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Comparing VFV ETF vs ZSP, VOO, SPY, VUN, XUU, XUS and More
What is VFV? Vanguard’s VFV ETF is a reliable and successful index fund that has proven to be quite profitable ever since its inception. Its success is mainly attributed to its approach, as it follows the S&P 500. Likewise, Vanguard S&P 500 ETF aims to follow the performance of a broad US equity index that measures the investment return of large-capitalization US equities. This Vanguard ETF currently aims to follow the S&P 500 Index, and become its successor. Putting it simply, VFV is a Canadian version of the S&P 500 and has shown similar success. What Type of ETF is VFV? VFV is Vanguard's Canadian counterpart of the famous S&P 500 ETF. Its stock is traded in Canadian dollars and is listed on the New York Stock Exchange. Furthermore, VFV is a type of ETF that, to a great degree, follows the performance of the S&P 500 Index before any costs and fees come into the picture. The VFV MER (Management Fee) is also quite low, sitting at 0.08%. What Holdings Are in VFV? As an ETF, VFV has allotted its capital to major companies, including big tech firms, banking organizations, and even consumer goods. Some major holdings included in VFV are: Apple Inc, Microsoft Corp, Amazon Inc, Facebook, Tesla Inc, NVIDIA Corp, Berkshire Hathaway, JPMorgan Chase & Co VFV Stock When it was initially introduced in 1976, the Vanguard S&P 500 Index Fund was the first index-tracking mutual fund. The fund, often represented by the VFV stock, owns the same stocks as the S&P 500 stock index in the same proportions. In fact, the stock companies in VFV account for 75% of the stock market's value in the US, making the index closely reflect the direction the US is headed in. Does VFV Pay Dividends? Yes, VFV pays dividends. Although they're generally paid out once every 12 months, these can be: MonthlyQuarterlySemi-annualYearly distributions The dividend, which generally includes interest, income, and/or capital gains, is given to investors who hold the fund on the date of the payouts. However, keep in mind that the VFV stock yield is rather low, accounting for around 1%. How to Purchase a Vanguard S&P 500 Index Fund? To invest in any of the VFV options, you must follow the steps we've explained below: Create an account on the website. Choose an account. i.e. individual, joint, or retirementFill out some basic info i.e. personal and financialDeposit money into your account: To finally invest in the index fund, consider making an online deposit to your account or send a check by mail. Minimum Deposit: Keep in mind that the Vanguard S&P 500 Mutual Fund has a $3000 minimum deposit, or $2000 if you buy it in an educational savings account. Automatic Purchases and Reinvestments: By connecting your bank account on your initial deposit, you can set up future automatic purchases and allowing you to invest with a click of a button. When investing in Vanguard, you should know that dividends and capital gains will often be automatically reinvested in the stock. Purchase Assets Using a CFD Broker: In addition to buying it directly from the Vanguard website, you can purchase S&P 500 assets by using a CFD broker like Fortrade. Although you won't have holdings in the company directly, you would still experience the same benefits, like a rise in profit and a dividend yield. Does VFV Have Fees? When it comes to ETF fees, Vanguard has traditionally been one of the lowest-cost ones. However, since financial services is a relatively competitive sector, Vanguard is now being challenged by corporations like Schwab for the crown of low-cost ETFs. Nevertheless, the charges are minimum: The Vanguard S&P 500 Mutual Fund: Has an expense ratio of only 0.14% ETF: The charges just 0.04 percent annually, Plus any applicable fees to purchase or sell, which are also minimal. Is VFV A Good Long-Term Investment? Yes, it can be concluded that the Vanguard VFV is a great choice if you want to diversify your stock portfolio, especially if you’re an investor looking forward to long-term gains. In fact, VFV has had a consistent rise in its price of at least 10% annually since its inception, making it a great choice for long-term investments. According to Reddit and Quora, VFV will probably continue its upward trend in the following years, as it has remained a reliable ETF throughout time. VFV vs ZSP Index Fund As they're similar index funds, both VFV and ZSP are tracking the US S&P 500 ETF, so they have had identical gains and losses over the years. Still, there are some minor differences. When comparing the prices of the individual stocks, VFV is approximately $100 per stock, whereas ZSP is cheaper, being around $60 per stock as of October 2021. Still, most evidence shows that VFV historically outperforms the ZSP, making it a better choice, even though ZSP is cheaper. VFV vs VOO Index Fund Similar to the ZSP and VFV, VOO attempts to mimic the success of the S&P 500 by investing in the same stock holdings. The only difference is that VOO is traded in US Dollars, and VFV is Canadian. Thus, investors from Canada should avoid purchasing VOO if they want to minimize their conversion fees (Canadian dollars to US dollars). Although VFV is cheaper, VOO's dividend payout is slightly larger, nearing 2%. VFV vs VSP ETF The VSP is the VFV with a Canadian dollar hedge, while it also follows the S&P 500. Many regard VSP as an excellent option, if you want your investment to be hedged against the CAD/USD exchange rate. Although the risks are smaller when hedging, keep in mind that you'll pay a small fee for hedging your position. Additionally, the VSP has a 0.09% MER (Management expense ratio) compared to 0.08% for VFV. VFV vs IVV ETF IVV is an iShares version of an S&P 500 index fund and is only accessible for buying and selling in US dollars. Other than being more expensive than VFV at around $400, the differences are minor. It’s a great choice, with an even smaller MER of 0.04%, and is expected to perform similarly to VFV. Still, fees for currency conversion must be considered, as IVV is traded solely in US dollars. Conclusion To summarize, Vanguard’s VFV ETF is a simple and quite successful index fund that does exactly what it says: it follows the S&P 500 and its success. It is one of the best options for investors looking forward to a reliable passive income, whether it's from dividends or capital gains. Additionally, Vanguard's VFV is one of the lowest-cost ETFs, so consider investing in it if you're up interested in a diversified portfolio with US large-cap stocks.
