What is CFD trading?
A contract for difference (CFD) is a method of trading which allows traders in HK to speculate on asset price movements. Hong Kongers involved can take either a long position (the asset price will go up) or a short position (the asset price will go down) when purchasing CFDs. When the contract time is up, the trader is paid the difference in the case of a correct speculation, or must pay the difference in the case of an incorrect speculation.
CFDs are a popular method of trading Forex, commodities, and stocks in Hong Kong. Most operators which sell CFDs will allow the trader to use leverage; with some as high as 1:1000. This means that traders can make big gains or losses with a relatively low investment.