-
A trading exchange is a platform where buyers and sellers can trade financial instruments. They are typically regulated to instill trust with its users.
-
Brokers make trades and investments for individuals that would like to invest and act as an intermediary for individual investors and exchanges.
-
Margin trading is when you used borrowed funds from a broker to trade financial assets.
-
Bid is the highest price someone is willing to pay for something, offer is the lowest price someone is willing to sell something.
-
Leverage is when you used borrowed money to increase the potential return of an investment.
2 Likes
-
What is a trading exchange?
An Exchange is a market place where Securities (e.g. Equities), Commodities (e.g. gold and oil), Derivatives (eeek!) and other financial instruments are traded. -
What do brokers do?
Brokers act as the middle-man between the seller and buyer; specifically they play “match-maker” -
What is margin trading?
Margin trading is when you borrow money to purchase stocks; this can be very risky if you don’t know what you are doing and the trade goes the wrong way on you. -
What is the difference between Bid and Offer (or Bid and Ask)
Bid is is the max amount of money a buyer is willing to put forth for a security; an ask is the min amount of money a seller is willing to accept for said security. The difference between those two amounts is called a “spread.” -
What is the leverage?
Leverage is utilizing debt; i.e. borrowed capital via a loan to generate returns. .
1 Like
1. What is a trading exchange?
Trading exchange is buying and selling assets or other things related to finances.
2. What do brokers do?
Brokers are the people who situate between investors and exchange, help them to do better investment and gain from them.
3. What is margin trading?
There are two types of account, one is a cash account, that means if you have 1000 dollars in cash, so you will have 1000 dollars in buying power. Another is a margin account, in which you do margin trading. For example, you have 1000 dollars, you also can borrow another 1000 dollars from brokers to improve your buying power. But also, you have to afford the risk of losing the money, so that you have to pay back the money to brokers. In short words, margin trading is an investor who uses the margin account to do trade with the borrowed money from the brokers.
4. What is the difference between Bid and Offer (or Bid and Ask)
For example, you have a Rolex watch to sell, you want to find the buyer who can give the highest price, because you want to gain more money, in this case, this is Bid, finding that buyer gives the high price. But you compare a lot of buyers, they want to make more profit, all of them give you the lowest price as they can. This is offered, finding the sellers who will be willing to sell their product at a low price.
5. What is the leverage?
Leverage is more like you use your money a to buy a part of something A, so A:a is the leverage rate, when the price of A goes up, your a also goes up.
1 Like
- What is a trading exchange?
Easily explained, An exchange is a platform that buyers and sellers meet. The playground. You want to buy Bitcoin but don’t know who owns it and want to sell it to you, and the same the other way around. - What do brokers do?
It is like in the real estate markets, the guy/girl or platform that you go to, and they contributing by finding that trading opportunity you want. They find you the buyer/buyers or seller/sellers. - What is margin trading?
“To margin” or “to buy on margin” means to use money borrowed from a broker to purchase securities. - What is the difference between Bid and Offer (or Bid and Ask)
Offers is the price that the seller had put as a selling price, he or she “offers” the Bitcoin for 17700 dollars. And the Bid is the price that the buyer had put as a buying price, “I want to buy a Bitcoin for 17600 dollars”. When this Bid and Offer meets (are in same price), we have a trade, one wants to buy it at that price and one wants to sell it at that price. YEAH! - What is the leverage?
Leverage is like the word describes, it put leverage on the money, such as you had that money 10x or 100x. Leverage results from using borrowed capital as a funding source to increase the potential return of an investment.
1 Like
- Trading exchange is a place where buyers and sellers of one or more commodity agreed to certain measure of price index.
- What Brokers do is connecting buyer and seller in a same market and get compensated upon.
- Margin trading is a practice of calculating the risk management of a loan to an investment and execute whats most profitable at any current moment.
- The difference between Bid and Offer/Ask lies on the representation of maximum or minimum price that someone is willing to agreed in.
- The Leverage is an investment strategy using various instruments to increase the potential return of an investment. Leverage can also refer to the amount of debt a firm uses to finance assets.
