The collective opinion of investors all around the world is that a diverse investment portfolio is better than a linear one. Diversification is perceived as easy and straightforward by many investors, but truth be told, there is plenty of misleading information out there that might damage numerous of investment portfolios. Of course, you can’t “put all your eggs in one basket” but this is wrongly interpreted by investors. Below we have some additional information that will certainly come in handy when it comes to building a strong and resilient portfolio.

Different Types of Risks Lowe Portfolio Vulnerability

When investing, venture capitalists face two main types of vulnerabilities: undiversifiable and diversifiable.

• Non-diversifiable risks are those that are associated with all companies and all investors. These are commonly known as market risks or systematic risks. In this category fall inflation rates, exchange rates, war, political instability and interest rates. These are things that cannot be changed by the investor themselves and should be accepted as they are.
• Diversifiable risks are also known as unsystematic risks and these don’t depend on political or economic instability. They can be influenced and minimized through diversification and they are specific to companies, markets and industry.

Why Should You Start Diversifying Your Portfolio?

Let’s take a hypothetical situation where an investor only has airline stock investments in their portfolio. The pilots and staff of said airline announce that they will be on an indefinite strike and all stock prices are dropping. Your portfolio will lose its value in an instant.

But if you also have stocks in other industries, let’s say railway stocks, only one part of your investments will suffer. But experts recommend not to stop your diversification at two types of stocks. In case of war or economic instability, both airline and railway stocks might suffer. Diversify your investment portfolio furthermore to gain resilience in face of unfortunate economic or social disasters. From different companies to different industries, investors should seek new diversification opportunities to gain uncorrelated stocks.

Asset class diversification is also important. Different asset classes react differently to various market events. This type of diversification will keep investors protected against market swings. As a general rule, equity markets and bonds move in opposite directions. So, if unfortunate events emerge in one asset class, the other will experience growth and a positive trend.

Experienced investors can try to diversify their portfolio with synthetic investment products. However, these are complex and require plenty of experience. Small investors and beginners should avoid such investments due to their difficulty level.

How to Find the Finances for Portfolio Diversification?

Diversifying your portfolio means more money invested in different types of assets. If you’re unwilling to swap one asset for another, you can find various types of loans that will offer you just enough financial means for your future investments. Business loans seem to be the most desired when it comes to reliable and accessible financing options for most investors (Source: Nocredit.se). When investors want to reach new diversification rates in their portfolios, these types of loans are the first on investors’ list.

How to Diversify Your Investment Portfolio

To diversify your investment portfolio, it’s mandatory to consider different asset classes. This depends, however, on your capital and risk tolerance.

• Stocks are the most common investment option but they also are the most volatile asset class. Instead of investing in stock in a single enterprise, it’s advisable to invest in different enterprises in different industries. Diversity can be achieved easily when it comes to these types of assets, but it’s important not to limit your portfolio at these.
• Real Estate is another asset in which you want to invest for a diversified portfolio. The real estate market and stock market influence each other (see the 2008 recession) but don’t show such a close relationship. When stocks or bonds drop, there is a long interval necessary for real estate to follow. But also, when stock rates experience a positive trend, the housing market needs a while to improve and also follow. When it comes to real estate assets, it’s important to remember that location-specific factors play a huge role in prices to boom or plummet. In this case, you should think of these factors as independent ones from the overall economic context. Expensive markets, for instance, tend to perform better than stock markets in many circumstances.
• Bonds are yet another great type of asset for investors looking forward to diversifying their portfolios. Bonds are issued by government and corporations when they look forward to raising money. Investors can lend money to the government or a company that needs money. The loan is issued for a fixed amount of time and it is also charging interests (variable or fixed). Of course, the borrower will have to repay the entire amount borrowed and interest as well when the bond expires. While this isn’t a permanent type of investment, it’s a great opportunity to diversify one’s portfolio. They perform opposite to stocks in face of various market events, which makes them perfect. Plus, in this case, portfolios are not exposed to market volatility. The amount borrowed will be recovered by its maturity date. Bonds are a great way to counterbalance market volatility and are more stable than stocks and real estate investments are. While the returns are certainly less generous than in other assets’ case, they are a secure investment for sure.

Other Reliable Ways to Diversify a Portfolio

While the options presented above surely are great tools to diversify an investment portfolio, there are other reliable ways to do so. For instance, you can invest in whatever type of asset you think that will accumulate value over time. Vintage cars, art and jewelry are only some of the asset classes that investors believer that will preserve if not boost their value over time. Low-risk short-term investments are other solutions when it comes to portfolio diversification. You could invest in foreign and domestic stocks at the same time to minimize your portfolio’s volatility in face of certain politic and economic events.

