If you think a particular market will rise you can buy a stock index CFD (long position). However, if you think a market will fall you may wish to sell a stock index CFD (short position).

All the normal benefits of trading CFDs apply, including:

No Stamp Duty

As CFDs are a derivative, there is no stamp duty to pay on trading UK sectors, however tax laws may change.

Margin Rates

Low margin requirement enables you to take a position with exposure to a market and initially only be required to put up a small percentage of the value of the position. This means that you are able to take far larger positions in the CFD than you would be able to in the underlying instrument.

For instance, with a 7.5% margin requirement only £750 is required for a £10,000 exposure to the underlying market. This magnifies the extent of any potential gains or losses.

Pricing Policy

We provde CFDs referenced to the major global equity indices. CFDs are synthetically created markets that reflect the cash price by taking the equivalent futures market contract and deducting the 'fair value'. This is to reflect the cost of funding and dividends between the trade date and the futures expiry date. The exposure can be hedged in the relevant futures market.

City Index trade CFDs on the FTSE, DAX and CAC when the markets are closed. The price quoted is based on the closure price of the index and is influenced by activity in world markets and business we are receiving.

Stock Index CFDs have no fixed maturity date and positions can normally be closed at any time during City Index's trading hours for that particular market.

City Index may adjust the CFD spread to take account of supply and demand.

Dividend adjustments

City Index will make ex-dividend adjustments for stock index CFDs held at the close of business on the day before an ex-dividend event of constituent index. For long CFD positions an adjustment is credited to your account. For short CFD positions an adjustment is debited from your account.

In addition, Stock Index CFDs are commission free.

We quote competitive two way prices for CFDs on leading stock indices, including:

• FTSE 100
• Wall Street
• S&P 500
• NASDAQ 100
• DAX 30
• Euro STOXX 50

Buying a stock index CFD - click here to see an example.

Selling a stock index CFD - click here to see an example.