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KOWong · Post by **KOWong** » Thu Jul 21, 2011 3:27 pm

I was talking to a CMC sales rep the other day, and he assured me that I will get dividends if I am long stock CFDs. Is this really true?

(Reason why I'm considering CFDs are coz of the low commission charges and flexibility to both long and short the market.)

DDCA · Post by **DDCA** » Thu Jul 21, 2011 3:50 pm

KOWong wrote:I was talking to a CMC sales rep the other day, and he assured me that I will get dividends if I am long stock CFDs. Is this really true?

(Reason why I'm considering CFDs are coz of the low commission charges and flexibility to both long and short the market.)

Yes, it is mentioned in this threaad:

http://www.masteryourfinance.com/forum/ ... c&start=15

lop · Post by **lop** » Thu Jul 21, 2011 5:14 pm

KOWong wrote:I was talking to a CMC sales rep the other day, and he assured me that I will get dividends if I am long stock CFDs. Is this really true?

(Reason why I'm considering CFDs are coz of the low commission charges and flexibility to both long and short the market.)

Hi KOWong,

On XD date, CMC brokers will credit you the dividend amount if you long stock CFD, likewise they will debit you the dividend amount if you short stock CFD.

zipink · Post by **zipink** » Thu Jul 21, 2011 9:02 pm

KOWong wrote:I was talking to a CMC sales rep the other day, and he assured me that I will get dividends if I am long stock CFDs. Is this really true?

(Reason why I'm considering CFDs are coz of the low commission charges and flexibility to both long and short the market.)

Hi KOWong,

CFDs mirror the value of their underlying stocks, so if you goes long on a stock during a dividend payment period, you will receive payment. If you short during that period, you pay the dividend.

Minimum commission is S$15. So a round trip (buy and sell) will cost $30.

Of course, if your shares value is above $15,000, then the 0.1% commission will be applicable to you.

Take note because you are trading on margin in CFD, there will be finance charge for long position. CMC's finance charge is about 3%.

Let's say your exposure is $5,000 worth of shares, finance charge will be:

($5,000 x 0.03) divide by 360 days = $0.42/day

KOWong · Post by **KOWong** » Thu Jul 21, 2011 10:29 pm

Wow, you guys respond fast!

Thanks for the (detailed) answers, guys!

Cheers,
KO

KOWong · Post by **KOWong** » Thu Jul 21, 2011 10:57 pm

I'm aware of the financing costs, but the great thing about their platform is that you can choose not to make use of the leverage, and hence avoid paying the associated interest / financing costs

.

(Not sure whether IG Markets offer the same thing though, it would be great if they do too)

zipink · Post by **zipink** » Thu Jul 21, 2011 11:24 pm

KOWong wrote:I'm aware of the financing costs, but the great thing about their platform is that you can choose not to make use of the leverage, and hence avoid paying the associated interest / financing costs .

(Not sure whether IG Markets offer the same thing though, it would be great if they do too)

Hi KOWong,

I think the main advantage about CFD is the leverage. You only need a small capital to get the full exposure (For SG stocks, the margin is 10%).

If you don't like the idea of margin trading, then I think just stick with traditional broker. (just my opinion)

It's just like buying a property. The cost is say $1 million, but you only pay $100k deposit. But you get to have the whole house. If the house appreciate to $1.2 million and you sell it, your gain is 100%. You fork out 100k but your returns is 200k.

Of course, trading with leverage is a double edge sword. If you can win big, your losses can be magnified too. If you don't know what you are doing, then it is very risky.

But if you are disciplined, you know what is your risk per trade, set your stop loss correctly and don't over leverage. The risk is in fact very minimal.

shazamnick · Post by **shazamnick** » Fri Jul 22, 2011 9:11 am

zipink wrote:
KOWong wrote:I'm aware of the financing costs, but the great thing about their platform is that you can choose not to make use of the leverage, and hence avoid paying the associated interest / financing costs .

(Not sure whether IG Markets offer the same thing though, it would be great if they do too)
Hi KOWong,

I think the main advantage about CFD is the leverage. You only need a small capital to get the full exposure (For SG stocks, the margin is 10%).

But if you are disciplined, you know what is your risk per trade, set your stop loss correctly and don't over leverage. The risk is in fact very minimal.

zipink san,

I have a qs.

If I set a stop loss price @0.90 for my long position $1.00 yesterday. In the following morning, when the mkt open with a huge gap down to $0.50, will my stop loss price trigger at $0.90 or $0.50?. BTW, i using CMC Markets. Tks in advance.

zipink · Post by **zipink** » Fri Jul 22, 2011 9:29 am

shazamnick wrote:
zipink san,

I have a qs.

If I set a stop loss price @0.90 for my long position $1.00 yesterday. In the following morning, when the mkt open with a huge gap down to $0.50, will my stop loss price trigger at $0.90 or $0.50?. BTW, i using CMC Markets. Tks in advance.

Hello shazamnick,

Your stop loss will be triggered at $0.50.

This is part of the risk you have to undertake, like unexpected events such as an earthquake can cause gap down which you can't control.

However, CMC has this "Guaranteed Stop Loss" (GSL) feature. So if the price gaps down lower than your stop loss, you still get out at your original stop loss price. But you need to pay a fee to "activate" this GSL, as it acts like an insurance.

zipink · Post by **zipink** » Fri Jul 22, 2011 9:46 am

By the way, I am not an expert in trading (yet).

Because I am also using CMC as my CFD broker, so I try to know them inside out.

shazamnick · Post by **shazamnick** » Fri Jul 22, 2011 10:15 am

zipink wrote:By the way, I am not an expert in trading (yet).

Because I am also using CMC as my CFD broker, so I try to know them inside out.

Tk u for your sincere and promptly reply. I am constantly sourcing for one that trigger my stop loss price instead of gap-down price. So far, CMC and IG are the best in the markets in term of lowest com and user-friendly trading platform.

zsin02 · Post by **zsin02** » Wed Aug 17, 2011 9:50 pm

Refer a friend to philip CFD, will receive S$100 CFD trading credits for every successful referral. Referred Friend(s) will receive $50 CFD trading credit. Receive free enrollment in our complimentary 4-week introductory CFD Training Program. Receive a free exclusive invitation to attend a complimentary* full-day trading course on Technical Analysis by Phillip CFD

Anyone have CFD with POEMS? Mind to be my referral?

h229229 · Post by **h229229** » Wed Aug 17, 2011 11:16 pm

Anyone have CFD with POEMS? Mind to be my referral?

I just got my CFD a/c setup last week. PM me yr info to be yr referral. I am also interested to learn more about CFD.

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