Placing your first CFD trade
Unsure of how to place your first trade? Please find below eight useful steps to guide through placing your first trade. You may find it useful to print the steps out and work your way through. If you have any questions, please contact the Customer Services Team who will be happy to help.
The web version of the CMC Tracker platform is equipped with lots of useful features that give you more control over your trading. View this video for the highlights, and find out more below.
Step 1 – Find the product you want to invest in
Use the product library to find the product that you want to trade. To open up an order ticket and place your trade simply click on the buy price if you wish to go long and profit from a rising market, or click the sell price to go short and profit from a falling market.
Note: The quoted prices will occasionally change colour. If the price is white, this means the market is open. If the price is flashing, the market has just moved. If the last tick was up the price will be green, if it was down then the price will be red. A greyed out price represents a market that is closed to trading, either because it is outside of market hours, or because it has been suspended.
Step 2 – Decide how much you want to invest
You can specify the size of your trade by a dollar amount or by the number of units: it’s your choice. The minimum trade size the CMC Tracker platform allows is 0.001 units.
Note: You can choose to have your order ticket display your preferred option of units or amount by clicking on the ‘Preferences’ icon. If you’re trading an international instrument using, the order ticket will show the equivalent value in your CFD account’s currency.
Step 3 – Decide how much funding you need, if any
We offer a flexible approach to financing. Gone are the days of being forced to take on fixed leverage. Trading CFDs on the CMC Tracker platform means you are in control of how much financing or leverage you use on each and every trade. You can dial up or down the amount of finance you would like to use on each transaction. So you can invest using no leverage or you can invest with a lot: the decision is yours. On the CMC Tracker platform, this is called customisable financing.
Step 4 – What price do you want to enter?
You can enter a position immediately at the current market price, or you can wait for the market to reach a certain level before you make your transaction.
When you place a market order, a buy or sell order will be executed as soon as possible at the first available price.
A limit order allows you to set an order at a specific price and within a specified period of time. This means that you can set an order to enter a position at a price that is different to the prevailing price at that time.
Note: If you set a ‘Valid Until’ date, the order will only remain active until the close of business on that date. If the product value fails to reach this price during the period you specified, the order will automatically be cancelled.
Limit order executions policy
• A limit order to buy at a price below the prevailing market price will be executed at the first available buy price that is equal to or less than the ‘Target Price’ that you have specified.
• A limit order to buy at a price above the prevailing market price will be executed at the first available buy price that is equal to or more than the ‘Target Price’ that you have specified.
• A limit order to sell at a price above the prevailing market price will be executed at the first available sell price that is equal to or more than the ‘Target Price’ that you have specified.
• A limit order to sell at a price below the prevailing market price will be executed at the first available sell price that is equal to or less than the ‘Target Price’ that you have specified.
Step 5 – Set your risk-management orders
Successful investing requires an effective risk-management strategy. You may easily minimise losses caused by adverse price movements by setting stop losses on your transactions. In this way you can specify up front exactly how much you are willing to lose and how much you aim to make from each transaction.
Stop loss, trailing stop loss and take profit orders
Stop losses are used to close out positions at predetermined prices to help limit losses. They allow you to specify a maximum amount that you are willing to lose if the market moves against you. Your position will be closed automatically when the product price reaches your stop loss. If the transaction-based stop loss function is enabled, the CMC Tracker platform will automatically suggest a stop loss on every trade that is equal to the amount that you have invested in the position less a small buffer. This stop loss can be altered during or after confirming the trade. However, once the order is executed it cannot be increased beyond your margin requirement for the transaction or removed completely.
Note: Automatic transaction-based stop losses can be turned off in ‘Preferences’ if you would rather not have the system set you a default stop loss on each trade.
Why are stop losses not guaranteed?
When the relevant price of the instrument reaches or crosses the ‘Target Price’, the order is executed at the first available price. However, due to market conditions such as trade volume and gapping, the first available execution price may or may not be exactly the same as your specified ‘Target Price’, therefore your target price cannot be guaranteed.
Trailing stop loss
These are used to lock in any profitable movement. As the market moves in your favour, the stop loss price of the order will stay the same number of ‘points’ away from the most favourable price to you. When the market falls, the stop loss order will remain at that new, more favourable price.
Note: When you edit a trailing stop loss, you specify a number of ‘points’ away from the current market price.
