We’ve been discussing changes at OANDA this week. Today the broker announced that they are making CFD products available to their Canadian customers. The news follows an announcement late last year that OANDA had increased its CFD products which were available to European customers.
TORONTO, Feb 13, 2013 (BUSINESS WIRE) — OANDA Canada clients now have the opportunity to invest in a variety of commodity, stock index, and fixed income contracts for difference (CFDs) using the company’s award-winning trading platform. With the addition of these products, OANDA Canada’s retail clients can invest in U.S. debt; commodities such as corn, wheat, and oil; and leading global stock indices.
According to Courtney Gibson, Vice-President of Trading at OANDA, clients benefit from access to multiple instruments from one innovative platform.
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“Our OANDA Canada customers now have access to a great selection of other asset classes, from the same platform they already know and trust for forex,” Gibson said. “Aside from the advantages that CFDs offer as an investment product – the ability to hedge existing positions, or short the market without paying a penalty – clients get the benefit of OANDA’s flexible lot sizes, commission-free pricing, and quality of execution.”
A CFD is a derivative instrument whose price is based on an underlying asset. Neither the trader nor the authorized, regulated dealer owns the underlying financial asset; they only own the speculation contract. CFDs may include equities, commodities, indices, or currencies, and investors can trade them without the need to tie up a large amount of capital to do so.
Investing in CFDs carries similar risks to investing in forex. CFDs are often traded on a leveraged basis (like forex) and a small market movement will have a proportionally larger impact on your position (which could result in losses or gains). CFD transactions carry a high degree of risk and are not suitable for all.