CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67.7% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
| Self-Trade |
Live trade alerts direct to your phone included for free as part of the service. If you like the recommendation you can place the trade or give us a call. If you don't, you put your phone in your pocket and continue your day.
The Self Trade account offers execution only services backed up by access to our high quality research and alert’s. The service is tailored to the individual investor who wants to receive market alerts and notifications but ultimately be left to make their own decisions. As a Self Trade client you have access to one of best trading platforms available with a depth of resources second to none, and free access to our real time trade alerts.
The service puts you in direct control and leaves all decisions to you. The service is tailored for those clients who want to do their own trades but be kept alert of trading idea and market developments from us.
Alerts as they happen. We send real time trade signals direct to your mobile and email, which includes entry price stop level and rationale, more importantly we tell you when to get out.
You will have access to an account manager with a wealth of experience and we will alert you to developments in the market as they happen. We want are clients to be assured there in safe hands.
Thousands of instruments including Shares, FX, Indices, Commodities with powerful charting and innovative trading tools available through desktop platform, mobile or tablet apps.
A service tailored around your needs. Communication preferences, alerts suited to you.
Access to the exclusive Atlantic client APP, the app provides you with live trade recommendations, risk management levels, open trade risk management, support Trades, Resistance Trades, power trends, stock market news, the week ahead as well as many more features designed to support your trading.
Not only do you receive live trade signals but also the continued alerts on open positions and how to manage the trade by locking in more profit and allowing the trade to develop. – The aim of this is try and maximise your gains in a position.
All clients receive full cost disclosures prior to trading, no hidden costs, no additional cost for dealing on the phone.
Access to over 10,000 financial instruments from across the globe.
CFDs are a way of trading on the price movements of financial markets without buying or selling the underlying asset directly.
They provide the opportunity to trade a wide range of markets including equities, indices, currencies and commodities.
CFDs can be used to speculate on upward or downward price movements, making them a flexible alternative to traditional trading.
A CFD (Contract for Difference) is basically an agreement to exchange the difference between the opening and closing value of a contract at its close. The price of your CFD will then replicate the price of the underlying asset giving you a profit (or a loss) as the price of the underlying moves.
There are no expiry dates on CFDs, as a result you can run a position for as long as required.
As with traditional share dealing, CFD prices are quoted as a Bid (the price you can sell at) and an Offer (the price you can buy at). You then buy or sell a CFD based on the value of a certain amount of the underlying asset.
To open a CFD trade, you need to deposit only a fraction of the total trade value – which is known as the “margin”.
Margin trading enables you to increase your exposure to an underlying asset from the same initial investment.
When you use a deposit of, say just £20,000 (or equivalent currency) in your account, you can typically trade up to £100,000 worth of shares. This is a leverage factor of 5:1 or, to put it another way, a 'margin requirement' of 20%.
Trading CFDs on margin allows you to take large market positions in relation to the money you have deposited. Margin trading magnifies both your profits and your losses.
You must maintain your margin if the market moves against you and your deposited funds do not cover open position losses and margin requirements. This may mean sending additional funds at very short notice and/or reducing the size of your positions, which is known as a 'margin call'.
Many investors choose to limit their risk - or protect a running profit or open position - by placing a 'stop-loss' order, which closes out their position automatically once a set price level is reached.
While Atlantic highly recommends using a stop-loss, we should point out that your stop-loss might be filled at a worse price than you had requested. This 'slippage' can happen in fast moving market conditions, or where a share opens a trading session well away from its previous close.
One key benefit of CFD trading is that you do not incur any stamp duty or need to pay safekeeping custody fees, as you are not making a physical purchase.
By the same token, you will not have any shareholder voting rights.
As CFDs offer the ability to go short as easily as long, they can be used to provide ‘insurance’ against price falls in an existing portfolio. For example, if you have a long-term portfolio that you wish to keep, but you feel that there is a short-term risk to the value of your investments, you could use CFDs to mitigate a short term loss by ‘hedging’ your position. If the value of your portfolio falls the profit in the CFDs should offset these losses.
CFD trading gives you access to a wide range of markets that would not otherwise be available to retail investors. It is as easy to trade on the price movement of commodities such as oil or gold as it is to trade an individual equity. CFDs also allow you to speculate on whole indices or sectors from a single trade.
The best way to understand how CFDs work is to follow some examples.
In this example an investor believes the share price of Barclays will rise. The investor wishes to go long (buy) £10,000 worth of Barclays shares priced at £2 each.