If you try to fly too fast in the trading business of Forex, there will not be a good performance. This is because the volatility in this market is very high compared to any kind of financial markets. The traders will have to maintain their performance to the most efficient level possible. As there can be a change in price trends at any particular moment, your trading process must be protective. Even the change can come at the time when there is trade running. For this kind of situations, the traders will have to design their business to handle the trades. There are some tools known as stop-loss and take-profit. They are very good with proper closing of the trades with a limit set based on pips. Traders will have to set them based on their profit targets. Like those, there will be a lot of good trading system in this business. All you will need to do is concentrate on the effective trading process. For that, traders will definitely have to remain down to earth.

Focus on your money management skills

Forex market does not need any kind of clever traders to make money from it. That does not mean that you can be overconfident about a proper performance. It is very hard for making a good trade and manage a proper risk to reward ratio. For that, the traders will have to learn about proper position sizing of the trades. Most importantly, proper market analysis needed for finding the right signals. Even the closing of the trades will have to get some protections. The tools we mentioned in the introduction are known as stop-loss and take-profit and will help trades with that. For all of these, the traders will have to select the right profit margin targets, first. It is like the traders are going to think about a decent risk to profit margins even before opening a trade. This system helps traders to maintain a consistent performance in the business.

Learn from the experienced traders

Being new to the retail trading industry, you have a lot to learn from the experienced trader. If you start using the copy trading mt4 service, you will understand how the pro-Aussie traders are making a consistent profit. Try to analyze their trades and develop a unique trading system. Use the demo account offered by Rakuten broker and build your confidence. Always remember, trading is nothing but a business where knowledge is the most powerful ingredient needed for you to become a successful trader.

Start your career in the demo trading account

Now all of the novice traders may have a basic idea of proper management of trades. But it is not so easy to learn about all of the process and strategies. If you think about learning them in the live trading account, there will be losses. This is because improper planning will make you lose the trades. From there, the traders will have the chances of refining their edge. From time to time, traders can reach a superior level of trading. But that must not make you lose a lot of money from the account. For that, the traders will have to select the demo trading process to learn about things. It is a system in which traders will not have to worry about losing their money. Because the investment in this sector of currency trading is fake. So, the losses will not affect the trader’s performance. You can learn about every single necessary process very easily and properly.

Learn properly about the right risk management

One thing has been forgotten in this article which is necessary for a better performance. We are talking about risk management. It is necessary for the traders to remain consistent in the performance for a trade. Basically, it reduces the tension of losing capital from the trades. You must maintain it all the time.

We are actually talking about the proper risk to profit margin ration. It is the one which is used for analyzing the trades. On one side, you will see the risk and the other side will define your return from the trades. That can be good for the traders to maintain some proper income. There can be another use of that feature. The trading system can get help from the right ratio. You will just have to target the amount of profit and fix the risk per trade for that. Basically, all of the traders will have to be with their own version of the risk to profit margin. As the volatile markets will not let anyone know about any certain signal, there will have to be some proper strategy which depends on the target. The traders will have to use that in the business of Forex for some proper income from it. In this article, we are going to talk about the proper working process on the basis of your own risk to profit margin ratio.

You can fulfill your targets from long term trades

The traders must know that way to maintain their business so that the proper income is possible. All of the traders will have to do the right things with their trades. If there is no good performance available for the traders, no income will come. But the marketplace will be a sweetheart for the traders to not let them lose money if the system is right. Or even a decent trading edge will have a proper income from the business. All you will have to do is choose the right timeframe for trading with. The bigger you can think of the timeframe, the proper it will be for good income. From the methods of trading into currency markets, the swing trading and the position trading process will be very good for the traders. They will help the traders to work with key swings in the process of the market analysis. Proper pips are also available on big time trades.

Avoid using indicators and EAs

Those who are relatively new to the investment industry might think the successful traders in Hong Kong are using an automated trading system. But in reality indicators and EAs has no place in the Forex market. You need to analyze the market sentiment to find profitable trades in favor of the market trend. Start working hard so that you can easily develop a balanced way to place trades with low-risk exposure.

The right position sizing will require proper targets

If you will not be able to make proper trades with right position sizing, the system will not let your money. This is because the trading business in Forex is all about managing the right signals for trades. Even when there is a huge lot for trading with, the volatility will not let the trades to bring back some proper income for you. In fact, the proper risk management will fail to make you right for trading and doing the right kind of performance for the income. That is why the traders will have to think about the right profit targets and work with it for proper position sizing. When there will be proper ones for your trades, there will be good income to make your smile for the business.

Risks management is a must for any kind of trader

Without the proper position sizing of the trades, there will have to be right risk management. Because the system will not let the traders be humble in the process. If you have tensions about losing your investment or random planning will come to you like overtrading or micromanagement. The right trading process will go in hell and take the trading account with it. So make the right choice for your money management plans and reduce the chance and tensions caused by the possibility of losing your capital.

