PropFirm Futures or PropFirm CFDs?

What is a Futures Contract

A futures contract (or futures contract) is a standardized agreement between two parties to buy or sell an asset at a predetermined price on a specific future date. These contracts are traded on organized markets called futures markets.

Futures contracts are powerful and flexible financial instruments, but they also carry significant risks, particularly due to leverage and market fluctuations.

These are the contracts traded by professional traders, banks and hedge funds.

What is a CFD?

A CFD, or "Contract for Difference" in English, is a financial derivative instrument that allows investors to speculate on price changes in underlying assets without having to actually own those assets. Here are the main points to understand about CFDs:

Basic principle :

A CFD is an agreement between an investor and a broker to exchange the difference in the value of an asset between when the contract is opened and when it is closed. If the price of the asset increases, the investor makes a profit proportional to this increase. If the price falls, the investor suffers a loss.

Underlying assets:

CFDs can be based on a wide variety of assets, including stocks, stock indices, currencies (Forex), commodities and even cryptocurrencies.

Benefits :

Flexibility: CFDs allow you to speculate on the rise or fall of the markets (short selling).
Access to various markets: They provide access to a wide range of financial markets from a single trading platform.

Risks:

Risk of loss: Due to leverage, it is possible to lose more than the initial amount invested.
Counterparty Risk: You depend on the broker to execute trades and honor winnings.

CFDs are therefore complex tools which require a good understanding of the financial markets and the associated risks before being used.