Contract for Difference (CFD) trading has surged in popularity due to its leverage, versatility, and access to global markets from a single platform. Despite its advantages, traders often encounter inconsistencies in trade results that aren’t entirely explained by their strategies or market direction. These issues frequently stem from operational mechanics—namely, the liquidity available in the market, the quality and speed of order execution, and the frequency or size of slippage. This article explores these elements in depth, offering clarity on how they work and what traders can do to navigate them effectively.

Understanding CFD Market Structure

To grasp the realities of liquidity, execution, and slippage, it’s essential to first understand the structure of the CFD market itself. Unlike traditional stock exchanges, the CFD market operates over-the-counter (OTC). This means trades are conducted directly between parties, usually through a broker, rather than on a centralised exchange. The lack of a central exchange creates differences in pricing and liquidity from one broker to another.

Key participants in this market include brokers, institutional liquidity providers, and retail traders. While some brokers act purely as intermediaries, others operate a market-maker model in which they take the opposite side of a client’s trade. This arrangement can impact order execution and the degree of slippage experienced by the trader.

One unique aspect of CFD trading is its reliance on broker pricing rather than exchange-traded prices. Because brokers aggregate prices from multiple sources or generate them internally, the market depth and execution quality can vary widely across platforms. This makes it essential for traders to understand the specific pricing and execution environment of the broker they choose.

Liquidity in CFD Trading

Liquidity in financial markets refers to the ease with which an asset can be bought or sold without significantly affecting its price. In CFD trading, liquidity is crucial because it determines how smoothly and efficiently trades can be executed. High liquidity often results in tighter spreads and better order fills, while low liquidity can lead to wide spreads, partial fills, or even failed executions.

The level of liquidity available in the CFD market depends largely on the underlying asset. Major forex pairs, stock indices, and popular commodities like gold or oil typically offer high liquidity, especially during peak trading hours. In contrast, exotic currency pairs, small-cap stocks, or niche indices may suffer from limited trading activity, making them prone to large price swings and higher slippage.

Unlike traditional markets, where liquidity is visible through order books, CFD liquidity is often opaque. Brokers may internalise trades or source liquidity from a limited number of providers, which can further obscure true market depth. During volatile market events, such as major economic announcements or geopolitical shocks, liquidity can evaporate, leading to unpredictable execution outcomes.

Trade Execution in CFDs

The way your trade gets executed in a CFD environment can significantly affect its outcome. Execution refers to how quickly and at what price a trade order is fulfilled. This process is influenced by several factors, including the broker’s execution model, system infrastructure, and the prevailing market conditions.

Most CFD brokers offer either a market maker model or a straight-through processing (STP) model. In the market maker setup, the broker may take the opposite side of your trade, creating a potential conflict of interest. However, this model can also offer faster execution and guaranteed liquidity for smaller orders. On the other hand, STP brokers route orders to external liquidity providers, often resulting in better transparency and potentially tighter spreads.

Execution speed is also critical. In fast-moving markets, delays of even milliseconds can cause orders to fill at prices that differ from those expected. This is particularly problematic for traders using scalping or high-frequency strategies, where consistency in execution is paramount.

Slippage: Causes and Consequences

Slippage occurs when a trade is executed at a price different from what was expected at the time of placing the order. This phenomenon is common in CFD trading due to the inherent volatility and lack of centralised pricing. While slippage can be positive, meaning you get a better price, it is more often a negative experience, especially during periods of low liquidity or high volatility.

There are several reasons why slippage happens. One of the most common is market movement between the time you place your order and the time it gets executed. This is particularly prevalent during economic news releases or in assets that are not frequently traded. Another cause is insufficient liquidity at the requested price level, forcing the broker to fill the order at the next available price. The consequences of slippage extend beyond individual trades. Frequent or large slippage can distort stop-loss and take-profit levels, throw off risk-reward ratios, and even cause margin calls if trades go against the intended position.

Conclusion

Liquidity, execution, and slippage are foundational components of the CFD trading experience. While often considered behind-the-scenes mechanics, they directly influence trade outcomes and long-term profitability. Understanding how these factors interact—and taking steps to mitigate their risks—can elevate your trading strategy from theory to practice. Rather than viewing these operational realities as obstacles, consider them essential components of a well-informed trading approach. The more you understand about how your trades are executed, the better positioned you’ll be to adapt, manage risk, and capitalise on market opportunities with confidence.

Ever sat at your desk and thought that you would love to go freelance but didn?t know where to start? Maybe even been afraid that you didn?t have the freelance experience to make it as a new freelance professional?

The easiest way to go freelance and make it a success is to start small and utilize the power of the internet to do it by joining a freelance community.

There are many freelance communities out there to choose from including GoFreelance, Elance and Home Job Shop. They each provide ways to work both full or part-time on freelance jobs right from your own home for clients around the world.

GoFreelance is a great choice for those who are new to freelance work. For a very small fee, you can access hundreds of super cool jobs that anyone can do including taking pictures, virtual assistants, blogging, internet marketing, research and more. They also offer more specialized work for programmers, business professionals, and copywriters.

Elance and Home Job Shop are great resources for the more seasoned freelancer. They have many options to easily fill your schedule so you could quickly make freelance work your full-time job. Many freelance professionals find that they don?t even have to work as many freelance hours as they were previously working away from home in order to replace a full-time income.