If you are still new to cryptocurrencies, it can be difficult to tell the difference between the different coins out there. But once you start digging in, you’ll start realizing how different cryptocurrencies can be in their implementation and objectives. Two of the most well-known cryptocurrencies are Bitcoin and Ethereum. And while both do share some similarities, they are also vastly different at their core. Let’s take a look at both cryptocurrencies, what differentiates them, and some predictions for the future.

What Bitcoin Is

Bitcoin was created to provide people with an alternative to fiat currency and the banking system. It uses cryptography and a new technology known as the blockchain to authenticate transactions. The blockchain is a system of distributed ledgers that broadcast transactions in real time to independent miners who have to solve complex logarithmic equations in order to provide “blocks” where authenticated transactions will be stored and strung together in chronological order. This allows everyone in the network to access a record of every transaction made on the blockchain, which makes it more secure and less prone to tampering.

What Ethereum Is

While Ethereum also uses the blockchain, this is pretty much where all similarities stop. Contrary to Bitcoin, Ethereum, or should we say Ether, was not created solely to make transactions. Ethereum is a sort of decentralized, blockchain-based operating system with its own coding language allowing developers to create decentralized apps and borrow the Ethereum network. Ether is supposed to be used as “fuel” to power these applications. While Ether is sold on the open market and is subject to speculation, its ultimate goal is to supply developers with an established network where they can build smart contracts, monetize work, and even launch their own cryptocurrencies.

What Does the Future Hold for Ethereum?

One of the main issues that have been raised with Ethereum was its scalability. And some of these issues were exposed when one of the first massively popular dapps, crypto kitties, nearly crashed the network when it was launched. In the beginning, the relatively small number of transactions the Ethereum network could handle wasn’t a problem, but now that it’s become popular, it is probably its biggest problem.

The future of Ethereum will largely depend on how they tackle these issues. One of the solutions proposed was sharding, which allows them to compress larger blocks and make them easier to process and store. Vitalik Buterin, Ethereum’s founder, also launched plasma protocol in order to simplify transactions and reduce the amount of unnecessary data being processed by adding a second layer to their blockchain.

But even with all its problems, many observers are still bullish about Ethereum, and people like Nigel Green of the Devere Group predicted that the value of Ether could hit the $2,500 by the end of the year. Those who wish to invest in Ethereum, however, should focus on getting the latest crypto news from reputable sources and take any predictions with a grain of salt.

What About Bitcoin?

Bitcoin also has to deal with scalability issues. As more people use the coin, more and more people have to wait in line for miners to authenticate their transactions. This not only slows down transaction speeds, but users now have to pay more to move in front of the line and get their transactions authenticated faster.

Many solutions have been proposed to deal with the issue, with the most popular being the lightning network. The lightning network is a separate network that allows people to conduct a number of off-chain transactions by opening payment channels between parties. This would put less of a strain on the network and allow it to run more smoothly.

As far as prices go, it’s really difficult to know which way Bitcoin will go in 2019. Most conservative forecasts predict that it should reach the $4,000 and gain more traction by the end of the year as ETFs and more regulation is being introduced. How high Bitcoin will go will also depend on how successful the lightning network is and if we start seeing more adoption from retailers. Transaction volume will also have to go up.

Conclusion

Bitcoin and Ethereum are two completely different projects and before you invest, it would be wise to do your homework and learn everything there is to know about them. Stay informed and only get your information from verifiable sources. Also, don’t be afraid to look at other cryptocurrencies and see what they have to offer as well.

If you have considered web hosting as a way of making money, you are not alone. In addition to some of the big names in web hosting out there, there are a seemingly endless list of smaller web hosting companies that are trying to make a dollar. As of January 1, 2018, there were more than 1.8 billion websites. Whether these websites get one visitor or they get tens of thousands of visitors every single month, they all need web hosting. This means that there is a lot of business to go around.

Is There Money to Be Made As a Web Host?

The short answer is yes. If there was not, then people would not be in the business. Sure, there are some companies that offer free hosting. However, that rarely works out for the companies that put their sites on these servers. They usually end up moving back to a paid host. And it’s always good to remember that with anything on the Internet that’s free, if you are not paying for it, it’s likely that you are actually the product that’s being sold.

In order to make money as a web host, you need is to find a hosting service that is affordable and then resell it at a slightly higher price. As long as you have large enough servers and you have a sufficient amount of bandwidth, you will be able to divide up your server and sell it for a monthly fee. This is an awesome way for you to make money, it’s a great way to gain client loyalty, and you can attract other people who may be interested in purchasing the services and products you have for sale.

Should You Purchase from a Reseller?

Maybe. If you do, we recommend using extreme caution. It is good to do your due diligence and learn as much as you can about hosting companies before spending your money and entrusting your business to them.

