CFD trading is a derivative market that allows traders to speculate on the movement of an underlying asset. CFDs are traded like stocks and can be bought and sold throughout the day, just like any other stock. However, unlike stocks, CFDs do not represent ownership in the company or product they reference. They simply allow you to make a profit if your prediction about how an underlying asset will move turns out to be correct.


Forex trading is similar in many ways but it involves currency pairs (e.g., EUR/USD). Forex traders buy and sell currencies based on their own analysis of future trends rather than speculation about whether an underlying asset will go up or down over time. When making trades with forex brokers, traders usually use leverage which means they can trade more than 1 million dollars worth of assets at once with only $10,000 (£6k) invested in each position – this is known as “margin trading” because it requires additional funds to be deposited into your account by your broker before you start trading.