PlatformsIs the Yokohama Trading Platform in South Africa Legit? (+ Best Alternatives)With the rise in popularity of online trading, more and more online platforms have arisen, and, unfortunately, many scam platforms have appeared as well. Namely, many question the reliability and safety of the Yokohama trading platform since it has advertised itself as a top trading platform for beginners in South Africa. In this Yokohama trading investment review, we will cover the reliability of this platform and whether or not it is a reliable place for forex trading. Continue reading to learn more. Yokohama Trading Platform Review Fees Reliable platforms do their best at offering the lowest possible fees, ensuring that every trader gets a satisfying experience when opening a position on the market. Unfortunately, with Yokohama trading, this isn't the case. Even though we couldn't find the exact fees the platform charges per transaction, there are a lot of online reviews shaming the platform's hidden costs. In simpler terms, this means that you'll get promised to retain more money with every transaction until, later on, you'll find that a significant part of your budget has been cut by hidden fees. Services NBR Trading Yokohama offers financial services for retail investors in South Africa. At first sight, the NBR Yokohama trading platform will look like a relatively solid brokerage to invest your money in, as you'll receive tons of options for CFD trading on stocks & shares all over the world. This platform offers trading bitcoin, and other cryptos, though we would strongly advise against registering for trading here. Should You Use The Yokohama Trading Platform? No, you shouldn't use the Yokohama Trading platform. There have been thousands of online reviews against them, putting them on a fake forex brokers list you should avoid. The truth is that you shouldn't waste your time with such a platform, as there have been many traders who have already been scammed for thousands of dollars. Namely, this trading platform hides the lack of its authenticity behind the name Yokohama, which is a reliable tire company based in Tokyo, Japan. On the other hand, the Yokohama trading platform holds the name of this reputable organization but is a fraudulent brokerage with offices in South Africa. The platform doesn't hold any relevant licenses from respectable licensing bodies, nor is it regulated under the law of any government. This means that you should avoid the Yokohama trading platform and stick to the best forex brokers in South Africa. Alternatives to the Yokohama Trading Platform There are thousands of forex trading & CFD brokerage alternatives you can go for other than the Yokohama Trading platform, so there really is no excuse for risking your money there. If you're not sure where to start, we would recommend checking out some of our top South African forex brokers and seeing which one of them appeals to you. A note we would like to make is that there are a lot of criteria you should go over before registering at a broker. For starters, a reputable broker will do its best to offer trading education resources, and other many services you might find useful, like forex trading and trading bitcoin. We also suggest that you consider going with a brokerage that offers an app download, so you can easily see your portfolio and manage your trades from your smartphone on the go.
PlatformsSolved—The Answers to Plus500’s Trading Knowledge AssessmentFor traders searching for a new trading platform that offers a broad array of assets, perhaps Plus500 has been on your radar for a while. But what about regulations? This is a common concern for investors who stray from the big banks and well-known investment arenas. Well, for Plus500, you do not need to be too concerned since it is a highly regulated global fintech and trading services firm. Since its launch in 2008, the company has gathered authorization and regulatory oversight by a wide range of organizations and institutions: Cyprus Securities and Exchange Commission (CySEC)Australian Securities and Investments Commission (ASIC)Israel Securities Authority (ISA)Seychelles Financial Services Authority (FSA) Monetary Authority of Singapore (MAS) Remember, if you are in a European country, most nations in the region will fall under CySEC regulation. Knowledge Questions—Plus500CY regulation 1. When you make a deposit of AU$1,000 and the instrument leverage is 1:100, what is the maximum leveraged amount you can trade with? AU$200AU$30,000AU$100,000 - correct answer Why? Because you put down $1,000 and the leverage ratio is 1:100, you can only trade with $100,000. 2. You have set a stop loss on your position. If the market moves rapidly and gaps through the price you have set, what will happen? If your share price gaps lower and starts the trading session at $25, your stop-loss order will be converted into a market order. Your position will then be closed at the next available price, which is applied even if the security is trading way below your stop-loss level. Knowledge Questions—Plus500AU regulation Important now: your answers to the following questions will determine your eligibility to trade with Plus500. 1. In order to avoid account balance falling below minimum margin requirements, who is responsible for adding funds to your account? Plus500I am responsible - correct answerMy bank Why? Although your trading platform might trigger a margin call, it is ultimately your responsibility to add money to your account when the balance slides below the minimum margin amount. 2. Where there is unexpected news in the market, it will be more likely the market will Become more volatile - correct answerRemain unchangedShut down Why? If there is one thing that financial markets do not like, it is uncertainty, be it a geopolitical fallout or a central bank instituting a policy out of left field. 3. What is a spread? The difference between the bid price and ask price - correct answerWhen a company publishes its yearly reports Holding positions for long time periods Why? Whether you are trading stocks or forex, the spread is the difference between the two prices (bid and ask). The ask price will exceed the bid price for an asset in the market. 4. You have set a ‘Guaranteed Stop’ on your position with a guaranteed stop level. What will happen if the market gaps through the price you have set? My position is guaranteed to be closed at my guaranteed stop level - correct answerA stop loss cannot close my positionMy position is not guaranteed to be closed at my guaranteed stop loss Why? Like a stop-loss, a guaranteed stop is a kind of stop-loss that makes sure your position is always closed at your pre-selected price. 5. When you buy a share CFDs (Contract for Difference) You are entitled to the difference between the open rate and close rate but you do not own the underlying asset - correct answerYou own stocks directly in you name exactly as if you purchase shares from a stock brokerYou have the same voting rights as a regular share holder Why? With Contracts for Difference (CFD) trading, you are trading based on the movement of the price. You will not take delivery of the asset you are buying and selling on the open market. 6. If you take a short CFD position You expect the price of instrument to fall - correct answerYou expect the price of instrument to riseYou always have less risk than a long position Why? A common strategy in the financial markets is by speculating that the price of a security, be it stocks or commodities, will fall. This is known as short-selling, or shorting. 7. The higher the leverage: The size of transaction I will be able to be open will be larger - correct answerPrice changes have a greater impact on profit lossSmaller fluctuations may cause faster automatic closing of the transactionAll answers are correct Why? Leverage trading is a popular speculative investment tool since you can initiate greater positions than the capital you have deposited when you open an account on Plus500. In fact, you only need to invest a small percentage of your position with a sizable leverage ratio. Trade Today! Now that you have improved your investment knowledge with Plus500 questions, you can begin your investment journey today, whether it is adopting CFD gold trading or traditional index investing. As long as you take a slow-and-steady approach as you familiarize yourself with Wall Street or London, you can enjoy the fruits of the stock market.
