You decide to buy the banks sector CFD. A City Index trader quotes
you 8175/8208 and you buy two CFDs at 8208.
Opening Trade
Price of Bank Sector CFD - 8208
Number of CFDs - 2
Value of CFDs - £16,416.00
NTR Required (7.5%) - £1,231.20
Daily Financing
On a nightly basis you pay financing for this position based on
Stirling LIBOR. Your financing rate might be LIBOR + 2.0%. Assume
this equates to a financing rate of (4.75% + 2.25%) 7.0% and the
closing price for the day is 8200. You pay 2 x 8200 x 6.75% / 365 =
£3.15 for holding the position overnight. This will be debited from
your account on the next trading day.
Closing Trade
Four days later the Banks Sector CFD is quoted 8410/8444 and you
sell two CFDs at 8410.
Price of Banks Sector CFD - 8410
Number of CFDs - 2
Value of CFDs - £16,820.00
Closing Value of CFDs - £16,820.00
Opening Value of CFDs - £16,416.00
Profit on Trade - £404.00
Financing (4 days) - (£12.60)
Overall Profit on Trade - £391.40