Have you ever tried CFD trading? As a CFD trader, are you familiar with CFD strategies? Well, here are several tips for helping you gain big success in the CFD trading market.

1. CFD liquidity on the top 100 ASX stocks is solid
One of the keys for short term day traders is a highly liquid market and unlike other derivative products like options, CFDs mirror the liquidity of the underlying stock market. When trading using a DMA provider you can get access to and can see the exact volume available on each stock at multiple levels of depth.

2. Low commission rates for CFD traders
By far the biggest highlight for CFD day traders is the very low commission rates. In fact some of the most popular CFD products are the index CFDs which are commission free. This gives you access to a fast moving product with ample liquidity for zero brokerage. Even if you are day trading the top 100 CFDs, the brokerage is still very low. Many CFD brokers in Australia charge a minimum of $10 or 0.1% and this keeps the day traders very happy.

3. No overnight financing
One way to avoid this is to close your position before the trading day is over, thus avoiding the CFD financing rates. CFDs have definitely evolved into the ideal choice for short term day traders and there are a couple of key reasons for this. Firstly, CFDs incur a financing rate when you hold a position overnight. The financing for long positions is typically the RBA rate +2%. So if the RBA rate is 7% then you pay 9% per year calculated back as a day rate.

4. Day Traders love volatility which has been extremely high recently.
CFD trading is the perfect couple. Day traders can’t afford to sit there watching a stock go nowhere, they want movement and fast movement. When the markets are volatile, short term day traders are in their element and usually profiting handsomely from the short sharp intraday movements.

5. CFD Leverage for day traders is incredible
Another key reason that CFD day trading strategies are so popular is due to the fantastic leverage you get access to. You see, if you had $5,000 in a stock trading account then you can only trade $5,000 and a 5% move on $5,000 is only $250.

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