Trading Basics topic

[skawal22]

1. What is a trading exchange?

Exchanges help us trade a wide range of financial instruments. There are two
types of exchanges depending on the controlling authority. DEX and CEX.

2. What do brokers do?

Brokers are intermediary that facilitate trading between buyers and sellers.
They are provide some services while facilitating trading and in return they
take fees.

3. What is margin trading?

It just a trading by borrowing money from a broker. It needs a collateral to borrow
for margin trading.

4. What is the difference between Bid and Offer (or Bid and Ask)

Bid is the maximum amount a buyer can offer to trade a financial instrument.
Ask is the minimum amount a seller is ready to sell his/her financial asset.
The difference between the ask and bid is called the spread. The less the spread
the more liquid the asset is.

5. What is the leverage?

Leverage is trading by borrowing money to increase the return on investment.
If not doing it properly, then there’s a chance you could get liquidated. In
other words, you could loose your money.

[Jorgevargas]

1. What is a trading exchange?
Platform where buyers and sellers transact.

2. What do brokers do?
Connects a buyer and a seller.

3. What is margin trading?
It acts as the amount of money required (expressed as a percentage) to enter a trade. It can be borrowed.

4. What is the difference between Bid and Offer (or Bid and Ask)
The “bid” refers to the highest reference price that a buyer is willing to pay to acquire a specific amount of shares/stock at any given time.
The “ask” is the lowest price at which a seller will sell the stock.
The difference between the two is called the “spread”

5. What is the leverage?
It is the additional amount of account equity expressed as a ratio that’s used to enter a position.

[jak]

What is a trading exchange?

A trading exchange is a hub which pairs buyers and sellers for a particular asset.
The exchange will typically charge a fee for the service of gathering these two sides of the market when an exchange takes place.
These exchanges often aggregate buyers and sellers for multiple assets, such as Bitcoin, Ethereum, AVAX etc. or, even across multiple asset classes.

What do brokers do?

Brokers are much the same as trading exchanges, however brokers are a more high-level service.
Where brokers provide the service of bringing buyers and sellers together, the trading exchange is the product which allows them to autonomously create buy and sell offers.

Brokers are using discussed in the realm of more niche asset classes where there doesn’t exist an autonomous trading exchange, or in higher value pairing of buyers and sellers. This is in cases where it’s best to transact peer-to-peer without incurring incredible slippage on both parties ends.

What is margin trading?

Margin trading is a process by which a trader can utilize borrowed funds to create a greater value trade than they’re putting down. In this margin trade, the trader only has to put a percentage (margin) of the total value down of the position, but reap the rewards (or loss) of a greater value position when a trade goes their way (or against them).

What is the difference between Bid and Offer (or Bid and Ask)

A bid is synonymous with going long (or being bullish) on an asset. The trader is putting a bid on what they are willing to pay for the asset, and at a specified quantity.

An offer is the other end of the market. They are willing to offer (sell) a specified amount of an asset at the specified offer price.

What is the leverage?

Leverage is similar to margin trading in that a trader utilizes someone elses funds (typically the exchanges) to purchase (or short sell) more of an asset than they put down themselves.

This means that the trader experiences magnified gains and losses from market moves by the leverage amount.

[ubosquet]

1. What is a trading exchange?

An exchange is a marketplace where securities, commodities, derivatives and other financial instruments are traded. The core function of an exchange is to ensure fair and orderly trading and the efficient dissemination of price information for any securities trading on that exchange.

2. What do brokers do?

Brokers settle trades by delivering securities and payments to each party, while also taking care of all the bookkeeping and tax-related documentation required. In many cases, going through a brokerage firm is the easiest and most accessible way for individuals to get started with investing.

3. What is margin trading?

Trading on 'margin' means borrowing money from a brokerage firm in order to carry out trades. When trading on margin, investors first deposit assets that then serve as collateral for the loan and then pay ongoing interest payments on the money they borrow.

4. What is the difference between Bid and Offer (or Bid and Ask)

A 'Bid' is the price that is chosen by a buyer when they want to purchase shares. On the other hand, the 'Offer' price, sometimes called the 'Ask' price, is the price at which the seller is offering to sell their shares.

