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Sunday, 28 April 2019

CFD Trades

I have a small account (currently around $300) with CityIndex so I can trade CFD's when I get bored (stops me mucking around with my asset allocation in our SMSF or other investments). I had a long position in a diamond CFD (GEMS) and also in crude oil. I decided to sell the GEMS CFD as it had been heading the wrong direction for quite a while and there didn't seem to be any indication that it would soon turn around. And while oil has been doing well, I decided to take a profit and close out that position too.

I had been thinking about going short on Tesla, but it has already come down quite a lot from last year's highs, and although I don't think it will do a well as Elon keeps promising, from here it could go either way, depending on how things turn out during 2019, so it seemed to much of a speculative gamble. The other CFD trade I had in mind I did go through with - going long on the Berkshire CFD. Although it has gained a lot over the past couple of years (I used to have a direct investment in Berkshire shares a few years ago, but the trading and holding costs with a US broker, and the tax complications, made it too much like hard work so I got rid of all my direct US share holdings), it has a great track record and should continue to do well (although there may be a temporary dip when Buffet retires from active involvement or dies). We'll see how well it does over the next 5-10 years.

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