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margin calculation on cfd

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WES
Super Contributor
Am I right in saying that the margin on cfd's are calculated by the cfd provider taking into account risk and liquidity on the share.
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4 REPLIES 4
SimonPB
Valued Contributor
OST use the Safex margin + 50% .. Safex takes into accont the risk and liquidity ..
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WES
Super Contributor
Thanks Simon, does it then makes sense to place a trailing stop loss on cfd's equal to the margin ? The worst you can loss is the margin and the stop loss will not necessarily stop you out unecessarily ?
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SimonPB
Valued Contributor
no, a stop loss should be a function of risk management and placed where the stock is not expected to go ..
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WES
Super Contributor
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