CFDs are available in Australia, Austria, Canada, Cyprus, Czech Republic, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, The Netherlands, Luxembourg, Norway, Poland, Portugal, Romania, Russia, Singapore, South Africa, Spain, Sweden, Switzerland, Turkey, United Kingdom and New Zealand. United States, where due to rules about over the jesse livermore how to trade in stocks pdf products, CFDs cannot be traded by retail investors unless on a registered exchange and there are no exchanges in the US that offer CFDs. In the late 1990s CFDs were introduced to retail traders.
It was around 2000 that retail traders realized that the real benefit of trading CFDs was not the exemption from tax but the ability to leverage any underlying instrument. This was the start of the growth phase in the use of CFDs. Trading index CFDs, such as the ones based on the major global indexes e. Most CFD providers launched financial spread betting operations in parallel to their CFD offering. In the UK the CFD market mirrors the financial spread betting market and the products are in many ways the same. However unlike CFDs which have been exported to a number of different countries, spread betting relying on a country specific tax advantage has remained primarily a UK and Irish phenomenon.
The CFD providers started to expand to overseas markets with CFDs being first introduced to Australia in July 2002 by IG Markets and CMC Markets. CFDs on the top 50 Australian stocks, 8 FX pairs, key global indices and some commodities. There were originally 12 brokers offering ASX CFDs, but this had dropped to five by 2009 and by 2014 the ASX ceased to offer CFDs. In 2014 the Australian securities exchange stopped offering exchange traded CFDs that they had launched in 2007, it had become clear that the majority of CFD trading occurred over-the-counter and the offering provided by the exchange was not attractive enough to create a viable on exchange market. This was after a number of high-profile cases where positions in CFDs were used instead of physical underlying stock to hide them from the normal disclosure rules related to insider information.