You want a reseller that has a variety of price brackets. There should be an uptime guarantee, and the reviews of the company should be stellar. The more automation the hosting company has, for example, when signing up new clients, the more reputable they likely are. Be sure that you do not get pulled in by a cheap price, because you will likely get quality that’s equivalent to what you pay.

Is Web Hosting Lucrative for Big Companies?

Again, the answer is yes, but there are some factors to consider. A hosting company is just like any other company. They determine how many people they can hire, how much marketing they can do, how much new hardware they can purchase, etc. based on their gross profit. For the majority of the bigger hosting companies, 30 percent of their gross profit is dedicated to their servers. That only leaves them with $.70 on the dollar to cover the rest of their expenses.

Some of the more established hosting companies do not need to worry as much about marketing because their names are synonymous with web hosting. Newer companies that are trying to make a name or existing companies that are looking to expand their client base could dedicate up to 10 percent of their gross income to marketing. Now, they are down to $.60 on the dollar that they can use to pay salaries and cover other expenses.

There are a number of web hosting companies that offer their service for around $10 a month or about $120 every year. They attract people to their service by offering 24 hour seven day a week support, along with other goodies. They are able to do this because they are betting that their servers are good enough that their clients are not going to require a lot of support.

Just think, call centers, like the ones you use for your cell phone, your insurance company, or maintenance on products you purchase, can pay their support team members under $40,000 a year. It’s because, in most cases, providing support does not require a software engineer. However, hosting services need system administrators who could cost in excess of $100,000 each year plus any benefits that are offered. By charging $10 a month or $120 a year, a hosting company can only hire one software engineer for every 1,400 customers.

This does not even take into consideration all of the other expenses a large hosting company is going to have, including staff, rent, etc. Hosting services that offer their product for $20 a month or $50 a month have a better margin, but still they need a lot of customers in order to cover their expenses.

Regional Differences Comparing US and Canadian Hosting

National dynamics also influence how web hosting revenue is generated. Take a country like the US where the web hosting industry is a mature and extremely profitable business sector. In the early days of US web hosting small resellers morphed into larger hosting companies and bootstrapped revenue, we are now seeing this with a lot of Canadian web hosts. However, in the US market dynamics have evolved to the point where larger conglomerates like EIG (Endurance International Group) have a massive share of the US web hosting market.

How the Economics of Web Hosting Impact Clients

Let’s say that a hosting company offers their clients virtually everything for $10 a month. They know that of the 1.8 billion websites that are on the Internet right now the vast majority of them get little movement. So what their hope is is that the majority of their clients use little to no bandwidth. Successful websites that do use a lot of bandwidth get throttled by the hosting service, they become unhappy with their slowed down service, and so they leave and choose another company or purchase a more expensive plan. Then the hosting service is able to replace those high-bandwidth clients with clients that have little to no bandwidth.

When you understand the economics of web hosting, you to see why it’s not in your best interests to purchase the cheapest hosting out there. Of course, not everyone can afford to pay hundreds of dollars a month for web hosting. However, if you’re only going to spend $10 a month, realize that the support you get will really only be the bare minimum, you’re going to be sharing your server with a lot of other sites, and if your site become successful, you can expect it to be throttled and will eventually need to find another hosting company.

Are you interested in becoming a web hosting reseller? Do you have additional insight on the economics of web hosting? If so, tell us about it in the comments section below.

Recently cryptocurrency trading has taken the market by storm but even seasoned investors have found it difficult to trade in crypto. Trading in cryptocurrency is proving beneficial but not everybody is well equipped to make a profit out of it. There are numerous tokens to choose from and various exchange markets on which to trade.

Cryptocurrency has had a fair amount of criticism since its invention. Despite that it has seen a rapid surge in the market and is being widely used as an acceptable digital currency. Economic experts have predicted a bright future for Bitcoin in particular and it is being said that it might revolutionize the way financial transactions happen all over the world.

Here we enumerate the most fundamental guidelines that an interested investor should follow.

Do your due diligence before diving in

The most basic thing you should keep in mind before investing into crypto trading is to do intensive research so that you have a thorough understanding of the market. There is a lot of information such as crypto-figures, and technical terms which are all too much to process.

Hence research becomes very important, there is a lot of information available on the internet so you can do research from the comfort of your home also. Bitcoin is the only crypto that is widely popular but there are a lot of other cryptocurrencies that are doing well in the market. So if you know the market very well beforehand then you can make smart investments.

Be very cautious about whose advice you take.

The upsurge in the use of cryptocurrency has given an opportunity to so called crypto experts to fill their pockets. They take advantage of the fear, uncertainty, and doubt surrounding crypto in the market and mislead the investors without due regard to their professional ethics.

