CFD Platform: City Index or IG or TOS? A question for orang Tua

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I'm just beginning to use City Index Platform using a demo account. However, when looking at the market info (in the chart window), I found that the commission for trading US stock CFD of 25 is pretty expensive when compared to US brokers (TOS). Moreover, when closing 2 separate position: BOC Hongkong Holding and Hongkong 40 CFD. City charged HKD 90 for BOC but none for Hongkong 40 CFD. I still don't know yet why that is.

According to Pak Herman, IG only charged USD 10 per transaction, which is even cheaper than City.

My point is:
Trading CFD is basically the same as trading shares (Long and/or Short) in any markets. If that's the case, then what makes a difference, except for the commission, between trading US stocks using TOS paying USD1.50 per trx and trading CFD using IG paying USD10 per trx?
Both are using margin and pay the same price (CFD or Stock price).
Using TOS, we can adjust the stop loss as many as we want to without paying a commission until after the transaction has been done.

Orang Tua, please clarify whether my point of view is correct. Thank you very much for your clarification.

Warm regards,
Delta

**orangtua** · Posts: 117 Join date: 2008-08-06

Delta wrote:

I'm just beginning to use City Index Platform using a demo account. However, when looking at the market info (in the chart window), I found that the commission for trading US stock CFD of 25 is pretty expensive when compared to US brokers (TOS). Moreover, when closing 2 separate position: BOC Hongkong Holding and Hongkong 40 CFD. City charged HKD 90 for BOC but none for Hongkong 40 CFD. I still don't know yet why that is.

According to Pak Herman, IG only charged USD 10 per transaction, which is even cheaper than City.

My point is:
Trading CFD is basically the same as trading shares (Long and/or Short) in any markets. If that's the case, then what makes a difference, except for the commission, between trading US stocks using TOS paying USD1.50 per trx and trading CFD using IG paying USD10 per trx?
Both are using margin and pay the same price (CFD or Stock price).
Using TOS, we can adjust the stop loss as many as we want to without paying a commission until after the transaction has been done.

Orang Tua, please clarify whether my point of view is correct. Thank you very much for your clarification.

Warm regards,
Delta

Hi Delta

This is a nice mail to share your experience and comparison. I must admit that I do not know about TOS. Let try to share my knowledge of your comparisons.

1. Commission defers between different brokerage houses.
2. For TOS in US, if they are a stock broker, I believe you must have your cash deposits with them. If they give you leverage, meaning credits, then you can trade more than the amount you have deposited. Normally, when trading stocks, you have trading and settlement dates which can be a windows of a few days and more on the works of stock trading. Whereas, CFD trading is leverage and settlement is immediate upon clicking your mouse to close your position/s. The next question, is how secure is your money with the broker in US? CFD provider in Singapore, follows a strict code of conduct regulated by MAS. Your money is secure.
3. Changing of exit stops for IG and City is without any charges and can be done anytime.
4. IG comm for US is cheaper than City Index. both have their pros and cons. CI has JSX but IG do not.
5. Finally, which broker is cheaper to use? My experience is not commission only, which most under informed traders look at. There is another cost in trading. That is Slippage, meaning the actual transacted $ of a market. This can end up more higher than commission charges. I explain this more in the 3-hour CFD course.

Hope this information helps.

Happy trading.
Orangtua

**delta192** · Posts: 4 Join date: 2008-09-09

Dear Orang Tua:

Thank you for your complete information. I do get some more information from you.

Delta