Contract for difference

RECENT NEWS
Mondo Visione  Jun 29  Comment 
This statement provides an update on the Financial Conduct Authority’s (FCA) policy work on contract for difference products (CFDs) and CP16/40: Enhancing conduct of business rules for firms providing contract for difference products to...
Mondo Visione  Feb 2  Comment 
The Financial Conduct Authority (FCA) recently reviewed the procedures for taking on new clients in a sample of ten firms that offer CFD products. We reviewed: the firms’ approaches to assessing the appropriateness of CFD trading for...
Biomass Magazine  Aug 15  Comment 
The U.K. Department of Energy and Climate Change has published a detailed draft of a long-term Contract for Difference, which is a new support mechanism that is being introduced to help incentivize private sector investment in energy infrastructure.




 

A contract for difference (CFD) is a derivative (of an underlying security) contract between two parties that stipulates that one party pays the difference between the current price (at the time they enter into the contract) of the security and the price of the security at another stipulated time.

CFDs are generally traded over the counter. They are not allowed in the USA but are becoming increasingly popular in countries like Australia, UK and Singapore. Some of the firms that offer CFDs are IGMarkets, Macquarie Bank etc.

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