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Do CFDs Offer Higher Leverage Than Traditional Trading?

As leverage becomes more popular among traders, many are wondering if CFDs offer higher leverage than conventional trading. Find out here.

By Andrew Moran

Edited by Joel Taylor

Updated June 18, 2024.

﻿Leverage is a popular trading tool that allows investors to borrow capital to increase their position, greater than what is available from their cash balance.  It can play a critical role since it can amplify your trading power in your trading endeavors and potentially add to your gains or result in sharp losses.
And, yes, CFDs offer higher leverage than traditional trading.
Leverage in CFD TradingWhen you are participating in the CFD market and you are interested in taking advantage of higher leverage, you will see that typical leverage in this arena differs between different regulations. 
By utilizing leverage, you may potentially enhance your gains but at the same time, the very opposite could happen if shares tank, meaning that you will owe a more significant amount to the brokerage firm.
» Don't get caught out: Learn the fundamentals of CFD stock trading .﻿

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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Be Aware: You can lose all, but not more than the balance of your Trading Account. These products may not be suitable for all clients therefore ensure you understand the risks and seek independent advice. This material does not constitute an offer of, or solicitation for, a transaction in any financial instrument. Fortrade accepts no responsibility for any use that may be made of the information and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information, consequently any person acting on it does so entirely at their own risk. The information on this site is not directed at residents of the United States or Belgium and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Be Aware: You can lose all, but not more than the balance of your Trading Account. These products may not be suitable for all clients therefore ensure you understand the risks and seek independent advice. You do not own, or have any interest in, the underlying assets. Fortrade Canada Limited is an Order Execution Only broker, and does not provide investment advice or recommendation. Fortrade is a member of the Canadian Investment Regulatory Organization (CIRO) and a member of the Canadian Investor Protection Fund (CIPF). Fortrade Canada Limited is authorised to provide CFD trading services in all provinces in Canada except Quebec. Residents of Alberta province are required to be Accredited Investors to trade CFDs.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70.91% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Read full risk warning.

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