asx_understanding_asx_cfds

asx_understanding_asx_cfds - Understanding ASX CFDs...

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Unformatted text preview: Understanding ASX CFDs Disclaimer Information provided is for educational purposes and does not constitute financial product advice. You should obtain independent advice from an Australian financial services licensee before making any financial decisions. Although ASX Limited ABN 98 008 624 691 and its related bodies corporate (“ASX”) has made every effort to ensure the accuracy of the information as at the date of publication, ASX does not give any warranty or representation as to the accuracy, reliability or completeness of the information. To the extent permitted by law, ASX and its employees, officers and contractors shall not be liable for any loss or damage arising in any way (including by way of negligence) from or in connection with any information provided or omitted or from any one acting or refraining to act in reliance on this information. ASX is under no obligation to list the CFDs set out in this booklet or may not list a particular CFD at the commencement of the ASX CFD market. Please refer to the ASX website (www.asx.com.au/cfd) for the availability of particular ASX CFDs. For this contract the market is operated by Sydney Futures Exchange Limited ACN 000 943 377 © Copyright 04/2008 ASX Limited ABN 98 008 624 691. All rights reserved 04/2008. Exchange Centre, 20 Bridge Street Sydney NSW 2000. Telephone 131 279 www.asx.com.au 1 Contents Before you begin 2 Advantages of trading CFDs 3 Benefits of ASX CFDs™ 4 Key features of ASX CFDs™ 6 Price formation 8 Margins 9 Cashflows 11 Trading ASX CFDs™ 16 ASX Equity CFDs™ 17 ASX Index CFDs™ 20 ASX FX CFDs™ 23 ASX Commodity CFDs™ 28 Risks of trading ASX CFDs™ 31 Taxation 33 You and your broker 34 Further information 36 Glossary of terms 37 2 Before you begin This booklet explains what ASX CFDs are and how they can be used. It should be noted that this booklet deals exclusively with ASX CFDs. Information on any other ASX products is available by calling 131 ASX (279) or visiting www.asx.com.au To assist you in your understanding of ASX CFDs there is a Glossary of Terms on page 37. To increase your knowledge before trading ASX CFDs, you may find it valuable to explore the ASX CFD online education courses and test your knowledge and skills on the ASX CFD Trading Simulator (both available on www.asx.com.au/cfd ) Trading of ASX CFDs involves risk. Transactions should only be entered into by traders and investors who understand the nature and extent of their rights, obligations and risks. ASX CFDs are traded on the SYCOM ® trading platform and operate under the SFE (Sydney Futures Exchange) Operating Rules. What is a CFD? A CFD (Contract for Difference) is an agreement between a buyer and a seller to exchange the difference in value of a particular instrument between when the contract is opened and when it is closed. The difference is determined by reference to an ‘underlying’ – a share, index, FX rate or commodity and the period over which the CFD is held....
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This note was uploaded on 08/30/2009 for the course FINM 3405 taught by Professor Philipgray during the Three '09 term at Queensland.

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asx_understanding_asx_cfds - Understanding ASX CFDs...

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