How to do LINE CFDs? Professional traders explain in detail 5 remarkable stock trading methods[avril 2022]| For Forex comparison and ranking, HEDGE GUIDE

LINE Securities has started managing “LINE CFD”. Although the mechanics of CFDs are not complicated, some investing newbies may find it difficult.

Therefore, this time, I will tell you the basics of CFD and how to use LINE CFD. In addition, we will feature notable stocks and investment ideas based on the investment environment from April 2022, such as the Russia-Ukraine conflict and the policy of increasing interest rates of the central banks of each country due to rapid inflation.

* This article is intended to provide information to investors and is not intended to solicit investment in specific products or funds. Please make investment decisions at your own discretion.

Table of Contents

  1. About CFD trading
  2. Introducing LINE CFDs
  3. Features of LINE CFDs
    3-1. “Ichikabu Challenge Course” can start from 0.1 shares of US stocks
    3-2.Easy investment by sector
    3-3.It is possible to create a well-balanced portfolio with just one account
  4. Featured brands and practical use of LINE CFD
    4-1.Take CFDs on crude oil in a long position
    4-2.Short Stock Index Aiming to Lower Stock Prices Due to Rising Interest Rates
    4-3.Short circuit in the semiconductor sector sensitive to rising interest rates
    4-4. Aim to increase overall commodity prices
    4-5. Surf the blockchain trend
  5. abstract

1. 1. About CFD trading

First, I will explain the basics of CFD trading. CFD is the abbreviation of “Defense Contract”. It is margin trading and a kind of differential settlement derivative trading. Although the mechanism is similar to currency trading, the investment target is not foreign exchange, but stock indices, commodities, foreign stocks, etc.

Since this is margin trading, it is a leveraged trade, so it is possible to take risks beyond the margin deposited and exploit it. Keep in mind that you may lose more money than you invested in your margin.

Leveraged trading also has the advantage of being able to manage capital efficiently. However, keep in mind that when you lose your assets, you lose them at a very rapid rate as you take advantage of them.

2. Presentation of LINE CFDs

Next, I will explain about LINE CFD. LINE CFD is one of the services provided by LINE Securities. The investment objectives provided by CFDs include Stock CFDs, Stock Index CFDs, Variety CFDs and Commodity CFDs.

The leverage is also different for each product, and the following is the maximum leverage for each product.

Product Name Leverage
Co., Ltd. CFDs 5 times
CFDs on stock indices 10 times
Variety CFDs 5 times
Commodity CFDs 20 times

3. 3. Features of LINE CFDs

Next, I will explain the features of LINE CFD.

3-1. “Ichikabu Challenge Course” can start from 0.1 shares of US stocks

First of all, it is a feature that you can start investing in US stocks from a relatively low amount of 0.1 share.

More than 60 foreign stocks are also available on CFD LINE. It is advantageous for investment beginners who want to invest in multiple stocks in that they can invest large foreign stocks from a small amount.

3-2.Easy investment by sector

In LINE CFD there is a product called “Index CFD”, and about 25 marks are prepared. You can even use rare stocks such as Japan 225 futures linked to the Nikkei Stock Average, clean energy ETFs, next-generation NQ100 ETFs, and cloud computing ETFs.

For example, if you think clean energy related stocks will rise in the long term, you have the advantage of being able to invest in the sector by buying “clean energy ETFs” without having to research and buy the stocks. yourself.

3-3.It is possible to create a well-balanced portfolio with just one account

While investing in stock indices, LINE CFDs can invest in crude oil, gold, and even the volatility index called VIX in the United States. Therefore, the advantage is that it is easy to create a wallet with just one account.

For example, if the stock price is rising but you want to incorporate safe assets, you can diversify your portfolio by making a profit on a portion of the stock index and investing in gold.

Four. Featured brands and practical use of LINE CFD

Next, I will explain the stocks you are interested in in LINE CFD. Starting from the April 2022 market environment, we will present investment ideas using LINE CFDs.

The points are the following two points.

  1. The war between Russia and Ukraine is ongoing (extended aspect)
  2. Inflation around the world is rising rapidly and interest rate hikes are being encouraged in various countries around the world.

Since April 2022, Russia has been sanctioned by the world, leading to global supply chain disruptions and wheat-centric high commodities. This causes additional inflation. Here are five investment ideas using LINE CFDs in the investment environment where the war between Russia and Ukraine continues.

4-1.Take CFDs on crude oil in a long position

The first is to take a long position in crude oil CFDs. High crude oil prices are one of the reasons for rapid inflation. Crude Oil continued to move strongly, with prices surging above $100 a barrel.

4-2.Short Stock Index Aiming to Lower Stock Prices Due to Rising Interest Rates

The second is a short sale of stock indices aimed at driving down stock prices due to rising interest rates. Rising interest rates have played a role in short-term stock prices.

Looking at past moves, stock prices have risen more than the effects of the economic downturn caused by rising interest rates during the normal phase of rising interest rates. However, the difference is that this time it is a rate hike to stop the rise in interest rates due to “stagflation”. Stagflation is a situation in which the policy interest rate is inevitably raised in order to curb inflation. This can negatively affect the stock price.

There is a way to short the “US 30 Futures” and “US SP500 ETF” in anticipation of falling stock prices.

4-3.Short circuit in the semiconductor sector sensitive to rising interest rates

The third is to build a short position in the semiconductor sector, which is sensitive to rising interest rates. When interest rates rise, there is a way to target the sector most vulnerable to rising interest rates. There is also a way to compete by shorting the semiconductor industry in the United States.

In fact, semiconductor-related products fell sharply, and the rate of decline is higher than that of the S&P 500 index and the Dow Jones Industrial Average. There may be an investment idea to target the NASDAQ decline by shorting “US NQ100 futures” with LINE CFDs.

4-4. Aim to increase overall commodity prices

Fourth, invest in ETFs aimed at increasing overall commodity prices. The first was focused on crude oil, but now a wide range of commodities such as wheat, crude oil and natural gas are up sharply. It is possible that it will continue to increase in the future.

There is a way to buy “full commodity ETFs” on LINE CFDs in anticipation of continued growth.

4-5. Surf the blockchain trend

Fifth, follow the blockchain trend. Blockchain is expected to be an area that will grow significantly as a long-term trend. Blockchain technology that has spread from cryptocurrencies can now be used in various industries. There is a way to invest in “blockchain ETFs” to keep up with trends.

The “Coinbase” of US stocks is also known as the largest cryptocurrency. Since you can invest individually, you can invest in Coinbase.

Five.summary

I explained the outline of LINE CFD and the investment idea using LINE CFD considering the situation in April 2022.

CFDs have the advantage of being able to invest in a variety of investment targets. It is important to note that the more positions you hold, the more likely you are to incur interest rate adjustment fees.

Check the cost of ownership. Since you can trade in a variety of ways with one account, please consider starting to use LINE Securities.

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Sho Nakajima

Experienced Forex, futures and options trading as a student, and dedicated himself to investing primarily in Forex for 4 years. After that, aiming to work in the trading sector of the financial industry, he obtained a qualification as a securities analyst in two years. At Aozora Bank, engaged in MBS (Morgage Backed Securities) investment business and foreign currency fund management business. In addition, he changed his job to Mitsubishi UFJ Morgan Stanley Securities and engaged in foreign exchange trading, futures trading and credit trading. Familiar with the financial industry and has a wide range of knowledge. Holder of a securities analyst diploma. Twitter: Twitter: @sweettrader3 / Instagram: @fukuokasho12
Sho Nakajima

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