CFD Trading Glossary
- Auto-Liquidation
- A process whereby the system automatically closes out positions until a margin call event is met or there are no more positions to close out, whichever comes first.
- Base Rate
- The interest rate from which CGSI will apply a mark-up for client funding purposes.
- Buy to Cover
- Buying of securities to close your short sell position.
- COB
- Close of Business. It represents the end of the work day.
- CFD
- Contracts for Difference.
- Cash Settlement
- Where cash is paid for the value of the security upon expiry of a CFD Futures contract instead of actual physical delivery.
- Contract Value
- Contract Value = Quantity of CFD contract purchased X CFD Price
- DMA
- Direct Market Access. This allows our CFD clients to have direct market access to the underlying security market through our CFD platform. Our CFD clients will be participating in the market at prices identical to that of the underlying security market.
- EPS
- Electronic Payment of Shares. This is a payment mode that can be used to transfer funds to your CFD trading account
- Final Settlement Price
- This will be shown on your client statement as the trade price for the closing of the position. Final Settlement Price for all futures is also published by the underlying exchange
- Free Equity
- The surplus funds in the CFD account available for creating new buy and sell positions. You will be unable to initiate new positions if your Free Equity is negative.
- GLV
- Gross Liquidation Value. GLV is the value of the account if all the positions are sold at the current market price (excluding all the commission and charges).
GLV= Free Equity + Initial Margin - Gross Exposure
- Total exposure value for all positions displayed, expressed in the base currency.
- Initial Margin
- The margin that you must furnish in order to transact in a CFD and is calculated as a percentage of the full contract value.
Initial margin varies with different CFDs thus you would have to check online for the initial margin on the CFD that you intend to place an order on. - Liquidity
- Volume of activity in a security. If a security has a high traded volume, it is said to be of high liquidity or very liquid.
- Liquidity Provider
- A Financial Institution that aims to bring liquidity to a security by providing a pool of securities and quoting prices to the market so that buyers and sellers will be able to trade easily without having to wait to deal with other individual traders.
- Long Buy
- Buying of securities to open a position
- Long Sell
- Selling of securities that you own.
- MAS
- Monetary Authority of Singapore. The financial regulator in Singapore.
- Margin Call
- A margin call occurs when you no longer have any free equity to cover the margin required to hold that position. You need to have funds in your account over and above that of the required margin to ensure you can cover any unrealised losses the position may incur.
- Mark-to-Market
- Mark-to-market is used to value your positions based on the prevailing market prices of the underlying instrument.
- Realised Profit / Loss
- Total profit or loss from closed (realised) CFDs across the selected portfolios.
- Rollover
- Extending the duration of a CFD contract upon expiry.
- SPAN
- Standard Portfolio Analysis of Risk. It is a system for calculating margin requirements for futures and options on futures. [https://en.wikipedia.org/wiki/CME_SPAN]
- Short Sell
- Selling of securities that you currently do not own. This can be done through our trading platform which will automatically borrow the shares from a willing lender.
You can obtain the shortable list from the margin table on our trading platform via Analytics -> Portfolio -> Margin Table. - Spread
- The difference between the bid and the ask price of a security or asset. [http://www.investopedia.com/terms/s/spread.asp]
- Swap
- A derivative contract through which two parties exchange financial instruments.
- Unrealised Profit / Loss
- Total profit or loss from open (unrealised) CFDs across the selected portfolios.