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Tuesday 23 June 2009
Saxo Capital launches commodity CFDs
SAXO Capital Markets is launching up to 20 commodity contracts for difference (CFDs) this year that will give traders leveraged access to energy, metal, soft commodity and grain markets worldwide.
SAXO Capital Markets is launching up to 20 commodity contracts for difference (CFDs) this year that will give traders leveraged access to energy, metal, soft commodity and grain markets worldwide.
The Singapore-based subsidiary of the Danish Saxo Bank has already launched the CFDs for commodities such as US crude, gold, silver and heating oil on its trading platform SaxoTrader.
A CFD is a leveraged derivative instrument through which a buyer and seller agree to settle the difference between the entry price and the exit price of the underlying shares.
Later this month, Saxo Capital Markets will launch CFDs for corn, wheat, New York coffee and New York cocoa.
‘Saxo Capital Markets Commodity CFDs have low margins and small trade sizes, which mean traders will be able to gain exposure to liquid commodities more readily than via futures contracts. Investors will now be able to easily diversify their exposure by adding energies, metals and commodities to their portfolios,’ said Alan Plaugmann, head of futures and fixed income at Saxo Bank.
Each CFD is quoted as one unit of the underlying contract, with a minimum trade size that can range from one unit for New York cocoa to 5,000 units for New York sugar #11.
A 10 per cent margin will be offered for most commodity CFDs and a 5 per cent margin for gold.
The commodity CFDs will expire each month and will be cash-settled on the expiry date of the underlying future. While there is no commission charged for commodity CFDs, there is a spread included in the bid- offer prices, which means that even though the CFD prices track the underlying future prices, they are not exactly the same.
‘The market for energy, metals and agricultural futures saw a massive growth in 2008,’ said Christoffer Moltke-Leth, head of sales trading at Saxo Capital Markets.
‘Saxo Capital Markets’ Commodities CFDs will allow traders and investors to take advantage of the potential in this market.’
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Saxo Capital launches commodity CFDs
JOYCE HOOI
23 June 2009
SAXO Capital Markets is launching up to 20 commodity contracts for difference (CFDs) this year that will give traders leveraged access to energy, metal, soft commodity and grain markets worldwide.
The Singapore-based subsidiary of the Danish Saxo Bank has already launched the CFDs for commodities such as US crude, gold, silver and heating oil on its trading platform SaxoTrader.
A CFD is a leveraged derivative instrument through which a buyer and seller agree to settle the difference between the entry price and the exit price of the underlying shares.
Later this month, Saxo Capital Markets will launch CFDs for corn, wheat, New York coffee and New York cocoa.
‘Saxo Capital Markets Commodity CFDs have low margins and small trade sizes, which mean traders will be able to gain exposure to liquid commodities more readily than via futures contracts. Investors will now be able to easily diversify their exposure by adding energies, metals and commodities to their portfolios,’ said Alan Plaugmann, head of futures and fixed income at Saxo Bank.
Each CFD is quoted as one unit of the underlying contract, with a minimum trade size that can range from one unit for New York cocoa to 5,000 units for New York sugar #11.
A 10 per cent margin will be offered for most commodity CFDs and a 5 per cent margin for gold.
The commodity CFDs will expire each month and will be cash-settled on the expiry date of the underlying future. While there is no commission charged for commodity CFDs, there is a spread included in the bid- offer prices, which means that even though the CFD prices track the underlying future prices, they are not exactly the same.
‘The market for energy, metals and agricultural futures saw a massive growth in 2008,’ said Christoffer Moltke-Leth, head of sales trading at Saxo Capital Markets.
‘Saxo Capital Markets’ Commodities CFDs will allow traders and investors to take advantage of the potential in this market.’
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