With a CFD, you only need to invest £2,000 (20% of £10,000) to open this position and unlike shares, you don’t pay 0.5% Stamp Duty.
|
Opening trade |
Buying shares |
Buying a CFD |
|---|---|---|
|
Total value of shares |
£10,000 |
£10,000 |
|
Initial outlay |
£10,000 |
£2,000 |
|
Commission (0.25%) |
£25 |
£25 |
|
Stamp Duty (0.5% on shares) |
£50 |
£0 |
After 10 days, the share price rises to £2.10 and you sell at a profit. With a CFD, your deposit is returned to you, together with your profit minus any associated costs.
|
Closing trade |
Selling shares |
Selling a CFD |
|---|---|---|
|
Closing value |
£10,500 |
£10,500 |
|
Commission (0.25%) |
£26.25 |
£26.25 |
|
Financing charges |
£0 |
£8.40 |
|
Net Profit |
£398.75 |
£440.35 |
Like normal share dealing, with CFDs you deal at the cash price of the share and pay a commission on both the open and the close, which is calculated as a percentage of the value of the transaction.
The above examples use our standard commission rate of 0.25%. Atlantic’s commission rates range from 0.2% to 0.5% (min £20) depending on account size.
The financing charge on a long CFD is based on LIBOR + 2.5%. Based on current LIBOR rates, on a £10,000 long position, this works out at around £0.84 per day.
In this example an investor believes the share price of Vodafone will rise. The investor wishes to go long (buy) £10,000 worth of Vodafone shares priced at £2 each.
To limit the risk, a stop-loss is placed at 194p. This means that if the share price falls to 194p, the position is closed. We recommend a stop-loss is placed on all CFD trades.
|
Opening trade |
Buying shares |
Buying a CFD |
|---|---|---|
|
Total value of shares |
£10,000 |
£10,000 |
|
Initial outlay |
£10,000 |
£2,000 |
|
Commission (0.25%) |
£25 |
£25 |
|
Stamp Duty (0.5% on shares) |
£50 |
£0 |
After 10 days, the share price falls to 194p and the stop-loss is activated. With a CFD, your deposit is returned to you, minus your loss and any associated costs.
|
Closing trade |
Selling shares |
Selling a CFD |
|---|---|---|
|
Closing value |
£9,700 |
£9,700 |
|
Commission (0.25%) |
£24.25 |
£24.25 |
|
Financing charges |
£0 |
£8.40 |
|
Net Loss |
£399.25 |
£357.65 |
Like normal share dealing, with CFDs you deal at the cash price of the share and pay a commission on both the open and the close, which is calculated as a percentage of the value of the transaction.
The above examples use our standard commission rate of 0.25%. Atlantic’s commission rates range from 0.2% to 0.5% (min £20) depending on account size.
The financing charge on a long CFD is based on LIBOR + 2.5%. Based on current LIBOR rates, on a £10,000 long position, this works out at around £0.84 per day.
In this example an investor believes the share price of Tesco will fall. The investor wishes to go short (sell) £10,000 worth of Tesco shares priced at £2 each.
With a CFD, shorting a share is the ‘mirror image’ of buying it. As most traditional stockbrokers do not allow private investors to go short, an investor is unable to use shares to capitalise on a falling price.
|
Opening trade |
Shares |
Selling a CFD |
|---|---|---|
|
Total value of shares |
n/a |
£10,000 |
|
Initial outlay |
n/a |
£2,000 |
|
Commission (0.25%) |
n/a |
£25 |
|
Stamp Duty |
n/a |
£0 |
After 10 days, the share price falls to £1.90 and you sell at a profit. With a CFD, your deposit is returned to you, minus any associated costs.
|
Closing trade |
Shares |
Buying a CFD |
|---|---|---|
|
Closing value |
n/a |
£9,500 |
|
Commission (0.25%) |
n/a |
£23.75 |
|
Financing charges |
n/a |
£7.50 |
|
Net Profit |
n/a |
£443.75 |
Like normal share dealing, with CFDs you deal at the cash price of the share and pay a commission on both the open and the close, which is calculated as a percentage of the value of the transaction.
The above examples use our standard commission rate of 0.25%. Atlantic’s commission rates range from 0.2% to 0.5% (min £20) depending on account size.
The daily financing on a short CFD is based on LIBOR - 2.5%. Based on current LIBOR rates, on a £10,000 short position, this works out at around £0.75 per day.
In this example an investor believes the share price of Tesco will fall. The investor wishes to go short (sell) £10,000 worth of Tesco shares priced at £2 each.
