CFD’s Level 1

•What are CFD’s?•Why do they exist?•How do they work?•Trading CFD’s using Saxo Trader II

Agenda

What are CFD’s?(Contract For Differences)

• Enables investors to participate in the price movements of stocks without ownership of the underlying share

• Based on either individual stocks or indices• Invented in the UK• CFDs enable leverage of stock-related investments

Nominal Value

Margin required

Nominal Value

Why do they exist?• Potential tax

breaks

• Leverage

• Diversification

How do they work?• A CFD is a derivative of either a stock or an index• A CFD reflects the value of the underlying asset/share +/- 0.1% - (this is the risk

premium)• You trade the amount of shares you want, but only use a fraction of the capital

Price difference is +/- 0.1%

Green prices. What you see is what you get.

Trading CFD’s using Saxo Trader II

• Trading made simple with our easy-to-use interface

• Clearly defined pricing, margins and costs

Account Summary

Trading CFD’s with Saxo Bank

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