Gold perp CFDs and spread bets explained

Gold perpetual CFDs and spread bets (or just ‘perp CFDs’ and ‘perp spread bets’) let you trade gold price movements 24/7, even during weekends and holidays. If you’re already familiar with gold CFDs or spread bets, perps offer a similar way to gain exposure to the gold market, but with a perpetual contract structure. While perpetual contracts didn’t originate in CFD markets, the model has since expanded to other asset classes including commodities, stocks and indices.

This guide explains what gold perps are, how they work and how they compare with spot gold and gold forward CFDs and spread bets. We’ll cover how pricing differs between CFDs and spread bets, the funding rate mechanism that replaces traditional overnight swap charges, the key risks (including margin) and how to get started if you decide they’re right for you.

A perpetual CFD is a derivative contract between a trader and a broker that tracks a perpetual futures market and has no expiry date. A perpetual spread bet works in the same way, except that you speculate on price movement by choosing a stake per point, rather than trading a contract. Instead of traditional overnight swap charges, both use a funding rate set weekly and applied once per day.

A gold perp tracks a gold perpetual futures market. It’s priced from that market’s mark price – which funding keeps in line with the spot gold price (the current market price) – plus our dynamic spread. This gives you exposure to gold’s price movements without owning the actual metal. You can take a long or short position, allowing you to speculate on both rising and falling prices.

At Pepperstone, gold and any other perps are traded through your existing CFD or spread betting account, using the same platforms and subject to the same regulatory protections as the rest of our CFDs and spread bets.

Three products, three different ways of taking a view on gold.

Gold perp CFDs and spread bets never close. They give you 24/7 access to gold, with no break at the weekend or on public holidays, when other gold markets are shut. They’re priced from the mark price of a gold perpetual futures market plus our dynamic spread, and their holding cost is a funding rate set weekly in advance and applied daily. They also have no expiry date.

Spot gold CFDs and spread bets track the cash gold market. They have no fixed expiry but do carry a daily overnight swap, based on the interbank rate. They trade during standard gold trading hours, which are almost 24 hours Monday to Friday, closed at the weekend.

Gold forward CFDs and spread bets are priced from the front-month gold futures contract. Unlike spot gold, overnight funding costs are incorporated into the pricing, so there are no separate daily swap charges. The contract automatically rolls to the next futures month, unless you close it. They trade during exchange hours, closed at the weekend.

You can trade gold perps as either a CFD or a spread bet. The market, the 24/7 hours and the funding mechanism are the same. What changes is how you’re charged and how you size your trade. 

With a gold perp CFD, you pay the spread plus a commission. Commission is 0.03% of the position’s notional value, charged on each side – once when you open and once when you close. Notional value is lots × contract size × price. 

With a gold perp spread bet, there’s no commission. Opening and closing costs are wrapped into the spread, so the spread is your cost of trading. You choose a stake – the amount you win or lose per point of movement – rather than a lot size. 

Spreads are dynamic in both cases. They tend to tighten in calmer conditions and widen when markets get volatile, which can include out-of-hours trading. Neither is cheaper in every case, so it’s worth comparing the total cost for the size and style of trade you have in mind. 

Funding is the mechanism used to help keep a perpetual market aligned with its underlying reference price. Unlike traditional CFD swap charges, funding is based on the balance between buyers and sellers in the market. When market positioning becomes heavily skewed towards long or short positions, funding helps encourage balance while supporting price alignment with the underlying market. 

At Pepperstone, funding is designed to be more predictable than on many native perpetual trading venues. Rather than passing through funding payments throughout the day, it’s converted into a single weekly rate that’s published in advance for the week ahead. That weekly rate is then applied as daily swap entries, with one-seventh of the weekly amount charged or credited each day at 5pm New York time, making it easier to estimate holding costs. 

Funding flows between longs and shorts, so depending on market conditions you may pay or receive it. There’s no broker mark-up added to the published funding rate. However, as with other CFDs and spread bets, gold perps are also subject to other costs such as spreads and, for CFDs, commission. 

Example* 

Say you open a long position in a gold perp CFD equivalent to 10 troy ounces, with gold trading at around $4,000 per ounce. 

Your total notional exposure would be: 10 × $4,000 = $40,000 

Assume the published funding rate for the week is 0.14% and you’re on the paying side. That equates to a daily funding adjustment of: 0.14% ÷ 7 = 0.02% per day. 

Therefore, your daily funding charge would be: $40,000 × 0.02% = $8.00 per day. 

For a full week, the total funding cost would be: $8.00 × 7 = $56.00. 

If you’re on the receiving side of funding, the adjustment would instead be credited to your account. Funding rates may change over time as market conditions evolve. 

