Contract for Difference

The CFD, or "Contract for Difference" is a retail investment tool that is common throughout European and US Market, and is quickly being adopted throughout the rest of the financial world. Originally used by institutions and major corporations to manage exposure risk on the equity market, CFDs ("Contracts for Difference") have found their way into retail traders' portfolios and as an efficient alternative to physical trading.

CFDs (Contracts for Difference) offers you all the benefits of trading financial products without having to physically own them; they are a way of buying and selling risk.

Contracts for Difference are agreements between traders and Brokerage Company (Legion Trade Limited) to mark the price of any given financial instrument when the CFD is opened, then settle the difference between the opening price and closing price of said financial instrument, multiplied by the number of lots mentioned in the trade.

CFDs can be opened on for equities, stock indices, futures, commodities, and many other instruments, and CFD trading is done on "Leverage Trading," so an initial deposit by the trader controls a much larger amount of money for buying/selling financial instruments. CFDs are often traded on approximately 1% margin, where a $1000 deposit allows control of $100,000 for the sake of transactions.