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Features of Forex CFDs

CFD contracts are available on major foreign exchange rates through CFD providers. When a CFD contract is entered into the trade involves simultaneously going long on one currency and going short on another currency. The trade is entered into at the prevailing exchange rates with a long and short position created in the currencies being traded on.

Features of Forex CFDs

CFD contracts are available on major foreign exchange rates through CFD providers. When a CFD contract is entered into the trade involves simultaneously going long on one currency and going short on another currency. The trade is entered into at the prevailing exchange rates with a long and short position created in the currencies being traded on. Any positions held overnight will have interest adjustment made accordingly. It is in effect a carry trade at work here depending if the long position currency is yielding a higher interest rate. Gross profit/loss is calculated when the trade is closed at the then prevailing exchange rate and any interest adjustment are made to arrive at the final profit/loss. 

 Example of Forex CFD

The following is a generic example of how a Forex CFD might work. The method of making interest adjustments may vary by CFD providers.