Atlantic Markets - Advisory Service

Our advisory service is set up for those that want advice on equities, markets and trading ideas.

You will receive the trading alerts direct to your phone highlighting the trade set up but you can also choose to have access to a fully qualified Investment advisor to discuss in more detail.

Your dedicated adviser will be available at the end of the line to help advise on our ideas and also to review anything you may be looking at. 

Your advisor will also be on hand to help guide you with any shares or positions you hold in other portfolio's.

Advantages include:

  • The potential to profit from rising and falling prices
  • No Stamp Duty to pay on shares (currently 0.5% on UK shares)
  • Access to a wide range of markets
  • Interactive online trading platform
  • Direct contact with your own personal Advisor
  • less initial outlay( you can hold £5,000 of shares with only £1000)
  • Hold positions for as long as required
  • Live market spreads
  • Suggest where to take profits or place a stop
  • Receive as much or as little advice as you would like
  • Monitoring service for open positions
  • Sounding board for your own ideas

What are CFDs?

CFDs are a way of trading on the price movements of financial markets without buying or selling the underlying asset directly.

They provide the opportunity to trade a wide range of markets including equities, indices, currencies and commodities.

CFDs can be used to speculate on upward or downward price movements, making them a flexible alternative to traditional trading.

How do CFDs work?

A CFD (Contract for Difference) is basically an agreement to exchange the difference between the opening and closing value of a contract at its close. The price of your CFD will then replicate the price of the underlying asset giving you a profit (or a loss) as the price of the underlying moves.

There are no expiry dates on CFDs, as a result you can run a position for as long as required.

CFD prices

As with traditional share dealing, CFD prices are quoted as a Bid (the price you can sell at) and an Offer (the price you can buy at). You then buy or sell a CFD based on the value of a certain amount of the underlying asset.

Margin trading

To open a CFD trade, you need to deposit only a fraction of the total trade value – which is known as the “margin”.

Margin trading enables you to increase your exposure to an underlying asset from the same initial investment.

When you use a deposit of, say just £20,000 (or equivalent currency) in your account, you can typically trade up to £100,000 worth of shares. This is a leverage factor of 5:1 or, to put it another way, a 'margin requirement' of 20%.

Trading CFDs on margin allows you to take large market positions in relation to the money you have deposited. Margin trading magnifies both your profits and your losses.

You must maintain your margin if the market moves against you and your deposited funds do not cover open position losses and margin requirements. This may mean sending additional funds at very short notice and/or reducing the size of your positions, which is known as a 'margin call'.

Risk management

Many investors choose to limit their risk - or protect a running profit or open position - by placing a 'stop-loss' order, which closes out their position automatically once a set price level is reached.

While Atlantic highly recommends using a stop-loss, we should point out that your stop-loss might be filled at a worse price than you had requested. This 'slippage' can happen in fast moving market conditions, or where a share opens a trading session well away from its previous close.

No stamp duty

One key benefit of CFD trading is that you do not incur any stamp duty or need to pay safekeeping custody fees, as you are not making a physical purchase.

By the same token, you will not have any shareholder voting rights.

Hedge other investments

As CFDs offer the ability to go short as easily as long, they can be used to provide ‘insurance’ against price falls in an existing portfolio. For example, if you have a long-term portfolio that you wish to keep, but you feel that there is a short-term risk to the value of your investments, you could use CFDs to mitigate a short term loss by ‘hedging’ your position. If the value of your portfolio falls the profit in the CFDs should offset these losses.

Access to financial markets around the world

CFD trading gives you access to a wide range of markets that would not otherwise be available to retail investors. It is as easy to trade on the price movement of commodities such as oil or gold as it is to trade an individual equity. CFDs also allow you to speculate on whole indices or sectors from a single trade.

The best way to understand how CFDs work is to follow some examples.

1: Long trade with PROFIT

In this example an investor believes the share price of Barclays will rise. The investor wishes to go long (buy) £10,000 worth of Barclays shares priced at £2 each.
With a CFD, you only need to invest £2,000 (20% of £10,000) to open this position and unlike shares, you don’t pay 0.5% Stamp Duty.

Opening trade

Buying shares

Buying a CFD

Total value of shares

£10,000

£10,000

Initial outlay

£10,000

£2,000

Commission (0.25%)

£25

£25

Stamp Duty (0.5% on shares)

£50

£0

After 10 days, the share price rises to £2.10 and you sell at a profit. With a CFD, your deposit is returned to you, together with your profit minus any associated costs.

