Leveraged CFD risk
Contracts for difference are leveraged products. A relatively small market movement can create a disproportionately large gain or loss. You can lose your entire trading deposit, and depending on your broker, account type and legal protections, additional loss scenarios may be possible.
VIX CFD characteristics
A broker's VIX CFD can be derived from futures, cash references or a proprietary pricing methodology. It may not track the headline VIX level one-for-one. Contract rollover, financing, spread, market hours and price gaps can materially affect results.
Short-volatility asymmetry
Volatility can rise rapidly during market stress and remain elevated. Short exposure can therefore experience abrupt adverse movements, gaps and spread expansion. A statistical mean-reversion signal does not place a limit on how far the market can continue moving.
Model and backtest risk
Historical performance can be affected by data quality, spread assumptions, execution modeling, overfitting and selection bias. A strategy that performed well in one period or on one broker feed can perform poorly in another.
Technology and execution risk
The EA can fail to act as expected because of internet disruption, VPS failure, MT5 shutdown, broker rejection, invalid symbol settings, insufficient margin, market closure, slippage, gaps, terminal updates or software defects.
No advice or guarantee
VIX Trader is software, not personalized investment advice. No statement on this website is a promise of profit, a target return or an assurance that losses will remain within a particular amount.
Your responsibilities
- Confirm that CFD trading and automated trading are suitable and lawful for you.
- Review your broker's contract specifications and risk disclosures.
- Test the exact release and broker feed on demo before live use.
- Choose an exposure that you can financially and emotionally tolerate losing.
- Monitor the terminal, account, open positions and software logs.