1 Like
Hello Lizette,
I am having problems with my demo account in trading view. I am following along in the course, I linked a demo account with FXCM. First trade we are looking at is the long/short tool. When I try to “create a new order”, I get an error message:
Non-tradable symbol
Symbol FX: BTCUSD Cannot be traded through FXCM
So, I am stuck and cannot continue with the course.
Thanks,
Julie
- A place where owners of assets can swap them for other assets, based on a set of rules, provided by the owner of the exchange.
- They are the link between buyers and sellers.
- Trading with X times bigger amount than the one you actually have by borrowing from the broker.
- Bid is the maximum value that any buyer is ready to give for an asset. Offer is the minimum value that any seller is ready to give the asset for.
- Leverage is the use of assets/funds that are not really yours in order to have bigger gains from a trade. However it also leads to bigger loses if the deal ends up unprofitable and also since you’re using someone else’s money => there is preset liquidation price, similar to stop-loss, at which your deal is executed without your approval.
1 Like
1.- It 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. Exchanges give companies, governments, and other groups a platform from which to sell securities to the investing public.
2.- Bokers act as intermediaries between an investor 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 members. Brokers provide that service and are compensated in various ways, either through commissions, fees or through being paid by the exchange itself.
3.- Margin trading is a method of trading assets using funds provided by a third party. When compared to regular trading accounts, margin accounts allow traders to access greater sums of capital, allowing them to leverage their positions. Essentially, margin trading amplifies trading results so that traders are able to realize larger profits on successful trades. This ability to expand trading results makes margin trading especially popular in low-volatility markets, particularly the international Forex market. Still, margin trading is also used in stock, commodity, and cryptocurrency markets.
4.- 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. The bid price represents the maximum price that a buyer is willing to pay for a share of stock or other security. The ask price represents the minimum price that a seller is willing to take for that same security. A trade or transaction occurs after the buyer and seller agree on a price for the security which is no higher than the bid and no lower than the ask.
5.- Leverage involves borrowing a certain amount of the money needed to invest in something. In the case of forex, money is usually borrowed from a broker. Forex trading does offer high leverage in the sense that for an initial margin requirement, a trader can build up—and control—a huge amount of money.
1 Like
-
An exchange is a marketplace where securities, commodities, derivatives and other financial instruments are traded.
-
A broker is an individual or firm that acts as an intermediary between an investor and an exchange.
-
So margin trading refers to the process whereby individual investors buy more stocks than they can afford to. Margin trading also refers to intraday trading.
-
The bid price refers to the highest price a buyer will pay for an asset. The ask price refers to the lowest price a seller will accept for an asset. The difference between these two prices is known as the spread; the smaller the spread, the greater the liquidity of the given asset/security.
-
Leverage is an investment strategy of using borrowed money—specifically, the use of various financial instruments or borrowed capital—to increase the potential return of an investment.
1 Like
- What is a trading exchange? A place where stocks, bonds, commodities, securities, and even cryptocurrencies are bought and sold.
- What do brokers do? They manage and or execute investments for the customers and charge fees and commissions for doing so.
- What is margin trading? In a margin account, a trader can buy more than he has in the account and can significantly increase gains or losses. This is risky as the cost may be significant to the trader with losses.
- What is the difference between Bid and Offer (or Bid and Ask)? Bid price is the highest price the buyer is willing to pay and the ask or (offer) price is the lowest price the seller is willing to take. The term bid and ask refers to a 2-way price quotation at any point in time.
- What is the leverage? Leverage results from using borrowed capital to fund investments in order to increase potential returns and expand assets.
1 Like
What is a trading exchange?
An exchange, bourse, trading exchange or trading venue is an organized market where tradable securities, commodities, foreign exchange, futures, and options contracts are sold and bought.
What do brokers do?
A broker is an individual or firm that acts as an intermediary between an investor and a securities exchange.
What is margin trading?
In the stock market, margin trading refers to the process whereby individual investors buy more stocks than they can afford.
