i just had a question regarding a situation with CFDs. Lets imagine the following scenario:
i have 1.2 million dollars. i open a long position with 1 million dollars on my CFD trading account and receive the maximum leverage. lets say 5 million dollars worth of CDFs on the company AHZ long with leverage. Now in the actual market i buy 200,000$ shares on the ASK and i checked the depth 200,000 buys will increase the AHZ share price by 20% since the company is worth 0.34c per share atm. now priced is pushed up by 20% therefore the value of MY CFDS has increased by 20%, meaning its now 6 million dollars therefore i receive a profit of 1 million dollars. and about the share in AHZ, lets they are all gone. Now i have made a profit of 800,000$ guaranteed.
this way all CFD companies should be bankrupt if people can purposely increase the value of underling asset of the CFD themselves.
now my question is what laws/regulations are there to stop this from happening? can the CFD providers do the same thing as well so they win?
