Stock CFDs are financial derivatives that allow investors to profit from price fluctuations without owning the underlying stock. By trading stock CFDs, investors can avoid additional costs associated with traditional stock trading (such as stamp duty) while benefiting from the flexibility of long and short trading opportunities, allowing them to capture potential profits in both rising and falling markets.
EBC offers 50 carefully selected global blue-chip stocks for CFDs trading, providing investors with competitive trading costs and the flexibility of long and short positions. Coupled with excellent liquidity support, EBC ensures a smoother, more efficient trading experience for investors.
EBC's stock CFDs offer 1:5 leverage, enabling investors to access top global companies with only a small initial investment and maximise their profit potential.
However, while leverage allows investors to participate in larger trades with lower capital, it also amplifies the risks associated with market volatility. Adverse market movements may lead to larger losses, so investors should use leverage with caution.
Stock CFDs trading is similar to traditional stock trading but does not require holding the actual stock. Prices are influenced by a company’s financial performance and market trends. Before trading, investors should review key financial indicators such as Price-to-Earnings (P/E) and Price-to-Book (P/B) ratios to evaluate a company's value. For example, a company with a P/E ratio below the industry average might indicate an undervalued opportunity. EBC selects globally recognised companies with strong liquidity and excellent financial performance to help investors identify high-value opportunities.
Stock CFDs investors can also earn dividend payouts. For instance, if a company announces a dividend of 0.32 USD per share, holding 10,000 units of the corresponding CFD would entitle the investor to a 3,200 USD dividend. On the EBC platform, simply hold the relevant stock CFDs position before the ex-dividend date to receive dividend payouts on the distribution date.
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