CFD Procedure

• 19 August 2008

• #1

W

winsonlee

Joined

9 August 2008

Posts

13

Reactions

0

$1.00 for 10000 unit with margin lending of 5% = $10000

If it drops to $0.80, does that mean that i will be paying $1900 ?

Is there a limit on how much I can pay ?

If it drops to $0.30 and I have the cash to pay , does that mean that I can hold the share as long as I want ?

If the share drops and there is no money in the account, will I be given anytime to transfer the cash in ? usually how many days I will be given before they actually sells the share ?

 

• 19 August 2008

• #2

skyQuake

Joined

1 May 2007

Posts

2,904

Reactions

52

If theres no $ in your account or its approaching 0, they will chase u up.

Give it between 0~3days. If its really bad, they'll close out ur position asap and you may end up owing them. Nasty situation any way you look at it.

 

• 19 August 2008

• #3

W

winsonlee

Joined

9 August 2008

Posts

13

Reactions

0

so as long as I have cash in my account to pay up the losses, I can hold the share as long as I want ?

 

• 19 August 2008

• #4

Trembling Hand

Can be found on the bid

Joined

10 June 2007

Posts

8,852

Reactions

205

Most CFD providers will have a point at which they will liquidate all positions if the remaining equity drops below a certain point. This will be done automatically without a chance to top up your account. Normally its around $200 USD

 

• 21 August 2008

• #5

W

winsonlee

Joined

9 August 2008

Posts

13

Reactions

0

If i am trading in US market, if the share drops, do I actually need to manually convert AUD to USD or it will convert automatically base on the current day conversion rate to pay for the losses?