Day tradingBest Indicators for Forex Day TradingIn this brief article, we will be talking about the most profitable and accurate indicators for day trading Forex so that the life of every day trader could be made a little easier. A forex indicator is a technical indicator (i.e., measure) that helps the trade examine the market's data. Forex indicators take many things into account, including currency price, volume, and market performance. With the help of the indicators mentioned in this article, you can make better predictions about the behavior of the market in the future. This is exactly why they're a hot topic among traders, as they're set-in-stone algorithms, many of which have stood the test of time for decades on end. Thousands of day trading strategies have been built on these indicators, and many of them have been successful. So, at this point, it must be quite clear to you what signal and forecast indicators are and why they are important for day trading. Now, with that behind us, let's take a look at the best indicators for Forex day trading. The Top Indicators Used in Day Trading When looking at the best indicators, it is important to understand their workings and how exactly they will impact your trading decisions. Let's look at the three best forex MT4 indicators with a brief explanation of how they work and what they indicate. 1. Uptrend/Downtrend By looking at this trend, you can get an idea about the market's current momentum. Namely, analyzing all the historical highs and lows can be quite a valuable piece of data for your day trading choices. Although the market incentive isn't always right, more often than not, it's worth paying attention to. Most experts regard it as being the simplest—yet the most accurate—forex indicator. Relative Strength Index (RSI) If you've dabbled in forex trading in the past, you've probably already heard of RSI—an oscillator that indicates whether the market is overbought or oversold. With most assets, you can tell that a market is overbought when the RSI value goes over 70. On the other hand, when a market is oversold, the RSI value will drop below 30. Namely, the RSI indicator alone may not prove to be the most important one for day trading, as it can be easily influenced by sharp and sudden price changes, causing it to give false signals on rare occasions. However, an experienced trader will be able to look at the RSI index in combination with other important signals and principles, like the 25k day trading rule, and effectively set themselves up for a successful run in the forex market. Exponential Moving Average (EMA) The EMA can be quite a beneficial day trading indicator and is primarily used in conjunction with the RSI. Using these two chart indicators together often makes for an accurate reading of the market, making day trading forex successfully a much easier feat. Regarding the latter, the EMA works by weighting prices and then giving a reading to gauge the market situation. Much like the RSI, the EMA index can be influenced by sudden changes in market prices to give out an inaccurate reading. Still, when used in conjunction with the RSI by a relatively experienced trader, it can prove to be an excellent tool for forex day trading.
Day tradingGuide to Day Trading Stocks for BeginnersWhen the global economy was shut down due to the COVID-19 pandemic, millions of people had nothing to do except watch CNBC, stare at their Robinhood trading accounts, and speculate on bankrupt companies. Dave Portnoy of Barstool Sports became the poster child for this activity, admitting that he would eventually stop day trading when the economy reopened. Well, the time has come. Countries are reopening, but are individuals abandoning their day trading strategies to return to some semblance of normalcy? Not quite. It is still a popular investment tool for many armchair traders who have developed a knack for finding patterns and enjoying a portfolio that is in profitability territory. For those who are entering this investment realm, there are many things you need to know before diving into volatile stocks or installing the latest day trading software on your computer. Suffice it to say, day trading is not as simple as "buy low and sell high." What Is Day Trading? Day trading consists of buying and selling an asset repeatedly within a trading session and then closing your positions by the closing bell. Day traders can be institutional investors and retail traders looking to generate a positive return by speculating on the movement of exchange-traded funds (ETFs), futures, commodities, stocks under $5, forex, CFDs, and more. Things to Do Before Trading With Real Money When investing in the stock market, it is crucial to become acquainted with a wide range of factors before you begin trading. This is critical as it will ensure you are equipped with the knowledge to increase your day trading or swing trading acumen. To help you out, ensure you do the following things: Learn the Terminology So, what terminology should you know? Let's list off a few that are imperative for day traders: Pattern Day Trader (PDT) This is an investor who executes at least four trades of a security in a five-day period and holds a minimum account balance of $25,000 (this is known as the over 25k day trading rule). Bid/Ask Price The bid is the price investors are presently bidding at, while the ask is the price traders are asking to sell the stock at. Float The number of outstanding shares available to trade in the open market. Scaling A day trader enters a position by partially scooping up shares at $4.75 and then adding more shares at $4.99. Scalping The investor will profit off small intraday price movements and turn a quick profit by trimming at the top. Learn the Strategies Every day trader should utilize a strategy rather than buying and selling on a whim. This could consist of monitoring charts, engaging in technical analysis, or using specific tactics. Essentially, not using a strategy is like walking around blind without a cane. So, what type of plan should you incorporate into your overall day trading strategies? There are quite a few, but only a few are popular, such as the following: Bullish flag pattern A bullish flag formation can be located in stocks that enjoy impressive uptrends and flash good continuation patterns. To help you spot this, read our beginner's guide to candlestick charts. Pullback trading First, find an investment that maintains an established upward trend. Second, spot a price decline from the trend. Third, pick your entry point and hit the buy button on your list of volatile stocks. Buy the rumor, sell the news Be it a war in Europe or disappointing corporate earnings, you can garner a position in a stock or commodity ahead of the news and then sell the asset when the developments come out. EMA indicator The exponential moving average (EMA) indicator is an average price calculation over a period that emphasizes the most current price data. Practice With Demo Accounts Indeed, day trading can be challenging. If knowing how to pick stocks for day trading was easy, everyone could do it and turn a quick profit. While most day traders lose money, many are successful by sticking to a routine: wake up early, study the markets, and remove emotion. That said, you can perhaps maintain a pattern of profitability by practicing this investment strategy. The best way to hone your craft is by opening a demo account or participating in a trading simulator. This way, you are not using real money and can test out other charts, strategies, and indicators. What You Will Need to Day Trade Ultimately, there are three necessary things you will need to day trade properly and successfully: 1. A Brokerage Account Before you begin day trading, you will need a brokerage account, which you can determine by best order execution, platform technology, or mobile app. To help you choose, read our Top 6 Forex Brokers for Day Trading. 2. Finances And, of course, if you are a professional day trader, you will need to fund your account with a minimum of $25,000. Is day trading without 25k feasible? Yes, but you will need to make some adjustments. 3. Strategy Next, pick your day trading strategy. Remember, it will not be your eternal investment tactic. As time goes by—and you become more seasoned and easily identify patterns—you will start utilizing different strategies. Should You Day Trade Stocks as a Beginner? In the end, day trading can be a risky endeavor. You are investing with large sums of capital and, if this becomes your career, your earnings will depend on how well you do in the financial markets. Put simply, you will need to understand your risk. Is this a daunting task? Absolutely. At the same time, with enough practice and gathering as much information as you can, you can build a fierce trading arsenal that will produce tremendous results. Every day trader is still striving to improve by learning as much as they can. The market is constantly evolving, and it is important you evolve with it to be successful.
