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Binary options trading

Binary option trading is a type of financial instrument whereby you make predictions about the future price of market-traded underlying assets, such as commodities, stocks, indices, and currencies. With binary options, you are simply predicting if the price of an asset will rise above or fall below a certain point, within a set timeframe. Binary option trading differs from traditional trading in a number of ways, but most notably in the following areas: 1. When trading binary options you are not purchasing physical stock or ownership of a company. 2. Returns are fixed and pre-determined, so you know exactly how much profit you will make before you commence trading. 3. Trades are short, normally lasting from between 10 minutes to an hour, although there are also different binary option products, such as One-Touch, that allow you to take long positions on an underlying asset. 4. With binary options you can profit regardless of whether an underlying asset is rising or fal...

Rules to follow for Day Trading

Day trading has a lure of its own. The quick profits and the no worries about the overnight exposure of the trade coupled with small margin requirement are the reasons that attract the multitude of traders to day trading. But things can go terribly wrong. The dreams of quick profits can turn into nightmarish losses within the same trading day. To avoid such situations, one has to work with a set of rules. These rules will keep you grounded, protect you from huge losses and will ultimately reward you for disciplined trades by way of profits. Ignore them and you are into gambling territory. Rule 1: Do not trade without a stop loss. Any trade can go wrong. We expect to make a profit but care is to be taken to manage the loss. A big loss can have psychological impact on other trades also besides depleting the capital. A sensible stop loss should always be there to protect you. Example: Please see the  Tata Motors  Futures trade dated 12–09–2017 ( ...

Secrets of Day Trading in the Stock Market

Stock Markets are full of experts. There is fundamental analysis and there is technical analysis. And then there are a plethora of technical indicators and charts. Armed with so much firepower of data and analysis a trader sets out to trade. His indicators tell him to enter a trade at Rs. 1130. It is a day trade. Same indicators tell him to exit at Rs. 1137. The exit is done. The lot size was 750. A profit of 5250 taken. A good trade. Only minutes later, there is another surge in price and stock keeps moving up and ends 4% higher at the end of day at Rs. 1175. The trade which could have given you Rs. 45 was exited after taking Rs. 7 only. This is what happens with most traders. Sorry, this is not true. What actually happens is that if the stock fell by Rs. 40, the trader will book a loss of Rs. 40 but while booking profit, it will be booked at 3–7 Rupees. Sounds familiar. It happens to everyone. Still we do not learn. After wiping out the initi...

Choosing Your Stock Broker !!

It’s scary to start Investing, I remember the day i started with a few thousand bucks, It felt like I am about to jump of the cliff. As soon as I bought the First Stock, i couldn’t stop staring at its price ticker for the next few days, constantly praying that it doesn’t fall and hoping that it rises miraculously, neither of that happened as the stock traded sideways for the next few days. But for all this to begin, you need to have a Trading & Demat account. It is important to choose it carefully, because the brokerage and maintenance charges will eat into your profits. So let’s discuss the options available with you 3 in 1 Accounts A combination of Savings, Trading & Demat Account offered by banks Pros Convenience of Fund transfer, as funds come in and go out from your savings account seamlessly and you don’t need to manually Transfer funds to your broker when you want to  buy a stock. Single point of contact - You don’t need to visit an additional broke...

WHY TO INVEST IN STOCK MARKETS ?

Why should one invest in the stock market? Actually, there are several reasons to do so. Investing in stocks can provide impressive returns, and these gains can help investors successfully overcome inflation. There is a significant wealth of information on this particular market, which can help individual investors to make better-informed decisions. In addition, numerous investment vehicles provide exposure to this market, offering investors many ways to get involved. Finally, there are many inexpensive ways to obtain exposure to this stock market, so investors don’t have to spend a prohibitive amount of fees. COMPETITIVE RETURNS Historically, stocks have provided the highest long-term results of any asset class, as the BSE SENSEX produced an average annual return of more than 15 % between 1980 and 2016. In comparison, the three-month Treasury Bill generated an average annual return of 3.46% and the 10-year Treasury Bond returned 5.18%. One great way to illustrate the di...

WHAT IS AN IPO? UNDERSTANDING IPOs

The journey of a thousand miles begins with a single step, so says an old proverb. In the world of equity markets, every public company starts its journey with an IPO. It is through an IPO that a private company “goes public”, i.e. it transforms into a public company. Hence, if you are interested in investing, then understanding what the term IPO means would certainly be very valuable. Public Company Vs Private Company and The Definition of an IPO Before we look at what an IPO is, let us quickly understand the difference between private and public companies. In general, a public company is one that is listed on a stock exchange, i.e. its shares are traded openly on a stock exchange. Most companies start their life as a private company, i.e. as a company that is not listed on any stock exchange. Typically, a few people – the founders of the company – get together to start a firm. After this, some shares of the company may be sold to other individuals or firms through private ...

TRADING VS INVESTING | DIFFERENCES BETWEEN TRADING AND INVESTING

This article will focus on answering a common question. What will make you more money – trading or investing? Trading can be quite similar to investing at certain points. For example, a trader may hold a security for the same amount of time as an investor. Therefore, to avoid confusion, I will refer to the extremes. In this article by trader I mean someone who places trades on securities like shares or currencies for very short periods of time. This could be for as little as a few seconds or minutes. And by investor I am referring to someone who is willing to make an investment and hold it for a very long period of time. The investment could be held for a lifetime, although a period of five to ten years is more common. The trader focuses on profiting from short-term price movements, and cares little about the fundamentals of what they are trading. The investor, on the other hand, focuses on the fundamentals and long-term viability of their investments. Warren Buffett i...