Do CFD brokers trade against clients?

Is it really in the interests of providers for clients to lose money? Daniel Moczulski responds. Absolutely, not. The broker isn't against you. Brokers aren't looking at the trading activity of one person. Because of the competition acquiring clients is costly so skewing the price to make a little extra isn't worth the risk of losing the clients. Where I see horror stories of spread betting is when clients over leverage themselves.

[rikirex]

the broker is not against one client is against all of them at the same time thanks to algorithms

[rickmorgan]

its not the broker, its who the broker is in cahoots with. do not use cfd's unless you have both deep pockets and youre hedging against long stock positions. you will be robbed eventually otherwise

[johnchang]

2:10… isn't depositing 1, 000 to trade 10, 000 worth the same as depositing 10, 000 and trading 100, 000?
Both are 10% margin or 10x leverage

[mli]

What nobody is talking about as a risk either is holding assets overnight. If you look at what they say they maybe say "oh its a overnight fee of 0, 2%" but that is bullshit. Deeply inbedded in the agreement it says that they will reset all the instruments every day. This means that if you want your money back after a day of loss you need to overshoot your buying price of 0, 2%+some ridiculus number. I held CFD's for 1 month thinking it was all fine. When i eventually reached my goal and should have earned alot of money because i predicted the markets i was at a loss of 70%. Ive never cried so much in my life.

[johnchang]

So what a broker earns? The overnight finance charges and the spread between bid and offer price?

[lucianosantucci]

Lies - CFD Brokers have B books and know 90% of new traders lose, so why not take the other side of those trades and keep all the money. That’s why some brokers offer 0 pips spread, how can you make money with 0 pip spread.

[lewisbirrer]

Of course they do...It's impossible otherwise. Don't lie.

[Baghuul]

Brokers now employ algos to hunt those stops. lol

[danielbeasley]

Lol, he's not lying... But he's also not being fully truthful. Alot of cfd brokers a pretty much shady characters. They might be legitimately "hedging" to minimize risk, but the act of hedging in this case also goes against the the trader which can pull the market to a unfavorable direction. And seanse most traders can't seem to understand risk management and how to use leverage correctly, it creates a mathmatical advantage to the broker. You throw in a bad spread and you now have a even larger mathmatical disitvantage. Cfds aren't for New comers, even tho that's what they seem to attract. They have their place, but at the end of the day, it's designed much like a casino.

[richnolan]

This clown is full of crap. Of course they don't look at individuals and their trades. But what they can do is set the algos to favor the brokerages, and besides, the whole concept has many flaws. You can lose money even if you sell at a profit. And the margin and leverage requirements are insanely high, which adds to the risk of a pursuit (day trading), that already has a 95% failure rate. The US allows 4 to 1 leverage for day trading. How much more do you need? Only 5% will make it as a profitable day trader, why in the heck would you need more leverage (margin)?

The US has the most trusted and respected stock market in the world. There is a reason CFD's have been illegal in the US for decades (1934 I think). Even though CFD's are allowed in other 1st World countries, that should tell you something, if they are not allowed in the US...you know if they were safe they would be allowed...more money for the US markets....

[doyoueatrocks]

That’s right, why look at one person when an algo can look at everyone all at once 😂😂😂 just joking, it could be done, but it would be so highly illegal, they would be mad to do it

[Do_not_assume]

Who takes the opposite trade when you trade using CFD/spread bet?

[Fromtheseatoriver]

I will ignore this channel for showing this bs promotional video