Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. You could sustain a loss of some or all of your initial investment and should not invest money that you cannot afford to lose. Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. You could sustain a loss of some or all of your initial investment and should not invest money that you cannot afford to lose.
Go long or short on over 12,0001 international shares with CFDs or spread betting.
Spread bet, trade CFDs or open a stocks and shares ISA to maximise your tax efficiency
Low margins and competitive spreads on a wide range of popular, global stocks
View market depth and interact with the order book. Benefit from greater control, functionality and liquidity
Gain full exposure using a small deposit with spread betting or CFDs, but remember that leverage will bring increased risk
Trade international shares with a 0.5% transfer fee on foreign currency balances
Subject to risk reviews, the margin rates may differ for individual clients
When you buy a share, you’re buying a small unit of ownership in a company. Trading shares as CFDs means you do not own the underlying, but you can still speculate on the price of that company. Therefore, before trading shares as CFDs, it’s really important to research both the company and the industry it’s in.
An added benefit of trading shares as CFDs is that you’ll still receive dividends. They represent your share of the company’s profits and are usually paid out twice a year. The amount you receive depends on how much the management distributes to shareholders, and how much is reinvested back into the business.
Share prices are affected by many factors, including supply and demand, the company’s earnings, and expectations of the company’s future performance (based on a wide variety of things such as industry legislation, the company’s management team and the health of the economy).
Watch Sara explain the basics of shares trading in less than two minutes
See an example of a shares CFD trade
Select a market
You're interested in trading a Barclays share CFD. Our price is currently 289.85 / 290.00, priced in pence..
Sell or buy
You choose to 'buy' 5000 shares at the offer price (290.00), because you believe the market will rise.
Alternatively, you could 'sell' at the bid price (289.85) if you believe the market will fall.
Commission and margin
Commission is charged twice, once when your position is opened, and again when it is closed (per side).
In this example, your total exposure is 5000 shares x 290.00p = £14,500. Commission is therefore £14.500 x 0.1% = £14.50 to open the position.
The margin required on Barclays shares is 5%, so to open this trade you would need to have £14,500 x 5% = £725 in your account.
Closing your trade
Over the course of the day the market rises, and at 3pm our Barclays share CFD price is 294.85 / 295.00.
You choose to close your trade by placing a 'sell' trade on 5000 shares at the bid price (294.85).
Calculating profit / loss
Profit / loss is calculated based on the difference between your opening and closing prices, in points.
In this case: 294.85p - 290.00p = 4.85p
You bought 5000 shares, and the market moved in your favour. Therefore your gross profit is: 5000 x 4.85p = £242.50.
Commission is charged when you close your trade as well, in this case 5000 shares x 294.85p x 0.1% = £14.74.
Similarly, if the market had fallen by 4.85p, your 'buy' trade would have resulted in a £242.50 gross loss.
Net profit / loss
To accurately calculate your net profit or loss, you would need to factor in any commission or funding charges. In this example, your total commission cost was £14.50 + £14.74 = £29.24, and there are no funding costs because the position was not held overnight.
The US stock market opens from 2.30pm to 9pm UK time, which means many UK-based trading companies only allow you to trade up until 9pm.
We've made sure our clients can trade CFDs on dozens of key US stocks at the most important times – up until 1am Monday to Thursday and 10pm on Fridays (UK time).
This includes major stocks such as Apple, IBM, McDonald's, Microsoft, Facebook and Alibaba during US earnings season.
Learn more about funding and margin requirements for extended hours shares.
DMA allows you to trade CFDs on prices sourced directly from the order books of major equity exchanges, as well as the ability to view pricing from global exchanges and MTFs.
It can be traded using our iOS and Android apps (to request DMA access on your app please give us a call) as well as on L2 Dealer, our dedicated DMA platform.
We recommend direct market access only for advanced traders. It is suitable for those looking to trade market depth with algorithms, and traders looking to participate in the pre-market and post-market auctions.
Why do companies offer shares?
By holding an initial public offering (IPO) and floating a company on a stock market, the management allow investors to buy shares and are able to raise capital to put back into the company. If this money is used for expansion and improvement it should boost the share price, so the company and its investors are heavily reliant upon each other.
Flotation is also a way for a business owner to realise a profit, particularly if they have built the company from scratch.
What are the funding and margin requirements for extended hours trading?
When trading during extended hours, normal margin requirements will apply.
It is important to make sure you have sufficient funds in your account to cover any open positions on these markets, as stops, limits and orders to open can be triggered during these times.
How do I trade share DMA with IG?
Our pricing technology is engineered to find the best available prices on both OTC (over-the-counter) and DMA (direct market access). This means that DMA prices are not necessarily better than OTC, but direct access to the markets can give you greater visibility and flexibility as a trader.
There are many added complexities to the trading environment and there can be an increased risk. As we take a parallel position in the underlying market, DMA traders need to be aware that once an order has been executed we are unable to change or reverse the position.
Most clients will need to have a minimum £1000 cash balance on their account to activate DMA. You can trade DMA on our iOS and Android apps (to request DMA access on your app please give us a call) as well as on L2 Dealer, our dedicated DMA platform.
What are the costs of DMA?
Our only charges are a small commission – the same as an OTC trade.
Depending on the exchange you wish to view or trade on, you may be liable to pay data fees. These fees are refunded if you're a frequent trader.
Under the terms of our customer agreement, we will also pass on to you any transaction costs, such as stock borrowing fees, which we incur as a result of your transaction.
How does share trading with DMA work?
Our DMA service allows you to trade on underlying market prices and depth, but what you’ll actually receive on placing a trade is a CFD from us. It works like this:
So while you’re trading at market prices, you won’t gain any ownership rights over the equities that form the subject of your CFD.
What are corporate actions?
A corporate action occurs when a publicly-traded company initiates a change to the business that will affect its shareholders, such as a merger, acquisition or share split. Any corporate action will normally need to be agreed by the company’s board of directors and authorised by its shareholders.
A corporate action may have substantial implications for the company’s finances, including its share price and performance.
1 The majority of IG clients have access to over 7500 markets, although individual country restrictions may apply
2 Professional clients are exempt from regulatory limits on leverage in place for retail clients, and are able to trade on lower margins as a result. You can find out more, and check your eligibility, on our professional trading page.