Bonds

trading

THE BOND MARKET IS THE LARGEST SECURITIES MARKET IN THE WORLD. BONDS ARE UNITS OF CORPORATE DEBT ISSUED BY CORPORATIONS AND GOVERNMENT BODIES TO BE USED AS TRADABLE ASSETS. A BOND IS REFERRED TO AS A FIXED-INCOME INSTRUMENT THAT IS TRADITIONALLY PAID A FIXED INTEREST RATE TO DEBTHOLDERS.

What are the advantages of

Bonds with CMG FX?

Security

Traditionally safer investment

Yield pickup

More predictable

Diversification

Hedge risk in your portfolio

Multiple markets

Wide variety of options

Offsetting

Ideal to offset volatility

DIVERSIFY YOUR PORTFOLIO

What is Bonds trading?

A Bond is an OTC (Over-the-Counter) fixed-income debt instrument that technically is a loan from an investor to a company or government agency.

Let’s say a corporation decides to expand its product range and as a result requires capital raising to undertake research and development. The total R&D cost to get the product to market is 10 million dollars. In order to raise the capital it might decide to sell 10,000 Bonds to investors at $1,000 each.

LEARN TO TRADE BONDS CFDS

How does Bonds CFD trading work?

A Bond CFD is a form of derivative trading. When trading Bonds as a CFD, you are not purchasing the literal Bond, you are taking a position on the price of the underlying instrument in the market. Trading Bond CFDs allows you to take a long position (price rising) or a short position (price falling). Each Bond CFD uses a designated Bond as its reference point. CFD stands for “Contract for Difference” which ultimately means the difference between the opening and closing position of the Bond. The MT4 and MT5 platforms offered by CMG FX are the ideal choice for trading Bonds CFDs.
METATRADER 4 (MT4) & METATRADER 5 (MT5)

What are the most recommended

platforms for Bonds trading?

MT4 & MT5 are the favourite choice for Bonds traders around the globe. CMG FX’ MT4 & MT5 are packed with extras to ensure you’re equipped with all the tools you need to make better informed trading decisions. Tight Raw Pricing, fast execution and superior charts are the building blocks for our MT4 & MT5 solutions.

Start trading with CMG on spreads from 0.0 pips

BUYING BONDS

Bonds trading example

The gross profit on your trade is calculated as follows:

OPENING PRICE

$100 × 10 contracts= $1000

CLOSING PRICE AT

$110 × 10 contracts = $1100

GROSS PROFIT ON TRADE

$1100 – $1000 = $100

CLOSING PRICE AT

$90 x 10 contracts = $900

GROSS LOSS ON TRADE

$900 – $1000 = -$100

Opening the position

You believe that the price of the US 10-Year Treasury Note (US10YR) is likely to increase, so you buy 10 contracts at an ask price of $100.

Closing the position

3 weeks later, the price of the US10YR is now $110 (bid), an increase of $10 on your entry price. You decide to close your position and take profit, earning you $10 profit x 10 contracts = $100 total profit.
TRADE FROM 0.0 PIPS

Typical Bonds spreads