How to trade IQ Option CFD on the stock market. Just 4 Easy Steps To Make Your First Trade


Trading stocks CFD on IQ Option

Trading IQ Option CFD is quite similar to share trading. The rules are the same. What is different is that in CFDs you do not own the underlying asset. You buy a contract between you and your broker. You can trade stocks with CFDs on the IQ Option platform.

Key Takeaways🔑

Trading CFDs on IQ Option is similar to share trading, but you don’t own the underlying asset.
CFDs offer high leverage and are traded on margin, allowing for potentially higher profits and losses.
IQ Option offers a variety of stocks and options to trade, with tools to help manage risk and maximize returns.

The differences between trading shares and IQ Option CFDs

The first difference I have already mentioned. It is about ownership of the underlying asset. In CFDs, you buy a contract for difference, not actual company shares. The agreement made with the broker refers to the difference in the opening and closing prices.

With IQ Option CFDs, you have the possibility to buy or sell. But all the transactions concern the contract. Even when you are selling, you are not obliged to provide the underlying asset.

Another major difference is that CFDs give a unique possibility to use high leverage. They are traded on margin, which means you only invest a margin of the value of a position. This permits to invest more than a trader has on hand. But the effect works on both sides. You can profit much more than you have invested, but you can also lose more. That is why you need to gain the necessary knowledge before you start trading CFDs.

In the UK, CFDs are relieved of the 0.5% stamp duty. The gains, however, remain under capital gains tax.

IQ Option CFD
You can be a stock trader on IQ Option

Trading CFD stocks on IQ Option

To trade CFD stocks you will have to follow a few steps. First, log in to your IQ Option account. Click on the plus icon and choose Stocks from the available options. You can see that the IQ Option platform offers 198 stocks from popular stock exchanges.

Then, you can search for a preferable asset simply by writing its name in the search window.

A whole list will be displayed. Next to the asset’s name, there is some information about it like spread, change percentage and the maximum leverage you can use.

How to choose one of 198 stock to trade on IQ Option
How to choose one of 198 stocks to trade on IQ Option

How do you trade CFD IQ Options?

You have decided on the asset you are going to trade. Now there are a few more steps to follow.

  1. Set the investment amount for this particular transaction. This decision should be made according to your capital management strategy.
  2. Adjust the multiplier. Bear in mind, that it will not only maximise the reward, but also a loss. In the example below a chosen multiplier is 5. The investment amount was $100 which means that the results will be multiplied. It is as if you were trading with $500 on hand. But the amount increased for both, profit and loss and that is why the next point is very useful.
  3. Auto Close. Setting auto close is optional. It is a very helpful tool as it will protect your account balance. Its function is to close the transaction automatically whenever it will reach a preset level.
  4. The last step is to decide on the market direction. Make a profound analysis and choose the Buy or Sell button.
How to open CFD transaction on IQ Option
How to open IQ Option CFD transaction

You can close your position when you are satisfied with the result or when you see the situation is not developing as you predicted. Then, to secure your IQ Option CFD earnings, you can choose to close the deal. Click on the Total Portfolio icon on the left side of the IQ Option platform. There you will see information about your position and the Close button.

Be aware there are overnight fees. Do not hold the position too long if you wish to avoid paying them.

You can close your open position by visiting portfolio section on IQ Option
You can close your opened position by visiting the portfolio section on IQ Option

Pros and Cons😃😔

Pros:

  • CFDs allow for high leverage, potentially increasing profits.
  • No ownership of the underlying asset, simplifying the trading process.
  • IQ Option offers a wide variety of stocks and options to trade.
  • Useful tools like Auto Close and technical analysis for better risk management.

Cons:

  • High leverage also increases potential losses.
  • CFD trading requires a certain level of knowledge and experience.
  • Overnight fees can accumulate if positions are held for extended periods.
  • Capital gains tax still applies to CFD profits in some jurisdictions.

 

CFD Trading Features IQ Option Platform Features
High leverage and margin trading. Offers 198 stocks from popular stock exchanges.
No ownership of underlying assets. User-friendly interface with search function for finding assets.
Requires knowledge and experience for successful trading. Auto Close feature to manage risk and protect account balance.
Overnight fees may apply for holding positions. Offers free demo account for practice and learning.

Can you trade options on IQ Option?

The IQ Option platform has been enabling traders to trade options since its inception. Binary and digital options are available here. If you want to speculate with these instruments on the stock market, choose binary options. You will find stocks of popular companies for which you can buy options.

Final words on IQ Option CFD

Trading CFDs on the IQ Option platform requires a certain portion of knowledge and practice. You have done the first step. You are here. Now, make use of the free demo account offered by IQ Option and implement what you have just learned. You will not risk your own capital, as you make transactions with virtual cash. Use technical analysis tools for better market identification. Once you get hold of trading IQ Option CFDs, you may switch to the live account and start earning real money.

I encourage you to tell us about your experience with the CFDs on the IQ Option platform in the comments section below. I will be happy to hear from you.

Best of luck!

Q&A Section💡

  • Q: What is the main difference between trading shares and IQ Option CFDs?
  • A: In CFD trading, you don’t own the underlying asset. Instead, you trade a contract for difference based on the asset’s price change.
  • Q: Can I trade options on IQ Option?
  • A: Yes, IQ Option offers binary and digital options, allowing you to speculate on stock market instruments.
  • Q: How do I open an IQ Option CFD transaction?
  • A: Choose an asset, set the investment amount, adjust the multiplier, and decide on the market direction (Buy or Sell) to open a CFD transaction.
  • Q: What is the purpose of the Auto Close feature in IQ Option?
  • A: Auto Close helps manage risk by automatically closing a transaction when it reaches a preset level, protecting your account balance.
  • Q: How can I practice trading CFDs on IQ Option without risking my own capital?
  • A: IQ Option offers a free demo account with virtual cash, allowing you to practice and learn without risking real money.

 

GENERAL RISK WARNING

The financial products offered by the company carry a high level of risk and can result in the loss of all your funds. You should never invest money that you cannot afford to lose.
Kindly note that this article does not provide any investment advice. The information presented regarding past events or potential future developments is solely an opinion and cannot be guaranteed as factual, including the provided examples. We caution readers accordingly.

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Bart Bregman

Author / IQ Option expert: "My name is Bart Bregman, I have 9 years of full-time professional trading experience. I've been trading with IQ Option for more than 7 years, mainly on the shorter time frames doing technical analyses, and have many experience with Binary Options, CFDs, Options, and Crypto trading. There is no such thing as a bad trade! As a digital nomad trader, I'm mostly traveling all over the world. Follow my journey on Instagram at https://www.instagram.com/bart_bregman/. "

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