Day tradingHow Much Does a Pattern Day Trader Make?In the last couple of years, millions more people established brokerage accounts to take advantage of a once-in-a-generation selloff in the financial markets amid the coronavirus pandemic. It was an incredible situation for anyone who did not have exposure to equities because you essentially got in on the ground floor. Once 23 March 2020 arrived, that elevator started to climb. Because so many armchair traders made money, they became interested in other opportunities to earn a living, including day trading. Many wonder if unlimited day trading is a profitable venture, particularly if you are day trading with a full-time job. The easy answer is yes, day traders can make money, but it's not as simple as that. Let's explore if day trading with or without $25,000 is worthwhile. Percentage of Day Traders That Are Highly Successful Day traders make up a small number of the global financial markets. According to some estimates, profitable day traders account for 1.6% of the market in an average year, while other reports peg the figure at as much as 4%. Although they represent a small percentage of the financial markets, profitable day traders account for 12% of all day trading activity. Indeed, they are quite active! Salary of Successful Day Traders Of course, when you are researching the numbers behind a professional day trader's salary, you will inevitably come across day traders who make millions. While it is certainly possible, and they do exist, it is safe to say that someone making this claim on TikTok is a grifter. A 2022 Glassdoor study found that the average day trader annual income was about $74,000, but there was a considerable canyon from the average, with some day traders earning a fortune and many losing a lot of money. Other reports found that the top traders with $10,000 accounts might turn a three percent profit each month, but these are the upper echelon of day traders. Your average independent day trader might generate $750 in a year. Moreover, studies show that most day traders will be on the losing end with a poor profit-loss ratio. A 2013 study of Taiwanese day traders concluded: "Less than 1% of the day trader population is able to predictably and reliably earn positive abnormal returns net of fees.” A June 2021 study of 1,600 Brazilian day traders learned that only 3% made money after a year, and 1.1% earned more than the nation's minimum wage. Can You Make a Living From Day Trading? If you execute four or more day trades of the same investment, be it a stock or a commodity, in five business days, you will be labeled as a pattern day trader. According to PDT rules, you need an account with $25,000 to continue day trading. Of course, it is entirely possible to be an unconventional day trader with less than $25,000, but you need to utilize zero-commission trading platforms with fewer trades. This is otherwise known as the 25k day trading rule. Many retail investors will day trade futures contracts or engage in day trading leverage, and financial experts purport that you need to put at least $1,000 into the market to make these endeavors worthwhile. Futures and leverage are not the only day trading strategies to employ, particularly if you cannot endure substantial losses that could wipe out your brokerage account. You can utilize other assets more conservatively and still enjoy capital gains day trading, such as: StocksETFsCommoditiesForexIndicesCFDsCryptocurrency Meanwhile, based on the data, here is a list of the expected annual income of day traders by percentile: 90th: $150,00075th: $100,00050th: $80,08125th: $37,50010th: $11,000 How Market Choice Influences Day Trading Profit Let's face it, the finance industry has presented the trader with many different types of stock trading. It is remarkable how much the sector has changed in the last decade alone. From investing on our mobile phones to using the best trading signal providers on the web, there are a plethora of choices that can both help or hurt your day trading journey. Of course, market choice is great for institutional and retail investors. You want as many choices as possible, no matter how overwhelming it might seem. You want the option to use multiple chart websites, stock screeners, and zero-commission platforms. This can only enhance your day trading profit as long as you have the knack for spotting patterns and correctly translating the information to your broader trading strategy. The Bottom Line: Is Day Trading Worth It? Few people can turn day trading into a profitable occupation. Every day, there's an abundance of factors driving the financial markets, from headline news to government reports. It takes studying every component in the global marketplace, in addition to taking advantage of charts, technical analysis, and data. Plus, even if you are fortunate enough to make a decent living as a day trader, there are still the commissions, fees, paperwork (gasp!), and paying taxes on day trading that can eat into your overall profits. Indeed, after you first turn $1,000 into $1,400, you will feel like you are on top of the world, but you will also feel deflated when that $1,000 turns into $650. This is crucial to remember as emotion will hurt your day trading career, particularly at the beginning. Put simply, day trading is worth it if you know what you are doing, you have the capital, and you can be unemotional over everything. Just as long as you understand that the odds are not on your side.
