Is it a good trading strategy to invest in ETFs via a CFD trade?

Asked 3 years ago

Hello all, I'm based in Switzerland, and Etoro has recently stopped allowing the direct purchase of US-based ETFs. This leaves me with one option: to invest in these as a CFD. What are your thoughts on buying ETFs as a CFD? Sorry long post, but I'm interested to hear thoughts on the pros and cons of ETF investing via a CFD trade.

Osasere Okunloye

Saturday, October 23, 2021

Some USA ETFs are still listed on the European market but with a different name. For example SPY is traded as IUSA.L in British pounds in the UK market. EWJ is traded as IJPE.L in EUR. There are more, you can do your research to find out.

Andrew Moran

Tuesday, October 26, 2021

Contract for Differences (CFDs) are great if you want to invest in price movements of stocks, commodities, and cryptocurrencies without directly owning these investments.

If you were not located in Switzerland and based in the United States, it would make sense to directly purchase these exchange-traded funds (ETFs). But, since you are overseas, and you are certain you want to own U.S.-based ETFs, you should move ahead with CFDs.

U.S. financial markets are one of a kind because of how liquid they are and how much possibility there is to generate strong returns. The options are astronomical, from using a Gold ETF as a trading strategy to holding onto index funds for your retirement needs.

That said, you should be aware that your initial position will immediately fall because of the size of the spread when you open the CFD.

Write an answer...


Please follow our  Community Guidelines

Can't find what you're looking for?