So if you are looking for an easy way to get started, start with an online freelance community and just do it. The world of freelance work is right there on the internet just waiting for you to find it!

Is your to-do list keeping you up at night? Are you counting tasks rather than sheep to fall asleep?

1. Wade through emails – 2. Finalize the presentation for tomorrow?s meeting – 3. Get handouts ready for Wednesday?s meeting – 4. Make follow up calls zzz – 5. Schedule sales meeting zzzzzz – 6. Buy anniversary gift. – 7. Call my kids.zzzzzzzz

If it?s been a long time since you laid your head down on the pillow at night without a care in the world, rest assured ? there is hope. You can have sanity and sleep, too.

When business worries and personal commitments get to be too much, you need to get help. Businesses owners are faced with more and more challenges every day?finding clients, keeping clients, creating products, article and press release distribution, social networking, and the economy. So if you?re spending more of your time on administrative tasks or just plain spinning your wheels going no where fast, it?s time to make a change. It?s time to partner with a Virtual Assistant.

So what exactly is a Virtual Assistant and what can one do for you?

A virtual assistant, or VA, is an independent business professional who among many things, can help overwhelmed business owners handle administrative tasks so they can remain focused on their business. Utilizing the latest technology your Virtual Assistant can manage your social networks, write press releases and correspondence, tweak or create a presentation, make travel arrangements, be your own personal concierge, write letters, follow up on trade show leads, handle literature fulfillment, and even prepare your expense and call reports. The possibilities are endless once you start to see how many tasks you really can delegate.

“I don’t know what I’d do without my Virtual Assistant. As a sales professional who works out of my home and travels extensively I don’t have an on-site staff to keep things moving. I can rely on my VA to prepare marketing materials, organize my contacts, send out letters, and keep me on track with special projects. Delegating routine tasks and special projects to my Virtual Assistant allows me to spend more time growing the business,” says Mark Loudenslager, VP of Sales.

Partnering with a virtual assistant affords you the luxury of spending more time in front of your clients and less time behind your desk. Because virtual assistants are independent professionals they come equipped with their own office, their own equipment, the latest software programs, and the know how of running a successful business. They don’t, however, come equipped with added expenses like payroll taxes, expensive benefit packages, paid vacations, holiday pay, or “free time” (that you pay for) for talking to co-workers. They’re only there when you need them. Sometimes they’re even there when you don’t think you need them!

Virtual Assistants are also invaluable in helping to keep your business from being lost among its many competitors or overlooked because of lack of professionalism. Amidst the Internet and Social Networking craze, millions of email exchanges, and web and teleconferencing many professionals have literally ?lost sight? of their clients. In a day and age where we thrive on customer relationship management, personal sales calls have taken a back seat to technology. Further, today?s economy has forced more layoffs and corporate downsizing, which has impacted the availability of internal support systems and other such resources. The lack of internal resources has forced companies to rely on already overburdened staff to pick up the slack. Staff such as sales people who are now spending more time doing administrative tasks than they are generating sales. Where does the madness end?

It?s time to wake up and get back in the field. Get ahead of the competition and you won?t find yourself saying, ?Oops, I could have had a VA!?

Business greeting cards are very different from normal holiday or ?occasion? type greeting cards. When you print greeting cards like this, the tone of it is distinctly different since its whole purpose and goal is very different as well. Do not go about it like your normal kind of personal greeting card since people will just wonder and get ?weirded? out at the person or entity sending them. Nothing screams uncomfortable more than a greeting card that is too personal (Hi Lizzy how are you!) yet you do not know exactly who it came from.

So it is important to know how to write for business greeting cards. You have to know how to approach the customer correctly using the alternative but very effective medium of the greeting card. To help you out with this, here are my tips on writing for business greeting cards.

1. Be personal yet formal ? The first thing that you should know about for writing for business greeting cards is the approach. We all know that greeting cards are best when they are personal, but as illustrated above, you can?t just go directly personal with a potential customer. It might be construed as invasive and even creepy. So, you have to walk a fine line between personal greetings and formality. For example instead of using the customer?s first name, you have to use titles like Mr., Mrs. or Miss and then use their last names. If they have a professional title like Dr. or Atty. then you have to use them as well. You of course have to research on these things so that you can do it correctly. Format titles like this plus their last names make the greeting card appear personal (by using a specific name) without appearing too much like a mass produced medium like the ?dear sir/madam? approach. So like this, try to walk the fine line between personal and formal so that you can maximize the usefulness of greeting cards without failing in the execution.
2. Use a polite and respectful tone ? Also of course, as a standard practice, try to use a polite and respectful tone in your business greeting cards. More particularly, try to use a tone that uplifts the status of the potential customer making them feel like they are in charge and you are there to serve their needs. People like feeling like they are in control or that someone is there to help and serve them. You can capitalize on this and have people respond well to your greeting cards by using this kind of tone.
3. Try to be subtle with promotions ? Nobody likes unsolicited sales mail. Most mails like this usually get classified as junk mail immediately. So keep the commercial talk to a minimum and focus more on establishing a relationship with the customer. Just casually say that you have that new product line that they might be interested in, but don?t go too much on its specifics.

Great! Hopefully this helps you out in writing your business greeting cards. As you can undoubtedly see, there are fine lines that you must tread to make them effective and acceptable. So keep your focus and review all your content before you go into greeting card printing.