CFD's are simply the modern electronic way of implementing margin trades therefore providing a way to take large risk with small capital.
Obviously novices are open to using them without understanding the risks involved and getting seriously burned.
I dont see anything wrong with CFD's in themself - its all up to the way you use them. Margin trading has always been risky whether it operates as a CFD or not.
My point is that a CFD is not evil in itself. They allow one to UP the risk factor which of course is going to mean the wins and losses are amplified. So yes you need to understand that before entering into the deals. I assume that most people would work this out before proceeding but I guess not all do. Why would anyone think they are going to allow them to get rich with no risk ? Only idiots imo.
Not related to this thread so much but its the same as these reverse mortgages that ASB are now offering. FINSEC criticisms are emotional claptrap. Reverse mortgages are very useful for some people, used in an appropriate way they relieve financial pressure. Banks stealing inheritances lol.
I'm much in the same boat as Jeremy. I want to learn about trading for the short term. I reckon i might have a steep learning curve. I'm going to sit on my money for now. I case I don't find out for myself what is FA and TA?
I'm much in the same boat as Jeremy. I want to learn about trading for the short term. I reckon i might have a steep learning curve. I'm going to sit on my money for now. I case I don't find out for myself what is FA and TA?
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Originally Posted by jeremyhowell
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