As with traditional share dealing, CFD prices are quoted as a Bid (the price you can sell at) and an Offer (the price you can buy at). With CFD trading you buy a CFD based on a certain amount of the underlying asset.

The following worked examples show how you can use CFDs to trade a number of different markets.

These examples show trades that result in both profits and losses.

CFD trading example (Equities) on Contra FX Pro – Buying Yahoo (YHOO)

You believe that the shares of Yahoo will rise, so you decide to buy a CFD based on 3000 shares.

Contra Forex quotes you a spread of $13.47/$13.49 for Yahoo (YHOO).

OPENNING TRADE
Price of YHOO is $13.49 13.49
Number of underlying shares 3,000
Value of total position ($) 40,470
Transaction Fee @ $.10 per share 300
Margin requirement @ 20% ($) 8,094

After 2 days the market has risen and you decide to close your position.

CLOSING TRADE (2 days later)
Price of Yahoo is $14.01 14.01
Number of underlying shares 3,000
Value of total position ($) 42,030
PROFIT (loss) ON TRADE
Closing value ($) 42,030
Opening value ($) 40,470
Gain on position ($) 1,560
Total transaction fee ($) (300)
Overall profit on trade ($) 1,260