CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% 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 all your money. Read our full Risk Warning.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77% 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.

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.

Andrew Moran - Writer for Fortrade
By Andrew Moran
Joel Taylor - Editor for Fortrade
Edited by Joel Taylor

Updated April 4, 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 Trading

When 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 .