What can you trade? Forex, CFDs, stocks and commodities

A plain-English guide to the four markets most Gulf traders meet first: currencies, CFDs, shares and commodities like gold and oil.

Beginner Lesson 1 of 10 · 3 min read

⚠️ Risk warning: CFDs and leveraged forex are complex instruments with a high risk of losing money rapidly. Most retail accounts lose money. This content is education only, not investment advice or a recommendation.

The four market families€/$ForexEUR/USDGBP/USDUSD/JPYCFDCFDsGold CFDOil CFDUS 500▲▼StocksAAPL2222.SREMAARAuCommoditiesXAU/USDBrentWTIMost online “forex” and gold trading at retail brokers is done with CFDs.
The four market families

Before you look at a chart, it helps to know what you are actually buying. Most online brokers in the Gulf offer four families of products. They behave differently, cost different amounts to hold, and carry different risks.

Forex (currencies)

Currencies always trade in pairs. When you buy EUR/USD you buy euros and sell US dollars at the same time. The first currency is the base, the second the quote: a price of 1.1150 means one euro costs 1.1150 dollars. Forex trades 24 hours a day from Monday morning in Asia to Friday evening in New York. The Gulf dirham and riyal are pegged to the dollar, so local traders mostly trade the majors (EUR/USD, GBP/USD, USD/JPY) and gold against the dollar.

CFDs (contracts for difference)

A CFD is an agreement with your broker to exchange the difference in a price between when you open and when you close. You never own the underlying asset, which is why you can go short (profit from a fall) as easily as long. Most retail “forex”, gold, oil and index trading at online brokers is in fact CFD trading. CFDs use leverage, so losses can exceed what you expected; that is why regulators require the risk warning you see on every broker site.

Stocks (shares)

A share is a slice of ownership in a company, such as Apple in the US or Saudi Aramco on Tadawul. You can buy the real share through a stock broker, or trade a CFD on its price. Real shares can pay dividends and have no overnight financing cost; share CFDs do have financing but let you use leverage and go short. See live examples on Apple (AAPL) and Saudi Aramco (2222).

Commodities

Gold, silver, crude oil (Brent and WTI) and natural gas are the commodities most traders follow. Gold is quoted in dollars per troy ounce (XAU/USD) and reacts to interest rates, the dollar and risk sentiment; oil reacts to supply news, OPEC+ decisions and the global economy. Follow them live on the gold page and markets overview.

Which should a beginner start with?

Pick one liquid market you can watch at the times you are free, for example EUR/USD or gold, and learn it well on a demo account before adding more.

✍️ Quick quiz

Check what you learned. Your answers stay in this browser.

1. You buy EUR/USD. What have you done?

Show answer

Bought euros and sold dollars. The first currency in a pair is the one you buy when you go long; the second is the one you sell.

2. What do you own when you open a gold CFD?

Show answer

A contract on the price difference, not the gold itself. A CFD only settles the price difference between opening and closing. No metal changes hands.

3. Which is a benefit of buying a real share rather than a share CFD?

Show answer

You can receive dividends and pay no overnight financing. Owning the share gives you dividends and no financing charge; leverage and easy shorting are CFD features.

4. Why do Gulf traders often focus on dollar pairs and gold?

Show answer

Local currencies are pegged to the US dollar. The dirham, riyal and most GCC currencies are pegged to the dollar, so they barely move against it.