In our previous article on CFD 10, we had buy call for DBS and Japfa.
DBS missed our target as it only reached a high of $26.71 while our target was $26.80. Japfa price high was right at our target price of $0.58. But if our sell queue is not done, it is better to sell of the shares today.
Our buy call was issued on 31st Oct and today is the 9th calendar day. For CFD 10, there are ten days of free financing as well as lower margin requirement for the first 10 days. Tomorrow is a Saturday and the stock exchange is not opened. By the time Monday comes, it would have been 12 calendar days. If we sell on Monday, there will be 2 days of interest charged. As much it is important to monitor the days in CFD 10.
There is also a higher margin requirement from the 11th day onward. If we do not sell off by Friday, there could be higher margin requirement depending on the stocks. For our 2 stocks, there were no increase in margin. An increase in margin for a penny stock could see the margin from the 11th calendar days rise from 20% to 70%. A margin call would be issued where clients will need to top up on Monday or in a worst case scenario, see their penny stocks forced liquidated because the margin ratio was above 140% resulting in an immediate force liquidation.
Remember to watch the number of days in your CFD 10 trading.