Index trade example - the US SP 500
We quote the US SP 500 at 1270.7/1271.1 and you believe that the
US SP 500 will rise.
This is how your investment in CFD indices might look ...
Opening position
| Buy
price (US$) |
1,271.10 |
| Number of underlying
contracts |
20 |
| Value of position (US$) |
25,422.00 |
| Margin required @ 100:1
leverage (US$) |
254.22 |
| |
|
| Total outlay (US$) |
254.22 |
Closing position - if the market rises
After two days, the US SP 500 price rises to 1275.6, at which
point you decide to sell the underlying contracts.
| Sell
price (US$) |
1,275.60 |
| Gross profit (US$) |
90.00 |
| Overnight financing (2 days)
(US$) |
(6.36) |
| Net profit (US$) |
83.64 |
| |
|
| Return on investment |
33% |
Closing position - if the market falls
However, if the sell price moves in the opposite direction you
will realize a gross loss.
| Sell
price (US$) |
1,251.90 |
| Gross loss (US$) |
(384.00) |
| Overnight financing (2 days)
(US$) |
(6.36) |
| Net loss (US$) |
(390.36) |
| |
|
| Return on investment |
-154% |
Financing charge: this is the daily debit or credit to a
trading account based on positions held open at 17:00 Eastern Time
(US). Based on this automatic rollover, funds are subtracted or
added to your account in respect to open positions. Please see
our Rollover & Interest Policy for more details.
Forex and CFD trading carry a substantial risk of loss and are
not suitable for all investors. Please refer to our Risk Warning policy (PDF) for more
information.