Spread Trading vs CFD Trading, Futures or Stocks
Finsa Markets offers Spread trading across a range of financial markets. The spread is a hidden cost in trading ANY market, regardless of the instrument you use. It is simply the difference between the buy and sell price you see in the order window that pops up when you trade.
Spread trading has these advantages compared to other instruments:
- You will always trade in Sterling (or your preferred currency). This means you are not exposed to swings in currency rates while you are in a position.
- You can trade with stakes as low as 10p per point, or in fact any amount you like.
- No need to worry about contract sizes.
- You ONLY pay through the spread. There is no commission or fees.
Spread trading and CFDs are leveraged instruments. In contrast to trading stocks and futures, by which – at least in principle – you own a piece of the underlying company or asset, this is never the case in Spread/CFD trading.
In Spread trading you don’t have to worry about contract sizes, and you can trade as small as 10p per point. This is a huge advantage if you are new to trading, as you get to know the markets without risking much of your capital.
Because you always trade in your own currency (or whatever currency you choose), you don’t need to worry about exchange rates and fees. In this way your P&L becomes transparent at all times. In this respect Spread trading stands out from other ways of trading, which all take place in the base currency of the instrument in question. When the trade is closed, the brokers will exchange the money at a rate they alone decide. You won’t experience this at Finsa Markets.
The cost of Spread trading is always clear when trading at Finsa Markets. There are no concealed costs, the only cost is the spread price you see in front of you.
- You pay no commission
- You pay no exchange fees
- There is no currency risk involved because you trade in your local currency
If you have any questions, please feel free to call us or send us an email.
Spread trading is a leveraged product. The potential for profit is great but at the same time there is increased risk involved in Spread trading because you are trading using leverage.