How stock CFDs work and how they differ from owning shares
A stock CFD is a contract that tracks the price of a share. You post margin rather than paying the full share price, which magnifies both gains and losses. You do not receive shareholder rights such as voting, and dividend treatment usually takes the form of cash adjustments to long or short positions rather than actual dividend payments. Because positions are leveraged, holding overnight typically incurs financing charges, and corporate actions such as splits or delistings are handled through contract adjustments set by the broker. These mechanics apply generally and are the baseline for evaluating any broker's stock CFD offer.
- Leverage magnifies losses as well as gains; margin is a deposit, not the full cost.
- Dividend adjustments and corporate action handling follow the broker's contract terms.
- Overnight financing usually applies to positions held past the daily cut-off.


