Crypto Academy Week 10 - Homework Post for [@kouba01] Season 2: Week2 | Cryptocurrency Contracts For Difference (CFDs) by @oscarcc89

oscarcc89 (71)in SteemitCryptoAcademy • 3 years ago

^{Logo eToro}

What is a cryptocurrency CFD?

The CFD is a contract for difference where users can benefit from the shares and/or indices to be used. Investing through CFDs carries a higher risk; Where you can win a lot and you can also lose.

When you buy the underlying asset and wait in the long-term stocks, then you are buying the real asset, which would be the underlying asset. Therefore it would not be a CFD action.

How do I know if cryptocurrency CFDs are right for my trading strategy?

When we trade down or short, the loss is limited and the loss itself is unlimited. To operate short is to operate with CFDs, since it is operated with a contract for difference.

Are CFDs risky financial products?

The risk involved in any investment, where with CFDs you can operate with more leverage, being advantageous when you have little capital. When you have a higher leverage, you can reach more units or shares without owning shares. You do not need a high capital to invest. The leverages imply greater risks and the more leverage the more risky the investment will be.

^{Source - Freepik}

Do all brokers offer cryptocurrency CFDs?

Not all brokers offer CFDs on cryptocurrencies, in fact, I signed up with a couple of CFD brokers but they did not have the contract for cryptocurrency difference. But there are several that do, such as XTB, Plus500 and eToro that below I will explain how to make a trade on that platform.

Explain how you can trade crypto CFDs on one of the brokers.

As I stated earlier, I will use eToro's cryptocurrency CFD for this example. I will use a Demo account for this exercise. DEMO accounts are recommended for beginners or simply to practice a strategy and gain experience in this area. This works exactly the same as the real platform, only here they give a certain amount of play money to get you started in understanding how the platform works.

Below is the registration and operation process:

Step 1: Enter the eToro website: https://www.etoro.com/
Step 2: Click on JOIN NOW.
Step 3: Fill in the registration fields by entering your USERNAME, EMAIL and PASSWORD.

or if you prefer you can log in with your Google or Facebook account.

Step 4: When you load the system you can see the Dashboard of your account and start trading. On the left side you will see the main menu. By clicking REAL you can switch from a real portfolio to a fictitious virtual portfolio. I will change it to a virtual account to do the operation.

If you continue with a REAL account you can deposit funds by clicking on the blue button at the bottom left DEPOSIT FOUNDS. A small window will open where you will be asked for the bank details for the payment.

Step 5: Next we click on the 'Filter' icon and select Crypto. All cryptocurrencies available in this CFD will be displayed.
Step 6: Click on the crypto of your choice or the one you want to do the operation on.
Step 7: Click TRADE to begin. Then a window will open where you will be asked for the amount you want to buy. I will invest $5,000.

Step 8: Then you can click CHART and see the chart of the crypto. The investment you made is also shown, if it is in red losses and if it is in green gains.

In this way we finalize our demonstration of a Trade operation on eToro. I really liked its user interface, simple and efficient, I think it is one of the main advantages.

Conclution

There are many brokers, but each user or investor chooses the one that best serves them, positioning themselves according to their own investor profile, their objective, how they want to invest and under which regulations they want to be.

Investments must be taken with care because they are talking about money, they must be serious due to variable income, as you can win, you are also exposed to lose.

Thanks for joining me in this trade!

#kouba-s2week2 #cryptoacademy #steemexclusive #cryptos #trading #cfd

3 years ago in SteemitCryptoAcademy by oscarcc89 (71)

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kouba01 (79)modProfessor 3 years ago (edited)

Hello @oscarcc89,
Thank you for participating in the 2nd Week Crypto Course in its second season and for your efforts to complete the suggested tasks, you deserve a 5/10 rating, according to the following scale:

Originality	Compliance with topic	Consistency of method	Quality of analysis	Clarity of structure & language
(1/2)	(1/2)	(1/2)	(0/2)	(2/2)

My review :

The answers to the three questions were not clear and direct, you may not fully understand the statements. Try to analyze your thoughts further so that the purpose of your essay becomes clear. But it is still generally acceptable work.

Thanks again for your effort, and we look forward to reading your next work.
Sincerely,@kouba01

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steem-seven (66) 3 years ago

Congratulations !

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