Make rational choices before trading

Trading in cryptocurrencies can be a stressful task, and it is best to take decisions based on logic and not emotions. Trading decisions that are based upon emotional whims and fancies can be hugely detrimental for one’s assets. For instance, deciding to sell simply because the token is not appreciating fast enough is a characteristically bad trading decision. On a similar note, it is not wise to buy merely because the value of a token is at an all time high level, because you might be putting your funds into a token which is on the brink of a collapse.

In order to maximize your trading profits in the long term, it is essential to understand that markets are volatile and can change at any moment, but one must not take any frenzied trading decisions when such changes take place.

Currently your economic transactions are strictly regulated by national governments and banks. This restricts people’s ability to freely make transactions globally. Cryptocurrency is a mechanism designed to get rid of these stringent system of government manipulation. It’s use in illicit activities have stagnated its growth but the use of blockchain technology will make sure that crypto is free from cyber crimes.

Running a small business often means having a lot of knowledge of your industry, and having some knowledge of accounting, finance, human resources, informational technology and similar.

Finance is one of the crucial parts of business operations. Still, very few entrepreneurs are financial experts by training.

Focusing on the financial side of your company is a must, regardless of your field of expertise. This aspect deserves as much attention as manufacturing, marketing, and distribution are receiving. While there are some major costs and investments to process every now and then, it is also essential to maintain your alertness when it comes to everyday spending. With that in mind, here are some important financial management lessons every small business owner needs to know.

Don’t mix business and personal accounts

A lot of business owners are often tempted to secure their business finances with their personal funds and sometimes even to use business money when they are lacking some in their wallet. Both of these ideas are bad for many reasons. Firstly, there are legal issues, such as accounting, taxes, and personal liability. Secondly, this can turn into a bad habit which can make both your personal and professional finances a train wreck.

To prevent such disasters you should set a personal and a business budget and adhere to them strictly. This includes separate credit cards, loans, and taxes.

Make timely payments

It is easy to lose track of the bills, loans, and credit card fees when you have tons of other things to do and worry about. But everything regarding finances, including utility bills and employees’ paychecks, needs to be managed properly because it will consistently add up to a large sum which can cause you millions of problems.

Paying your bills and loans on time will save you from late fees and giving your employees what they are promised and when they are promised will ensure loyalty and overall good atmosphere in the firm.

The easiest ways to do this is to set up monthly reminders and set aside a budget for these sorts of things for each month.

Don’t forget to pay yourself

Being your own boss means that you are an employee too, which consequently means you deserve compensation too. Many small business owners invest everything they have in day-to-day operations and growth, and they overlook their own role in the company. If you neglect to pay yourself your personal finances will not be in good shape and your business will suffer as a result.

Seek out growth opportunities

In addition to compensating for all the hard work you are doing, you need to keep your eyes open for the chance of growth opportunities. In order to remain vital, every small business needs to continue to innovate, attract new employees and partners, come up with new ideas, and grow. For that, you need to invest. Some of the small business growth strategies you need to consider are market penetration, market expansion, product expansion, diversification strategy, and acquisition strategies.

Have a solid billing strategy

If there is anything that can hurt your business that is poor cash flow. If there is anything that can hurt your cash flow that is poor billing strategy. Clients that are late on their invoices and payments can harm your business operations, which can lead to business failure.

If you have problems with late-paying customers, and badgering them with reminders and repeated invoices doesn’t work, you should try a different approach. You can give them discounts when they pay on time and fines when they are late.

Plan for the future

The world of business is full of surprises, and many of them are unpleasant. However, based on your previous expenses and earnings for a few months back, you can learn just how much money you need to set aside each month. Besides the regular items on your monthly budget, there is also a need for dedicating money for the unforeseen expenses, which can include everything from lawsuits to natural disasters.

Some business find that getting a loan can ease cash flow issues. One popular option loan option for smaller businesses is from the US Small Business Administration (SBA). The SBA Express Loan can be a good option if you need access to cash quickly as the review process usually takes under 36 hours. However, while the review process is extremely fast, keep in mind that it takes over 30 days still to actually receive the cash. So before applying for an SBA loan make sure to plan ahead.

Have a strong budget

Speaking of… Keeping your budget accurate is one of the best things you can do for your firm. All expenses and incomes need to be recorded and tracked as they arrive. To succeed in that, you will need to hire an accountant, outsource this part of the job to an accounting company, or, for the time being, download a budgeting smartphone app.

Establish healthy financial habits

In the end, it all comes down to setting up good financial habits. This includes internal financial protocols (e.g., setting time to review and update financial information), controlling where and when your money goes and becoming more frugal.

If you fail to do these things you will leave your business vulnerable to fraud, theft, and legal problems. As for the frugality, there is no need to turn yourself and your employees into extreme “coupon collectors”. However, you can be alert for rebate offers, negotiate with vendors for better deals, and refrain from unnecessary costs.

