Understanding CFD Trading: Risks and Considerations

Before engaging in CFD trading, it is crucial to understand what a CFD (Contract for Difference) is and the associated risks. Unlike owning an underlying asset, CFD trading involves speculating on price movements. CFDs are typically unsuitable for long-term investors due to holding fees. Suitable only for experienced traders with high risk tolerance, CFD positions require active management and a solid understanding of leverage. All eToro CFD positions include a stop loss feature, though it may not be foolproof during rapid market changes. Given that the majority of CFD traders incur losses, it is advisable to consider this risk seriously and utilize eToro's demo account and educational resources before trading.

Chapters:
00:00 Understanding CFDs and the Risks Involved
00:26: Active Management and Stop Loss Orders in CFD Trading
00:54: The Importance of Experience, Knowledge, and Risk Tolerance in CFD Trading

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