How to trade or invest in the NASDAQ

For those who don’t want broad exposure, but rather have their eye on a particular NASDAQ-listed company, try CFD share trading.

With CFD share trading, you won’t own company shares outright. Unlike owning company shares, which means you can only make a profit if the share price goes up, you can go long or short.

While owning shares means paying the full share price upfront, CFD trading is leveraged. This means you’ll pay only a small deposit amount (called margin) to open a larger position.

However, as profits and losses will be calculated based on your total position size, these can substantially outweigh your margin amount, so ensure you always trade within your means.

CFD share trading enjoys very low spreads, as we charge no spread on our side with you only having to pay the underlying spread price, and a minimum commission charge of US$10.

To open a shares position, simply go to the CFD trading platform and:

1. Select ‘Shares’
2. Click on your chosen company, for example Tesla
3. Decide whether you want to buy (go long) or sell (go short)
4. Choose your deal size in terms of number of contracts
5. Set your stops and limits
6. Click ‘place deal’ to open your position

If you want to gain exposure to a broad range of NASDAQ 100 shares all in one place, you can trade ETFs. Exchange traded funds (ETFs) are investment instruments that track the performance of a range of NASDAQ stocks, to give you variety with very low commissions.

ETF commissions start from just 2 cents on each side of a CFD trade, with a minimum fee of USD$10 for online orders. Just bear in mind that you’ll be trading on the cash (spot) price with ETFs, so there are funding charges you could incur if you leave your position open overnight.

To open a NASDAQ 100 ETF position:

1. Go to the CFD trading platform
2. Select ‘ETFs’
3. Click on your chosen ETF, for example the iShares NASDAQ 100 UCITS
4. Decide whether you want to buy (go long) or sell (go short)
5. Choose your deal size in terms of number of shares
6. Set your stops and limits
7. Click ‘place deal’ to open your position

When you trade NASDAQ 100 futures with us, you won’t pay additional overnight funding charges or commission, as the cost is built into the spread. This is why futures have wider spreads than spot positions.

Trading index futures via CFDs means you’re agreeing to trade the NASDAQ 100 at a specific price on a specific date in the future. To open a NASDAQ 100 futures position:

1. Go to the CFD trading platform
2. Select the US Tech 100 under ‘Indices’
3. Choose ‘Futures’ instead of ‘Cash’ to trade and select your preferred date range
4. Decide whether you want to buy (go long) or sell (go short)
5. Choose your deal size in terms of number of contracts
6. Set your stops and limits
7. Click ‘place deal’ to open your position

One way to trade the NASDAQ 100 using CFDs is on the spot (cash) price.

Trading the spot price means you get the closer pricing to the real time NASDAQ 100 than you would with futures, as prices are based off our future’s price with a fair value adjustment to get as close to the real time cash price as possible, plus low spreads and no commission on indices.

As spot trading does come with overnight funding fees if you leave a position open overnight, this form of trading is best suited to short- and medium-term strategies.

To open a NASDAQ 100 spot position:

1. Go to the CFD trading platform
2. Select the US Tech 100 under ‘Indices’
3. Choose ‘Cash’ instead of ‘Futures’ to trade and select your preferred contract value
4. Decide whether you want to buy (go long) or sell (go short)
5. Choose your deal size in terms of number of contracts
6. Set your stops and limits
7. Click ‘place deal’ to open your position

Trading CFDs on NASDAQ 100: options

With options you have the right, but not the obligation, to exercise the contract on or before its expiry date. When you trade options via CFDs, you’ll pay an initial deposit (called premium) to open a larger position. You’ll then speculate on the option’s premium for a profit or loss – but note that both can significantly outweigh your deposit amount. This is because profits and losses are calculated on the full position size, not the premium amount, so ensure you trade wisely.

Remember, buying options is limited risk as you’ll only risk as much as your margin paid, but selling options is technically unlimited risk, as there’s no restriction to how much a market’s price can rise.

*Do note that CFD options are opt-in only.

To open a CFD options position on the NASDAQ 100:

1. Go to the trading platform
2. Click on Options’ instead of ‘Indices’
3. Choose ‘Indices’ as your asset class and select the US Tech 100
4. Decide on your preferred maturity date range – daily, weekly or monthly
5. Select a call or put option, and whether you want to buy (go long) or sell (go short)
6. Choose the size of your position
7. Set your stops and limits
8. Click ‘place deal’ to open the position