The more you comprehend the financial side of your business, the better equipped you will be to make smart money management decisions. The lessons above will help you get started, but you should always be hands-on it and proactive when it comes to managing your finances, regardless of the scale of the challenge ahead.

So you want to be successful with trading forex? Then there are a number of ways you can learn about forex trading. From reading books, to trading articles to forex related websites and forums and videos, there is no shortage to information that you can access on the internet.

Most beginner traders tend to make the mistake of starting to trade with real money even before they can take some time to understand how the forex markets work.

This is one of the biggest reasons why many forex traders fail. Starting with a demo trading account for at least a few months can help you to hone your forex trading skills.

In this article, we take a look at how you can learn about forex trading.

Forex trading books

The best place to start if you want to learn about forex trading are books. There are many books written by famous traders which can be useful. Starting with one of these books is a good way to understand how the forex markets work.

A good starting place is to either order these books via Amazon. You can also download these books in a PDf format so it is easy to read. These books, especially ones authored by some very famous traders can provide you with a wealth of information.

Forex trading videos

There are numerous trading videos that are available. However, not all of them are knowledgeable. Now a days, anyone can upload a video onto Youtube. Therefore, you need to take some time to check out the publisher.

There are quite a few reputable Youtube video channels that you can check out if you want to learn about forex trading.

For example Trading 212 or Khan Academy are two good channels to begin with. When learning about forex trading, you also need to pay attention to other aspects such as the economy and also understand how the fundamentals work.

Forex trading forums

Forex trading forums are another avenue to learn about forex trading. There are many threads that you can follow to understand the more technical aspects of trading.

It is important to note that you need to be careful about the threads and topics that you follow. This is because forums are made up of different types of traders; from professionals to absolute beginners. Therefore, the information you come across can be incorrect at times.

However, if you spend enough time on a forum, you would be able to easily figure out which threads and traders to follow.

Trading strategies and testing

In order to be able to truly figure out how good you are trading, then you need to put this knowledge to the test. Trading strategies are one way to understand how well you know the markets and the technical indicators.

Most traders make the mistake of purchasing a trading system. In reality, these trading systems can end up losing you money than making any money for you. Therefore, it is always best to build your own trading strategy instead of buying a ready made one.

Forex demo account

A forex demo account is another way to help you with trading forex. A demo account will allow you to trade without any risk. You can also experiment different strategies with a demo account until you are familiar with your trading.

Having a good broker also helps. There are many forex brokers that offer a demo trading account. A good example is JustForex which offers a demo trading account for free so you can practice how to trade forex (JustForex review).

In conclusion, it is important to understand that it will take a lot of time and practice to learn forex trading. The only way you can be successful is by being consistent and patient when learning.

Before we start, this is just a note that this is a guide designed for the absolute beginners in trading. How beginner, you ask? Well, we have sat down with an experienced trader to ask the all important questions about trading to teach us, absolute novices, all about the world of trading.

Where does the beginner start? How much do you have to learn? Well, the answer is, PLENTY. In fact, the learnings never end. Not only do you have to keep yourself constantly researching, but you have to be on top of new strategies and possibilities all the time.

So, keeping this in mind, we asked the trader the basic questions that you would have to know to get into the game and how to actually make a profit out of this tricky world.

Why would you go into trading if you have never done it before?

People go into trading for various reasons. You need to make up your mind what the exact reasons are for you wanting to enter the trading space so that you don’t put yourself in a bad position.

Decide what your reasons are for going into trading in the first place. Are you looking to make some extra money to pay for your children’s education, a dream trip or to put away for retirement? Or is this the start of your new, exciting career? Being a local trader and a once a week trader are totally different animals.

Based on your answer, you can start determining what your timeline is in trading.

Are trading platforms important?

Absolutely! There are hundreds of trading platforms out there for you to choose from, but you do need to do some careful research into it as it is quite cut-throat. There are a lot that simply assume that you will lose and take your trades.

What is great is that a lot of the platforms can be accessed through desktop and mobile, and many allow you to build your own personalized trading hub.

If someone was launching themselves into trading for the first time ever, what would your ultimate piece of advice be?

If you are first starting out, the first thing you need to get sorted is a risk management strategy. You can have the greatest indicators and the best strategy on how to trade, but if your targets and what profits you are taking and stop loss orders are wrong, you can still not make money.

So, basically you have to look at trades and see how they have performed in the past and what their historical movement looks like. If you are capable of doing a statistical study on it, do a stat study on what you need your stop level to be and how much loss you can take. You ultimately need to, going into the trade, know what your profit level needs to be and stick to that as rigorously as possible.

Lets chat more about stop loss orders. What is it and what happens if you don’t implement a stop loss order

When you execute a trade and buy something, the market could possibly go against you. This is when you start losing money, which is absolutely normal when trading. The market goes through peaks and dips and you need to know just how much you can take.