Trading-strategyTrading Forex With Binary Options in 2022: What You Need to KnowOver the last couple of years, online investing has exploded in popularity, thanks to the growing number of options available for digital trading. Be it zero-commission trading or the myriad of features provided by these platforms, many people have been persuaded to engage in the digital trading bandwagon. In the aftermath of the first wave of the COVID-19 pandemic, armchair traders, who were confined to their homes, hopped on Robinhood and started buying and selling meme stocks. Once they turned a handsome profit and became confident in their investing abilities, these same individuals expanded their horizons and delved into the world of commodities, cryptocurrency, and binary currency trading. But what exactly is binary currency and binary forex trading? What Is Forex Trading? Forex trading involves the buying and selling of currency pairs, such as the USD/CAD, GBP/JPY, OR EUR/CHF. When you execute a forex trade, you sell a currency and purchase another currency, speculating that one will outperform the other. This is the most liquid and actively traded market globally, even more than stocks, commodities, and cryptocurrencies. All you need to do is find a source from the long list of forex brokers. What Is a Binary Option? A binary option is an investment strategy whereby you decide if a security is traveling up or down, also known as a yes/no proposition at a pre-determined period. Essentially, it is an all-or-nothing investment endeavor. When it comes to binary options trading, there are three key elements you need to know: Underlying market This is the online binary options exchange, such as Nadex, where you place these types of trades. Strike price The value of the asset that it must equal or surpass for the trader of the binary option to turn a profit. Expiration date The time when the binary option will expire. Brokers will generally offer hourly, daily, and weekly expiration dates, but some brokers will even provide 60-second options. For example, will shares of Acme International hit $20 by 3:35 p.m. EST on June 29? Difference Between Binary Options and Options Options and binary options might seem the same because of the term "options". However, the two investment styles are notably different from one another. The biggest differentiation between the two is time. Binary options maintain short expirations, while real options provide long expirations. Moreover, in binary options trading, there is no real asset, and you are trading against a broker. However, in the real options market, you have an actual asset whereby you are trading against other traders. 5 Steps to Trade Binary Options Now, how do you start trading binary options? First off, you need to know that you can trade binary options any time the market of the underlying asset is open. So, for example, if it is a stock on the Dow Jones Industrial Average, you can trade the security between 9:30 a.m. EST and 4 p.m. EST. Or, if you are engaged in binary forex, you could invest Monday to Friday at any time of the day. After that, we have compiled a list of five steps to help you begin this exciting heads-or-tails investment journey: Analyze market trends As time goes by, you will eventually notice trends and identify market patterns. This is a crucial component of binary options since you need to be confident where a security is going. Choose your market Are you more adept at forex or stocks? Whatever the case may be, it is vital to only invest in the markets you are comfortable with; otherwise, you will be speculating on indexes, metals, or currency pairs you know nothing about. Choose strike price and expiration Select your strike price and then select your expiration. For example, if you are partaking in binary options currency trading, you would pick USD/CAD climbing above 1.2501 in 46 minutes and 23 seconds. This is a part of how you sign off on binary trades. Execute Once you have picked your investment, selected your strike price, and chosen your expiration, you can process your trade. It will show up on your account. Wait for expiration Between now and expiration time, monitor your position closely and act accordingly. If it looks like the market is working against your trade, it may be better to exit the position ahead of time, even if your profits are lower. Benefits of Binary Options Trading Despite warnings from regulatory bodies about binary options, there are several advantages, many of which can reduce your risks. The risks dissipate if you are an infrequent patron of the binary options market as investors need to be correct a greater percentage of the time to cover the losses that are more likely to happen. Indeed, losing trades can cost the client much more than they can gain by winning trades. Here are some of the significant benefits: Access to all kinds of markets What is great about binary options is that you can take advantage of all sorts of markets: up, down, and even flat. This applies to stocks, indices, cryptocurrencies, or binary options currency trading. You just also need to monitor binary options forex signals and employ the right forex binary options strategies. Simplicity For many novice retail traders, the talk of puts and the broader options market can be confusing. The binary options realm simplifies the investment process. Fees Once again, the advancement in digital trading has allowed fees to come down, even in the binary options community. You can buy a contract for as little as $1, limiting your risks. Easy access In the end, the barriers to entry are minimal, particularly on the financial side. You do not need to lay down a sizable amount of capital to trade, making the entire investment strategy more attractive and reasonable. No concern for liquidity The trader does not possess the underlying asset, while brokers will provide multiple strike prices and expiration times or dates. Maximizing Forex Volatility With Binary Options The forex market is perhaps the most volatile aspect of the broader financial markets. With trillions of dollars traded every day worldwide, it makes sense why there is so much volume, but while it might seem like a chaotic and risky market, you can balance it out with binary options. You can combine forex with binary options. You apply the same strike price and expiration date for, let's say, the EUR/CHF currency pair. This is certainly an investment strategy that experienced traders should consider. Once today's younger generation of investors becomes more familiar with the ins and outs of the markets, then they, too, need to think about incorporating forex binaries into their trading arsenal.
