What are stock CFDs?

Stock CFDs, or Contracts for Difference, let traders speculate on share price movements without owning the actual stock. They work by exchanging the difference in price between when a trade is opened and when it is closed. Traders can take a long position to benefit from upward movement or a short position to benefit from downward movement. Stock CFDs allow flexible exposure to global markets, but because they use leverage, both potential profits and losses are magnified.