GBP/AUD Online Chart
Trade Forex CFDs with Plus500
What is Forex?
In the world of Forex, there are 3 primary markets:
- Spot Forex Market – The physical exchange of a currency pair, taking place on the spot date (generally, this refers to the day of the trade plus 2 days - “T+2”).
- Forward Forex Market – An Over the Counter (OTC) contract to Buy or Sell a set amount of a currency at a certain price at a future date.
- Forex Futures Market – A Forex futures contract is an exchange-traded contract to Buy or Sell a specified amount of a given currency at a predetermined price on a set date in the future.
Forex vs. Forex CFDs
CFD trading allows you to place leveraged trades on currency pairs, speculating on the movement of the underlying instrument. Rather than settling (or delivering) a set amount of base currency, CFDs are cash-settled, based on the difference between the opening and closing prices of a pair of currencies.
One of the key features of CFD trading is that by using leverage you can increase your trade size while committing a relatively small amount of capital. You should keep in mind that while increasing your exposure magnifies potential profits, it also magnifies potential losses.