Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% 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. 71% 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.

Counterparty risk (also called ‘default risk’) is the risk to each party of a contract that the other party will not live up to its contractual obligations.

Counterparty risk definition

Counterparty risk (also called ‘default risk’) is the risk to each party of a contract that the other party will not live up to its contractual obligations.

An example would be a mortgage taken up with a bank. The bank will be exposed to the risk of payment default, where the borrower has the risk of not receiving the agreed loan amount.

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