures
Selection of the Assets   The selection of the most liquid commodities and stocks from huge amount! 12 the most liquid stock indices, approximately 130-140 stock titles USA, Europe, Asia. 13-15 the most significant commodities, 20 cross currencies which represent more than 90% of the overall liquidity and financial markets!  On the trading platforms is usually the selection of 150-250 commodities in the all contract months. The offer is particularly addressed to hedgers, who need it. Complicated selection for the scalpers....Stocks are inaccessible.
Liquidity The most liquid markets all over the world, very quick execution of the trading orders, minimum limit movements etc.  Sometimes problematical and limited liquidity.
Margin Requirements Low, Standard accounts approximately 500,- USD/lot, Mini accounts 50,- USD/lot (stocks in similar relations)
Absolutely without any competition!
 High at very liquid and attractive commodities
Charges Trading on so called spread as well as at Forex, without any charges. Possible overnight carry charges (very low with regard to the effectiveness of the trading).  Sometimes spread, always charges for the contract 10-30 and more USD! Rollover charges!
Contract Roll-over

Automatic, without any charges! It means you don’t have to choose contract months with different liquidity; you don’t have to watch over the expiration dates and the delivery, rollover charges. Trading is from this point of view easier.

It is necessary to choose contract months with different liquidity, the necessity to watch out the data of expiration and delivery, rollover charges, trading is more complicated...

Minimum Recommended Size of the Account in USD

Mini account from 500 USD
We recommend from 2 000 to 3 000 USD.

Standard account from 2000 USD
We recommend from 5 000 to 10 000 USD and more!

Minimum 5-10 000 USD, but generally 15-20 000 USD, for real and safe account management is the minimum 20 000 USD! 
Execution of the Trading Orders

  • Very quick, generally seconds - tens of seconds, minimum price slippagepage.
  • Guarantee of the filling of Limit and Stop Limit!
  • Linkage of the orders with contracts without any time limits
  • The function of the Trailing stop
  • Using of the orders Limit and Stop for trade management too

 

  • Telephonically – menace high price slippage, generally very problematical
  • Electronically – sometimes the delay because of worse liquidity
  • Problem of using individual GTC orders, it is necessary to watch out, we are speaking about individual trading tip-offs.
Limit Movements and Margin Call  
Very liquid assets constrain limit movements. The possibility of hedging positions by guaranteed stop and limit orders
 Menace the price slippage over the range of Stop order without execution. Menace of the account devaluation and margin call
Overnight Trading Sometimes low charges (low with regard to the leverage) Generally up to two times bigger margin!
Limited Losses Trading with the risk limited by the account size Oftentimes trading with the unlimited risks
Access to Data, Quotations, Charts  Free of charge in the frame of the trading platform
Charts – basic items of technical analysis for intraday and swing trading
Generally always are paid, the necessity of the extra software for the analysis of the charts. But the software is usually very comprehensive with great possibilities.
Trading Platforms Usually easy, very well-arranged, and always free of charge! Oftentimes quite complicated, a lot of functions which more correspond to the requirements of hedgers...oftentimes paid.
Standardization Contracts, lots are very well standardized; there are unified margins, easy money management

 Particular contracts very differ in conditions of trading, more complicated money management

Safety

Better possibilities of risk management, high leverage! Very high effectiveness of trading (profits and losses)

Problems – limit movements, GTC orders, more complicated money management. Greater selecting, lower leverage, lower effectiveness of the trading (profits and losses)

Process of Learning Demo Version  The possibility to work with mini accounts, very safe for the beginners! High quality demo version for the trading quickly accessible, free of charge data, quotations and charts!  There aren’t mini accounts for the beginners! Demo version – usually problem (at the Czech market) with the availability...The access only to delayed data from exchanges, otherwise only the pencil and paper...
Trading Electronically (it is possible to enter into the trading telephonically through broker on the trading platform), discount service, telephone support, e-mail, chat 24 hours online.

 Electronically or telephonically (fax too) through broker, different levels of the service provided!
Full service – special help for the trader and making the pressure on trades because of the brokerage fees   


   

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