Contracts for difference (CFDs) are agreements between two parties to exchange the difference between the opening and closing price of a contract. There are long and short parties - a long party buys the CFD while a short party sells it. CFDs offer margin flexibility and the ability to go long or short without stamp duty. They can be traded on stocks above certain market capitalizations. The profit or loss from the difference in prices is returned to the parties when closing, plus or minus any interest charged for using margin. Trading rules include only risking money you can afford to lose and using stop losses.