Use our range of orders to manage both your downside and upside potential, and reach your trading goals.
You can use orders to open new positions in the future when prices reach a specific level pre-determined by you, at which you would like to buy or sell. When you spot a trading opportunity, be it at current or future market levels, you can place and monitor the order through our online platform. Orders are a great tool to make sure that you don’t miss out on price moves without having to monitor market prices constantly.
Example: Woolworths CFD For the purpose of this example, our Woolworths CFD price is trading at 24.99 / 25.00. Over the last few days there has been a surge in Woolworth’s share price, causing it to rally over 5% on hopes of a better-than-expected set of earnings. You believe that Woolworth’s share prices will hit resistance should they reach a level of $26, which will then cause prices to fall, thus representing a potential sell opportunity. You can use our wide range of orders to profit from this potential new trend.
You place a new opening order to sell 1,000 Woolworth’s CFDs, when our bid price reaches $26. This means that as soon as the sell price of our Woolworth’s market reaches $26, your order will be triggered and our systems will automatically enter you into a new sell trade of 1,000 CFDs.
Limit orders are used to lock in profits by closing your CFD trade once the market passes the trigger value you’ve set. Example: Australia 200 Let’s say you have bought 2 CFDs of the Australia 200 at 4000, and have highlighted 4,200 as your profit target, a $400 gain (4200-4000 x 2 CFDs). You can use a limit order to ensure that should the Australia 200 reach 4200, our systems automatically close out your trade at this level. Sure enough, the Australia 200 rallies to 4200, and our systems automatically close your position out at 4200. Next time you log onto the platform, you will see your $400 profit already credited onto your cash balance.
City Index stop loss orders are incredibly flexible and while they’re mainly used to stop losses, they can also be used to protect profits. All of our orders can be moved as much or as little as you like, as long as they have not been triggered. As the market goes in your favour, you can move your stop loss in line with the market to cash in your profits. Many CFD traders use this strategy along with a limit order to put a minimum and maximum profit cap on their trades.
Example: Wall Street Let’s say you have bought 2 CFDs of the Wall Street Index at 10100, expecting it to rise over the coming days. You set a Guaranteed Stop Loss at 9950 to ensure that your downside risk is protected and put a Limit Order at 10300 as a profit target. Sure enough, Morgan Stanley announces a solid set of earnings, which lifts the Wall Street Index to 10255. Seeing this move, you can now move your Guaranteed Stop Loss higher to 10150 to ensure that the minimum you can make from this trade would be $100 (10150-10100 x 2 CFDs). Remember, you still have your Limit Order set at 10300, meaning that should the Wall Street Index continue to rise and reach this level, your trade will automatically close at your profit goal. By moving your Guaranteed Stop Loss higher in line with the market rise, you have ensured that at the very minimum, you will make a US$100 profit on this trade.
To limit your trading risk, we recommend that you consider a GSLO when you open a new position. They are the most efficient risk management tools available that guarantee to close your trade at the trigger you set, regardless of market volatility and gapping. Please note that GSLOs are not available across all our markets.
Example: Rio Tinto Let’s say you have bought 200 Rio Tinto CFDs at $62, and have highlighted $58 as your maximum loss level, a A$800 loss allowance ($62 - $58 x 200 CFDs) with a premium of $37.20 to place the GSLO. You can use a GSLO to ensure that should Rio Tinto reach $58, our systems will automatically close out your trade at this level, to prevent you from incurring any further losses.Unfortunately some bad copper production figures push Rio Tinto lower to $56, and our systems automatically close your position out at $58. Even though Rio Tinto's share prices continued to trade past your maximum risk allowance, the GSLO has already stopped your losses by automatically closing out your trade.
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City Index is a trading name of GAIN Capital Australia Pty Ltd.
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The material provided herein is general in nature and does not take into account your objectives, financial situation or needs. While every care has been taken in preparing this material, we do not provide any representation or warranty (express or implied) with respect to its completeness or accuracy. This is not an invitation or an offer to invest nor is it a recommendation to buy or sell investments. GAIN Capital recommends you to seek independent financial and legal advice before making any financial investment decision. Trading CFDs and FX on margin carries a higher level of risk, and may not be suitable for all investors. The possibility exists that you could lose more than your initial investment further CFD investors do not own or have any rights to the underlying assets. It is important you consider our Financial Services Guide and Product Disclosure Statement (PDS) available at www.cityindex.com.au, before deciding to acquire or hold our products. As a part of our market risk management, we may take the opposite side of your trade. GAIN Capital Australia Pty Ltd (ACN 141 774 727, AFSL 345646) is the CFD issuer and our products are traded off exchange.