CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Long position definition
What is a long position?
A long position describes the process of buying an asset with the expectation that the price of the underlying will rise. It is also known as ‘going long’ or ‘taking a long position’, and long positions are often opened by bullish traders with an optimistic market outlook.
Learn how CFD trading works
Find out more about CFD trading, including what the spread is and how leverage works.
How to take a long position
If you’re looking to go long, you would open your trade at the offer (buy) price. A long position can either be opened by investing directly in the underlying asset, or by using financial derivatives such as CFDs.
When investing in an asset directly, you will take ownership of it. As a result, you need the price to rise in order to realise a profit.
CFDs are different because you never take direct ownership of the underlying asset, meaning they can be used to go both long and short. With a long CFD trade, you would expect the price of an asset to rise and the extent to which your prediction is correct will determine your profit or loss.
Long vs short positions
A short position is the opposite to a long position. You’d go short if you believe that the price of the underlying asset will decrease.
When you open a short position with CFDs, you are effectively speculating that the market will fall in price. The extent to which the market agrees with your prediction determines your profit or loss.
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