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Trading dax futures vs CFD


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Trading dax futures vs CFD

  #31 (permalink)
 avasfx 
Poland
 
Experience: Intermediate
Platform: Multicharts, RealTest
Broker: AMP, TradeNation, IntractiveBrokers
Trading: ES, DAX, YM, FTSE
Posts: 23 since Jul 2009
Thanks Given: 15
Thanks Received: 1

You are wrong here. It depends on broker. Lets look for example on ES/MES: spread most of the time 0,25 to enter and exit the market + commission.
With my broker now i trade S&P 500 CFD with sread 0,14 (during US session) and 0,20 (Europe session) - no commission. So its much cheaper to trade CFD being in europe. And i get no slippage (as i trade with market maker), max position - up to 7500 CFD's, which is equivalent of 600 ES contracts for one mouse click. Margin is also always the same (day and overnight). And also no data fees
I think that cfd's are banned in US because CME, NYSE etc don't want competition...
But on the other side - there are too many scamers now, so we have to be carefull selecting a broker.
Nowadays a lot of reputable US brokers offer cfd's for their cliens outside of US - like Phillip Capital, InteractiveBrokers, etc
Alex



jazzmutant View Post
SBtrader82, thanks for your concern. I make money and tbh I'm actually happy with my broker, they're legit and have been very good to me.

The cost of trading the CFD is the only thing that's bothering me, knowing there exists a cheaper alternative.

L


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  #32 (permalink)
 Tudman 
Toronto Canada
 
Experience: Beginner
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A trader I follow uses TD365.com to trade CFDs. Never any issues for him.i am thinking of opening an account as there are:
1. No commissions
2. No Exchange fees
3. Tight spreads
4. Widening of bid-ask during volatile times

If one can deposit money with them and be able to withdraw anytime without issues, seems attractive compared to futures.

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  #33 (permalink)
 
bobwest's Avatar
 bobwest 
Western Florida
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Tudman View Post
A trader I follow uses TD365.com to trade CFDs. Never any issues for him.i am thinking of opening an account as there are:
1. No commissions
2. No Exchange fees
3. Tight spreads
4. Widening of bid-ask during volatile times

If one can deposit money with them and be able to withdraw anytime without issues, seems attractive compared to futures.

I wouldn't normally be posting on a thread about CFD's -- since I don't trade them and never have -- except to point out that with CFD's you are trading with your broker as the party on the other side, and not with other traders on an exchange, and you should have a care about that. But the same is true for spot foreign exchange, so it's just a "let the buyer beware" situation, and everyone can make their own decisions.

Which is basically what I am going to say here as well, but in the case of the no-commissions and no-fees broker just mentioned, a person has to wonder just how the firm is going to make any money? Well, since they don't charge you anything up front, even though they supposedly have "tight spreads," they are going to take it out of the prices they offer the trader. Where else? It is coming from somewhere, and the trader is going to pay it.

If a trader understands that some money is going to be made by the broker from their trading, one way or another, then they can perhaps make an informed decision about what to do. But money will be made in order to provide traders with the trades, and it is important to understand this.

Just be careful of free things. There just never are any. There may be no commissions, but there is still no free lunch.

Bob.

When one door closes, another opens.
-- Cervantes, Don Quixote
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  #34 (permalink)
AlphaBetaDelta
Ipswich and England
 
Posts: 16 since Jan 2023
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The only real drawback to trading CFDs (or DFBs) is the spread the broker charges. Most brokers only charge 1pts spread so for swing trading or even day trading reasonable sized swings its not an issue. Scalping on CFDs would be impossible. In the UK for e.g. DFBs are tax free so can offer some good opportunities.

Only issue Ive experienced in the past is that during the volatility the broker randomly widens the spread - again this makes short term trading problematic

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  #35 (permalink)
hnmw
Melbourne
 
Posts: 1 since Feb 2020
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avasfx View Post
You are wrong here. It depends on broker. Lets look for example on ES/MES: spread most of the time 0,25 to enter and exit the market + commission.
With my broker now i trade S&P 500 CFD with sread 0,14 (during US session) and 0,20 (Europe session) - no commission. So its much cheaper to trade CFD being in europe. And i get no slippage (as i trade with market maker), max position - up to 7500 CFD's, which is equivalent of 600 ES contracts for one mouse click. Margin is also always the same (day and overnight). And also no data fees
I think that cfd's are banned in US because CME, NYSE etc don't want competition...
But on the other side - there are too many scamers now, so we have to be carefull selecting a broker.
Nowadays a lot of reputable US brokers offer cfd's for their cliens outside of US - like Phillip Capital, InteractiveBrokers, etc
Alex

Hi Alex

I saw your old post here.

I was wondering which broker you use. I have a 0.4 point spread with S&P 500 CFD on IG Markets

Also, do you know any CFD providers that allow you to trade ES S&P 500 March Contract (or ES Mini Futures CFDs). IG Markets does but the spread is 0.6 points!

Thanks
Ben

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  #36 (permalink)
 avasfx 
Poland
 
Experience: Intermediate
Platform: Multicharts, RealTest
Broker: AMP, TradeNation, IntractiveBrokers
Trading: ES, DAX, YM, FTSE
Posts: 23 since Jul 2009
Thanks Given: 15
Thanks Received: 1

Hello Ben, sorry for answering only now, just saw your replay. I use TradeNation (and that is what i was talking about). At that time spread was 0,14, but currently they have 0.3 with no commission. Love them. Platform i very poor, defiantly not for scalping or algorithmic trading, but other than that - great.

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