CFDs (contracts for difference) are highly speculative derivatives without maturity restrictions. CFD trading is risky and therefore not suitable for beginners. If you are aware of the high risk, you should consider the following tips when choosing your CFD broker.
CFD trading: tips
- Costs of CFD trading: Select a CFD broker providing narrow spreads and cheap financing for the requested CFD products.
- CFD tools: Select a CFD broker that provides you with the requested tools and services, for instance analytics tools, real time data, and mobile apps.
- CFD products: Contracts for difference are available for different product groups including stocks, commodities, indexes (such as SMI, NASDAQ or DAX) or currencies (forex). Choose a CFD broker that offers the requested CFD products.
- Reputation of the CFD broker: A multitude of CFD providers can be found online. Unfortunately, not all of them are respectable. For a selection of FINMA regulated providers, just go to the online trading comparison tool and select "CFDs" within the filter criteria "specialized asset classes".
- Leverage and margin: Choose a CFD broker that provides you with the requested leverage and margin. The higher the leverage, the higher the risk. Choose a CFD account with the requested minimum.
- Demo trading account: Test the CFD broker before you trade with real money. Most Swiss CFD brokers offer a free demo trading account.