How to trade US stocks with leverage
|June 19th, 2015, 06:11 PM||#11 (permalink)|
Christchurch, New Zealand
Futures Experience: Beginner
Broker/Data: IB,IG,TT, IQ Feed
Favorite Futures: US Equities
Posts: 318 since Jul 2014
Thanks: 408 given, 362 received
CFDs typically have 10:1, or 20:1 Margin, often with better overnight rates.
The only reason not to trust CFD's is if you're trading a Market maker model that's taking the otherside of your trade or using some indirect hedge. DMA models( like IB's) are generally quite transparent, as your order is physically hedged in the book( you can see the order for yourself) so their CFD markets trade 1-1 with the underline- You're basically trading the NBBO. If you're trading liquid stocks eg AAPL, FB etc then a typical retail trader isn't going to see any real difference in order fills/ execution. The only disadvantage is that illiquid stocks might not always have shares available, there can be delays in modifying orders( it might take seconds instead of ms), and you can't route to a specific exchange.
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