On top of funding, a CFD of this size would carry commission of $40,000 × 0.03% = $12.00 when you open and $12.00 when you close, so $24.00 in total. A gold perp spread bet has no commission – the cost is included in the spread – and funding works in the same way. 

*For illustration only. Always check live pricing on your platform. 

• 24/7 access, including weekends: Gold perps can be traded around the clock, outside regular market hours, allowing you to trade or hedge over the weekend.
• No expiry or rollover to manage: Gold perps have no fixed expiry date, so there are no contract rollovers to manage or expiry dates to monitor. You can hold a position for as long as your account has sufficient funds.
• Predictable funding cost: As rates are published before the week begins and applied once daily, it’s easier to estimate the overall holding costs than on native perpetual trading venues where funding can change throughout the day.
• A choice of how you trade: Trade gold perps as a CFD, paying the spread plus commission, or as a spread bet, with no commission and a stake per point.
• Leveraged long and short exposure: Like other CFDs and spread bets, gold perps allow you to take both long and short positions using leverage, so you can speculate on rising and falling gold prices. Leverage magnifies both profits and losses, so make sure you understand the risks before trading.

Gold perps tend to appeal to traders who: 

• Trade around weekend or out-of-hours news and want continuous access to the market rather than waiting for Monday’s open.
• Want to hold a gold position over an extended period without managing contract expiries or rollovers.
• Already trade gold CFDs or spread bets and want an alternative to traditional overnight swap charges.
• Are comfortable with a funding rate that’s published in advance but can change from week to week as the cost of holding a position.

They’re less likely to suit traders who need a fixed-date exposure to align with a specific event or hedge, for example, or who would rather avoid a holding cost that can change from week to week.

Gold perp CFDs and spread bets are complex, leveraged derivative products and, like all CFDs and spread bets, carry a high risk of losing money quickly. Their pricing behaviour, trading conditions and market liquidity differ from those of spot gold, so it helps to know the risks that are specific to perps. 

Specific risks to consider include: 

• 24/7 and out-of-hours trading: Gold perps trade continuously, including weekends and public holidays. Prices can move sharply, and your positions can be closed out under margin rules, while you’re not watching. During quieter periods, weekends and market holidays, liquidity may be lower and spreads wider, potentially increasing trading costs and affecting execution. Stop-loss orders and other risk-management tools may not always be executed at your requested price.
• Reference market divergence: The price of a gold perp comes from a gold perpetual futures market, which can itself drift away from the spot gold price. That could lead to pricing outcomes that differ from what you expected.
• Underlying market infrastructure: The perpetual futures market we reference can have different liquidity, depth, trading rules and operations from regulated traditional markets. Disruption to that market can affect our ability to price or offer gold perps.
• Funding rates: These are published in advance but can change from week to week, and whether you pay or receive them can change too. If you hold a position for an extended period, these costs can accumulate and affect your earning potential. They also reduce your account equity, which brings margin close-out closer.
• Market risk: Gold prices can react sharply to economic data releases, geopolitical events, central-bank decisions and changes in market sentiment. Significant price movements can occur in a short period of time.

Margin and your potential liability 

Margin is the deposit that keeps a leveraged position open. It isn’t a limit on what you can lose. 

• Losses can exceed your margin. Your profit or loss is based on the full value of the position, not the margin you put up. A move against you can lose more than the margin on that trade and, if the position stays open, use up the rest of your account balance.
• You may need to add funds. If your equity falls, you may need to deposit more to keep positions open. We endeavour to contact you if a position is at risk (known as a margin call), but we can’t guarantee to do so, especially if the market moves quickly or gaps.
• Positions can be closed automatically. If your account equity falls to a set level – normally 50% of your total required margin for retail clients – we’ll close your open leveraged positions under margin close-out. That could happen at a loss, and you can’t choose the closing price.

To work out whether gold perps are appropriate for you, we encourage you to seek independent financial advice. Make sure you understand how the funding rate, margin and leverage work, and start practising on a demo account before risking real funds. 

If you’ve traded CFDs or spread bets before, getting started with gold perps is a straightforward process. The product is available through your Pepperstone trading account and can be accessed on the same platforms you’ve been using. 

1. Open and fund a live trading account (CFD or spread betting), or start with a demo account if you would rather test the mechanics first.
2. Log in to your preferred trading platform: TradingView, MT5, cTrader or the Pepperstone platform.
3. Search for the gold perp instrument (shown as GOLD-PERP on MT5, the Pepperstone platform and cTrader, or GOLD.P on TradingView).
4. Review the current funding rate, spread and commission (CFDs only) before placing a trade.
5. Choose your position size – lots for a CFD or a stake per point for a spread bet – decide whether to go long or short, and apply your risk-management settings.