With a CFD, shorting a share is the ‘mirror image’ of buying it. As most traditional stockbrokers do not allow private investors to go short, an investor is unable to use shares to capitalise on a falling price.
|
Opening trade |
Shares |
Selling a CFD |
|---|---|---|
|
Total value of shares |
n/a |
£10,000 |
|
Initial outlay |
n/a |
£2,000 |
|
Commission (0.25%) |
n/a |
£25 |
|
Stamp Duty |
n/a |
£0 |
After 10 days, the share price rises to £2.10 and you sell at a loss. With a CFD, your deposit is returned to you, minus your loss and also any additional associated costs.
|
Closing trade |
Shares |
Buying a CFD |
|---|---|---|
|
Closing value |
n/a |
£10,500 |
|
Commission (0.25%) |
n/a |
£26.25 |
|
Financing charges |
n/a |
£7.50 |
|
Net Loss |
n/a |
£558.75 |
Like normal share dealing, with CFDs you deal at the cash price of the share and pay a commission on both the open and the close, which is calculated as a percentage of the value of the transaction.
The above examples use our standard commission rate of 0.25%. Atlantic’s commission rates range from 0.2% to 0.5% (min £20) depending on account size.
The daily financing on a short CFD is based on LIBOR - 2.5%. Based on current LIBOR rates, on a £10,000 short position, this works out at around £0.75 per day.
If you can't find an answer to your question, please do not hesitate to contact us, and we will be happy to answer any questions.
Yes. Atlantic Capital Markets Ltd is authorised and regulated by the Financial Conduct Authority. Our Firm Reference number is 764562.
A CFD offers you all the benefits of trading shares without having to physically own them. Simply put, it is a contract that mirrors the performance of an underlying instrument. It is traded on margin, and just like physical shares your profit or loss is determined by the difference between the price you buy at and the price you sell at.
Margin trading allows you to free up your capital by placing only a small percentage of the value of trade in your account.
The initial amount you pay is known as the deposit or Margin Requirement. Dealing on margin can significantly increase your profits, but it can also significantly increase your losses in the same way.
Margin rates vary depending on what you trade, but typically range between 5% and 50%. You can find details of the margin requirements for each specific instrument on the trading platform.
You pay a commission when you trade and may incur financing charges on positions held overnight.
There are no hidden costs such as administration or management fees and you deal at the market price as we do not widen the spread of the share.
Our commission rate on equities varies from 0.2% to 0.5% depending on account size. For commission rates and charges related to other instruments please contact Atlantic for further information.
Positions held overnight may incur a financing charge. This may be paid or received dependent upon the position.
Clients pay interest on the contract value of a long CFD. Interest is charged at a percentage over LIBOR (LIBOR is the London Interbank Offered Rate and is linked to base interest rates).
Clients holding short CFD contracts may receive interest on the cash that the sale of the underlying stock would have generated. This is similarly paid at an agreed rate under LIBOR.
For example, if a client was paying a long CFD funding charge of 3% over LIBOR and if LIBOR was 0.25%, the client would be paying a funding rate of 3.25% per annum. If the total contract value was £10,000 the funding charge would be around £0.89 for every day the contract was maintained (£325 divided by 365).
This amount would be debited daily from your CFD account. The funding charge is only incurred if the position is held overnight. These amounts will be credited or debited on the next trading day.
There are no expiry dates on CFDs, as a result you can run a position, long or short, for as long as required.
A client can "go short", meaning that they can sell a CFD as an opening position.
A common question is "How can a trader sell something they don't own?" This can be done as what the client is buying is a contract between themselves and the CFD provider, based upon the price movement of a share. It does not matter who agrees to buy and who agrees to sell, as neither party physically owns the share anyway.
The important thing is how far the price of the Share or Index moves, and whether or not it moves the way you want it to. Using this facility, a trader may be able to profit from a falling market.
Yes. Although a CFD trader does not physically own the share, s/he can partake in Corporate Actions and receive dividends. However, as the CFD trader does not own the share itself, they are not entitled to any voting rights.
Whilst they are exempt from stamp duty, any profits on CFDs may be subject to CGT (Capital Gains Tax) but losses may also be offset against CGT.
Yes, Atlantic clients can also trade Currencies and Commodities from their CFD account.
Yes, trading can be conducted over the telephone or the online trading platform. There is no additional cost for trading over the telephone.
Applying for an account is quick and easy. The next step is complete our secure online Suitability Questionnaire.
Provided you are suitable for a CFD advisory account and we receive the correct documentation from you, your account should be up and running within a business day.
Yes, to open a joint account you will need to complete a paper based application form signed by both parties. The documentation required from each applicant is the same as that required for an individual account.
Yes you can, with our Atlantic Account you have regular Stop losses available but also we have Guaranteed stop losses and automatic trailing stop losses which can be used at no extra charge.
The Atlantic trading APP is a key companion for all clients, and indeed anyone actively looking at the markets. Live trade alerts, live position management, Support trades, Resistance trades, Trend identifiers as well as the guidance for the week ahead, dividends and the latest news.
Why go it alone when you can have Atlantic on your side.
