5. What is Contract for Difference (CFD)?
CFD, or Contract for Difference, is a relatively new type of derivative in the financial markets, where investors can start trading after paying a small amount of margin to banks or brokers according to the agreement. Most CFD transactions cover a variety of financial assets and commodities, including forex, precious metals, energy, stocks, indexes and crypto currencies. In theory, investors can trade all “underlying assets” through the concept of CFD.