CoastaxProTech Insights
CFD Risks Explained for Australian Users
Understand leverage, margin calls, spreads, financing costs and counterparty risk before considering CFDs.
What a CFD is
A contract for difference is a leveraged agreement based on the price movement of an underlying asset. The user usually does not own that asset.
Why losses can be rapid
Leverage magnifies price movements. Spreads, overnight financing, gaps and forced closure can affect the outcome. A position may be closed when account equity falls below a provider’s requirement.
Checks before proceeding
Confirm the provider, product disclosure statement, leverage limits, fees, margin rules and complaint process. CFDs are high-risk products and may not suit your circumstances.
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