Friday, December 11, 2015

How to Trade CFD Indices? Using advance order types to max your profit & min loss!

New to CFD Trading?
Do you wish hedge your position when market turn into a bear market or know how to you use lesser capital to take on opportunity in the market? In this article, let me share with you what is Contract for Difference (CFD) all about.

What is Contract for Difference (CFD)?

Contract for difference (CFD) is a contract between two parties, typically described as "buyer" and "seller".  Stipulating that the seller will pay to the buyer the difference between the current value of an asset and its value at contract time (If the difference is negative, then the buyer pays instead to the seller).

CFDs are financial derivatives that allow traders to take advantage of prices moving up (long positions) or prices moving down (short positions) on underlying financial instruments. 

Margin requirement
As CFD is an Leveraged product hence it operates like a Margin Account. Margin requirement is the minimum capital you have to park in to the account to have an open position. 

Financial charges
You essentially become a borrower by as CFD allow you to trade larger stocks or indices using smaller amount of your fund and borrowed fund. Financial charges are charged on daily, mark to market price when market close

Trading STI index on POEMS. How does it look like?

CFD allowed you to long as well as short the STI index, 
Long is to buy first, sell later at a higher price to make profit.
Short is to Sell first, buy back later at a lower price to make profit. 

STI Bid-Ask Spread is at 3.6 pips. E.g STI bid price is at 2850.6 while ask price is at 2854.2, 

Search for Straits Time Index SGD5 in PhillipCFD or Poems 2.0 you will find the contract.

To calculate the value of contract, every 1 point in STI is valued at SGD5. 

If you buy 1 Contract of Straits Time Index SGD5 at 2850, your contract value is $14250, however margin Requirement in CFD is only 5%, hence = 14250*5%= SGD712.5

if you have a 50point Gain in your profit will be 50xSGD5= SGD250

So, what will be the COST in trading STI using CFD under POEMS?

Here is the counter detail for STI

Important advantage of trading STI is the lower COST.
Financial Charges: 1.5% p.a for long position and 2.5% for short position.

Minimum Margin requirement: 5% 
(lower requirement mean lower stuck in fund, opportunity cost is lower)

Commission Charge: SGD3 per transaction
(Stock market minimum commission charge is at SGD25 and yet you are required large amount of fund to invest )

World Indices 

Trading Platforms
A dedicated application-based platform designed for risk management or the brand new POEMS Mobile CFD, which allows you to trade CFDs anytime, anywhere. Whichever platform you require to suit your lifestyle, we are certain you would be able to find one that would suit your needs amongst the Phillip CFD offering. 

  • Advanced Order Types Provided:
  • Stop-Limit
  • Trailing Stop
  • If Done
  • OCO Order
  • Contingency

Why Phillip CFD?

  • A member of Phillip Capital
  • Winner of Largest CFD Broker in Singapore 
  • First stockbroker to introduce CFDs to Singapore
  • Phillip CFD prices are marked to market, with no additional spreads. Direct Market Access (DMA) for Singapore market
  • Phillip CFD is committed to provide fair dealing and a transparent trading experience 
  • Phillip CFD also won the award of being *Singapore’s largest CFD provider by market share for 2010, 2011,2012,2013 and 2014.


Click for short videos on how CFD works

Still not sure how CFD works? Come and join us for CFD coaching  

Get yourself ready and prepare before Market is selling down and how to profit from market correction that everyone MUST know on how to take advantage using CFD to max your profit from bull and bear market
Losing huge money each time without proper stop loss? Come and join us to learn risk management features to minimise your loss NOW!
You shall learn:
  • How CFD works & CFD Platform Demo
  • How to utilise Risk Management to Maximise your Profits and Minimise your Losses?
  • Learn how to key in GTD orders and Advance Order Types to manage your portfolio while you are not looking at the markets?
  • How to trade World Indices using CFD? Are you entitled to dividends if you have a long position in World Indices CFD?
  • Market outlook and stocks selection using Technical Analysis
  • Identify the strongest and weakest stocks in the market right now
  • << Untold Scerect Of CFD Trading >>
Event Details
  • Dates:  14 Dec 2015
  • Venue: Level 6, Presentation Room, Raffles City Tower, 250 North Bridge Road
  • Time: 7pm - 10pm
  • Fee: Free Admission

Register Now, Last seminar for this Year! 

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