4. Similarity to the underlying market
CFDs are designed to mimic trading of their underlying market fairly closely. Buying an Apple share CFD, for instance, is the equivalent of buying a single share in Apple – if you want to buy the equivalent of 2000 Apple shares, you’d buy 2000 Apple share CFDs.
Buying or selling a forex CFD, meanwhile, is equivalent to buying a certain amount of base currency by selling the equivalent amount of quote currency. So buying a single CFD on AUD/USD would give you the same exposure as buying A$100,000 in US dollars.
So if you’re already experienced in non-leveraged markets, CFDs can be more immediately familiar than other forms of leveraged trading.