Dividends are the portion of corporate profits that are allocated to shareholders, and the cut-off date for share ownership in order to qualify for a dividend is known as ex-dividend date.
At Plus500 you trade CFDs on equities, therefore, you do not actually own the share itself. If you have an equity or ETF CFD position open on the ex-dividend date, an adjustment will be made to your account in respect of the dividend paid on the underlying market. If you hold a buy position you will receive the dividend as a positive adjustment to your account. However, if you hold a sell position there will be a negative adjustment. Please note that voting rights are not acquired with equity CFDs.
Most of the instruments we offer that are based on a futures contracts, have a rollover date. You can find this information by clicking on the "Details" link on the main trading platform screen next to each instrument.
Whenever a futures contract reaches its automatic rollover date as defined for the instrument, all open positions and orders are automatically rolled over to the next futures contract by Plus500, free of charge.
In order to nullify the impact on the valuation of the open position, given the change in the underlying instrument’s rate (price) for the new contract period, a compensating adjustment is made to allow you to keep your positions open without affecting your Equity level. Stop Orders and Limit Orders are also adjusted proportionally to reflect the rate of the new contract. The value of your position continues to reflect the impact of market movement based on your original opening level.
For more information about how rollover adjustments are calculated, please read: ”What is a Rollover Adjustment?"
Plus500 quotes prices with reference to the price of the relevant underlying financial instrument and its spread.
Our prices are obtained from a range of third-party market data providers who source their price feeds from relevant exchanges. An adjustment (i.e. the spread) is then applied automatically, to arrive at the Plus500 price. This spread is paid by you, but is incorporated into the quoted rates and is not an additional charge or fee payable by you above those quoted rates.
The spread can be calculated by subtracting the sell price from the buy price of the instrument. Information regarding the spread for a given instrument can be found on our website or trading platforms in the “Details” link next to the instrument’s name.
The pricing generated for our cryptocurrency CFDs is derived from specific cryptocurrency exchanges. Please bear in mind that Cryptocurrency prices may vary widely between cryptocurrency exchanges.
A corporate action is an event initiated by a public company that affects the shares/equities issued by the company. For example:
Dividend - A portion of corporate profits that are allocated to shareholders. When a dividend is paid, the value of the share drops.
Spinoff - An independent company is created through the distribution of new shares of the parent company. The parent company’s shares will lose value following a spinoff, and shareholders receive equivalent shares of the new company as compensation.
Rights Issue - Existing shareholders are offered a right to purchase additional shares of the company at a discount. This usually lowers the price of the company’s share.
Stock Split - Increasing the number of outstanding shares by dividing each share, while the market cap remains the same. Share value decreases, as number of shares increases.
Reverse Stock Split – Reducing the number of outstanding shares by consolidating existing shares, while the market cap remains the same. The share value increases as the number of shares decreases.
As you do not own the physical share/equity when trading CFDs, you neither acquire voting rights, nor any rights under a rights issue or similar event such as stock split, etc.
Therefore, in order to ensure that there is no material impact to your open position(s), following a corporate event, Plus500 will automatically adjust your account. For example, in the case of a dividend, Plus500 may add to/subtract from your balance the amount you would have incurred as an additional loss/profit (depending on your position’s direction). In the case of a Stock Split or a Reverse Stock Split, the number of shares and price will be updated, as necessary. This is referred to as an ‘Adjustment’.
Occasionally instruments are temporarily unavailable for trading when market events restrict price feeds, for example but not limited to: extreme volatility, illiquidity, underlying market suspensions, etc.
Whenever a futures contract reaches its expiry date, and an automatic rollover is defined for the instrument, all open positions and orders are automatically rolled-over to the next futures contract. In order to nullify the impact on the valuation of the open position, given the change in the underlying instrument’s rate (price) for the new contract period, a compensating adjustment is made to the account. Stop Orders and Limit Orders are also adjusted, to reflect the rate (price) of the instrument in the new contract.
The value of your position continues to reflect the impact of market movement based on your original opening level, size and spread. If the new contract is trading at a higher price, Buy positions will receive a negative adjustment, and Sell positions will receive a positive adjustment. Conversely, if the new contract is trading at a lower price, Buy positions will receive a positive adjustment, and Sell positions will receive a negative adjustment.
Instruments that are based on a futures contract either have an expiry date or a rollover date. You can find out which by clicking on the "Details" link on the main trading platform screen next to the instrument’s name. Whenever a futures contract reaches its expiry date, all open positions and Orders for that instrument are terminated, regardless of any associated Orders you may have set beforehand.
"Spread" is defined as the difference between the "Buy" price and the "Sell" price on an instrument at a particular time.
Plus500 offers two spread mechanisms for its instruments: Dynamic spread which is constantly adjusted according to the market spread during the period a position is open vs. a Spread which does not typically change in line with general market fluctuations while a position is open, but when the market is volatile and illiquid, may change to a new level so that the underlying market conditions are better reflected. Nevertheless, Plus500 aims to provide the tightest possible spreads at all times.
You should always check the applicable spread type and make sure you are aware of an instrument’s properties before you start trading. Information regarding the spread for a given instrument can be found on our website or trading platforms in the “Details” link next to the instrument’s name.
Useful instrument information can be found in the “Details” tab for each instrument on the trading platform. These details may change from time to time, therefore please ensure you verify the information before trading (any change will only affect new positions).
CFDs are a leveraged product and can result in the loss of your entire balance. Consider whether you fall within our Target Market Determination available in the Terms and Agreements.