Take profit order
Take profit orders are used to close out a position at a predetermined profit level. This profit-taking level can be altered at any time while the trade is live, whether via the charts or through the ‘Account’ section.
Handy hint: Use the charts that have been built into the order ticket to set your stop losses and orders against current and historical prices. Simply move the market price (blue for BUY, orange for SELL), stop loss (red) or take profit (green) bars up or down and see the new price reflected in the order ticket.
Are my orders linked together?
If you place a stop loss and take profit order on one transaction they will automatically act like an OCO (one cancels other). When one order gets executed the other automatically gets cancelled. Similarly, if you place a limit order and then set take profit and stop loss orders alongside this trade, they will act as if done orders, meaning these will only become active if the limit order is executed first.
Step 6 – Confirm your trade
Once you are happy with your trade simply click ‘Confirm’. If you have the ‘Placing an Order’ confirmation enabled under ‘Preferences’, you will be asked for confirmation once more before you place your order. Click ‘Confirm’ again to go ahead with the transaction and the trade will be processed. An ‘Order Confirmation’ box will then appear to confirm the trade has been processed. It contains all of the details concerning your trade.
Note: You can place your trades more quickly by turning off the ’Placing an Order’ confirmation warnings via ’Preferences’ or by using the check box in the order ticket itself.
What happens if I lose the connection when I am in the middle of placing a trade?
If you don’t see a confirmation screen then it is likely that your trade has not gone through. Click on ’Account’ and check your open positions to see whether your trade has gone through. Trades that aren’t completed or that are frozen for more than 60 seconds should automatically time out.
Step 7 – Check progress and edit live trades
Once a trade is live there are two ways to monitor it and make any necessary changes to your stop loss and take profit order. You can do this either through ‘Account’, or directly through the charts for each position.
All positions are displayed separately under the ‘Positions’ tab, so you can quickly view each investment individually and easily edit stop loss and take profit orders if and when you want. If you have multiple trades open on the same instrument there will be a summary line that groups them together showing overall profit and an average entry price. You can close out all trades with one click from this summary line, or you can edit and close positions individually.
Note: Profit or loss will always be displayed in your CFD account’s currency.
Each trade can be viewed against historical and live prices directly on your charts. Edit your stop losses and take profit orders by clicking on the trade icon (the small triangular shaped point on the chart that shows your entry point) and dragging the stop loss (red line) and take profit levels (green line) up or down. What better way to see how your trades are progressing and make changes? Please be aware that our charting tools are indicative and are provided for information purposes and must not be relied upon as investment advice.
Step 8 – Close out your position
If you want to close out a trade you can do so by clicking on the ‘Account’ icon. Select the position you wish to close and then click on the red ‘x’ icon. You will then see a new pop-up asking you to ‘Confirm’ or ‘Cancel’ the request.
Note: If you are trading an international instrument the profit or loss will automatically be recorded in your CFD account’s currency when you close out your position.
See the Trading Costs user guide to view charges that apply to trading.
What happens if my account value falls?
If your total Account Value falls to 50% of your total minimum margin requirement, a notification will be shown on screen and sent by email, showing the value of the close-out level. Your total minimum margin requirement is the aggregate of what the margin requirements for your open positions would be if each position had used the maximum financing available.
Provided that your ’Account Value’ remains above the close-out level, you will not be required to top up your funds.
If you receive one of these notifications you should consider closing your positions or paying further funds into your account.
If your account value keeps falling to reach 20% of your total minimum margin requirement, and no additional funds are added, your account will reach the close-out level. A red pop-up will appear over your account position stating: ‘Your position close-out level has been breached.’
The CMC Tracker will attempt to automatically close all open positions on the account. The platform will look to close out your open trades at this level to protect you from losing more than what is held in your account.
Note: You should not rely on the CMC Tracker to close out your positions if your account value falls below the close-out level, as we cannot guarantee that close-outs will always occur.* The safest thing to do is monitor your positions closely.
*Market events such as gapping, liquidity issues, corporate actions and news announcements can cause close-outs to occur below our suggested level and cause your account to go into negative.
We encourage all our customers to practise placing trades first on our free unlimited-use demo account. You can use virtual funds until you are comfortable with the different order types and how they work. This way you can learn in a risk-free environment before committing your own money.