You can open a position without having to put up the full underlying value. Instead you put up a deposit or margin from just 1% to up to 20% of the contract value. Clients only have to deposit approximately 5% of the value of the Shares. So if you want to buy $50,000 worth of Shares, you only need to have $2,500 on deposit with OFB.
You can buy or sell any share that we quote, to profit from rising or falling prices. Other methods of shorting shares are often inconvenient and expensive.
You can trade in seconds; there is no irritating wait for an execution. Alternatively you can call our dealing room which is open 24-hours (Monday- Friday) to execute the trade.
CFDs have no fixed expiry date, giving you the freedom to close your position when you choose. While your position remains open, your account is debited or credited to reflect financing and dividend adjustments.
Your account is debited to reflect financing adjustments and credited to reflect any dividends. This mirrors the effect of buying shares in the normal way, where you no longer earn interest on the cost of the shares, but do receive dividends.
Your account is credited with financing adjustments and debited to reflect any dividends. This mirrors the effect of selling shares, where you earn interest on the proceeds of the sale, but cease to receive dividends.
The applicable interest rates will be set out in your account opening letter. Dividend adjustments are applied at the amount of the net dividend, if you have an open position in a share on the ex-dividend date.
CFDs are not suitable for "buy and forget" trading or long-term positions. Each day you maintain the position it costs money (if you are long), so there is a time when CFDs become expensive. For short-term trading they have advantages, provided you get the markets right. But be prepared at some economic stage to cut the position.