A CFD is a type of financial contract which allows investors to trade in the movement of a stock without owning an actual stock. CFDs are bets that an assets price is going to rise or fall.
CFD is an agreement between the investor and the broker, which obligates the broker to pay the investor the difference between the current price of the asset and the price at the time the contract is concluded. It is important to note that CFDs are complex financial instruments, which bears a lot of risks.
Therefore, social trading platforms which offer CFDs must display a warning about the risks and the likelihood of losing money.
