There are plenty of CFD providers that are direct to market - not market makers. It is just like trading stocks with 10:1 leverage like a margin loan. The commissions are lower 0.1%, there are holding costs (cash rate +- 2% usually just like margin loans) and there is more versatility than trading direct into the market. They can hedge every client with all trades direct into the market. For the provider it is almost risk free collecting brokerage and holding costs, providing the client can provide the margin. I have had no problems, so far up 100% for 08.
Direct to what market? CFDs are an OTC market, so anyone offering them has to be a dealer/market maker or have a relationship with a market maker.
Your information is incorrect. There are CFD providers that will place your order directly into the ASX - Man Financial, Marketech, First Prudential - see http://compareshares.com.au/CFD_features.php You can trade with a market maker OR with DMA. With DMA you get the market price, and you can find your order in the market depth for that stock. pneuma
Hey Pneuma. You sound like you're trading in Aus. Would you mind telling me who your provider is and how you find them. I'm using CMC (market maker) at the moment but am looking into the DMA thing for a number of reasons. Thanks.
I use GET, one of the Saxo platforms. I hear good things about IG if you want to stay with a MM, simple and web based. MF for DMA but their platform can be tricky. pneuma
I was looking to day trade not hold long term. SSF looks like a bad choice with low liquidity and high spreads