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Any recommended CFD Brokers for USA based Traders?
So, I have a really strong opinion on CFD. It's all a scam and you should stay as far away as possible. Basically CFDs are setup by bucket shops to take trader's money.
I'm pretty strict: only trade products on regulated exchanges with regulated brokers, and solid clearing houses backing the transaction. When you trade a CFD, the entity your trading with is the broker, exchange and clearing firm. There is far too much chance that something fishy will go on in that situation to warrant the risk.
CFD's are illegal in the United States, so I believe the only option would be a non-US broker that would accept your account.
I think there is an obvious reason they are illegal: as @fxfool said, you are trading against your broker, not against other traders in an open market.
This can also happen in non-exchange FX for that matter. What got FXCM banned in the United States was that they claimed to be operating a "non dealing desk," matching customer orders to outside firms' bids/offers, but they were not. In other words, they were operating dishonestly, to their customers' detriment. You have no protection from a CFD broker doing this to you, and they, on the other hand, have every incentive to act against you.
Bobwest , Fxfool and Myrrdi
Thank you all for your replies
I understand now why CFDs are not favored - I had no Idea that they were un-regulated
Makes perfect sense now as why it is best to stay away from trading them
If you are interested in trading leveraged products, you have the choice between futures, options on futures and options on stocks. All of these are traded on regular exchanges.
There are many brokers around offering these products.