A CFD (Contract for Difference) is an over-the-counter derivative with your broker: it replicates underlying movement. At close, one side pays the other the price difference.
In plain terms — You do not buy Apple stock: you bet with the broker on its move. You gain or lose the difference between open and close, times size and leverage.
| Aspect | CFD | spot-market | futures |
|---|---|---|---|
| Ownership | No | Yes (stock) | No (standard contract) |
| Counterparty | Broker / market maker | Exchange / CSD | Clearing house |
| Expiry | Usually none | None | Yes |
| Leverage | Yes, typical | No (unless margin) | Yes, via margin |
Buy and sell on CFDs
buy-and-sell buttons open long or short equally. bid-ask-spread and broker market-maker policy affect real cost — see slippage.
Operational notes
- Regulation varies by country (some retail CFD markets are restricted).
- Overnight financing (swap) on open positions.
- CFD chart tracks underlying but is not identical to cash.