Most CFD trades are executed instantly, which means that there can be less risk of slippage (depending on your trading account and order type). Compounding is the action of reinvesting the profits back into the investment in order to increase profits even further, or in other words, getting interest on interest. We'll say you have $10,000 in a savings account earning 5% interest per year, with annual compounding.
An overnight funding charge will be charged from your account if you maintain a daily CFD position open past the daily cut-off time. Achieving the right balance in CFD trading regulations is a challenging task as they should prioritize investor protection, facilitate transparent and fair trading practices, and promote risk management while allowing traders the freedom to assume the level of risk they desire.
The first part of your Forex trading strategy should be to act when the time is right.
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