What is the difference between Bid and Offer (or Bid and Ask)
Bid-Ask Spread is typically the difference between ask (offer/sell) price and bid (purchase/buy) price of a security. Ask price is the value point at which the seller is ready to sell and bid price is the point at which a buyer is ready to buy.
What is the leverage?
Leverage results from using borrowed capital as a funding source when investing to expand the firm’s asset base and generate returns on risk capital.
1 Like
1. What is a trading exchange?
A trading exchange is a place where people can buy or sell assets.
2. What do brokers do?
A third-party that helps people buy and sell their assets. They can also provide assets if the assets isn't there a party willing to sell their assets.
3. What is margin trading?
Margin is money that is borrowed from brokerage firm to purchase an investment.
Margin trading is when an individual investors buy more stocks than they can afford to. Third party will provide these investor money.
For example, I have $1000 and I borrow $1000 from third party to invest $2000 in ETH.
https://www.investopedia.com/terms/m/margin.asp
4. What is the difference between Bid and Offer (or Bid and Ask)
Bid is when the price selected by a buyer to buy a stock.
Offer is the price at which the seller is offering to sell the stock
5. What is the leverage?
Leverage is the use of borrowed funds to increase a person’s trading position beyond what would be available from their cash balance alone.
2 Likes
-
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. Exchanges give companies, governments, and other groups a platform from which to sell securities to the investing public. -
What do brokers do?
A broker is an individual or firm that acts as an intermediary between an investor and a securities exchange. -
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. -
What is the difference between Bid and Offer (or Bid and Ask)
Bid-Ask Spread is typically the difference between ask (offer/sell) price and bid (purchase/buy) price of a security. -
What is the leverage?
Leverage is an investment strategy of using borrowed money—specifically, the use of various financial instruments or borrowed capital—to increase the potential return of an investment.
2 Likes
-
What is a trading exchange?
It is where buyers and sellers have transactions to sell and buy a particular assest. -
What do brokers do?
They help facilitate the transaction between buyers and sellers by connecting them together. -
What is margin trading?
Margin trading is where an individual uses borrowed capital to trade an asset. -
What is the difference between Bid and Offer (or Bid and Ask)
Bid represents the maximum price that a seller is willing to take while an ask is the minimum price that a seller is willing to transact. -
What is the leverage?
Leverage is when someone uses borrowed funds to increase their position of a particular asset. Leverage uses debt to increase returns from an investment.
2 Likes
- What is a trading exchange?
Where buyers and sellers meet to buy or sell assets - What do brokers do?
provide a plattform for buyers and sellers connecting them together - What is margin trading?
you borrow money froma broker to buy assets.so the broker act as a lender and your securities in your account act as a collateral - What is the difference between Bid and Offer (or Bid and Ask)
Bid --> Price of a buyer to buy an asset
Ask --> Price of a seller to sell an asset - What is the leverage?
strategy of using borrowed money to increase the potential return
1 Like
Hi Julie,
Sorry to hear that you got stuck, let’s see if I can help you get back on track.
If you are receiving the error that it’s a non-tradeable symbol, then it’s possible that the market you have selected is not an FXCM market, but possibly a market listed by a different broker.
If you click anywhere on your chart, then type for example “BTCUSD”, it should bring up the search and give you a list of options. You want the one that says FXCM:
However, if you’re certain you’ve selected an FXCM market, but it’s still not working then it’s possible that FXCM are not allowing trade from your country of residence. In that case I have a homework assignment for you: try to create a demo account with Gemini or one of the other available brokers in the list and attempt to make trades with those. Most often the website for the broker will tell you which countries it does/does not accept.
I hope that solves your issue and hope you enjoy the rest of the course.
1 Like
Thanks, I did create a demo account with Paper Trading. I enjoyed the course and learned a lot. Currently, I’m more of a HODLer than a trader, so I’m still not fully understanding when to use the stop loss trading function. Is this used only for quick trades, as you mentioned in the course i.e. one day or maybe two. If you are holding it for longer, would you still use this feature? Any suggestions on how I could teach myself how to be more knowledgeable and confident with this risk management feature? Thanks
1 Like
Great to hear!
