What is CFD trading and how does it work?

[Shyla Bernetta]

I hear quite a bit about CFD trading through advertisements. What is this and how does it differ from usual stock (equity) trading? How does CFD trading work? Does it carry more risk than stock trading?

[Xanthia Alysha]

1. cfd is contract for difference.
2. the value is based on the difference of stock price
3. through a cfd broker
4. i think so.

[Butscher]

if you want a very easy explanation: its like future trading just with leverage.

[ricky028]

Hello Friend,
In financial term it is a process of essence an agreement between the buyer and seller to exchange the difference in the current value of a share or in the term of currency or commodity and its value at the end of the contract.