Build your trading knowledge: Learn How to Start Trading with Trader Leaks
The Online Trading Essentials
When aspiring traders and investors are considering entering the online financial markets trading world, a prerequisite for their potential success lies in building a strong knowledge foundation and understanding of what is necessary for them to get started and go through the trading / investing processes successfully.
Therefore, we are highlighting 4 main areas that traders need to go through before engaging in actual trading.
Understanding the Basics
Trading Accounts
A Trading Account can be any investment account that holds securities, cash or other holdings typical for a brokerage account. With a trading account, traders can buy and sell assets (stocks, shares, commodities etc.) or perform CFD trading. The key point that differentiates a trading account from other investment accounts is the level of trading activity (frequent/daily), the purpose of activity and the risk involved in the activity (usually very risky).
Trading Platforms
Online Trading Platform is a software which is used for placing orders- opening and closing (buying and selling) of financial products (stocks, bonds currencies, commodities etc.) and managing market positions online via financial intermediaries – brokers. These platforms are in most cases offered to traders as basic trading tools by brokers, either completely free or at a small rate in exchange for them maintaining a funded account or making a specified number of traders per month.
Trading Conditions
Trading conditions refer to the terms set by the financial intermediary – broker under which a trader will perform the actions related to online trading. These trading terms include but are not limited to Spread, Lot Size, Initial Margin, Hedge Margin, Trading Commissions, and Financing Rate etc. Aspiring traders need to be well aware of these terms and conditions and count any brokers fees prior to formulating a trading strategy, engaging in trading and profit calculations.
CFD Trading
CFDs (Contract for Difference) are financial derivative products which allow traders and investors an opportunity to profit from price movement without owning the underlying assets. It is based on price movement forecasts where traders are opening “buying positions” when they believe the asset price will go up, or “selling positions” if they believe the price will go down, and if the predictions were correct their profit will be the difference between the paid amount and closing value amount.