Monday, June 25, 2018

FX and CFD Trading – 4XFX Review

On the “Account types” page of you can see that 4XFX offers the following instruments for online trading: FX & CFD on Metals & Indices.

CFD trading

4XFX also offers a variety of trading platforms such as MT4 & MT4 Mobile and a lucrative algorithmic trading program.
4XFX also offers trading signals.

CFD Trading With 4XFX

It is not uncommon for people to take Forex trading for CFD and vice versa. This is largely due to the many similarities common to both trades even as they possess some very distinguishing features. Both trades are carefully dissected below, explaining some of the similarities and benefits.

One feature common to both trades is the process of executing deals. It is pretty easy for traders to enter and exit the market whether it is a rising or a falling one.

Another common characteristic of both trades is that they share the same platform. Trades are usually executing using similar platforms with charts that look similar and the same pricing method.

Both trades have their execution been done in the OTC market which is by the way run electronically in its entirety. This means there is no physical location neither is there a central exchange.

Unlike other trading instruments types that attract commissions and such fees, the spread is the only cost involved in trading in CFD and Forex, making it another similarity of both trades.

Even as many benefits have been mentioned, the major similarity of both trading is the fact that traders involved have no actual ownership of the underlying assets.

In actual fact, some quarters regard forex as just a kind of CFD.

Having mentioned some of the several similarities between CFDs and Forex, it might worth mentioning some of the differences.

CFD and Forex trading are majorly different based on the types of contracts involved. CFD trading contracts cover a number of markets like indices, energy, and metals. On the other hand, pure currency is what Forex deals in. 

Forex involves the trading of one currency against another one would normally have the same lot sized traded. CFDs however gives traders the opportunity to select different contracts with diverse increment value and currency type, based on the originating country of the underlying asset.

Another feature that differentiates CFD trading from Forex trading comes from considering the general factors that determine the climate of the markets. While such factors as supply and demand of a particular commodity or trend changes that relate with business sectors influence CFD trading, Forex trading is majorly influenced by events across the globe which include changes in the international political arena and huge employment shifts.

The features listed above are some of the basic differences and similarities of CFD trading and Forex trading.

CFD trading