CFD = Contract For Difference

A CFD is a derivative financial product that allows investors to take a long or a short position in an underlying asset. The underlying may be a share, an index, a currency, a commodity, etc.

A CFD is concluded between two parties: a buyer and a seller. The contract stipulates that the seller will have to pay the buyer the difference between the value of the asset at the beginning of the contract and its value at the end of the contract. If the difference is negative, the buyer will pay the difference to the seller.