CFD Trading in Australia: Key Risks Before You Trade
Contracts for Difference (CFDs) are complex, leveraged and high-risk products. ASIC's product intervention order limits leverage and other features for retail clients. Make sure you understand the risks before trading.
Risk Warning
Trading financial products involves risk. CFDs, forex and crypto-related products can be highly volatile and may not be suitable for all investors. TradeRadarNews Australia provides general educational information only and does not consider your objectives, financial situation or needs. Consider seeking independent advice before investing.
What is a CFD?
A CFD is a derivative contract that lets you speculate on price movements without owning the underlying asset. CFDs use leverage, which magnifies both gains and losses.
Key CFD risks for Australians
- Leverage can amplify losses quickly, sometimes within minutes.
- Overnight financing costs reduce returns on positions held for longer periods.
- Slippage and gaps can trigger margin closeouts at unfavourable prices.
- Many retail CFD traders lose money over time.
Frequently Asked Questions
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Our editorial team researches trading platforms, market education topics and scam warning signs for Australian readers. Our content is general information only and does not consider your personal objectives, financial situation or needs.
General information only. Trading involves risk and may not be suitable for all Australians.