Day tradingDay Trading Options: Best Brokers and Beginner StrategiesIn addition to the growing popularity of stock trading, forex, bonds, and funds, options trading has also become quite popular in recent years. As the name suggests, this style is known for giving traders better diversification options. However, keep in mind that options trading is slightly riskier, albeit more profitable than forex or stock trading. With options trading, you can buy or sell a market instrument on a specific time period and at a specific price. This so-called "option contract" can last as short as a couple of minutes, or potentially last a couple of years. Continue reading to learn more about options trading. How Much Money Do You Need to Day Trade Options? Although there are no clear rules that say how much money you need to start day trading options, a good rule of thumb is to never go with more money than you can afford to lose. Still, that is often seen as relatively bland advice, so most experts recommend slowly building up a trading budget. Depending on your income, you could allocate anywhere between 10 to 20% of it towards a “trading jar”, and you can start trading when the amount is big enough to satisfy your goals. Best Brokers for Day Trading Options easyMarkets EasyMarkets is an easy-to-use trading platform designed with a beginner's needs in mind. Throughout our research, we found out that easyMarkets offers quite attractive features like reduced commission rates and minimal requirements for maintaining an account. While easyMarkets may not be the best choice for professional traders who’d like market research details and advanced trading tools, it’s still one of the best options for beginners simply looking to learn the ropes. Read our easyMarkets review here AvaTrade AvaTrade is a widely trusted trading platform with a good selection of trading products to choose from. From our research, we found out that AvaTrade offers convenient tools for beginners, including copy trading, mobile accessibility, and competitive spreads and fees. However, similarly to our previous recommendation, we’d say that intermediate and professional options traders should stick to other platforms. Read our AvaTrade review here HYCM HYCM (Henyep Capital Markets) is a regulated broker available in most of Europe and the US and is a solid choice for option day traders. However, keep in mind that HYCM has slightly higher fees than other trading platforms like easyMarkets, so it’s not the best option for traders who’re looking to invest actively on a daily basis. Read our HYCM review here IronFX As a trading platform, IronFX is an excellent fit for those who are totally new to trading and those who have less knowledge of the market. Unlike some of the other platforms on this list, IronFX also offers a satisfactory amount of tools for advanced traders. Moreover, the trading platform offers flexible account types that make it easy to find a suitable method of day trading. Regularly active traders can also enjoy a personal multi-account manager (PMAM) that offers plenty of convenient tools, like the ability to trade on multiple MetaTrader accounts. Read our IronFX review here Best Time of Day for Day Trading Options Options markets are available from around 9:30 AM to 4 PM ES time. Many experts say that the opening hours, specifically the first 1-2 hours after the market opens, are the best times to day trade. This is because this time period has drastically increased market volatility, making it a lot easier to make a sizable profit. Most experienced day traders tend to stop trading around 11:30 AM due to the decreased volatility and market volume, making the profits lackluster in comparison to the opening hours. What to Remember Before You Start Day Trading Options Although many see it as a way to earn money in your free time, it’s important to remember that day trading is an activity that requires plenty of time and research. While there are no set-in-stone strategies that every day trader should stick to, there are general guidelines that you should follow, like following some of the best trading signal providers. Trading signal providers let other traders follow their trading activities and choose to copy if they wish. For example, experienced day traders often take advantage of price fluctuations throughout the day or intraday period, and the key to this is having a flexible plan and budget during this time. Like any other type of trading, options trading has its perks, with the main one being flexibility, especially when it comes down to setting your schedule. A good piece of advice would be to research when the particular market gets highly volatile and find a way to fit that period into your schedule. A general word of advice for any stock market trading strategy is that you shouldn’t trade more than you're ready to lose - meaning that you, as a trader, should be prepared to risk your capital. This is why in-depth market research is essential and should never be overlooked. In addition to having access to a reliable online broker or trading platform, most successful day traders also take the time to research stocks themselves before buying in and logging trades. Keep in mind that many trading platforms charge high commissions and fees on your profits, and the amount definitely adds up over the long term. Sticking to the reliable trading platforms we’ve included on this list will generally finish most of the hard work for you. Beginner Day Trading Strategy: Long Puts and Covered Calls There are two common types of option trades beginners should stick to: calls and puts. These types of trades allow you to sell and buy an option asset respectively, and both are equally as profitable. Beginners should try to stick to long puts and calls before they get into trading with riskier methods. This essentially means buying or selling contract options with the belief that they will increase or decrease in price while offering the lowest possible risk associated with this method of trading. Though there are other options trading strategies, they should be avoided by beginners until a certain level of comfort and understanding has been reached. The Bottom Line: Is Day Trading Options Profitable? Yes, day trading options can definitely be profitable. As the name implies, option day traders enter positions within the market hours and are usually looking to turn a quick profit. This is usually done by entering early on a position, and exiting before a loss happens. By doing this, experienced option traders are regularly profitable, though they are ready to take the time needed to research the market and do the hard work. Yes, options are good for day-trading. However, keep in mind that options are generally regarded as slightly more complicated than stocks, but their overall way of functioning is quite similar. Consider doing your research and finding day trading stocks that offer exactly what you're looking for.
Trading-strategyThe Ultimate Beginner's Guide on How to Read Candlestick ChartsDo you remember the first time you bought a stock? You may have had quite the emotional ride, the thrill that you could turn over a handsome profit. Unfortunately, your first investment had a sharp selloff, forcing you to sell too early before the security recovered. Your emotions got the better of you, but consternation also infiltrated the broader equities arena. Surely, there must be some type of assistance to ensure you stay the course and generate profits. Well, thankfully, there is. When you begin trading in the financial markets and start utilizing the same tools and resources as the professionals on Wall Street, the go-to source is the candlestick graph. Upon first glance, you might be taken aback by a stock market candlestick, prompting you to learn how to read candle charts. This guide is here to teach you, and we'll begin with the fundamentals. What Exactly Is a Stock Candlestick? This is one of many charts that allow investors to determine the potential price movement during a specific period by identifying previous patterns. It is a common visual aid utilized by beginners and seasoned veterans alike. But what else do you need to know about the technical analysis candlestick chart? Candlesticks function similarly to a bar as they tell you the market's open, close, high, and low price during the trading session. The candlestick has a real body, which is the wide part you will see on the chart. This is the price range between the open and close price for the trading session. If the real body is filled in with black, the closing price was lower than the open. If the real body is empty, the closing price is higher than the open. Many traders will typically alter the