facebookIs trading CFDs and on margin worth the risk? currently have 10k, want to grow to 20k by this year? - Seedly

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Anonymous

18 Apr 2019

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General Investing

Is trading CFDs and on margin worth the risk? currently have 10k, want to grow to 20k by this year?

The returns look really good, and looking to grow capital quickly

Discussion (2)

What are your thoughts?

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You can consider if you know what to do with CFDs and if you are 100% certain about the direction of the underlying counter. Remember, it is a double edged sword so your position can go against you as well and it'll be harder to climb back up.

CFD is a complex vehicle for investment, mainly speculation. While there are high possible returns, the risk is non-neglectable. To grow by another 10k in 9 months, you're expecting more than 100% profit per annum. To give you a sense on how much that is, Peter Lynch, regarded as on of the world's best investors, scored about 29.2% annualised rate of return. That is to say you're looking to beat the one of the world's best by 3x.

The other possible way with less risk is to have a side job. The pay only needs to be 1k per month which is more feasible.

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