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Back in 2007, AxiTrader wased established on an easy concept: to be the broker we had actually want to trade with. We've because grown to turn into one of Australia's biggest and leading Forex brokers.
Our trading options are advanced enough for seasoned traders yet simple enough for those with less experience. Whatever your Forex experience, we've got a solution that fits your requirements.
We assist traders utilizing Forex as an asset class to fulfill part of their trading portfolio. Our commodity prices and liquidity is sourced from several locations in Forex markets. We aim more difficult to be the finest-- it's exactly what separates us from our competition and makes us one of Australia's largest domestic Forex brokers.
CFD & Indices Basics
WHAT ARE CFDS?
CFD stands for Contracts for Difference, with the difference being between where you enter a trade and where you exit. Simply put, when the position is closed, you'll get the profit or incur the loss on that difference.
If you have bought gold for $1600, you do not have an ounce of gold that you can hold, rather you purchased a contract from AxiTrader that will increase in value if the Gold cost boosts. For example, when you trade a CFD you're hypothesizing on the movement of the price just, instead of traditional stocks where you acquire a physical asset. When integrated with leverage, CFDs offer you quick, versatile and economical direct exposure to a host of worldwide financial items.
WHY TRADE CFDS?
- If you're planning to invest in the cost movements of instruments, instead of purchasing physical assets
- To make the most of swift changes in the underlying instrument or security. This is popular with short-term financiers looking to make money from overnight and intra-day movements in the market
- To take benefit of leverage and spread capital throughout a range of different instruments rather than tie it up in a single investment (note: this technique can increase risk).
- As a risk management tool to hedge exposure.
EXAMPLE GOLD CFD TRADE.
If the gold (XAUUSD) cost is $1600.00, it indicates an ounce of gold is traded at US$ 1600.00. The cost of silver is its price per ounce in USD.
If you have bought gold for $1600, you do not have an ounce of gold that you can hold, however you rather have the commitment to buy XAU at US$ 1600. When you close your position, you sell the XAU and close your exposure. You have made profit of $5 for every ounce (unit) of gold in your contract if you offer it for $1605.00. The exact same concept applies to silver trading. If you have purchased silver (XAGUSD) for $28.00 and sell at $28.50, you would have earned a profit of $0.50 for each ounce of silver in your contract.
INDEX FUTURES ROLLOVERS EXPLAINED.
AxiTrader's Index contracts are based on the pertinent futures exchange rate. Futures agreements expire because they belong to a conclusive date. There are many months traded and the forward rates can be higher or lower depending upon market conditions.
In order to eliminate final day volatility, at AxiTrader we change from using the front month contract into the 2nd month's contract one trading day prior to the exchange expiry.
An example of this is when the Australian SPI contract for March ends. The June rate needs to be utilized and the rate on the AxiTrader MT4 platform might increase or decrease depending on the value of the June contract relative to the March contract. This is undoubtedly not a rate rise or fall in the SPI however just a transfer to a brand-new referral price, for that reason no profit or loss will be incurred as an outcome.
In order to ensure this does not affect our customers, a cash adjustment has to be made. This is discussed in the copying:.
SPI March closes at 5050/5051 and SPI June opens at 5000/5001.
Your Position: 10 Buy agreements.
It closes on the old Bid cost of 5050 and resumes on the brand-new Ask price of 5001 if your position is a Buy. Your open trade P&L has actually made a loss because you are in a Buy and the brand-new market rate has actually reduced. As a result you will get a favorable adjustment quantity in your swap column equal to the difference of the old bid and the new ask.
xtb trader You will get (5050-5001) * 10 agreements = $490AUD.
Your Position: 10 Sell agreements.
It closes on the old Ask price of 5051 and reopens on the new Bid cost of 5000 if your position is a Sell. Your open trade P&L has actually made a gain due to the fact that you are in a Sell and the new market price has actually decreased. As an outcome you will get a negative adjustment quantity in your swap column equivalent to the difference of the old ask and the brand-new bid.
You will receive (5051-5000) * 10 agreements = -$ 510AUD.
Accounts will be cash changed on positions held at the following times:.
HSI Future-- Close of business on the day 3rd to last business day of the contract month.
CAC40 Future-- Close of business on the day before the 3rd Friday of expiry month.
DAX30 Future-- Close of business on the day prior to the 3rd Friday of expiry month.
S&P Future-- Close of business on the Wednesday the week prior to the 3rd Friday of expiry month.
FT100 Future-- Close of business on the day prior to the 3rd Friday of expiry month.
DJ30 Future-- Close of business on the Wednesday the week before the 3rd Friday of expiry month.
SPI200 Future-- Close of business one day before the 3rd Thursday of expiry month.
OIL ROLLOVER EXPLAINED.
AxiTrader's oil contract (WTI) is based upon the ICE futures cost (Front-Spot Month). This futures cost is the largest rate standard for the international oil industry.
Futures contracts expire because [empty] they belong to a definitive date. There are many months traded and the forward commodity prices can be higher or lower depending on market conditions.
In order to eliminate last day volatility, at AxiTrader we change from using the front month contract into the 2nd month's contract one trading day prior to the exchange expiry.
When the WTI (West Texas Intermediate) contract for September expires, an example of this is. The October price has to be utilized and the price on the AxiTrader mt4 hotforex platform may increase or decrease, depending upon the value of the October contract relative to the September contract. This is obviously not a cost increase or fall in oil but just a relocate to a new recommendation cost and therefore no profit or loss will be incurred as an outcome.
In order to guarantee this does not affect our clients, a cash adjustment has to be made. This is described in the following examples:.
Example 1: Long position of 1000 barrels.
September Contract closes @ $110.00.
October Contract opens @ $111.38.
Cash adjustment methods of hedging currency risk-- $1,380 is made on account.
Profit of $1,380 is made on open position.
Net monetary effect is absolutely no.
Example 2: Short position of 2000 barrels.
September Contract closes @ $110.00.
October Contract opens @ $111.38.
Cash adjustment of +$ 2,760 is made on account.
Loss of $2,760 is incurred on employment opportunity.
Net financial result is zero.
The cost of silver is its price per ounce in USD. The June price requires to be used and the rate on the AxiTrader MT4 platform may increase or decrease depending on the value of the June contract relative to the March contract. If your position is a Buy, it closes on the old Bid rate of 5050 and resumes on the new Ask price of 5001. If your position is a Sell, it closes on the old Ask cost of 5051 and reopens on the new Bid cost of 5000. The October rate requires to be utilized and the rate on the AxiTrader MT4 platform might decrease or increase, depending on the value of the October contract relative to the September contract.
AxiTrader is a registered business name of AxiCorp Financial Services Pty Ltd (AxiCorp). AxiCorp (ACN 127 606 348) is authorised and regulated by the Australian Securities & Investments Commission (ASIC) AFSL number 318232. Investing in over-the-counter derivatives carries significant risks and is not suitable for all investors. You could lose substantially more than your initial investment. When acquiring our derivative products you have no entitlement, right or obligation to the underlying financial asset. AxiCorp is not a financial adviser and all services are provided on an execution only basis. AxiCorp is authorised to provide general advice only and information is of a general nature only and does not take into account your financial objectives, personal circumstances. AxiCorp recommends that you seek independent personal financial advice. A Product Disclosure Statement (PDS) for our financial products and our Financial Services Guide (FSG) are available at www.axitrader.com or can be obtained free of charge by calling AxiCorp on 1300 888 936 (+61 2 9965 5830). The PDS and FSG are important documents and should be reviewed prior to deciding whether to acquire, hold or dispose of AxiCorp’s financial products or services. The information on this website is for Australian residents only.