They say buy new bottoms and sell new highs. With that said, you can find plenty of financial assets to trade in contemporary financial markets. Still, contracts for differences (CFDs) can actually be considered some of the best assets to trade, especially as some of them are currently undervalued.
Some traders are actually scared away by various financial and economic crises. That is what makes them skip and miss excellent moneymaking opportunities. At the same time, wiser traders see any crisis as a good moneymaking opportunity to make money because there is always a recovery (and growth0 after a decline. We buy now in order to sell later. Apparently, there are many factors that should be considered when buying at or around bottoms. When it comes to conventional financial trading, you need to pay attention to the near-term and mid-term economic prospects.
However, when it comes to trading contracts for difference (CFDs or short), even a mediocre trader can actually generate stellar profits relatively easily, especially when he/she trades via ActivTrades, a major UK0based Forex broker, which is a top-ranking member of Forex rating by Masterforex-V Academy. By the way, Masterforex-V Academy has been r the Best UK Forex Broker since 2012.
ActivTrades allows traders to benefit from trading over 250 major stocks including AIRBUS, Renault, Boeing, Coca-Cola, McDonald's, Apple, Google, Facebook, Microsof, Barclays, Adidas and many others. Thanks to pretty high leverage and appealing margin requirements coupled with innovative solutions, thousands of mediocre traders and investors keeps on seeing stable and stellar profits month by month.
The leverage of 1:20 allows traders to boost their trading volume twentyfold. On top of that, you can purchase starting from 1 share on major exchanges like NASDAQ and NYSE (New York), as well as stock indices FTSE 100 (London), DAX 30 (Frankfurt), CAC 40 (Paris), FTSE MIB 40 (Milan) etc. This is coupled with minimal fees.
ActivTrades was one of the first broking companies to introduce CFDs on US and European stocks to MetaTrader 5 users.
Trading Stocks Via “CFD MetaTrader 5”
According to Alexander Elder, a trading guru, the market doesn’t try to deceive you but you should learn do perceive the signals it gives you. It is true in essence. However, some people still cannot or do not want to see those signals.
Still, ActivTrades experts believe that he ability to perceive and interpret market signals is one of the cornerstones of successful trading. With that said, CFDs offered by the broking company known as ActivTrades can be traded via MetaTrader5, an innovative trading platform. Some people call CFDs the future of trading since they are are some of the most convenient financial instruments out there. They allow traders to transform market signals into perfect trading opportunities. You get stable results and optimal portfolios.
CFDs stand out from the crowd of many other financial assets and derivatives since you do not buy or sell real commodities. You trade contracts on stocks, futures, commodities (oil, gold, natural gas, wheat, coffee etc). Later on, when you sell the assets, you make money on the difference between the starting price of the underlying asset and the current (final) price. If you have expected the price to go up and this is the case, you make money. The same is true for bearish forecasts.
CFDs (contracts for difference) provide access to more controllable and liquid instruments. While Forex trading can sometimes be risky because of volatile contemporary markets, CFDs are definitely less risky because there is only one actual risk – when the sell / buy price is worse than your prediction. There is a competitive edge over other derivatives like futures. With derivatives like CFDs, you can open a trade whenever you want, which next to impossible when you trade contracts for obligatory delivery of the underlying commodity.
Now let’s consider an example:
Let’s now assume that you would like to invest in Eni’s stock (Eni is a major Italian oil-and-gas company).
ActivTrades provides a 5% margin coupled with 1:20 leverage and other beneficial trading conditions. This means that you need only $1000 to purchase the amount of shares equal to $20 000. We purchase a CFD on Eni’s stock since we expect its value to start growing (we go long). Eventually, we sell the CFD when the rally is underway (we take profit) as we naturally expect the price to start retracing after the rally.
How To Profit From CFDs Despite Financial Uncertainty?
At this point, European stocks are extremely undervalued and underestimated by investors since they are unsure about the Eurozone’s prospects. Still, history shows that any financial or economic crisis attended by market weakness is eventually followed by pretty much confident recovery turning into economic growth. The thing is that most market participants (including traders and investors) become aware of this fact only when the actual recovery is already underway. Most of them cannot anticipate it. Meanwhile, smart traders and investors start making money prematurely, when the severe crisis is still affecting businesses and plain folks.
Let have a look at the very same example we just covered. There are many bullish factors. We have decided to buy a CFD on 1000 shares of Eni’s stock. In this case, the open price is, say, €18. Well, the price starts gaining value. Then we make up our mind to take profit by selling the CFD at €22 per share. In this case, we earn €4 per each share, which gives us €4000 in total. If the price decreased in value, you would lose the same €4000.
We must confess that CFDs can sometimes be rather risky as derivatives even though they are pretty profitable at all times. With that said, you’d better stay away from playing bingo when trading CFDs. It is crucial to take into account a certain range of factors if you want to make weighted trading decisions putting the odds of winning in your favor more often.
As a truly client-oriented business, ActivTrades developed a whole new approach to working with CFDs – futures on CFDs. Since the expiration date is predetermined, the company doesn’t charge its clients with any commissions for trades left overnight. Moreover, on expiration, all trades are closed automatically at the price of the corresponding futures.
Another benefit of trading with ActivTrades is a wide range of underlying assets available for trading: commodities (including precious metals, crude oil, natural gas, stock indices etc.
And finally, ActivTrades PLC is authorized and regulated by the Financial Services Authority (FRN 434413) and is a member of the Financial Services Compensation Scheme, which guarantees the safety of your funds as well as reliability and transparency of all transactions.
The bottom line: Taking into account all the information given below, we can conclude that ActivTrades is a perfect option for professional traders who need a reliable broker.
