Risk Disclosure

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

When the European Securities and Markets Authority restricted CFDs for retail clients in 2018, it found that most retail CFD accounts lose money. Only trade with money you can afford to lose in full.

Leverage works in both directions

• A small move can wipe out a deposit. At 1:30, a 1% move against a position is a 30% loss on the margin behind it.
• Margin calls and stop-outs can close positions automatically, at a loss, when your equity falls below the broker's margin requirement.
• Losses can exceed your deposit unless your account has negative-balance protection. Check this before you fund an account.

Prices can jump

Around news, at the weekly open and in thin markets, spreads widen and prices can gap past your stop. A stop-loss order then fills at the next available price, which can be far worse than the level you set. Only a guaranteed stop, where a broker offers one and charges for it, removes that risk.

Nothing here is advice

ForxZen publishes education and calculators, never a personal recommendation. Past results, a broker's historical spreads or a strategy's backtest do not predict future results. If you are unsure whether trading suits you, ask an independent, regulated adviser.

Habits that limit damage

• Risk a small, fixed share of the account per trade; the position size calculator does the sum.
• Decide the exit before the entry, and know what the trade costs before you place it; see the trade cost calculator.
• Treat the legal leverage limit as a ceiling, not a target.
• Practise on a demo account until your process is consistent.

Check a broker's licence yourself

Look the firm up on the regulator's own register, not on the badge on the broker's website. Official tools:

• FCA Financial Services Register (UK)
• CySEC register of investment firms (Cyprus)
• ASIC Moneysmart company check (Australia)
• ESMA investor corner (EU)
• NFA BASIC (United States)

Our own process is in How we review and how we earn.