Closing trade

Selling shares

Selling a CFD

Closing value

£10,500

£10,500

Commission (0.25%)

£26.25

£26.25

Financing charges

£0

£8.40

Net Profit

£398.75

£440.35

Like normal share dealing, with CFDs you deal at the cash price of the share and pay a commission on both the open and the close, which is calculated as a percentage of the value of the transaction.

The above examples use our standard commission rate of 0.25%. Atlantic’s commission rates range from 0.2% to 0.5% (min £20) depending on account size.

The financing charge on a long CFD is based on LIBOR + 2.5%. Based on current LIBOR rates, on a £10,000 long position, this works out at around £0.84 per day.

2: Long trade with LOSS

In this example an investor believes the share price of Vodafone will rise. The investor wishes to go long (buy) £10,000 worth of Vodafone shares priced at £2 each.

To limit the risk, a stop-loss is placed at 194p. This means that if the share price falls to 194p, the position is closed. We recommend a stop-loss is placed on all CFD trades.

Opening trade

Buying shares

Buying a CFD

Total value of shares

£10,000

£10,000

Initial outlay

£10,000

£2,000

Commission (0.25%)

£25

£25

Stamp Duty (0.5% on shares)

£50

£0

After 10 days, the share price falls to 194p and the stop-loss is activated. With a CFD, your deposit is returned to you, minus your loss and any associated costs.

Closing trade

Selling shares

Selling a CFD

Closing value

£9,700

£9,700

Commission (0.25%)

£24.25

£24.25

Financing charges

£0

£8.40

Net Loss

£399.25

£357.65

Like normal share dealing, with CFDs you deal at the cash price of the share and pay a commission on both the open and the close, which is calculated as a percentage of the value of the transaction.

The above examples use our standard commission rate of 0.25%. Atlantic’s commission rates range from 0.2% to 0.5% (min £20) depending on account size.

The financing charge on a long CFD is based on LIBOR + 2.5%. Based on current LIBOR rates, on a £10,000 long position, this works out at around £0.84 per day.

3: Short trade with PROFIT

In this example an investor believes the share price of Tesco will fall. The investor wishes to go short (sell) £10,000 worth of Tesco shares priced at £2 each.

With a CFD, shorting a share is the ‘mirror image’ of buying it. As most traditional stockbrokers do not allow private investors to go short, an investor is unable to use shares to capitalise on a falling price.

Opening trade

Shares

Selling a CFD

Total value of shares

n/a

£10,000

Initial outlay

n/a

£2,000

Commission (0.25%)

n/a

£25

Stamp Duty

n/a

£0

After 10 days, the share price falls to £1.90 and you sell at a profit. With a CFD, your deposit is returned to you, minus any associated costs.

Closing trade

Shares

Buying a CFD

Closing value

n/a

£9,500

Commission (0.25%)

n/a

£23.75

Financing charges

n/a

£7.50

Net Profit

n/a

£443.75

Like normal share dealing, with CFDs you deal at the cash price of the share and pay a commission on both the open and the close, which is calculated as a percentage of the value of the transaction.

The above examples use our standard commission rate of 0.25%. Atlantic’s commission rates range from 0.2% to 0.5% (min £20) depending on account size.

The daily financing on a short CFD is based on LIBOR - 2.5%. Based on current LIBOR rates, on a £10,000 short position, this works out at around £0.75 per day.

2:Short trade with LOSS

In this example an investor believes the share price of Tesco will fall. The investor wishes to go short (sell) £10,000 worth of Tesco shares priced at £2 each.

With a CFD, shorting a share is the ‘mirror image’ of buying it. As most traditional stockbrokers do not allow private investors to go short, an investor is unable to use shares to capitalise on a falling price.

Opening trade

Shares

Selling a CFD

Total value of shares

n/a

£10,000

Initial outlay

n/a

£2,000

Commission (0.25%)

n/a

£25

Stamp Duty

n/a

£0

After 10 days, the share price rises to £2.10 and you sell at a loss. With a CFD, your deposit is returned to you, minus your loss and also any additional associated costs.

Closing trade

Shares

Buying a CFD

Closing value

n/a

£10,500

Commission (0.25%)

n/a

£26.25

Financing charges

n/a

£7.50

Net Loss

n/a

£558.75

Like normal share dealing, with CFDs you deal at the cash price of the share and pay a commission on both the open and the close, which is calculated as a percentage of the value of the transaction.

