What is CFD Trading?

Contracts for Difference allow us to invest in the price movement of assets including stock, indices, ETFs, Crypto and commodity futures. CFDs gain investors with all of the regular benefits and risks of owning a security yet without actually owning.

Understanding Leverage

The benefit of trading with leverage is the ability to get exposure of multiple opportunities within the financial market with only a pretty small amount of capital from your side.
CA Trade Pro delivers CFD’s, Forex and Crypto trading which are leveraged so that any investment made, large or small can gain large exposure within the market which increases your chance of making profit and lowers the risk of losing your capital.

Margin Trading

Margin is simply allowing a certain about of leeway when trading in the CFD, Forex or Crypto market. You must maintain a degree of funds within the account (margin) you can do this by calculating the necessary requirements you will need in your account before conducting each CFD trade. If you don’t have a sufficient margin in your account it could reflect on the accessibility of trades available.
CA Trade Pro can provide expertise advice on how much margin you will need before any leveraged CFD trade. Our experts have been in the industry for many years and can aid on any calculations you may need.

Trading Profit and Loss Calculation

Pip value: is an important component of the P&L calculation and will be given to you by the platform prior to opening your position.

Formulas:

Pip value for Forex (other than JPY) = (invested amount * Leverage) / open price / 10,000
Pip value for Forex where JPY is the quoted currency = (invested amount * Leverage) / open price / 10,000
Pip value for Equities and Commodities = (invested amount * Leverage) / open price / 100
Note that the pip value given by the platform is the base currency of your account.
Profit and Loss Formula = (pips movement * pip value) – swap charges

Pending Orders:

You can set pending/future orders for entering into a position when the actual price will reach your target/set price.
Buy Limit: an order to buy at a specific price that is lower than the current one.
Sell Limit: an order to sell at a specific price that is higher than the current one.
Note that there are restrictions of how close your pending order price could be from the current price
Take profit: is a pending order at a predetermined price to exit a profit making position.
You can set or change your take profit price (or amount) at the start or/and during the period of your position.
We recommend to check the take profit price prior to opening a position.
Note that there is a limit on the range between the open price and the take profit price.

Example:

You open a SELL position on EURUSD at 1.1208 with an invested amount of 100 EUR.
The pip value will be 3.5688 EUR and the take profit will automatically be set at 1.118 so if the price reached the take profit you will win 100 EUR (3.5688 * 28pips ≈ 100 EUR).
If you wish to decrease the take profit level further at 1.11 then the potential gain of your position will increase to (3.5688 * 108) 385.4 EUR.
Stop loss: is a pending order at a predetermined price to exit a loss making position.
You can set or change your take stop loss price (or amount) at the start or/and during the period of your position.
We recommend to check the stop loss price prior to opening a position.
If you change the initial stop loss level your invested amount (margin) will change also but the pip value will remain the same.
Note that there is a limit on the range between the open price and the stop loss price.

Example:

You open a SELL position on EURUSD at 1.1208 with an invested amount of 100 EUR.
The pip value will be 3.5688 EUR and the stop loss will automatically be set at 1.1236 so if the price reached the stop loss you will only lose your invested amount (3.5688 * 28pips ≈ 100 EUR).
If you wish to increase the stop loss further at 1.1250 then the risk of your position will increase to (3.5688 * 42) 150 EUR meaning that your invested amount (margin) will automatically go to 150 EUR.
Close Manually: you can close your open positions manually by pressing the close button at the right side of your open trades section.

Trading Costs:

Spread is the difference between the bid (sell) and ask (buy) price. The difference is presented in pips and reflects the cost of opening a position.
The related cost will be spread * pip value.
Swap is the interest deducted from the Profit/Loss of your position and is only charged when a position is held open overnight.
Swap charge formula: Invested amount * Leverage * swap rate / 365days.