Capital.com announced today that it will cease charging overnight funding fees on non-leveraged contracts for difference (CFDs) trades involving stocks and cryptocurrencies. This move is aimed at benefiting traders who maintain positions beyond a single trading day, accommodating those pursuing longer-term investment strategies.
The decision reflects a notable shift in retail trader behavior observed by Capital.com, particularly towards extended holding periods in stock and cryptocurrency markets. According to the company’s data, 89% of all non-leveraged overnight positions in Q2 2024 were in stocks and cryptocurrencies, contrasting sharply with commodities, which accounted for only 28%.
Dana Massey, Chief Product Officer at Capital.com, emphasized the rationale behind the decision: “Our data shows that retail traders are increasingly diversifying their trading styles, including embracing longer-term positions in popular stocks and cryptocurrencies. To support this evolving trend, we have opted to eliminate funding adjustments for non-leveraged CFD trades on shares and cryptocurrencies.”
Data from the platform indicates that traders typically hold overnight stock positions for up to 7 days, while cryptocurrency positions average 4 days. In contrast, positions in indices and commodities tend to be closed within 3 days.
Massey further explained the implications of the change: “By removing overnight funding charges on widely-traded markets like shares and cryptocurrencies, our traders can now explore longer-term investment strategies without the concern of additional costs.”
Effective immediately, the new policy applies exclusively to overnight funding on 1:1 leverage CFD trades within shares and cryptocurrency markets. Trades involving different leverage ratios or other markets remain unaffected.
Capital.com, which recorded client trading volumes surpassing $1 trillion in 2023, continues to adapt its offerings to meet the evolving demands of retail traders. This includes recent collaborations such as the partnership with TradingView in July, aimed at enhancing traders’ access to advanced charting tools.
In terms of personnel updates, Capital.com has been actively expanding its team. Patricia Lyn Dixon recently joined as Global Head of Programmatic, moving from Amazon Ads. Additionally, Tarek Mahassen assumed the role of Head of Risk for the MENA region, following a tenure at Revolut. Campbell MacPherson was appointed CEO for Capital.com’s operations in Australia, bringing extensive experience from FactSet.
Capital.com’s proactive adjustments underscore its commitment to addressing the dynamic needs of retail traders amidst evolving market conditions.
Related topics:
