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A stock, which is also known as a share or equity is simply a divided-up unit of the value of a company. When a firm needs money, instead of borrowing this (debt) it can start a public offering (IPO) and sell shares (equity) in itself. If a company is worth €100 million and 50 million shares are issued, each share is worth €2.
The main difference between Stock CFD Trading and Stock Trading is when you trade a CFD you don't own the asset or instrument you have chosen to trade, but you can still benefit if the market moves in your favour, or make a loss should the market move against you. CFDs are a leveraged product, which means that you only need to deposit a small percentage of the full value of the trade to open a position.
Equities are part of most investment portfolios.
Shares & stocks are probably the most covered and highest profile asset classes.
For individual & professional traders they offer a way of diversifying portfolios and can be used to hedge FX, fixed income or cryptocurrency exposure.
If you buy a share in a company and hold this yourself, or through a nominee account, you are tied to the value you brought at. However, you can buy a CFD based on an individual share and go long or short, as with any other CFD. For this reason, at SquaredFinancial, we offer access to a full range of individual stock based CFDs.
Shares can be traded on a single company (single stock) or through an index which tracks a number of companies listed on the same exchange. Single stock shares may provide better returns especially if you have insights into the firm or the sector – automotive, pharma, technology etc – but can be higher risk. An index will tend to be less volatile, as it tracks a number of firms from a range of sectors, but will provide lower net gains or losses.
If you hold an open Long position on a Equity contract that pays a dividend, you will be entitled to an amount equal to the amount based on the number of contracts you hold after the close of the business day before the ex-dividend date.
Conversely, if you hold an open Short position in an Equity which pays a dividend, you will be required to pay an amount based on the number of contracts you hold after the close of the business day before the ex-dividend date. This adjustment may be made either as a cash adjustment into your MetaTrader 5 trading account.
Keep an eye on Earnings. Upon an upcoming company reports or other corporate actions (collectively, the ‘corporate event’), margin requirements for Shares and Spot Indices may be increased 5 business days prior to the corporate event and may remain in effect after the corporate event, at the companies sole discretion.
During the affected period, new margin requirements will apply for all new and existing trades. Clients remain fully responsible for monitoring the required margin of their accounts as well as the free margin prior, during and after the affected period. As a result of the above, clients must understand and accept that this may result in their account(s) incurring a stop out. When trading Stock CFDs or Indices CFDs, it is important to stay up to date with the Earnings & dividends be aware of any potential impacts on your trading.
Exchange | Commission charged | Leverage | Trading hours | Platform | ||
---|---|---|---|---|---|---|
North America | ||||||
NASDAQ | 0.06 USD/share (min 2 USD) | 1:5 | Mon-Fri 13:30-20:00 GMT | MT5 | ||
New York Stock Exchange | 0.06 USD/share (min 2 USD) | 1:5 | Mon-Fri 13:30-20:00 GMT | MT5 | ||
NYSE MKT | 0.06 USD/share (min 2 USD) | 1:5 | Mon-Fri 13:30-20:00 GMT | MT5 | ||
Europe | ||||||
BME Spanish Exchanges | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
Deutsche Börse (XETRA) | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
London Stock Exchange | 0.15% (min. 5 GBP) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
Milan Stock Exchange | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
NASDAQ OMX Copenhagen | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
NASDAQ OMX Helsinki | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
NASDAQ OMX Stockholm | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
NYSE Euronext Paris | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
NYSE Euronext Brussels | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
NYSE Euronext Amsterdam (AEX) | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
NYSE Euronext Lisbon | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
Oslo Stock Exchange | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
SIX Swiss Exchange | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||
Vienna Stock Exchange | 0.15% (min. 5 EUR) | 1:5 | Mon-Fri 07:00-15:30 GMT | MT5 | ||