Why Pairs CFDs are generating so much buzz

Liam Smith

“Our Pairs, we’re very excited by. The best part is to think they just operate exactly like a normal FX pair. The price you see on screen is a ratio of two underlying instruments. So, it allows us to cross up any combination of symbols across all asset classes, which is the exciting part. For the end trader, they see a single position, single rate of leverage or margin, and they can use all existing order types, as well as EAs. 

For brokers, our solution is operationally simple. It slots into all of their current back and middle office processes, and it’s compatible with all trading platforms, of course, MT4 and MT5. The exciting part for brokers is the volatility enhancing nature of the inversely correlated pairs. So, a popular one we see is the S&P 500 Index, crossed with the Volatility VIX index. And over the U. S. election, the seven day period, I think we saw that one fall about 12. 5% and then rally strong up 24%. Similar case with the China A50 and the US 500 Index over Beijing’s policy announcement at the end of September, beginning of October, that pair moved about 40%. So, it’s a really exciting product. 

We’ve more recently just launched Gold based pairs, a suite of them, crossed up against all major Indices and Commodities, especially Oil, which is a popular one. We knew those were going to be exciting, that’s for sure, but I think we’ve been blown away by the demand from brokers wanting to be the first to market. I think it’s the familiarity of the Gold instrument that makes the thematic of the pair easy to comprehend, but personally, I think risk managers should be the ones most excited because it gives a good opportunity to finally diversify some of that heavy Gold concentrated exposure away into other instruments.“