STEEMITACADEMY HOMEWORK S2-WEEK2// CRYPTO CFDs//24/4/2021//#CRYPTOACADEMY// #KOUBA S2-WEEK2

in #cryptoacademy3 years ago

CRYPTO CFD TRADING.
What is CFd trading? CFD as used in financial setting simply means a contract for difference. It means that there is a contract or agreement between a broker and a trader over an asset, it could be stocks, currency, commodity etc. The trader would have to speculate or predict the movement of the price of the said asset within a stipulated time of the contract. If the price moves according to his prediction the broker pays him the agreed contract amount, but when the movement of the price goes against what he predicted he looses his staked money to the broker.
To illustrate;
IMG_20210424_094713.jpg
Let's take steem coin as a case study, let's say a price of a steem coin is $50 usd as at 4pm today, and I have taken a position to predict that in next 5 minutes ( which is the agreed time of the contract) that the price of steem will increase; and let's say I staked with $10 and the price of steem increased just by any fraction, I have won and I will be paid by the broker the agreed percentage stipulated in the contract. Suppose the price of steem drop just by any fraction below 50usd, I loosed and my staked $10 usd will be taken by the broker. So in cfd trading one makes money by predicting the difference in the movement of price of the asset, if the prediction is correct, then he smiles as a winner but when the opposite is the case, he looses.

IS CFD A GOOD OPTION FOR ME?
That question can only be answered by an individual trader after taking into consideration his trading strategy.
For instance, if i happen to be a day trader , I don't intend holding a position for long; I just want to benefit from small variance in time within a day. Then CFD is a good option.
I will make profit by conducting what is called market analysis. There are two types of this kind of analysis.
1:technical analysis- Traders analyse what has happened in the past and use it to predict what could happen in the future. They make use of charts, price based indicators to read their market and then make decisions.
2: fundamental analysis. Doing fundamental analysis traders analyse if an asset has been overbought or oversold. When an asset is overbought, it is believed that people would want to sell and therefore the price might drop. When an asset is oversold, the price must have dropped and therefore might begin to rise.

IS CFDs RISKY FINANCIAL PRODUCTS?
The answer is a definite yes! Despite how good one could analyse an asset, one must understand that the market is highly volatile and may pose a great risk of one losing his entire money. Nobody despite how visionary, can accurately predict the future.
To trade successfully in CFDs requires that one need to handle his emotions. If we become emotional, we are headed for disaster. One need to know when to start and when to exit the platform; also how much profit is due for a day and how much loss to endure. Let's just say that I made three or five wrong predictions and I become emotional, trying to get back what I have lost, this might simply result in me blowing up my account. A person who trades CFDs needs great decipline.

DO ALL BROKERS OFFER CRYTOCURRENCY TRADING?
The answer is no. Check the broker to see their services. Also beware of scam brokers. Doing some back checks before making an investment is ideal.
Ensure too that you have practiced with the demo account and mastered the platform before investing your money.

One broker to trade crypto CFD is iqoption.
Iqoption offers a lot of asset trading including currency pairs, cryto pairs, commodities, stocks etc. To register and trade with demo account simply visit the website.
Click on the sign up botton, you will see a space to fill your personal details. A confirmation code will be sent to your mail, click on it to confirm your email, then you are good to go.
Iqoption is better when you download their app. You can get the app on google playstore, install and enjoy.
TRADING WITH IQOPTION DEMO
Once you have opened the app, you can choose from the number of items to trade. Since our lesson is on crypto, we want to go to cryto.

IMG_20210424_140525.jpg
The + sign on top shows where to choose our asset. By the right you will see a buy option with green background, selecting it you are predicting that the price will go higher. Under the buy option is a lower or sell option. Selecting it you are predicting that the price will go lower.
Conclusion:
Trading CFDs may hold promise of a high return. At the same time it is also high risk investment. Following the suggestions above may lead to profitable trade.

@kouba01

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Please @kouba01 take a look at my homework

This is five days, no responce
#cryptoacademy, #koubas2-week2, @kouba01

What is the benefit if asking us to do homework task that would never ve looked at... A total waste of effort. #cryptoacademy, @kouba01

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