Australian retail broker GO Markets announced the addition of several new contracts for difference (CFDs) this Thursday.
Traders using the broker will now be able to access CFDs in equities listed on the Australian Securities Exchange (ASX).
One of the largest exchanges in the world, the ASX is Australia’s main marketplace for the trading of securities.
GO Markets traders will be able to access shares in companies such as Rio Tinto, Commonwealth Bank, and Telstra.
Though GO Markets offers up to 500:1 leverage on some products, trading in the new equity-based CFDs will be limited to 20:1.
“[Adding ASX CFDs has] been a long time coming, and [it’s] all part of our central plan to have an all-inclusive offering for our clientele,” said GO Markets CEO Christopher Gore.
“Over time, we hope to be launching an even greater variety of global markets, with NYSE and NASDAQ stocks flagged for Q2 2019.”
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Equities and Australia on the rise
The move by GO Markets to add equities-backed CFDs to its platform is likely a response to a growing trend in the retail trading industry.
Traders are increasingly demanding access to equities. In many cases, they want direct market access to real stocks – not just CFDs.
It is also indicative of Australia’s expanding role in the retail trading world.
Since the European Securities and Markets Authority introduced, amongst other things, leverage caps on retail traders last August, Australia has become an attractive jurisdiction.
That is true for both brokers, who want the respectability that an Australian regulatory license conveys upon them, and clients – who want to trade with higher leverage but also don’t want to use a bucket shop based in Vanuatu.
The only problem for brokers is that it is both expensive and difficult to get a license from the Australian Securities and Investments Commission (ASIC).
The regulator did, however, issue a license in March to Fortrade – the first time it had given a retail broker its approval in more than two years.