The term "bid and ask" (also known as "bid and offer") refers to a two-way price quotation that indicates the best potential price at which a security can be sold and bought at a given point in time. 

5. What is the leverage?

Leverage or gearing is any technique involving using debt (borrowed funds) rather than fresh equity (value of owned assets minus liabilities) in the purchase of an asset, with the expectation that the after-tax profit to equity holders from the transaction will exceed the borrowing cost, frequently by several multiples ⁠— hence the provenance of the word from the effect of a lever in physics, a simple machine which amplifies the application of a comparatively small input force into a correspondingly greater output force. (Source Wikipedia)

[helder]

1. What is a trading exchange?
Trading exchanges can be a physical location or an electronic platform and are used as marketplaces for the trade of securities, commodities, derivatives, and other financial instruments.

2. What do brokers do?
   A broker is an intermediary between the buyer and the seller and who receives a payment in the form of a commission.

3. What is margin trading?
   Margin trading is a method of trading assets using funds provided by a third party.

4. What is the difference between Bid and Offer (or Bid and Ask)
   Bid prices refer to the highest price that traders are willing to pay for a security. The ask price, on the other hand, refers to the lowest price that the owners of that security are willing to sell it for.

5. What is the leverage?
   Leverage enables a trader to get a much larger exposure to the market he’s trading than the amount deposited to open the trade. Leveraged can magnify potential profit, but also potential loss.

[marsrvr]

[tuxedocat]

1. What is a trading exchange?
   A trading exchange is a marketplace where investments and securities are listed so that assets like cryptocurrencies, securities, commodities, foreign exchange, futures, and options contracts, etc. can be bought and sold.
2. What do brokers do?
   The role of a broker is to act as an intermediary between the buyer (investor/trader) and a seller on the market. Brokers are compensated through commissions or fees.
3. What is margin trading?
   Margin Trading is the practice of using borrowed funds from a broker to trade a financial asset, which forms the collateral for the loan from the broker.
4. What is the difference between Bid and Offer (or Bid and Ask)
   The bid price refers to the highest price a buyer will pay for an asset whereas the ask price refers to the lowest price a seller will accept for an asset
5. What is the leverage?
   Leverage is when a position size has been multiplied in hopes of increasing the gains at the risk of increasing the loss also through lending.

[Jelkucijus]

1. What is a trading exchange?

A trading exchange is a system or market in which commercial transactions involving securities, commodities derivatives and other financial instruments like currency and shares, are traded. They can be carried out within or between countries.

2. What do brokers do?

Brokers are buying and selling goods or assets for others.

3. What is margin trading?

Margin trading is a method of trading assets using funds provided by a third party. It allows traders to access greater sums of capital to leverage their positions
Margin is the money borrowed from a broker to purchase an investment and is the difference between the total value of investment and the loan amount…

4. What is the difference between Bid and Offer (or Bid and Ask)?

Bid is the price a buyer is willing to pay while Offer or Ask is the price a seller is willing to accept for an asset.The difference between bid and ask prices, or the spread, is a key indicator of the asset. In general, the smaller the spread, the better the liquidity.

What is the leverage?

is an investment strategy of using borrowed money (borrowed capital) to increase the potential return of an investment. Simply stated, leverage refers to the use of debt (borrowed funds) to amplify returns from an investment.

–

[JanCrypto]

1. A trading exchange is an exchange where a lot of participiants are collected who wanna buy and sell their trading instrument (crypto, FX, etc.). The trading exchange/broker works as the middle men for bringing people together and takes a small fee for that.

2. A broker is an individual or firm that acts as an intermediary between an investor and a securities exchange.

3.Margin trading = borrowing money from the broker to have more money for investing. Margin is the amount of money required to open a position.

4. BID = price buyer wants to pay
   OFFER/ASK = price seller wants to sell

5. Leverage is the multiple of exposure you trade your equity.

[Arod_773]

Q1. A trading exchange is where commodities are bought and sold.

Q2. A broker is a middle man in between an investor and a trading exchange.

Q3. Margin trading is borrowing money to invest.

