ETFs & Commodity CFDs

ETF's or Exchange Traded Funds

ETFs are passively managed investment funds traded publicly on stock exchanges in the same manner as traditional Stocks. An increasingly popular product, ETFs combine the benefits and ease of investing in stocks with the advantages of mutual fund investing and ready-made diversification of index tracking.

Each ETF tracks an index or benchmark, meaning the objective for an ETF is to replicate the performance of the index or benchmark that it is tracking. ETFs track specific Stock, Bond, commodity or currency indices, some of which have a regional focus, while others have a sector focus, thus making them ideal for diversifying portfolios. Saxo Bank offers a wide range of Exchange Traded Funds from providers such as iShares, Powershares, Rydex, StreetTRACKS, SGAM ETFs, Lyxor ETFs and many more.

Benefits of trading Exchange Traded Funds:

• Access to 650 ETFs from a selected range of Tier one providers
• Straightforward trading on live prices
• Extensive ETF charting and analysis tools
• Ability to using ETF investments as collateral for margin product trading
• Availability of Inverse ETFs that allow investors to potentially benefit on falling prices and Leveraged ETFs that offer a fixed amount of leverage on certain securities.

Commodity CFDs

Commodity CFDs are the new and easy way to trade commodities markets. Now investing in oil, grains, softs, energies, gold and other precious metals is as simple as trading any other CFD products. CFD Commodities give traders and investors direct exposure to the underlying commodity with the trading features of a CFD.

Instead of trading on the Futures exchanges – with sometimes prohibitive lot sizes and high collateral requirements – investors can now access leveraged commodity trading with reduced collateral through Commodity CFDs. For instance, the lot size of a US Crude Oil CFD is 25 barrels, compared to the Futures contract size of 1,000 barrels, which means easier and more flexible trading.

Benefits of trading Commodity CFDs:

• 5% Margin on the first EUR 50,000 (20:1 Leverage).
• Standard margin is 10% Smaller lot sizes compared to futures for increased flexibility
• Easy-to-understand single-unit pricing
• One-click trading of oil, gold, grain and other major commodities
• Simple cash settlement in line with the underlying Future
• No commissions on Commodity CFDs aside from Bid/Ask spreads
• Short selling is fully supported.