shades. A down candle is colored red rather than black, while an up candle is filled in with green instead of white. The lines on the top or bottom of the real body are the high and low prices of the day's trading. These are known as either shadows or wicks. The length determines the difference between the potential lowest prices and the difference between the potential opening or closing prices. If the upper wick on a down candle is short, the opening price was close to the high of the day. A short upper wick on an up candle shows that the closing price was near the high of the session. The lower wick spotlights the lowest value of the trading day. Why Are Candlestick Charts Useful? Knowing how to use candlestick charts is essential to trading stocks, especially if you want it to be an income generator. But how does it work anyway? Here is a rundown of candlestick patterns explained with examples. The body is a tremendous visual aid as the color-coding can better showcase the difference between the opening price and the closing price. The Colors and Sizes of the Boxes Red-filled candlesticks highlight selling pressure, while a red hollow candlestick is created when the close is above the open. Black-filled candlesticks highlight when the close is below the open, while black or green hollow candlesticks suggest strengthening buying pressure (prices are higher after the open, and the close was above the previous closing price). A long candlestick body spotlights buying interest and a strong price move, while a short candlestick body indicates less buying interest and smaller price movements. The Lines The lines, or wick, are important as they represent the high or low range for the period you are monitoring or researching. Moreover, when novice traders are researching technical analysis, they will come across the tick chart vs. candlestick debate, but it can be a complementary tool since a tick chart represents the number of transactions in any given period. Remember, not every trader will use one method. Successful investors use multiple resources. The overall candlestick chart is essential because they identify the four crucial price points: Open The opening price at the start of the session Close The closing price from the previous session High The price of the high during the session (intraday) Low The price of the low during the session (intraday) Essentially, the candlestick open and close is imperative to the efficacy of your trading endeavors. The above image determines the open and close points of bullish stocks (one that experts and investors think is about to increase in value) and bearish stocks (one that the experts believe will decrease in value). One-Candle Signals A single candlestick pattern is essentially a pattern formed by one candle. The time frame is shorter as the trading signal is based on the price movements of a single session. Here are a few patterns associated with the one-candle chart: Hammer A bullish reversal that is created during a downtrend. It appears as the last candlestick in a downtrend before an uptrend, and the appearance is a long lower wick and a shorter body at the top with a small upper wick. Hanging Man A bearish signal that suggests a reversal pattern is here, with sellers outnumbering buyers. Unlike the hammer, the hanging man appears at the top of an uptrend before a downtrend and looks like a small body, a long lower shadow, and hardly any shadow on top. Inverted Hammer A trend reversal signal that suggests bulls want to buy the stock at slumping prices. The inverted hammer appears as an upside-down version of the hammer candlestick pattern at the bottom of a downward trajectory. Shooting Star A bearish reversal indicator that looks similar to the inverted hammer, but it happens at the top of an upward trajectory. When the prices trend higher, it will look similar to a shooting star. Doji A Doji Japanese candlestick pattern is when a stock or currency pair's open and close are equal for a specified time. This could signal a reversal pattern. There are generally two ways to spot a Doji formation. The first is if the candlestick appears as a "plus" sign. The second is if prices move lower at the opening bell and then slightly higher in the opening minutes of the session. There are also four different types of Doji patterns: Patterns in Candlestick Graphs The diverse array of patterns that form when studying candlestick graphs is critical to technical trading. By using them to your advantage, you can come across potential market trends and establish trading strategies and tactics from your understanding of these trends. That said, here are some patterns you might notice and how to identify them: Piercing Pattern A piercing pattern is a bullish trend reversal that forms at the end of a downtrend. Since this requires two candlesticks, you can identify the pattern by homing in on two developments: The bullish candle opens lower than the close of the bearish candleThe bullish candle closes above the 50% level of the bearish candle. Dark Cloud Cover A dark cloud cover is a transition in momentum to the downside after a rally in the security's price. You can identify a dark cloud cover pattern by looking for these five elements: A bullish trend.A bullish candle in that upward trend.A gap up on the next session.Positive momentum, driven by positive and unexpected news, diminishes.The bearish candle ends the session below the midpoint of the previous bullish candle. Bearish Harami A bearish harami is a two-bar candlestick pattern that forecasts prices going through a reversal on a downward slope. It also suggests a top has been reached. Traders can locate a bearish harami if the momentum is starting to slow, like a bearish moving average crossover. Bullish Harami Like multiple of the candlestick patterns discussed here, a Bullish Harami is just the opposite of another variant (the Bearish Harami. Candlesticks Visualize Emotion If you ever wanted to visualize emotion in the stock market or forex arena, the candlestick graph is the best way to achieve this. Be it green candlesticks or long candlesticks, you are witnessing how the market is performing in real-time with the help of visual aid. As long as you know how to read a candlestick stock chart, you will not only profit from your investment strategies, but you could potentially find great amusement in how the market operates on a day-to-day basis.
Day tradingGuide: How to Day Trade Forex Successfully for BeginnersForeign exchange day trading has blossomed in recent years, thanks to the abundance of online trading platforms and the easy user experience on these outlets. Like day trading stocks, day trading in forex consists of buying and selling currency pairs within a single trading session. So, you will open positions at the start of a trading day and close those same positions the same day. This is done either once or multiple times per day, especially if you spot momentum or small market movements. This post will break down the basics of forex day trading so that you can start as soon as possible. What Is Forex Day Trading? Forex trading is the largest and most actively traded market in the world today. This consists of purchasing one currency and selling another as you trade currency pairs. For example, you will trade USD/CAD, GBP/JPY, or EUR/CHF. The quote attached to these pairs in the forex market will tell you how many euros are needed to purchase one Swiss franc, for instance. So, a common query among beginners is how to day trade the forex market. Typically, the three most common tactics are: Scalping Taking advantage of short price movements. Moving Averages Indicators (simple moving average or exponential moving average) that project the direction of a price movement. Candlestick Patterns Investors will enter the market determined by a specific candlestick pattern, like pin bar, triangle, or inside/outside bar. Now, because forex is regulated by the National Futures Association (NFA), there are not too many official rules you need to be concerned about as you endeavor on forex day trading. That said, there are several recommendations from industry observers you need to adhere to before executing a GBP/JPY or EUR/CHF trade. The first is that the minimum capital for forex day trading is $100. But market experts say that starting out with $5,000 is the best way to start. The second is that 1% to 5% of your overall day trading account should be allocated to foreign exchange. Remember, forex day trading is typically done during local market hours rather than buying and selling currency pairs all day long. Like a day trader who trades stocks from the opening bell to around 11:30 am, a forex day trader will execute transactions during periods of heavy volatility. Or, if you are a forex day trader situated in a different time zone, you might concentrate on forex trading during New York or London hours. Best Forex Day Trading Strategies for Beginners When you forex day trade, you need to assess several market conditions before you venture forward: liquidity, volatility, and volume. Once you know how the market is operating during a particular session, you need to employ one of your day trading strategies to ensure you are trading the right way. But which forex trading strategy should you include? These are the three best tactics to employ when you are day trading currency pairs: 1. Swing Trading Are you noticing short-term trading price patterns? This might be your moment to profit from the up or down movement of a currency pair in intraday trading. Known as swing trading, investors can earn quite a bit of return by taking advantage of the market's price adjustment. 