Market guides
How a trade works at a broker.
The machinery behind a position, spreads, commission, financing, order handling, execution, margin close-out and the documents that record all of it.
Trading involves risk. You could lose more than your deposit.
28 guides, each written to be read on its own
Mechanics
Every guide in this group
Reference guides to the mechanics of a leveraged trade: how a spread is formed, how commission and overnight financing are charged, how orders are routed and filled, how margin requirements work and what a stop order does not guarantee.
The contract for difference as an instrument
What the two parties actually agree, how the settlement arithmetic runs, and how it differs from owning.
- Level
- Foundation
- Covers
- All markets
Contract sizes and lots
Where the number in the volume box comes from, and how contract size turns a price move into money.
- Level
- Foundation
- Covers
- All markets
Pip, point and tick
Three units of price movement used as though they were one, and how each converts into money.
- Level
- Foundation
- Covers
- All markets
How a spread is formed
Where the bid and the ask come from, what widens the distance, and why a spread is not a fee.
- Level
- Foundation
- Covers
- All markets
Commission and how it is charged
The three bases commission is quoted on, and why per side and round turn figures cannot be compared.
- Level
- Foundation
- Covers
- All markets
Swaps and overnight financing
Why a position held past the daily cut off is credited or debited, and how the adjustment is worked out.
- Level
- Foundation
- Covers
- All markets
The triple swap day
The settlement convention that produces a threefold financing entry on one day of the week.
- Level
- Foundation
- Covers
- All markets
Slippage, and why it is not a fee
What produces a fill away from the expected price, and why the same mechanism can improve it.
- Level
- Foundation
- Covers
- All markets
Gapping and weekend risk
Why a market reopens away from where it closed, and what happens to orders sitting inside the jump.
- Level
- Foundation
- Covers
- All markets
Order types reference
The full set of order types a CFD platform accepts, and the time in force settings that go with them.
- Level
- Foundation
- Covers
- All markets
How a stop order actually fills
The four stages between a resting stop and a settled fill, and when trigger and fill price diverge.
- Level
- Intermediate
- Covers
- All markets
Stop orders, and what they do not guarantee
The four things a stop order is believed to promise, and which of them it actually delivers.
- Level
- Intermediate
- Covers
- All markets
Market hours and the trading day
Where a trading day starts and stops, and what a session break changes about orders and positions.
- Level
- Foundation
- Covers
- All markets
Rollover and the daily cut
What happens to an open position at the daily boundary, and why spreads widen around that moment.
- Level
- Intermediate
- Covers
- All markets
Order routing and execution
An order's journey from click to confirmation, and what a best execution obligation requires.
- Level
- Intermediate
- Covers
- All markets
Execution quality and how it is measured
The four measurements that describe how orders are filled, and what each of them cannot show.
- Level
- Intermediate
- Covers
- All markets
Liquidity and depth of book
What the lower rows of an order book describe, and why the best price is only true for a quantity.
- Level
- Intermediate
- Covers
- All markets
Requotes, rejections and partial fills
Why an order comes back as something other than a trade, and how each outcome reads on a statement.
- Level
- Intermediate
- Covers
- All markets
Margin requirements by market
What margin is, why the requirement differs by market, and when a published requirement can change.
- Level
- Intermediate
- Covers
- All markets
Margin close out explained
The sequence from a falling margin level to a closed position, and what the warning threshold does not do.
- Level
- Intermediate
- Covers
- All markets
Currency conversion on an account
Which figures on an account are converted and when, and how a conversion differs from a charge.
- Level
- Intermediate
- Covers
- All markets
Corporate actions on share CFDs
What happens to an open share contract when the company splits, merges, spins off or is taken over.
- Level
- Intermediate
- Covers
- Shares
Dividend adjustments on shares and indices
Why a dividend produces a cash entry, and the withholding that makes the adjustment smaller.
- Level
- Intermediate
- Covers
- 2 classes
ETF tracking difference and total cost
Why a fund does not return exactly what its index returns, and the four sources of the gap.
- Level
- Intermediate
- Covers
- ETFs
Futures based CFDs and contract rollover
Which instruments are written on futures, what happens on the roll date, and what the curve shape costs.
- Level
- Advanced
- Covers
- 2 classes
Price sources and how a quote is built
Where a CFD price comes from, how an aggregated book is assembled, and the filters in between.
- Level
- Intermediate
- Covers
- All markets
Tick size and minimum increments
Why prices move in fixed steps, who sets their size, and the three grids that decide what a venue takes.
- Level
- Intermediate
- Covers
- All markets
Statements and trade confirmations
What each document is for, and the four reasons a hand calculation and a statement line disagree.
- Level
- Foundation
- Covers
- All markets
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