What is CFD currency?

CFD currency, more often referred to as a forex CFD, is a Contract for Difference that allows traders to speculate on the price movement of a currency pair without owning the underlying currencies. Traders may take a long position if they expect the currency pair to rise in value or a short position if they expect it to fall. Forex CFDs are typically traded on margin, meaning traders can gain market exposure with a smaller initial outlay than the total value of the position. Leverage can amplify both gains and losses.