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CFDs are financial instruments that allow traders to speculate on the price movements of various underlying assets.
Using Clarity as your self-directed trading platform means that you are trading with CFD’s or contract-for-difference with Investec Bank. CFDs are financial instruments that allow traders to speculate on the price movements of various underlying assets.
CFDs (Contracts for Difference) and owning shares represent two different ways of participating in the financial markets.
With CFDs, you don’t own the underlying asset (such as a share) but rather enter into a contract with a broker allowing you to participate in the gains and losses.
A CFD, or Contract for Difference, is a financial contract that allows you to gain exposure to the price movements of a share, ETF, or other financial instrument without owning the underlying asset. When you trade a CFD on Clarity, you enter into a contract with Investec that mirrors the performance of the chosen instrument.
If the price of the underlying asset rises, you benefit from the increase. If it falls, you incur a loss. The difference between the opening and closing price of the contract is settled in cash.
When you open a CFD position, you’re agreeing to exchange the price difference of an asset from the time you open the trade to when you close it. The economic outcome is the same whether the position is fully funded or traded using leverage.
Key characteristics of CFDs on Clarity:
CFDs offer flexibility that traditional share ownership doesn’t always provide. They allow investors and traders to tailor their approach depending on their goals, time horizon, and level of experience.
With CFDs, you can:
CFDs carry risk, and it’s important to understand how they work before trading.
CFDs are best suited to investors who are comfortable managing risk and understand market movements.
Discover the key features, benefits, and considerations of CFD trading in one quick overview.
You can trade without owning the underlying asset.
Take positions on whether prices will rise or fall.
Trade using leverage for increased market exposure.
Access a wide range of local and global markets.
Go long or short depending on your market view.
Benefit from real-time pricing and market information.
Open and close positions quickly through the platform.
Monitor your portfolio and trading activity in one place.
Manage your account online with ease.
Geared CFDs (Contracts for Difference) allow you to gain exposure to the price movements of a share or ETF using leverage. Instead of putting up the full value of the investment, you commit a portion of the total value, known as margin, and enter into a contract with Investec to track the price movement of the underlying asset.
This means you can participate in the market with less upfront capital but with greater risk.
When you trade a Geared CFD on Clarity, you’re speculating on whether the price of an instrument will rise or fall. Because you’re using leverage, both gains and losses are amplified relative to the capital you’ve committed.
Key points to know:
Geared CFDs are best suited to experienced traders who understand leverage and actively manage risk.
CFDs offer flexibility that traditional share ownership doesn’t always provide. They allow investors and traders to tailor their approach depending on their goals, time horizon, and level of experience.
With CFDs, you can:
CFDs carry risk, and it’s important to understand how they work before trading.
CFDs are best suited to investors who are comfortable managing risk and understand market movements.
A Fully Funded CFD gives you full economic exposure to a share or ETF: without using leverage. You fund the entire value of the position upfront and enter into a CFD contract with Investec that mirrors the performance of the underlying asset.
In practical terms, this makes a Fully Funded CFD very similar to owning the share, just without the administrative complexity of direct ownership.
When you trade a Geared CFD on Clarity, you’re speculating on whether the price of an instrument will rise or fall. Because you’re using leverage, both gains and losses are amplified relative to the capital you’ve committed.
Key points to know:
Geared CFDs are best suited to experienced traders who understand leverage and actively manage risk.
Physical Equities refer to direct ownership of shares in a listed company. When you buy a physical equity, your name (or your nominee’s) is registered as the shareholder, and you own a portion of the business.
This is the traditional way of investing in shares.
When you invest in physical equities:
Physical equities are generally used for longer‑term investing and portfolio building. Unlike CFDs:
Clarity’s trading platform gives you access to financial markets through Contracts for Difference (CFDs), rather than direct share ownership.
This approach allows you to:
It’s important to understand that when trading CFDs, you do not own the underlying asset. Instead, you enter into an agreement that reflects the price movement of that asset. As with any investment product, CFDs carry risks and may not be suitable for all investors.