Example: Buying the Australia 200
All our stock index contracts are commission-free: the only charge is our highly competitive dealing spread.
Our most popular stock index contracts are listed in the Contract Details. You can trade in full or mini contract sizes, and even in fractions of a contract. You can also trade the Australia 200 either on a standard contract (with a 2-point spread) or a futures contract (with a 3-point spread).
Opening the position
On 29 September 2008 our quote for the Australia 200 is 4355/4357. You think the blue-chips are going to start their recovery and decide to buy two contracts at 4357. (One contract is the equivalent of $25 per index point.) There is no commission to pay.
To open your position you supply a deposit of $5000 per contract = $10000. You will then make or lose $50 for every point the sell price rises above or falls below 4357.
To open your position you supply a deposit of $2500 per contract = $5000. You will then make or lose $50 for every point the sell price rises above or falls below 4357.
Closing the position
The market moves in your favour over the next couple of days, and you decide to take your profit. On 1 October 2008 our quote has risen to 4840/4842, and you close your position by selling two contracts at 4840.
Your gross profit on the trade is calculated as follows:
Profit
| Closing level | 4840 |
| Opening level | 4357 |
| Difference | 483 |
Gross profit: 483 points x 2 contracts x $25 per point = $24,150
To calculate the net result you also have to include interest and dividend adjustments. Interest adjustments are applied daily to stock index trades in exactly the same way as to Share CFDs. Dividend adjustments are applied whenever a stock in the relevant index goes ex-dividend. For more information see Contract Details