The above examples use our standard commission rate of 0.25%. Atlantic’s commission rates range from 0.2% to 0.5% (min £20) depending on account size.

The daily financing on a short CFD is based on LIBOR - 2.5%. Based on current LIBOR rates, on a £10,000 short position, this works out at around £0.75 per day.

If you can't find an answer to your question, please do not hesitate to contact us, and we will be happy to answer any questions.

Is Atlantic Capital Markets Ltd regulated?

Yes. Atlantic Capital Markets Ltd is authorised and regulated by the Financial Conduct Authority. Our Firm Reference number is 764562.

What is a CFD?

A CFD offers you all the benefits of trading shares without having to physically own them. Simply put, it is a contract that mirrors the performance of an underlying instrument. It is traded on margin, and just like physical shares your profit or loss is determined by the difference between the price you buy at and the price you sell at.

What is trading on 'margin'?

Margin trading allows you to free up your capital by placing only a small percentage of the value of trade in your account.

The initial amount you pay is known as the deposit or Margin Requirement. Dealing on margin can significantly increase your profits, but it can also significantly increase your losses in the same way.

Margin rates vary depending on what you trade, but typically range between 5% and 50%. You can find details of the margin requirements for each specific instrument on the trading platform.

What costs are involved in trading CFDs?

You pay a commission when you trade and may incur financing charges on positions held overnight.

There are no hidden costs such as administration or management fees and you deal at the market price as we do not widen the spread of the share.

What are your commission rates?

Our commission rate on equities varies from 0.2% to 0.5% depending on account size. For commission rates and charges related to other instruments please contact Atlantic for further information.

When is financing charged, and how is it calculated?

Positions held overnight may incur a financing charge.  This may be paid or received dependent upon the position.

Clients pay interest on the contract value of a long CFD. Interest is charged at a percentage over LIBOR (LIBOR is the London Interbank Offered Rate and is linked to base interest rates).

Clients holding short CFD contracts may receive interest on the cash that the sale of the underlying stock would have generated. This is similarly paid at an agreed rate under LIBOR.

For example, if a client was paying a long CFD funding charge of 3% over LIBOR and if LIBOR was 0.25%, the client would be paying a funding rate of 3.25% per annum. If the total contract value was £10,000 the funding charge would be around £0.89 for every day the contract was maintained (£325 divided by 365).

This amount would be debited daily from your CFD account. The funding charge is only incurred if the position is held overnight. These amounts will be credited or debited on the next trading day.

How long can I hold a CFD?

There are no expiry dates on CFDs, as a result you can run a position, long or short, for as long as required.

How can I profit using CFDs in a falling market?

A client can "go short", meaning that they can sell a CFD as an opening position.

A common question is "How can a trader sell something they don't own?" This can be done as what the client is buying is a contract between themselves and the CFD provider, based upon the price movement of a share. It does not matter who agrees to buy and who agrees to sell, as neither party physically owns the share anyway.

The important thing is how far the price of the Share or Index moves, and whether or not it moves the way you want it to. Using this facility, a trader may be able to profit from a falling market.

Will I receive dividends?

Yes. Although a CFD trader does not physically own the share, s/he can partake in Corporate Actions and receive dividends. However, as the CFD trader does not own the share itself, they are not entitled to any voting rights.

What are the tax implications of trading CFDs?

Whilst they are exempt from stamp duty, any profits on CFDs may be subject to CGT (Capital Gains Tax) but losses may also be offset against CGT.

Can I trade other products from the same account?

Yes, Atlantic clients can also trade Currencies and Commodities from their CFD account.

Can I trade over the telephone?

Yes, trading can be conducted over the telephone or the online trading platform. There is no additional cost for trading over the telephone.

How do I open an account with Atlantic?

Applying for an account is quick and easy. The next step is complete our secure online Suitability Questionnaire.

How long does it take to open an account with Atlantic?

Provided you are suitable for a CFD advisory account and we receive the correct documentation from you, your account should be up and running within a business day.

Can I open a joint account?

Yes, to open a joint account you will need to complete a paper based application form signed by both parties. The documentation required from each applicant is the same as that required for an individual account.

Can I use Stop losses to limit the Risk?

Yes you can, with our Atlantic Account you have regular Stop losses available but also we have Guaranteed stop losses and automatic trailing stop losses which can be used at no extra charge.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.