General risk warning
Trading leveraged products such as forex and CFDs carries a high level of risk and can result in the loss of all your invested capital. Leverage magnifies losses as much as gains. These products are not suitable for everyone, and you should not trade with money you cannot afford to lose. Past performance is not a guide to future results.
Contracts for difference
A contract for difference (CFD) is an agreement to exchange the difference in an asset's price between the time a position is opened and the time it is closed. You do not own the underlying asset, and you have no rights attached to it.
CFDs are usually traded over the counter rather than on a regulated exchange. The price you trade at is the price quoted to you, which can differ from prices elsewhere.
Every position has costs, including the spread and, where they apply, commission and overnight financing. Costs reduce any profit and add to any loss, and they apply whether a trade makes or loses money. Read the spreads and fees guide and confirm the current charges for your account and instrument before placing an order.
Leverage and margin
Leverage lets you open a position much larger than the money you put down as margin. A small price movement against you can therefore cause a loss that is large relative to your margin, and can use up all of it.
If your equity falls below the margin needed to keep positions open, you may be asked to add funds at short notice. If you do not, or if prices move too quickly, positions may be closed automatically at a loss.
Higher leverage means higher risk. Use the lowest leverage that suits your strategy, and understand the margin requirement before you open a position.
Market gaps and slippage
Prices do not always move smoothly. Around economic data releases and news, at market open and close, and over weekends and public holidays, a price can jump from one level to another without trading at the levels in between.
When that happens, an order may be filled at a worse price than the one you requested. This is known as slippage. A stop-loss order does not guarantee the execution price. If it is triggered, execution may occur at a price different from the level you set.
In fast or thin markets it may be difficult or impossible to open or close a position at the price you want.
Currency risk
Profits, losses, margin or charges denominated in a currency other than your account's currency may need to be converted. Exchange-rate changes can reduce a profit, increase a loss or change the amount of margin required, even if the instrument's price has not changed.
No investment advice
Information on this website, including market analysis, education and tools, is general information. It does not take your objectives, financial situation or needs into account, and it is not a recommendation to buy or sell any instrument.
You are responsible for your own trading decisions. If you are unsure whether trading leveraged products is appropriate for you, seek independent professional advice before you open an account.