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CFD trading
Flexible, accessible and free from stamp duty,1 CFD trading is an alternative way to go long or short on a huge variety of financial markets.
Why trade CFDs with IG?
It takes less than five minutes to open a CFD trading account, and you get reduced commissions for your first two weeks.2
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Join the UK's No.1 CFD provider3 for superior service and support
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Competitive rates: FX from 0.8 points, indices from 0.4 points, shares from 0.1% commission
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Never miss an opportunity, wherever you are, with our mobile trading app
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Opportunities in over 15,000 markets: indices, forex, shares, commodities and more
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Limit your risk with negative balance protection and a choice of stops, limits and alerts4
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Access our free research tools to become a better-informed trader
Discover more advantages of using CFDs, and see some working CFD examples.
What are CFDs?
A contract for difference, or CFD, is a derivative product which enables you to speculate/trade on the difference in price of a financial market between when the contract opens and when it closes. The profit or loss you make depends on the extent to which your forecast is correct.
- Importantly, CFDs are a leveraged product. This means you only have to put down a small deposit for a much larger market exposure
- Leverage comes with significant benefits and risks: your investment capital can go further, but you can also lose more than your initial deposit
While this means the product is very flexible, it also requires a high level of risk management. It's important to remember you're trading contracts with IG, not physically trading in the underlying market, so don’t actually own any assets.
How do you trade CFDs?
To trade CFDs, you’ll first need to set up a CFD trading account. You can do so in a matter of minutes, and once approved, you can then fund your account and start trading using an online trading platform. This is where you’ll see all the available markets, as well as view the prices for each contract.
We set prices based on the underlying market. For most markets, you are given a 'buy' and 'sell' price either side of the underlying market price. For equities, you will also need to pay a commission charge on top of this. You can take a position on a market going up (known as 'buying' or 'going long') or going down (known as 'selling' or 'going short').
Who trades CFDs?
CFDs are suitable for a wide range of traders:
- Shares traders looking to diversify their portfolio by trading on indices, commodities, forex and more
- Professional forex traders looking to gain exposure to deep liquidity with direct market access (DMA). To trade with Forex DMA, you’ll need to qualify for an IG professional account
- Indices traders looking to take a position on entire sectors, from banking to mining
- Plus commodities and ETP traders looking to access the markets without committing a lot of capital up front
What are the advantages of CFD trading?
- Flexible: Speculate on market price movements without buying or selling the underlying market, eliminating the need for brokers, forex providers and futures exchanges
- Go short and long: Trade markets you think are about to fall in value, not just those you expect to rise. This makes CFDs particularly useful for hedging existing positions in your portfolio
- Make your capital go further: CFDs are a leveraged product, meaning you only need to put up a fraction of the value of the market – its margin – to gain exposure to the full value of your trade
- No stamp duty: CFDs are free from stamp duty, and you can offset losses against future profits as a tax deduction1
- Out-of-hours markets: Close positions overnight with 24-hour trading on a number of markets, or trade over the weekend with Sunday trading
- Accessible: Whether you’re an experienced trader or relatively new to the markets, you can set up a free online trading account and get started in a matter of minutes
Our charges
It's completely free to open an account with IG. Once you've funded your account and started trading, our main charge on each trade is the spread or a small commission for shares trades. Find out more about the spread.
You choose your price per contract (we offer low minimum contract sizes for new clients), and put down a margin payment. This allows you full exposure to a market with only a fraction of the total capital you'd normally need, though remember with leverage comes increased risk.
Learn more about our charges and fees
| Number of individual markets | Minimum spread | Margin rates from | |
|---|---|---|---|
Indices |
68 |
0.1 |
0.50% |
Forex |
100+ |
0.6 |
5% |
Cryptocurrencies |
6 |
1 |
35% |
Shares |
10500+ |
0.10% |
5% |
Commodities |
47 |
0.3 |
0.70% |
Treasuries |
20 |
1.5 |
0.50% |
Choose from more than 15,000 markets
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Indices
FTSE 100, Wall Street, Germany 30 and more
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Shares
Competitive rates on over 8000 shares, plus DMA trading
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Forex
Choose from over 60 currency pairs with the UK's No.1 retail forex provider5
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Commodities
Trade on gold, silver, oil and dozens more commodity markets
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Cryptocurrencies
Trade bitcoin, ethereum, litecoin and ripple pairs
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Other markets
Deal on interest rates, bonds, sectors, ETPs and more
CFD risk management
Like all forms of trading, CFDs carry risk. You’ll lose money if a market moves against you, and, if you fail to adequately manage your risk, these losses could increase suddenly and significantly. Keep in mind that CFDs are leveraged products, meaning you could lose more than the initial deposit you put down to open your position.
This is why it’s essential you do your research before you go into any trade, and that you have an effective risk-management strategy in place. IG offers a range of tools and features to help you manage your risk, as well as educational resources to refine your understanding of the potential pitfalls.
Awards
Shares Awards
Best CFD provider
2016, 2017
ADVFN Awards
Best finance app
2016, 2017, 2018
Online Personal Wealth Awards
Best Overall Personal Wealth Provider
2014, 2015, 2016, 2017, 2018
Open an account now
It's free to open an account, takes less than five minutes, and there's no obligation to fund or trade.
CFD FAQs
You might be interested in...
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Execution and pricing
Get fast, reliable execution and the best available prices
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Web and mobile apps
Our dealing platform is available on desktop, tablet and mobile
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MetaTrader 4
Fully integrated functionality for fast, reliable trading
1 Tax laws are subject to change and depend on individual circumstances. Tax law may differ in a jurisdiction other than the UK.
2 Introductory offer. See more details.
3 Based on number of primary relationships with CFD traders (Investment Trends UK Leveraged Trading Report released August 2018).
4 Negative balance protection does not apply to professional traders.
5 By number of primary relationships with FX traders (Investment Trends UK Leveraged Trading Report released August 2018).
Example CFD Share Trade
Buying Barclays: detailed
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CFD |
|---|---|
| Underlying market/value | Barclays Plc 281/281.1 |
| Our price | 281/281.1 |
| Deal | Buy at 281.1 |
| Deal size | 2000 shares |
| Initial margin required | Notional value x margin factor = £5622 x 20% = £1124.4 |
| What happens next? | The market rallies and the closing price of Barclays is 292. This level is used to calculate overnight funding. The following day, the market continues to rally. |
| Funding | One day funding = ((One-month LIBOR + admin charges) x Notional value) / 365 = ((0.51% + 2.5%) x £5,840 / 365 = £0.48 |
| Underlying market | 295/295.1 |
| Close | Sell at 295 |
| Gross profit | £278 295 – 281.1 = 13.9p Number of shares = 2000 £0.139 x 2000 = £278 |
| Costs | Commission: £10 to open + £10 to close = £20 This is charged to open and to close. It is calculated ar 0.1% of the notional value of the position, with a minimum charge of £10 To open: Notional value x 0.1% = £5800 x 0.1% = £5.880. The minimum commission is therefore charged. Funding: £0.48 |
| Net profit | £257.52 profit subject to tax |
| What if... | If the underlying market fell to 267/267.1 instead: 267 – 281.1 = -14.1 pence (-£0.141 x 2000) + £20 + £0.48 =£302.48 net loss |
Help and support
Get answers about your account or our services.
Or ask about opening an account on 0800 195 3100 or newaccounts.uk@ig.com.
We're here 24hrs a day from 8am Saturday to 10pm Friday.
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Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.