At some point you have to know when to exist the trade for a loss and the loss level cannot be higher than what your take take profits are. You have to have a lot higher success rate than losing, which falls within your strategic planning.  

How do you personally know when to exit? Markets go through peaks and falls, but what is the biggest indicator

This is where it comes to you getting your trading strategy right and then sticking to it. Once a trader gets a trading strategy that works, most stick to them as long as they making a profit.

If you are looking to take ten ticks on the trade then stick to taking ten ticks instead of having a ten tick stop loss or something along those lines. A tick is essentially the change in trading price from trade. The minimum tick size for stocks trading above $1 is 1 cent.

Setting targets depends on the reason why you are doing the trade. If there is a technical reason for it, you have to make sure that you set your timescale and stick to it. What is a reasonable level to make profit from it to is a question you have to be asking yourself too. Setting this limit is important as obviously everyone wants to make hundreds and hundreds of ticks, but it is not always reasonable all the time.

Market conditions are also one of the biggest determinants of when to stay and when to exit a trade. If there are huge events globally, you will need to be taking it into account. So, for example, if there big events like nonfarm payrolls out of the US, there are usually large moves on the markets. So, if you have a trade at that time, you will need to have a larger take profit because you are risking more because of the increased volatility of the market.

Talking about market conditions, how important is it to keep up to date with what is happening globally?

Wake up and read the news. Go to bed reading the news.

Most of the life of a trader is doing research and keeping the research in front of you while trading in order to make good choices and decisions. Everyone is trying to stay as well informed as possible to not get caught out by buying something that happens on the global scale.

There are tons of accurate and up to date news wires that you can subscribe to. But they are usually quite expensive. Market Squawks have all of the major screens like Bloomberg and Reuters which is always updated. They put out daily calendars and research papers to keep you updated with global events and market movements. Twitter is also great for breaking news for you to keep an eye on, although you need to  keep watching the feeds and trends to make sure that it is accurate.

This also depends on what type of time period you are looking at trading over. Locals in the trade arena, which are the regular traders who trade several times a day need to have an in-depth knowledge. Other strategies mean that you only trade a few times a week, and this will mean that you don’t need to be quite as in depth in market movements.

In saying this, it is important to have a proper risk strategy in place as you can land yourself in trouble. Hence why having the risk strategy was the first and foremost most important thing to have before launching your trading career.

To wrap up

In ending, the greatest advice given, is not to follow the pack. Don’t do exactly what everyone else does all the time. Take time to work on your strategy and refine it over time. Take all of the main considerations into mind. Time frames, profit margins, your ultimate risk appetite. Don’t get down when something does not work out and when you see a fall in the market. Keep at it. But also be savvy enough to know when to cut your losses.

In the past few years, more and more people chose trading as their full-time job and main source of income. The reason behind this phenomenon is that nowadays, extraordinary profits are just one-click away! Forex and stock trading are among the most popular types. Both come with advantages and disadvantages which will make you choose the best one for you.

Forex and Stock trading – a brief introduction

Forex trading is more speculative and represents the action of trading fiat currencies. When you trade a currency pair, you either buy a currency at one price and sell it at a higher price; or you sell a currency at one price and buy it at a lower price to make a profit. This market is the largest and most liquid in the entire world, with $5 trillion traded every day. It is open 24 hours a day, 5 days a week for banks, institutions, and individual traders.

On the other hand, the stock trading process consists of you trading the price of a stock or buying partial ownership of a publicly-listed company available on the stock market. You can easily do that through a stock certificate.

This market is also known as the equity market and it allows companies to gain capital, while also giving their investors the opportunity to have partial ownership of their shares. In contrast with the foreign exchange market, the stock market is less flexible, as your investments and trades depend on the activity of the company you chose.

Forex and Stock trading – Pros and Cons

Forex trading comes with its ups and downs, considering that the foreign exchange is such an imposing market. Let’s begin with the pros, because it surely has some! First of all, the size and the high liquidity of this market can be a great advantage for traders, as there are many potential buyers and sellers at any given price-level. Another pro is the flexibility of this market.

As we mentioned, it is open 24/5 and no matter where you’re located, there is always an open trading session in the world where you can buy and sell currencies. Last but not the least; a significant advantage is that forex trading has low transaction costs! You usually have to pay a fee requested by the broker – which is based on the difference between the buying and selling price of the currency pair, also known as the spread.

Given the extremely competitive nature of this market, the spreads of major currency pairs can be as low as 1 pip, meaning that in order to open a position size of $100,000 on the let’s say the EUR/USD pair, you would have to pay only $10!

