What Is CFD Trading? How CFDs Work, Margin, Swap and Worked Examples

A CFD (contract for difference) is an agreement with a broker to pay or receive the difference between the price at which you open a position and the price at which you close it. You do not own the share, the gold or the currency. You trade the price change, using a small deposit called margin. That is what "CFD trading" means, and it is why the same product that can magnify a gain also magnifies a loss.

Disclosure: OnForex may earn a referral commission from Exness links on this page. This is general education, not investment advice.

This guide explains how a CFD works, how margin and swap are calculated, how CFDs differ from forex, and walks through checked examples on a stock, an index, gold and oil. All Exness product details were checked on the Exness Help Center on 2 November 2026.

How a CFD works

When you buy a CFD, you profit if the price rises and lose if it falls. When you sell, it is the other way round. Your result is:

Profit or loss = (closing price - opening price) x contract size x lots for a buy, and the reverse for a sell.

The Exness Help Center states that Exness offers CFDs on the spot price of the instruments, that the contracts have no expiration date, and that overnight swap may apply (article "Available trading instruments"). In Exness's own description, CFDs let you trade price movements without owning the underlying asset.

Two things follow from this:

• You are exposed to the broker. The contract is with the broker, not with an exchange. How the broker executes orders is covered in A-book vs B-book brokers.
• You have no ownership rights. A stock CFD gives price exposure to the share; it does not give votes or the right to the company itself. Dividends are handled by cash adjustments, not payments from the company.

Margin: the deposit, not the cost

Margin is the amount the broker holds from your account to open and keep a position. The Exness Help Center describes it as a deposit, not a fee, returned when the position closes unless losses use it up.

For forex pairs on dynamic margin, the formula given by Exness is:

Margin = Lots x Contract size / Leverage

Example: 1 lot of EUR/USD is 100,000 EUR. At a leverage of 1:100, margin is 100,000 / 100 = 1,000 EUR. That is a deposit against a 100,000 EUR position, so a move of 1% (1,000 EUR) in the wrong direction takes all of that margin.

Some instruments use a fixed margin requirement that does not depend on your leverage setting. Exness lists exotic pairs, cryptocurrencies, commodities such as XAUUSD247, stocks and indices among them. For these, the formula is Margin = Lots x Contract size x Required margin (for stocks, multiplied by the share price). Margin requirements can also be higher around news and market closures, so check the contract specification of each instrument, and read the margin guide.

Worked examples (checked)

The price levels below are hypothetical round numbers chosen to make the arithmetic clear. The contract sizes are the ones listed in the Exness Help Center on 2 November 2026.

Stock CFD

The Help Center lists a contract size of 100 shares and a fixed margin of 5% for most stock CFDs.

• Share price 200 USD, buy 0.1 lot = 0.1 x 100 = 10 shares.
• Position value: 10 x 200 = 2,000 USD.
• Margin at 5%: 2,000 x 0.05 = 100 USD.
• Price rises to 204 USD (+2%): profit = 10 x 4 = +40 USD, which is 40% of the margin.
• Price falls to 196 USD (-2%): loss = 10 x 4 = -40 USD, also 40% of the margin.
• A 5% fall to 190 USD costs 10 x 10 = 100 USD, which equals the whole margin, before spread and swap.

Index CFD

For US30 the Help Center lists a contract size of 1.

• Index at 40,000 (hypothetical), buy 0.1 lot: value = 0.1 x 1 x 40,000 = 4,000 USD.
• A 100-point rise gives 0.1 x 1 x 100 = +10 USD; a 100-point fall gives -10 USD.

Index CFDs also carry dividend adjustments. Buyers may receive and sellers may be charged an amount of Lots x Contract size x Dividend rate, applied at 22:00 UTC, Sunday to Thursday, per the Help Center article "How dividends impact indices".

Gold (XAUUSD)

The contract size is 100 troy ounces per lot, and the minimum volume is 0.01 lot.

