Contracts for Difference- Unique way to profit from rising or falling rates

CFD's are financial derivative products that allow you to trade on the price movements of securities and indices without ever owning the underlying asset. Trading CFD’s has the scope to maximize your market participation for only a fraction of the investment you would need to buy or sell the underlying asset directly through the use of leverage. Trade with a leverage of up to 1:100 and capitalize on your trading opportunities.

By trading Commodity CFD's with Al-Shuaib you are able to profit by using the low margin requirements and access a wide range of products with competitive spreads.

Why trade CFD’s with Al-Shuaib?

Broad range of markets:

Trade CFD’s with Al-Shuaib and gain access to a wide range of products with competitive spreads. Trade in US, UK and Japanese Index CFD’s, currencies, metals, commodities and more.

Trade CFD’s on low initial margin:

Al-Shuaib offers you the benefit of trading CFD’s with competitive margins over a broad ra ra range of markets. We provide trading with low initial margin requisites.

Multi-faceted platform:

Never miss an opportunity when you trade on the dynamic and leveraged instrument. Trade on the go with our highly customizable trading software available on PC and mobile devices.

1:100 Leverage:

Enjoy trading on less capital with the same market exposure as compared to what the conventional trading methods can give you. Trade with a leverage of up to 1:100 on various CFD’s and maximize your opportunities while trading in the financial market.

Benefits of trading CFD’s

Efficiently use your capital

Efficiently utilize your capital by putting up only a small percentage of the total investment value by using leverage. To start with, trading on a CFD you need to deposit only a fraction of the total trade value. Leverage can be helpful if the market moves in the direction that you are expecting it to be but it carries a high amount of potential risk if the market moves against your favor.

Gain from rising and falling markets

The market is volatile. It may go up or down. When you trade CFD’s you can potentially profit from rising or falling markets because you are not owning the financial instrument; instead you are trading based on the price movement of the same. This makes it easy to sell a CFD like buying it.

While trading in a bull market a trader would look to buy a CFD position first and then sell at a later date to end their position. This is known as ‘going long’.

Again while trading in the bear market a trader would want to sell a CFD position before buying it back again at a later date to liquidate their position. This is known as ‘going short’ in trading.

Trade on a wide range of markets

CFD’s present traders an opportunity to trade in a variety of markets and in a range of instruments that would not be otherwise available to investors. The ability to trade across varied markets helps traders diversify their trading portfolio.

Ability to hedge your positions

Implementation of hedged positions can help investors cut down the potential risk. To cite an example if you have a long position that is incurring loss you can open a position in the opposite direction using a short CFD. This will help to even out losses, as the short position will start to make gains if prices continue in a downward direction. Hence ‘hedging’ can allow you to limit risk and prevent future losses

LEARN WITH AL-SHUAIB: SHARPEN YOUR SKILLS

CFD’s and how they work

Contracts For Difference or CFD’s are derivative instruments whereby investors can speculate or hedge on any movements in their investments without the onus of physical ownership. Thus they can easily diversify their portfolio and the use of leverage allows them to hold onto positions much greater in worth than the value of their actual trading accounts. Due to the lack of ownership they enjoy the advantage of not having to pay any account management fees, or commission charges, and, in some countries even the stamp duty. A trader's share in a CFD trade is calculated by the variance between the rate at which they buy it and the rate at which they sell it, plus or minus interest credits or debits.

Hedging

Hedging is used to cut down potential risk of losses via short-selling, future contracts, call options or put options. A hedge can help lock in gains and lessen the volatility of a trading portfolio.

CFD's are available on many underlying assets, including:
  1. Single stocks
  2. Equity indices
  3. Commodities
  4. Forex

It’s important to recognize the potential downside of CFD trading too as it can be a two-edged sword.

  1. Counterparty risk: CFD’s can prove counter-productive if the opposite party fails to honor the obligation especially if it is unregulated or cash-strapped. Also CFD trading is an over-the-counter transaction so a trader has access to merely the contract in a CFD trade provided by the CFD provider who becomes the counterparty.
  2. Leverage risk: The use of leverage means that even slight market movements can impact your gains/losses significantly. So if the markets move against your favor your investments maybe affected adversely and you might even be subject to a margin call to infuse more funds into your trading account in order to hold onto your positions.
  3. Market fluctuations: The markets are always in a flux and prices alter in unprecedented ways especially due to political changes, some economic news or announcement or even natural catastrophes. Fluidity in prices offer money-making opportunities for any enterprising trader but it’s highly risky too.