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I am a total newbie so this might be a silly question but I am trying to buy S&P 500 and own it like a stock.

The problem is that my broker (XTB) only has the option to buy it with margin and leverage is 1:20. I don't like this because broker can automatically close my position when instrument I bought drops a lot in price and I don't deposit more funds. In this scenario where broker closes my position after a big drop I will obviously lose money which is something I want to avoid.

Ideally I'd like to buy S&P 500 and be able to hold it as long as I want without the need to do backup deposits if the price drops really hard but I don't know if this is possible.

TL;DR - Can I buy S&P 500, e.g. SPDR S&P 500 ETF Trust and own it without worrying about margin calls or broker automatically closing?

Lilienthal
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hdw3
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1 Answers1

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Yes, but you'll want to trade an ETF or mutual fund instead of a CFD. See if your broker offers ETFs on that index (I presume the S&P 500) instead of CFDs. If not, look for a more traditional broker that does.

Or, see if they offer "100% margin" as an option, which just means that you'll have to deposit all of the cash upfront (as you would for an ETF purchase).

D Stanley
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