A contract for difference (CFD) is a derivative product which enables you to trade on the price movements of underlying financial assets (such as forex, indices, commodities, shares and treasuries). It's an agreement to exchange the difference in the value of an asset from the time the contract is opened until the time it's closed.

With a CFD, you never actually own the asset or instrument you're trading, but you can still benefit if the market moves in your favour, or make a loss should the market move against you.

Trading CFDs involves trading on leverage, which means that you can enter a position with a set initial deposit, known as the margin requirement. It's important to remember that leverage amplifies your gains and losses in equal measure, based on the full value of the trade, and not just the initial margin amount. Learn more about CFD trading