• 0.01 lot = 1 ounce. A 10 USD move in the gold price changes the result by 10 USD.
• 1 lot = 100 ounces. The same 10 USD move changes the result by 1,000 USD.

See gold trading for how traders handle that sizing.

Oil (USOIL)

The contract size is 1,000 barrels per lot, with a minimum of 0.01 lot.

• 0.01 lot = 10 barrels. A 1 USD move per barrel changes the result by 10 USD.
• 1 lot = 1,000 barrels. The same 1 USD move changes the result by 1,000 USD.

The Help Center lists energies as having a single overnight charge each weekday, with no triple swap, while most other instruments have one triple-swap day per week.

Costs of trading CFDs

1. Spread: the difference between bid and ask. You pay it when you open. See spread explained.
2. Commission: charged on some account types. The Help Center lists commission per lot, per side for Raw Spread and Zero accounts on some instruments.
3. Swap: an overnight charge or credit, which depends on interest rates, position direction and the broker's own charge. See forex swap explained.
4. Dividend adjustments: on index and stock CFDs only.
5. Slippage: a worse fill than expected in fast markets. See slippage.

A worked cost example. A buy of 1 lot EUR/USD with a 1.0 pip spread costs about 10 USD at the open (1 pip is 10 USD per lot for a USD-quoted pair). To break even, the price has to move 1 pip in your favour before any swap or commission.

CFD vs forex

	Forex (spot)	CFDs on other assets
Underlying	Currency pair	Stock, index, metal, energy, crypto
Quote	Pip-based	Points, dollars or cents
Margin	Usually dynamic, by leverage	Often fixed per instrument
Special charges	Swap	Swap, plus dividends on stocks and indices
Trading hours	About 24 hours, 5 days	Follow the underlying market, with breaks

At Exness, both forex and the other instruments are CFDs on spot prices. So "CFD vs forex" is mostly a question of which underlying asset you trade and which rules come with it. For the forex side, see what is forex.

Risks specific to CFDs

• Magnified losses. A small adverse move can use up the margin. Use a stop-loss and size positions with a fixed risk per trade. See position sizing.
• Stop out. If equity falls too far compared with margin, positions are closed automatically.
• Gaps. Stocks and indices can open far from their last close after earnings or news, so a stop-loss may fill at a worse price.
• Costs add up. Overnight swap on a long-held position can matter more than the spread.
• Counterparty. You depend on one broker, so check regulation and the client agreement.

How to try CFDs safely

1. Open a demo account and trade one instrument for two weeks.
2. Write down, for each trade, margin used, spread paid, swap and result.
3. Compare the profit and loss you expected from the contract size with the platform's figure. If they differ, find why before using real money.
4. Move to a small live size only after your demo results are consistent.

Frequently asked questions

What is CFD trading in simple terms?

You agree with a broker to exchange the price difference between opening and closing. You never own the asset, and a small deposit controls a larger position.

What is the difference between CFD and forex?

Forex is the currency market; a CFD is a contract type that can be written on currencies and other assets. At Exness, forex is traded as a CFD as well.

Do you own the asset when you trade a CFD?

No. You have price exposure only, with no ownership or voting rights.

How much can you lose trading CFDs?

More than the margin on a position. Check whether the entity you contract with gives negative balance protection.

Is there a fee for holding a CFD overnight?

Often, in the form of swap. Check the swap schedule and swap-free status for each instrument.

Are CFDs suitable for beginners?

They are complex products. Start with a demo account and small sizes.

Further reading

• What is forex trading
• Margin in forex
• Lot size explained
• Pip value
• Forex risk management

Risk warning: Forex and CFD trading carries a high risk of loss, and you can lose more than you deposit with some products. CFDs are complex instruments and are not suitable for everyone. Past performance does not guarantee future results. The price levels in the examples are hypothetical and are not forecasts. Nothing here is a recommendation to trade.