Get to know trading the instruments and strategies – In recent years, the word ‘business’ has emerged. Some people may already understand the trading system. However, for others, the word still sounds strange to the ears. So, what exactly is trading?
According to the Indeed website, trading is the activity of buying and selling assets with the aim of making a profit.
Investopedia’s page explains the definition of trading, which means buying and selling securities such as stocks, bonds, currencies, and commodities.
Trading is not the same as investing with a long-term buy-and-hold strategy. Rather, trading is done by repeatedly buying and selling to make a profit.
In financial markets, trading can refer to stocks, commodities and currencies.
Types of marketing tools
Again referring to the Indeed page, there are several tools that can be used for marketing. Namely as follows:
1. Shares
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Shares are a unit of ownership in a company. Shares can be used as a trading tool because their value can change over time.
Shares are profitable if the price increases compared to the original purchase price. Apart from this, if the corporation earns a profit, trading instruments with shares may pay dividends.
When a person buys a company’s stock and holds it for a long time, the price of the stock fluctuates. If a company grows and its earnings grow, so does its stock price. vice versa. If a corporation loses value, its shares will also decline or disappear.
2. Forex
Foreign exchange (forex) is known as foreign exchange (forex), that is, currency exchange. Among the commodities traded are major currencies such as the United States Dollar (USD), Euro (EUR), British Pound Sterling (GBP), Japanese Yen (JPY), Swiss Franc (CFH) and Canadian Dollar (CAD).
Foreign trade can make a profit when the market rises or falls, because there is a two-way opportunity. If the price increases, it will be beneficial to make a purchase (long) transaction. Similarly, selling (short) position is beneficial when the price decreases.
3. Gold
Gold can be used as an instrument of exchange. The principle of gold trading is similar to forex, which is based on price fluctuations. Therefore, gold prospectors have the opportunity to profit from rising and falling markets.
However, gold trading can be dangerous if one does not understand how to play it properly.
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4. Crypto
Crypto is a virtual or digital currency. There are several digital currencies that are used as trading instruments on crypto exchanges. These include Bitcoin, Litecoin, Ripple, Ethereum, Dogecoin and others. Bitcoin is the most popular digital currency.
Crypto trading is said to be similar to forex and gold. However, the volatility of this digital currency is usually the higher of the two.
Marketing strategy
For those new to the world of trading, here’s a summary of the four most frequently used strategies from Investopedia:
1. Make a skull
Scaling aims to take advantage of small price fluctuations. This strategy is done by closing and opening positions to make profit in a short period of time from a few seconds to minutes.
Traders need to be ready and alert in front of the chart to avoid missing a moment of headwind weakness.
2. Day trading
This strategy is done by buying and selling assets within 24 hours. Day trading relies on price fluctuations to make small profits. People who use this strategy will continue to buy and sell to increase their profits.
A day trading strategy is suitable for estimating risks and price gaps at the close and open of the trading session. The volatility of day trading is similar to auto trading, traders must be vigilant to monitor the market’s price fluctuations.
3. Swing Trading
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Swing trading is done by holding positions over a period of days to weeks. This strategy aims to profit from short-term price movements in the market, by buying when prices are low, then holding, then selling when prices rise.
4. Position Trading
For spot marketing strategies, positions can last for a long time, from months to years. The goal is to profit from major trends in the market rather than short-term gains.
People who use this strategy do not always need to check the price movements, because based on their analysis, they wait a long time to exit the position.
This is a definition of marketing, along with types of tools and strategies. How about datkers, are you interested in starting a business?