Good question, I had to consider it a little bit. The answer depends on whether you are an investor or a margin trader.
Generally, if you connect a real-money brokerage account to tradingview, you are connecting to a derivatives account and this means you are more like to be a margin trader. An investor would only be using tradingview for the technical analysis to identify a good time to buy the cryptocurrency. They would then complete the transaction on coinbase, or whichever exchange you want to use to buy the actual coins/tokens. A margin trader doesn’t own the physical coins/tokens. So here’s my thinking on the two routes:
Buying the physical coins/tokens as an Investor
If you are an investor, you are probably just looking to buy the coins/tokens and then hodl them. If that’s the case, you would not need to use a margin account to complete your transaction and you would not be using leverage. So, as investor you probably wouldn’t be using tradingview to buy the cryptocurrency and therefore you probably wouldn’t need to use a stop loss.
Margin Trader
Trading cryptocurrency with a margin account is different to being an investor because you are using leverage and you don’t physically own the tokens/coins. A stop loss order helps to protect a margin trader from going broke (or losing too much of their capital) if the trade goes the wrong way - and the market can easily move against a trader. Small fluctuations in market price can have a huge impact on margin account.
If you are buying cryptocurrency using a margin account - with leverage, then you should always use a stop loss order, or you risk being liquidated on corrective move.
So if you connect to a real, live, trading account with tradingview and open trades, it generally means you’re connecting to a broker with a margin account and that means you’re using leverage. Therefore, yes, a stop loss order should be used, regardless of the timescale you have in mind for the trade.
So for me, it depends on which category you fall into.
As for learning more about teaching yourself to be more knowledgeable with risk management, I recommend you practice paper trading and setting yourself some challenges. Open some trades by sticking to some rules, for example:
1 - Never have more than three trades open at one time
2 - Never risk more than 5% of your account on a trade
For manually calculating 2, you need to know what the cost to your account would be if you the market hit your stop loss. In trading view they have a nice ‘percentage function’ that allows you to type in 5% and it will work out where your stop loss order should go.
I hope that helps
1 Like
What is a trading exchange?
It is a stock exchange, securities exchange, or bourse where stockbrokers and traders can buy and sell securities, such as shares of stock, bonds, and other financial instruments. … Trade on an exchange is restricted to brokers who are members of the exchange.
What do brokers do?
A business broker is someone who sells businesses. Broker, by definition, is someone who buys and sells assets or goods on behalf of others.
What is margin trading?
It is a facility under which you buy stocks that you can’t afford. You are allowed to buy stocks by paying a marginal amount of the actual value. Margin trading can be considered leveraging positions in the market either with cash or security by investors.
What is the difference between Bid and Offer (or Bid and Ask)
A Bid is the price selected by a buyer to buy, while the Offer is the price at which the seller is offering to sell.
What is the leverage?
Leverage is an investment strategy of using borrowed money—specifically, the use of various financial instruments or borrowed capital—to increase the potential return of an investment. Leverage can also refer to the amount of debt a firm uses to finance assets.
Please find by yourself answers to these questions: (Use whatever means suit you best like Google, Investopedia, YouTube, etc.)
These Answer were from google:
- What is a trading exchange?
An exchange is a marketplace where securities, commodities, derivatives and other financial instruments like crypto currencies 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 .
- What do brokers do?
A cryptocurrency broker offers derivatives products to traders, where traders enter contracts to speculate on the price of cryptocurrency assets. Cryptocurrency derivatives include crypto options, crypto futures, and crypto CFDs.
- What is margin trading?
A margin account allows a trader to borrow funds from a broker, and not need to put up the entire value of a trade . A margin account typically allows a trader to trade other financial products, such as futures and options (if approved and available with that broker), as well as stocks.
- 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.
- What is the leverage?
Leverage is the use of borrowed money (called capital) to invest in a currency, stock, or security. … By borrowing money from a broker, investors can trade larger positions in a currency. As a result, leverage magnifies the returns from favorable movements in a currency’s exchange rate.