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CFD and FX Trading Expands in Volatile Conditions

SYDNEY, 3 March 2008 — A wave of sophisticated equities investors that moved into contracts for difference (CFDs) and currency trading during the equities and commodity market boom has continued to grow during the recent market plunge, GFT says.

The increased volatility of markets in recent months has added momentum to traders who are adept at using the added flexibility of CFDs and forex, the CFD and forex markets group believes.

“We’ve seen a ten-fold rise in CFD trades in the past 12 months worldwide and the rate of activity has continued at a similar pace during the share market fall in the past two months,” GFT sales manager Brendan Gunn says.

Increased activity in CFDs and forex is evident in Australia, he adds. GFT has offered traders a forex market in Australia for 10 years and trading is at record levels. The company entered the CFD market here two years ago with its state-of-the-art trading platform and this business is currently growing at a rate of up to 40 per cent a month.

Confident equity traders have become more aware of the benefits of CFDs and their flexibility compared with shares. “CFDs offer a way to trade the movements of shares, commodities, currency and market indices. They can be sold short without the restrictions that apply to shares.

“CFDs also are used to hedge against an investor’s equity portfolio and we know many investors used this strategy in the recent share market slump,” Mr. Gunn says. This has not only helped traders but may have prevented the excessive share market falls that occurred in the 1987 crash, which led share markets to suspend trading at that time, when CFDs were not traded, he added.

“In contrast to the share market, our dealing desk and personal phone support is available 24 hours a day, 5.5 days a week and we offer more than 2,500 CFDs. Serious traders can potentially make money in volatile times, providing they have this availability, support and reliable trading systems, and they trade in a disciplined way.

“In the volatile market we are seeing more use of Guaranteed stops that we offer as protection against the slippage that would result on a normal stop loss. The Guaranteed stops is similar to insurance when wild market moves are anticipated or trades are left open overnight, providing a limit on a trader’s risk. Of course there is a cost associated with this peace of mind and the trader needs to assess when this cost is justified,” Mr. Gunn commented.

“Some traders who have witnessed the recent share market correction have realised currencies move independently of share markets, so that diversifying into forex trading can lower your overall risk of exposure to share market falls. We have had greater demand recently from equities investors wanting to learn more about foreign exchange trading.”

CONTACT: For further information or comment, please phone Kathy Tricolas at FCR (Financial & Corporate Relations) on (02) 8264 1008 or 0412 929 191 or Simon Marmot, Marketing Director / Australia, 02 9028 7525.

About GFT

Founded in 1997, GFT is a world-leading provider of CFDs and spot forex trading services and software for individual and institutional traders in Australia and more than 100 countries around the globe. GFT provides traders with its versatile award winning* trading platform in desktop, web-based and mobile versions, and also offers free real-time practice accounts. Trading foreign exchange and contracts for difference (CFDs) on margin carries a high level of risk, and may not be suitable for all investors.

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