Q4. Bid is the highest price a buyer is willing to pay and ask is the lowest price a seller is willing to sell at

Q5 Leverage is using borrowed funds to boost potential returns on an investment

[NumaMisfit]

1. A trading exchange is marketplace, where commodities, securities or derivates are listed. You can buy them, or sell them in this space.

2. A broker is middleman between investor and trading exchange. There are exchanges, where only members(brokers) are allowed to trade.

3. Margin trading is trading with borrowed money to earn more. Its used on trading with leverage.

4. Bid is highest price, which buyer is willing to pay for the asset. Ask is the lowest price a seller is willing to sell for the asset.

5. Leverage is strategy of using borrowed money to increase profit of the investment. It can help you to earn more, or wrecked sooner.

[IrishDevlin90]

What is a Trading Exchange?

A Trading exchange is a marketplace where commodities, stocks, derivatives, and other financial instruments are traded. The main function of an exchange is to ensure that fair and orderly trading can take place, also that there is an efficient dissemination of price information for any buyer/seller on that given exchange. Exchanges give the public, private companies, and other groups a platform in which to buy/sell commodities.

What do Brokers do?

A broker is an individual or firm which acts as a so-called middleman between an Investor/Trader and a securities exchange. Because securities exchanges only accept orders from individuals or firms who are members of that exchange, individual traders and investors need the services of exchange member to trade on that platform. Brokers can provide the service and are compensated through commission, fees or being paid by the exchange themselves.

What is Margin Trading?

Margin trading can be defined as having collateral that an investor must deposit with a broker or an exchange to cover the credit risk the holder possess. An investor can create credit risk if they borrow cash from a broker to buy financial instruments like stocks, borrow financial instruments to sell them short, or enter a derivative contract.

What is the difference between Bid and Offer?

The term bid and ask refers to a two-way quotation that indicates the best potential price at which a security can be sold and bought at a point in time, A bid price represents the maximum price a buyer is willing to pay for a share or stock. The ask price represents the minimum price the seller is willing to take for that same stock or share. A trade can occur when the buyer in the market is willing to pay the best offer available or a seller is willing to sell at the highest bid. The difference in these two prices being known as a spread.

What is the Leverage?

Leverage involves tapping int borrowed capital to bolster the potential return of an investment. Leverage might increase the return for an investor but the downside is should the investment not work it could also increase the potential risk and loss of an investment.

[Jelkucijus]

Hello!
I have a problem signin in brockerage account precisely to Trading view, i get the key to enter but the box in the trading view which give me the option to paste the key don t appear so i can not register to Trading View demo. How and where i can find that box, anytime i want to connect i get the box with login and pass and when i try to put the credentials it start to load and it don t connect me with Trading View. I use opera, maybe i should use google? *

[Flippy]

1. what is a trading exchange

• It is an exchange marketplace where you can buy and sell your asset like bitcoin or any alt coin that is listed in that exchange.

2. what do brokers do?

• A broker is a person or company who acts as a link between an investor and a securities exchange.

3. what is margin trading?

• Margin trading is the process of trading a financial asset with borrowed cash from a broker, which serves as security for the broker’s loan.

4. what is leverage?

• When investing to develop the firm’s asset base and earn returns on risk capital, leverage occurs when borrowed cash is used as a funding source.

[andreicristi]

1. What is a trading exchange?
   Is a market where financial instruments are traded. Gives companies, governments and other entities a platform where they can sell their securities to the investing public.
2. What do brokers do?
   Are sale agents who act on their own or for a brokerage firm. They buy and sell securities base on their clients wishes. They deal with equities, bonds, ETF’s, mutual funds for more sophisticated clients.
3. What is margin trading?
   A trader is using borrowed money from the broker to trade a financial asset and is the difference between the total value of an investment and the loan amount.
4. What is the difference between Bid and Offer (or Bid and Ask)
   The bid price is the maximum price that a buyer is willing to pay for a security, and the ask price is the minimum price that a seller is willing to take for a security.
5. What is the leverage?
   Use of debt to amplify returns from an investment, investors are using leverage to multiply their buying power in a market.

