- Trading Conditions of Stock Index CFDs
Trading Conditions of Stock Index CFDs
You may want to look into the contract specification table in LMFX’s official website before you start trading as there should be all information you may need for trading with LMFX.
LMFX offers 13 different Index CFDs with MT4.
you don’t need to open an another different account to trade Index CFDs and other trading instruments together, but you are able to trade all the instruments in one account.
1. Swaps of Index CFDs
There will be swap charges if you hold an open position through over night(server time 00:00) and it is decided by the liquidity providers of LMFX.
The swap points are not fixed so you may get charged or credited every night as long as you don’t close the positions at that time.
Although, the swap charge occurs at server time 00:00, the process may take a few minutes so the time is not so precise.
2. Swaps for weekends
One thing you will need to be careful is that the swap charge on the weekends(Saturday and Sunday) will be charged on Friday nights but not Wednesdays.
Tripled swap on Fridays are only for Index CFDs and other financial instruments(Forex pairs, Stock CFDs, Commodities and Precious Metals) will have the tripled swap charge on Wednesdays.
3. Dividend as swaps
LMFX will allow any corporate action resulting in funds being transferred to shareholders. It is called a bonus or dividends and your account will be credited for this bonus(dividend) if you have long position and charged for this bonus(dividend) if you have short position of an Index CFDs.
These dividends are subject to change at anytime depending on the corporate actions.
These dividends will be charged as swaps to your account, according to the swap(dividend) points.
4. Required margin for Index CFDs
Please note that the leverage you have set in your account is not applicable for trading of Index CFDs.
LMFX may require fixed margin for Index CFDs and it is from 50 to 400 USD.
The followings are the margin requirement for each Index CFDs:(4/2016)
|Index CFDs||Margin Requirement||Contract Size|
|AUS200||200 USD per 1 lot||1|
|USD Index||200 USD per 1 lot||1|
|USA500||160 USD per 1 lot||1|
|USA30||100 USD per 1 lot||1|
|USA100||50 USD per 1 lot||1|
|UK100||200 USD per 1 lot||1|
|SUI20||200 USD per 1 lot||1|
|SPA35||200 USD per 1 lot||1|
|SHCOMP||300 USD per 1 lot||1|
|ITA40||400 USD per 1 lot||1|
|HKG33||300 USD per 1 lot||1|
|GER30||200 USD per 1 lot||1|
|FRA40||200 USD per 1 lot||1|
The contract size is 1 for all symbols above.
5. Trading commissions
LMFX will charge you 2 dollars per 1 lot for trading Index CFDs.
This commissions will be charged along with the spread, so you will need to cover the spread and 2 dollars per 1 lot extra commissions.
For the standard spread of Index CFDs, please refer to the followings:
|Index CFDs||Spread||Trading Commissions|
|AUS200||2 pip||2 USD per 1 lot|
|USD Index||11 pip||2 USD per 1 lot|
|USA500||0.5 pip||2 USD per 1 lot|
|USA30||4 pip||2 USD per 1 lot|
|USA100||2 pip||2 USD per 1 lot|
|UK100||1 pip||2 USD per 1 lot|
|SUI20||4 pip||2 USD per 1 lot|
|SPA35||10 pip||2 USD per 1 lot|
|SHCOMP||20 pip||2 USD per 1 lot|
|ITA40||20 pip||2 USD per 1 lot|
|HKG33||15 pip||2 USD per 1 lot|
|GER30||2 pip||2 USD per 1 lot|
|FRA40||1 pip||2 USD per 1 lot|
Please note that the spreads above are not necessarily fixed at all times, but it could get wider depending on the volatility in the financial markets.
6. Market hours of Index CFDs
The market hours of Index CFDs are not 24 hours like Forex pairs, but the times are different for each Index CFD.
Please refer to the followings:
|Index CFDs||Trading Hours(GMT+2)||Breaking Hours(GMt+2)|
|AUS200||Daily 00:50 – 23:00||None|
|USD Index||Mon 01:00 – Fri 23:15||Daily from 23:15 until 23.30|
|USA500||Mon 01:00 – Fri 23:15||Daily from 23:15 until 23.30|
|USA30||Mon 01:00 – Fri 23:15||Daily from 23:15 until 23.30|
|USA100||Mon 01:00 – Fri 23:15||Daily from 23:15 until 23.30|
|UK100||Daily 09:00 – 23:00||None|
|SUI20||Daily 08:50- 18:25||None|
|SPA35||Daily 10:00 – 18:30||None|
|ITA40||Daily 10:00 – 18:40||None|
|HKG33||Daily 04:15 – 11:15||Daily 07:00 – 08:00|
|GER30||Daily 09:00- 23:00||None|
|FRA40||Daily 09:00 – 23:00||None|
7. OTC environment for Index CFDs
In the real market of Index CFDs you can not sell and make profits, as you can either buy and open a position or close the positions.
But Index CFDs offered by LMFX are OTC derivatives, For the trading of Index CFDs, LMFX will become a market maker for traders and cover all the orders.
This means that LMFX is hedging your positions and there is a conflict of interest in that terms.
LMFX has been active for a few years and no one has ever posted a review mentioning a trouble with LMFX though(as far as we can see), it is an useful information to know if a financial instrument is OTC or STP.