In contrast the payout and liability on the Contract for Difference is unknown. In contrast to most binary options the CFD contract can be closed out at any point. This can be used to lock in profit or minimize loss. However the key point to note is that the higher risk of these contracts offers the potential for higher rewards but equally bigger losses.
If you think that your current portfolio might experience a loss, then you can short sell by utilising CFDs. This can assist you in offsetting any portfolio value losses. You may consider CFDs as great hedging tools. You will find a number of organisations as well as individuals who use these so that they can hedge against portfolio losses.
EDF Energy have committed to insulate their Fixed + Peace of Mind customers from CfD and other additional cost elements brought about by the Electricity Market Reform from July 2014 for contracts up to 3 years. This policy is effective until 31st October 2014 however EDF Energy have reserved the right to withdraw this offer at any time.