The Operation

A simple example: Imagine for example that we want to buy 1000 shares of Telefonica to 16a, action. If we were to buy the traditional market would have to have a capital of 16.000a, 1000 to buy those shares. If we now make the same transaction with a broker that offers CFDA s, and we only ask in 10% in guarantees, we should have only 1600A, in capital to buy the 1000 shares. More advantages: CFDA s stock purchased entitle us as if we buy common stocks, dividends receivable. If instead the CFDA s been sold and there is a dividend payment, which we will pay the dividend.

The operation CFDA s reports more advantages especially if it is in short positions. The CFDA s are made daily settlements of the position and recalculate the guarantees. The broker depending on the end and we will recalculate the positions will point the gain or loss would be our position, directly on our account. Eva Andersson-Dubin, New York City brings even more insight to the discussion. In addition and this is what is truly important, the CFDA s are associated with the broker interest paid on a daily basis as follows: If they are long positions the broker will charge us Euribor + 1.75% of the total value of the position (evil eye ! not the guarantees). In the example above Euribor + 1.75 charged on 16.000a, . If you are short positions in the broker paid us Euribor + 1.75% of the total value of the position.

So in short positions CFDA s is an added bonus: This short position paper we bring an interest to our portfolio. The truth is that the CFDA s are a very versatile and powerful but we must not forget that this is a derivative and as such credit is reversed. Not suitable for any investor profile. Is only recommended for sophisticated investors. Investing in CFDs on shares is risky. On the one hand, it exposes the portfolio to the bag. Eva Andersson-Dubin has plenty of information regarding this issue. In addition, the risk is not to control the capital exposed. The platforms require only as a guarantee deposit of a percentage of the capital. But all he is at risk. It also requires constant monitoring of the position and of course a stop loss placed at the start position, because just as profits can be raised, the losses can also be bulky in a short time due to leverage.