What Do You Know About CFD?

Contract for Difference, CFD is internationally the most common and popular trading site. From 280,000 users in 2017 trading regularly on CFD trading platform to 800,000 in 2018. The jump of CFD trading was approximately 520,000 people joining and using the CFD website for international trading. The reports have further stated that there has been about 193% increase in the accounts being registered in 2020. As Covid-19 hit and destroyed all other businesses, people joined online trading websites to meet the ends. 

Thus, CFD was and remained popular and at the top among other websites. Additionally, people reported being interested in CFD trading four times compared to 2015. 

History of CFD

The CFD trading website has evolved. In 1990, when it was introduced, there were pretty strict policies and rules to get yourself registered. Investors must go through a lengthy procedure of submitting personal documents and then getting approval to conduct business. However, now registration does not require that much of the regulations which have let the scammers in the game. Anyone can get themselves registered and be part of trading sites. 

Why Are Scams Increasing on The CFD?

The foremost reasons scammers are not caught and scams are immensely increasing are lack of accountability and transparency. The authorities do not think themselves responsible for the frauds and scams stating it as part of an online system. The scammers find online fraud less threatening as their identities are hidden. Trades and transmission are done with anonymous identities. 

One might wonder why traders are very much attracted towards this trading website? EzChargeback has been working long on scams and the online trading website to present the most suitable statistics and realities of these websites. 

Why is CFD Getting so Popular?

 Traditional trading on the spot exchange market requires investors to possess assets and products to trade, sell or buy. However, CFD does not require investors to have possession of any commodities already, it provides leverage in trading, that is buy and sell the new or non-possession commodities. 

Further, the profit and loss is based on the bets of investors. If they believe the  price of the commodity will rise, they will buy the product and sell it at a higher price. This will lead to a gain in their profit. While, if investors bet the prices will fall, they will do the opposite.

Trading on CFD in Australia

CFD trading began in 1990 and was introduced in Australia in 2003. It has gained much popularity by now. It has been reported that one-third of investments are done through CFD trading platforms. Several derivatives are offered for trading in Australia like stocks, shares, commodities, government bonds, forex and FTS.

The initial step to begin your trading in Australia requires investors to choose the market they want to trade from. MetaTrader (MT4) and MetaTrader 5 (MT5) are the most popular markets currently. People are attracted to these two markets as they find others a little complicated and harder to use. 

A trader has to bet whether the price of commodities will fall or rise. They will buy if the prices fall and sell if the prices rise. Then, they will select the size of commodities; whether they are willing to trade a significant amount or no. 

Trading Policies 

Investors and businessmen must strictly abide by the policies and rules set by the Australian Securities Investment Commission (ASIC). These policies are to protect the investors’ commodities and investments. 

Australian Man Manipulation

Mr Mark has been sentenced to one year and nine months jail for being guilty of manipulating the share prices in the Australian CFD market. 

He created uneven opportunities for the investors on the CFD platform by manipulation. He used the strategy four times. What he did was that when investors on the CFD platform. He used the strategy four times and caused prices to move. 

The CFD authorities have stated that they are putting keen and close eyes on the manipulation of the stocks to ensure a secure and safe atmosphere for the investors. 

Are All CFD Websites Manipulated? 

Well, CFD trading websites provide equal and fair opportunities to each investor. As EzChargeback had reported several scam cases, it could be noted that the risks are involved with each transaction and trade. Also, the scammers are taking the lead as reports have stated 82% of the investors lose their money on CFD trading platform. However, it doesn’t demonstrate that it is manipulated and not a legit market itself. The nature of fraud is due to scammers and their ill intentions, not the CFD market’s nature.