At FTS we offer a derivative known as a CFD (contract for difference) rather than the underlying share itself. The price of the CFD is derived from the price of the share; the difference is that the holder of the CFD never owns part of the company.

1.You’re able to trade long (buy) or short (sell)
2.The ability to trade using leverage, this enables you to gain more exposure and increase potential profits (also has the potential for increased losses)

The formulae for working out your P&L for any CFD shares is shown below
Long (buying): Profit or loss = ( Exit price - Entry price ) * Lots traded
Short (Selling): Profit or loss = ( Entry price - Exit price ) * Lots traded

Example one
You decide to buy 100 CFDs in Coca Cola at $45.00
The share price rises +10% due to the release of the company’s quarterly earnings being better than forecasted
You sell 100 CFDs in Coca cola at $49.50
Using the formula above for a ‘long’ trade: Profit or loss = ( Exit price - Entry price ) * Lots traded
The result would be +$450. The commission on this trade would have been 0.02% * $45.00 * 100 = $0.90 The net profit would therefore be $449.10

Example two
You decide to sell 10 CFDs in Amazon at $1,900 with the opinion that the price of the share will fall
Amazon sales data is released and the report states that they have had an increase in sales, as a result the share price rises +1%
You decide to Close you position at a price of $1,919
Using the formula above for a ‘short’ trade: Profit or loss = ( Entry price - Exit price ) * Lots traded
The result would be -$190. The commission on this trade would have been 0.02% * $1,900.00 * 10 = $3.80 The net loss would therefore be -$193.80