Lesson Archive

What is online trading?

Trading involves the buying and selling of assets. These assets may be company stocks, currencies, cryptocurrencies, commodities, exchange-traded funds (ETFs) etc. Trading is somewhat different to investing: the former often focuses on short-term profits, whereas the latter implies a longer-term strategy. In the past, whenever traders wanted to complete a transaction, they contacted a broker […]

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What is forex trading?

Foreign Exchange, also known as forex or FX, means exchanging one currency for another or, in other words, paying in one currency to buy another. Every time you travel to a destination which uses a different currency, you engage in foreign exchange as you use your country’s money to buy “local money”. Millions of traders […]

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What is margin and leverage in trading?

Online trading is so popular that most people you know probably hold an account with a trading platform. You may even hear them talk about large positions or how they made a solid profit in the forex market out of small fluctuations in currency values. And then you ask yourself how much capital they needed […]

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What is a pip in forex trading?

Pip stands for “percentage in point” and it is the smallest possible change in the exchange rate of a currency pair. The reason we use pips in forex trading is because price fluctuations are tiny and their impact depends on the size of your position. A pip is actually a standardised unit and it’s 0.0001 […]

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How does stock trading work?

Companies sell shares in order to raise money and enable their growth. When you buy these shares, you own stock or equity which effectively means that you own a fraction of the company. As a shareholder, you may be entitled to an annual dividend, which is a slice of the company’s earnings, and you can […]

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How to read key indexes and ratios in stock trading

Once you understand the basics of stock trading , you can start buying blue chips, i.e. “safe” stocks from established companies, in anticipation of dividends or an increase in price. The next step is to explore indexes and ratios. These will help you move beyond well- known companies, in a space where the risk may […]

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What is commodities trading?

Commodities are physical goods that people have been trading for centuries. They’re broadly divided in four categories: energy, metal, agricultural products and livestock. You can also see them categorised as hard or soft commodities, depending on whether they’re mined/extracted or grown/harvested respectively. Nowadays, commodities trading is done in the form of futures contracts, i.e investors […]

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What are CFDs?

CFD stands for Contract For Difference and it’s a derivative, i.e. a financial product that allows you to speculate on the price movement of an asset without actually owning it. When you believe that the value of e.g. a stock or currency will decrease, you can go short or sell, which means you open a […]

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How does cryptocurrency trading work?

If you haven’t heard of cryptocurrencies, then you’ve probably been hiding from civilisation for the past 10 years or so. Back in 2008, a person (or a group of people) by the name of Satoshi Nakamoto published a paper called “Bitcoin: A Peer-to-Peer Electronic Cash System”. This paper marked the birth of the world’s first […]

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What is an ETF?

ETF stands for Exchange-Traded Fund. Think of it as a basket of assets that may include stocks, bonds, currencies, commodities etc. As an investor, rather than buying or selling each asset separately, you trade shares of the basket, which are available in stock exchanges, exactly like normal shares . This makes ETFs simpler than mutual […]

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