You should consider whether you understand how this product works, and whether you can afford to take the high risk of losing your money.ĬFD Accounts provided by IG International Limited. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail client accounts lose money when trading CFDs, with this investment provider. The risks of loss from investing in CFDs can be substantial and the value of your investments may fluctuate. Digital 100s offer a simplified form of option that do not require the trader to own the underlying asset, for instance.Īs an asset could theoretically increase in price indefinitely, short selling requires careful risk management to prevent losses from overrunning. There are other ways of opening short positions.
Derivatives such as CFDs enable traders to open short positions that do not require borrowing the underlying asset.Usually the borrowing and selling of the asset is taken care of by the broker. When a trader borrows an asset they do not own from a broker and sells it on the market.There are two main methods of short selling: The most well-known method of shorting is short selling. Shorting is the opposite of going long, or trading to incur a profit if your market increases in price. It is also often referred to as going short, shorting or sometimes selling. In trading, short describes a trade that will incur a profit if the asset being traded falls in price.
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