ETFs vs Mutual Funds vs Stocks

In today’s world, with added connectivity and hordes of more accessible trading options, there are many different ways to invest your money. Each investment option comes with its own set of pros and cons. When it comes to investing, there are many options. Today we look at three popular investment vehicles: ETFs, mutual funds, and stocks.   What are ETFs? They are investment funds that track an underlying asset, such as a basket of stocks or a commodity. You trade ETFs on stock exchanges. Like ordinary stocks, you can buy and sell them throughout any trading session.   Benefits of Continue Reading →

Understanding leverage in forex trading

In the forex market, leverage is commonly referred to as the ratio of a trader’s account size to the size of their trades. If a trader has a $5,000 account and is willing to risk 2% per trade, they can take positions worth up to $100,000. In other words, their leverage would be 50:1. Leverage can be a valuable tool for traders, allowing them to take on more prominent positions than they could with their capital alone. However, it’s important to remember that leverage also magnifies profits and losses. Therefore, careful consideration should be given to choosing an appropriate amount Continue Reading →

Everything you must know about high-frequency trading

Everything you must know about high-frequency trading

High-frequency trading (HFT) is a method of stock market trading in which the computerized system used by the trader places a large number of orders at extremely high speeds. What exactly is high-frequency trading? HFT describes any automated trading strategy and operates on algorithmic or pre-programmed rules in very basic terms. These trading strategies utilize sophisticated technology and powerful computers to complete transactions at rates never before possible in the financial markets we see today. It would have been impossible for a machine to do this so quickly a few decades ago. Still, with the advent of ultra-fast internet speeds, Continue Reading →

What is CFD trading?

What is CFD trading?

CFD stands for Contract for Difference. It was initially designed in the 1980s to help businesses manage their risk. If a business is involved in importing and exporting goods, it could find that its profit/loss margins are extremely volatile thanks to currency fluctuations. In other words, when you buy something from abroad using a different currency than your own, the value of that foreign currency can change after you have made your purchase – resulting in either a healthy profit or a crushing loss. The CFD allows both buyers and sellers to avoid this asymmetric risk. In essence, what happens Continue Reading →

Understanding candlesticks in forex

  Various factors affect the movement of currency rates and forex market analysis. More often than not, one such factor is the use of candlesticks in technical analysis. Candlestick charts (also known as Japanese candlesticks) consist of a rectangle of a body and an upper and lower shadow. The rectangle’s colour represents whether or not the closing price for that particular time was higher or lower than the opening price. It gives traders important information about what happened during the trading session within the set time frame. The length of each part of the rectangle – body, upper shadow, and Continue Reading →