What is a CFD Forex?

A short explanation...

IMPORTANT: CFD trading is HIGH risk. Please seek professional financial advice before you embark on CFD trading. You may lose all, if not more, of your capital.

Contract for Differences, or CFD for short, is simply a contract to purchase the underlying asset and to sell it in the future, hopefully for a profit. The underlying asset can be any tradable financial assets such as equities, metals, commodities, forex and even indices.

When you are using ForexHero, the underlying asset is forex.

Why not trade Spot Forex? Trading spot forex requires alot of capital as well as bank accounts denominated in the currencies that you are trading. Many retail traders will not have the resources to trade spot forex. Hence, in order to provide greater accessibility for forex trading, ForexHero works with forex brokers that can offer forex trading via CFD instruments.

It is important to note that in ForexHero, a trader does not actually own the underlying currency. For example, a trader who buys EUR/USD (buying EUR with USD) does not actually own any EUR currencies.