Forex CFD or Forex Spot

Differences between trading forex CFDs and spot forex transactions (forex spot) at FXFlat

At FXFlat you are in the comfortable situation to trade currencies either with classic Forex CFDs or as spot foreign exchange transactions (Forex Spot) in direct Forex Kassa. In the following we would like to present you the most important differences and features.

Forex CFDs are derivatives issued by an issuer with a fixed reference to a specific reference market.
Spot foreign exchange transactions (forex spot), on the other hand, are the reference market itself and a spot transaction, i.e. the cash. The forex spot price of a currency pair, is determined by all market participants and not just by a single market maker or issuer as is the case with CFDs.

Digression: The price of a CFD from provider A is also determined only by him and may differ from provider B or even the reference market. In Forex Spot, bid and ask prices are set by different market participants and are completely independent of each other. There is no fixed spread between bid and ask prices. The price can even be inverse, so the spread is quoted in favor of the client.

Forex CFD trading is a bilateral OTC trade while spot forex trading is a multilateral OTC trade. This means that you have to buy a CFD only from the respective issuer, and it is also mandatory to sell it. In spot FX trading, for example, a currency can be bought at bank A and sold at bank B. For the respective market participants (bank, market maker, etc.) it is not apparent whether a position is opened or closed in the securities account with a purchase or sale and there is also no participation in the profit or loss of the customer or investor. At FXFlat you can ask for each individual trade to be disclosed at which executing agency was bought or sold for you.

In Forex spot trading, a delivery of the traded currency with value date after 2 business days is provided - equivalent to the purchase of a share. However, FXFlat excludes a physical delivery. Background is that customers of FXFlat do not want a delivery of the currency. FXFlat also does not guarantee delivery as no overnight trading is offered and clients must close all positions intraday. Any open Forex spot positions are forcibly liquidated from 22h. Forex CFDs, on the other hand, are tradable 24 hours continuously and are charged with financing costs, which do not exist in Forex Spot trading at FXFlat. The value date in FX trading is 2 business days.

Number of currency pairs

FXFlat offers you the 6 major forex pairs for trading in spot (forex spot) trading, while you can currently trade 53 currency pairs in forex CFD trading (all currency pairs can be found here)

Margin requirements

The margin requirement in spot forex trading is from 0.5%. In Forex CFD trading the margin requirement is from 3.33% to 10%.

Trading hours

Forex CFDs can be traded at FXFlat in the period from Sunday to Friday continuously from 23:00 CET - 23:00 CET.

Spot FX trading (Forex Spot), on the other hand, is exclusively tradable intraday in the period from Monday to Friday 06:00 CET - 22:00 CET.

Differences at a glance

  Forex Spot (Spot Exchange Transaction) Forex CFD
Margin % 0,50 3,33-20,00
Spread from 1.2 pips from 0.9 pips
Times 08:00 - 22:00 CET 24h
Delivery - -
Pricing Multilateral Bilateral
margin call no* no*

*Exception: Professional Classic account

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