Leverage Risk

CFDs are traded on margin, meaning you only need to deposit a small percentage of the total trade value. While leverage can amplify profits, it can also magnify losses. Depending on the product and protections in place, losses may exceed your initial margin if the market moves against your position.

Market Volatility

Financial markets can move rapidly due to economic events, news, or low liquidity. Fast price movements may result in slippage, where orders are executed at a different price than expected, particularly during volatile conditions.

Margin Calls and Liquidation

If your account equity falls below the required margin level, you may receive a margin call or have positions automatically closed to prevent further losses. This can happen quickly in fast-moving markets.

Liquidity Risk

In certain market conditions or with less liquid instruments, it may be difficult to open or close positions at your desired price, resulting in delays or execution at less favourable prices.