[Sinan_Ya]

What is a trading exchange?
A place where you can buy or sell items/stocks/goods or services.
What do brokers do?
They find for every seller a fitting buyer who wants to buy the items/stocks/goods or services for the wanted price.
What is margin trading?
Trading with borrowed money from a broker
What is the difference between Bid and Offer (or Bid and Ask)
A Bid: The highest price to which someone wants to buy a certain items/stocks/goods or services
An Offer: A lowest price to which someone wants to sell a certain items/stocks/goods or services
What is the leverage?
Trading with borrowed money

[VitoGorbach]

1. What is a trading exchange?
   A platform enabling companies, governments and other groups to sell securities to the investing public.

2. What do brokers do?
   A broker is an individual or firm that acts as an intermediary between an investor and a securities exchange.

3. What is margin trading?
   Margin trading refers to the practice of using borrowed funds from a broker to trade a financial asset, which forms the collateral for the loan from the broker.

4. What is the difference between Bid and Offer (or Bid and Ask)
   The bid price refers to the highest price a buyer will pay for a security.
   The ask price refers to the lowest price a seller will accept for a security.
   The difference between these two prices is known as the spread; the smaller the spread, the greater the liquidity of the given security.

5. What is leverage?
   Leverage is the use of debt to amplify the earnings, it is used to multiply the buying power in the market.

[ryandsy]

1. A trading exchange is a platform or service that essentially matches buyers and sellers of any given asset, be it commodities, bonds, stocks, or currencies (including crypto). In a financial sense, they can also be called market makers - since an exchange provides the “market” for which buyers and sellers can transact.

2. Brokers or brokerages act as third party bridges between buyers and sellers. They can exist within a market, or act as a facilitator between P2P transactions. A key difference between a broker a market is that brokers will actively seek out prices based on their knowledge or their client’s preferences rather than letting the market itself handle price discovery.

3. A margin trade is basically using borrowed money (from an exchange, brokerage, etc) to transact trades. Usually, the leverage provider will ask for a percentage of the total amount to act as collateral, and will also charge interest on the funds that they provide. It is important to note that margin trading amplifies the potential risk and reward for any given trade. Because you essentially are borrowing an asset at a given price and agreeing to later pay it back at that same price, if the market value goes up far beyond this, then you stand a lot to gain, but if the market value falls, then you are stuck having to pay a potentially astronomic price for the underlying devalued asset.

4. A bid is the highest price the market can offer for an underlying asset, or the highest price a buyer is willing to spend to acquire it; while an ask is the lowest price this market or seller is willing to accept for this asset.

5. Leverage is the use of borrowed funds in order to amplify the buying power of a proposed trade. In other words, you will be able to amplify your gains or losses because you are essentially using money that you don’t currently have. A 10x leveraged position means that you are only putting up 10% of a given trade, while the rest is covered by the debtor. For obvious reasons, we can see why this is a huge risk/reward consideration for all traders.

[Devo]

1. What is a trading exchange?
A trading exchange is a marketplace for the trade of securities, commodities, derivatives, and other financial instruments.

2. What do brokers do?
Brokers act as intermediaries between an investor and a securities exchange.

3. What is margin trading?
Margin trading is the practice of using borrowed funds from a broker to trade a financial asset, which forms the collateral for the loan from the broker.

4. What is the difference between Bid and Offer (or Bid and Ask)?
The bid price represents the maximum price that a buyer is willing to pay for a share of stock or other security whilst the ask price represents the minimum price that a seller is willing to take for that same security.

5. What is the leverage?
Leverage refers to the use of debt (borrowed funds) to amplify returns from an investment or project.

[ItsCreyzi56]

1. What is a trading exchange?
   A marketplace where people can use peer to peer exchanging of assets through an intermediary.
2. What do brokers do?
   A broker is somebody that trades in the place of a investor. Usually used to get access to exclusive platforms, that the investor would otherwise not have access to.
3. What is margin trading?
   Trading with borrowed money. The loan amount is considered a margin.
4. What is the difference between Bid and Offer (or Bid and Ask)
   Bid is the highest price that a buyer is willing to pay and ask is the lowest price, that the seller is willing to sell an asset for. The difference is the spread.
5. What is the leverage?
   Leverage is using borrowed money, to increase potential upside, with the risk of getting liquidated completely, when the downside reaches a threshold.