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  • Writer's pictureLEE FISHER

Behind the scenes of CFD companies

First, let me explain what a contract for differences (CFD) is. This is an agreement between an investor and a CFD broker to exchange the difference in the value of a financial product (securities or derivatives) between the time the contract opens and closes. A contract for differences enables one to trade shares without having to physically own them. In any CFD company, during the account opening procedure, all clients are appropriately informed about the risks associated with trading, as per industry practice. This will be the excuse they’ll give you after losing you

r money. Most of the CFD companies are making money while their clients are losing it. The fake answer you will hear from your account manager is the spreads and swaps, but it's not where the real money is coming from. Their sales agents make money when you transfer money to your trading account. Also, our account manager makes a percentage every time you put money into your trading account. In fact, the more money you put into your account, the more the percentage they get through your account. The sad truth is that the more you invest, the more you will lose.

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