CFD's are a synthetic equity product, which mirror the economic benefits of being long or short an equity. Performance is settled daily and dividends and corporate actions are treated as cash payments.

Contracts for Difference are designed for short-term share trading and have significant advantages over normal dealing, most importantly the ability to trade on margin (normally between 10 and 20% of the full contract value) and the ability to go short. Contracts for Difference do not incur stamp duty. For more information, please visit http://www.ifscl.co.nz or call IFSCL.

Advantages of CFD trading over normal share dealing:

GEARING

Instead of depositing 100% of the transaction value, the investor is only required to deposit margin as collateral, usually only 20% of the transaction value, though 10% margin deposit is available.

SELLING SHORT

Using an equity CFD allows the investor the ability to go short on a share - previously a costly and complicated procedure available only to significant and sophisticated investors. This allows the investor to take advantage of anticipated price declines in a share.

REDUCED TRANSACTION COSTS

There are no other costs involved other than a low transaction commission - there is no Stamp Duty to pay, PTM levy or other local charges. Commissions are fixed and visible and there is no widening of the market spread. And, there is no storage fee.

RISK MANAGEMENT AND HEDGING

Equity CFD's are particularly useful when employed in risk management and hedging strategies. For example, if an investor held a physical position but anticipated a short-term price decline, he would simply short the stock via a CFD to realize a profit to offset any loss on the physical.