2. Scalping Scalping is a popular short-term trading strategy because it elicits routine profits based on fast movements in prices. Essentially, a scalping initiative consists of taking smaller profits repeatedly during a session. But you need to establish an exit strategy so you do not miss out on your opportunity to walk away with gains. 3. Money Flow Indicator Is a currency pair oversold or overbought? Whatever the case may be, a money flow indicator will tell you how the asset is performing by combing through volumes and price movements. Put simply, a reading of 80 or higher suggests the pair is overbought and a reading of 20 or below highlights the pair is oversold. How Do Forex Trading and Day Trading Differ? Forex trading is highly liquid and runs 24/5, meaning that you can execute trades at any time during the week. If this is the case, would a forex trader technically be the same as a day trader? Not exactly. Regular forex trading could consist of swing trading (holding onto an asset for several days) or long-term investing (holding onto a currency pair for several months). However, forex day trading includes going in and out of forex positions in a single session as you monitor up and down price movements. Now, the three primary types of forex trading: Day trading You do not hold positions overnight and will employ quick trades to turn a profit. Swing trading You are holding onto your position for a few sessions as you wait for current events, news reports, or political developments to impact the currency pair in your favor. Position trading You have a strategy and you are speculating, based on fundamental analysis and research, on positive long-term price movements of a particular currency pair. Pros and Cons of Day Trading Pros Plenty of volatilityInstant resultsReduced trading overhead Cons A risk of overtrading in forexGreater odds of losing more trades than winningAddiction to day trading Pros and Cons of Swing Trading Pros Part-time trading is popularTime commitment can be minimal based on your scheduleYour capital is not frozen for too long Cons You will face the risk of overnight and weekly risksTiming the market is a challengeTrading costs could add upRisk of missing out on additional gains Pros and Cons of Position Trading Pros You will miss the volatilityGains could be greater with a specific price targetBuy the dipsAvoid the stress of day and swing tradingZero time needed outside of your research Cons A minor drop could lead to a full bear marketA winning trade could switch to a losing alternative How to Find the Best Broker So, how do you find the best broker for your trading needs anyway? The most superior way to come across the top forex day trading brokers is by listing important criteria and what attributes matter to you. For example, forex day traders will generally home in on the lowest commissions and fees and a user-friendly interface. Many websites claim to offer these features to users, but the reviews suggest that IronFx, Fortrade, and easyMarkets provide these tools to clients. How to Start Day Trading Forex Successfully The best way to trade forex is by arming yourself with the tools, resources, and knowledge to successfully execute trades. This consists of following trends, knowing market times, and monitoring trading charts. That said, let's become acquainted with these things. A trend showcases the movement of a price in a specific direction over a period. These trends can be long- or short-term and upward, downward, or sideways. The forex market is open 24 hours a day, five days a week, worldwide. That said, since most forex traders will trade between the hours of 8 am and 4 pm local time, investors and analysts typically view this period as when the market opens and closes. Terms You'll Need to Know If you come across a superb research note, or you have found a great community to monitor, you may be confused by some of the terms. To help you out, here are a few terms to become familiar with: PIP The percentage in point, or PIP, is the fourth decimal on a price quote for a currency pair. Bid/Ask Price The bid is the price a trader wants to sell a currency pair. The ask is the price a trader will buy a currency pair. Lot The size of the trade you will open (one lot is equal to 100,000 units). Leverage Money that is borrowed from a broker to open a position with an immense contract size. Long/Short Long is when you anticipate a currency to appreciate, while short is when you expect the price of a currency to fall. Charts to Learn One thing you notice when you establish a tailored forex day trading system is that you will come across a plethora of different charts. For beginners, here are the top three charts you can utilize: Line Charts These charts generally display the closing price and are quite popular in business media with how easy they are to peruse. Bar Charts These charts are a little more advanced because they are used to spot key levels by identifying ups and downs, highs and lows, and opening and closing prices. Candlestick Charts If you are in forex, the candlestick is your best friend, since it lists the opening and closing prices (body) and high and low prices (wicks) for a specified period. Step-By-Step Guide for Day Trading Forex With all this information, here is also a step-by-step breakdown on how to start day trading forex: Learn Equip yourself with everything you need to know about forex and day trading, from strategies to brokerage accounts. Create a brokerage account You will need to have a brokerage account to begin day trading forex. You need to find one with the best spreads, lowest fees, and best user experience. Monitor If you are actively trading forex, you need to monitor the numbers, the news, broader markets, and the rest of the world that could impact currency pairs. Strategy Before picking and choosing what forex pairs to trade, you must have a trading strategy to maximize your profits. Without one, you will be going into your sessions blind and without a cane. Emotion It is normal to feel emotional about forex day trading. This is your money and your livelihood could accelerate or break down in a single session. Ultimately, it is imperative to check your emotion at the door when you are buying, selling, and trading forex. Is Day Trading Forex Profitable? How much money do you need to day trade forex? These are some of the most common questions asked, and they are important to determine before you launch your adventure of day trading in forex. Ultimately, day trading will only be profitable if you stick to it in the long run and take it seriously by doing your due diligence and research. As many financial experts will tell you, forex day trading is a job that requires hours of research and trading. Now, the market needs to do its part, too. This means that you need to spot particular conditions. For example, if there is a breakout (price movement that veers away from a defined support or resistance level), you need to take advantage of this development. Moreover, as time goes by and you develop a sense of how the market will move, you will eventually know when to buy the rumor and sell the news. How to Ensure Success With Forex Trading Indeed, there are many factors for being successful in forex trading. You need to study charts, identify patterns, keep track of the pip movements, and monitor the news headlines as part of your forex day trading system. By even abandoning one of these mechanisms, you could potentially lose out on a profitable trade. In the end, there is not just one aspect to make money from forex trading. It is a house of different measures. Now that you know the basics of forex day trading, you are ready for the next step. Continue with our post about the Best Forex Day Trading Strategies for Beginners.