Forex trading has its share of cons, too! The high liquidity can bring great profits, but it can also be very risky. This market shows greater sensitivity to all kinds of political and economic situations in other countries, especially when they are of an international importance and can change the value of currencies in a split second. Along with many other reasons, without a proper education, forex trading can be dangerously risky! The leverage available for this type of trading can also be profitable, but just as easily it can work against you if you enter a trade that goes the wrong way.

Stock trading has a solid list of pros, too! They are easy to buy and equally easy to sell. You can earn money in two ways: either by taking advantage of short-term trends, or by holding the stock in order for the company’s earnings and stock price to grow over time. Moreover, stocks rely on economy, meaning that when the economy grows, so do the corporate earnings – which is a reason to celebrate for stock traders!

Probably the biggest disadvantage of stock trading is that while investors do have the advantage of owning a part of the profits of the corporation, they can also risk losing the invested money in case stock prices fall due to bad business decisions, a bad economy or worse – if the company goes bankrupt. Also, stock trading is less flexible, and it can require a lot of time.

How to start Forex and Stock Trading

You can become a forex trader or shareholder in just a few minutes. All you need to do is find a professional and trustworthy online broker. TradeFW forex and CFDs broker is a broker chosen by millions of traders and it offers its client the two financial instruments. The process of becoming a forex or stock trader is the same. All you need to do is open the right account for you level of experience, in this case a standard account; fund it and enter a position or buy a share of your favorite company.

Although it sounds easy, and this step it actually is the easiest part – the truth is that successful trades will come with hard work and a lot of knowledge. Before you place a trade or invest in a stock, make sure to inform yourself and develop a strategy, as well as a trading plan with clear objectives. Be patient and learn from your mistakes! One day, the well-deserved profit will also come just in a brief second.

Conclusion

Forex trading, just like stock trading, has pros and cons – but the truth is that each investor knows which one to pick and turn its cons into advantages. Trading can become your career, a profitable one, but it takes time and hard lessons! Just be patient, you will get there, and it will be worth it!

The new year is approaching fast, and that means many people are making resolutions for 2019. If you are looking to improve your financial status, you might want to consider including a financial resolution to your list. Resolutions are great as goals for the new year and can keep you on task when you want to make something happen. Whether you want to learn more about budgeting, interested in saving more for your retirement savings, or you are just getting started in investing, making it a resolution might be the best option you can make.

Saving a Portion of Your Income

Everyone has the best intentions and will say they want to save more money, but when you choose an actual amount, it’s more likely you will actually do it. We suggest you make a resolution to save 10 to 15% of your income every time you get paid. This doesn’t have to be a complicated process, either. You can choose to have an automatic transfer done each time you are paid, so the money goes into savings. You’d be surprised how easy it is to live off of 10% less and you’ll be set for emergencies in the future.

Check Your Credit Report Frequently

As you likely know, there was an information leak from Equifax this year, which should give you an idea of how important it is to monitor your credit score. While you can only get each credit report once a year from the major companies, there are plenty of other options. Sites like Credit Karma and Credit Sesame give you an idea of what your credit score is and you can access them as often as you like. We recommend checking on your score every three or four months just to make sure everything is in order.

Get Involved With Investing

If you’re just getting started in investing, it might seem a bit overwhelming, but it doesn’t have to be. All you have to do is set up your bank, so a certain amount goes into an investment account automatically. The reality is that bank sitting in your account earns very little and popping it into an investment account will grow your money for you. There are many options and some of them require only a small amount of cash to get started. You can work on your retirement savings or save for big purchases you have coming up.

Track All Your Expenses

There’s something about tracking your expenses that really opens your eyes. When you aren’t tracking, you have no idea how much you’re spending in a certain period on various items. There are free apps that can help you determine what you’re spending your money on, so you are more mindful about where your paycheck goes. This gives you a place to start if you need to cut a few things out of your budget to save money.

These are only a few options you have for making a financial new year’s resolution. Feel free to think about your specific needs and build a resolution all your own!

Although the origins of algorithmic trading can be traced back to the mid 1990s, for many individual traders, the practice is still shrouded in mystery. However, as markets change and become ever more data reliant, it seems that there’s no stopping the rise of algorithmic trading and its associated technologies. But what exactly is algorithmic trading and how does it work? Here, we take a quick look at the rise of the machines and how they might shape markets in the future.

What is Algorithmic Trading?

Put simply, algorithmic trading employs computers to process complex formulae designed to follow a specific set of instructions. These instructions are based on variables such as time, price, and volume among many others. For instance, you can write an algorithm that sells a specific stock if it ends in losses over 10 days or buy a stock if market liquidity increases over the same period. However, the overall aim of algorithmic trading is to execute high frequencies in lightening quick time—much quicker than any human might be able to. ­

There are currently hundreds of thousands, if not millions, of algorithms that are based around a broad range of data sets; and anyone, in fact, can author their own. This is perhaps why so much confusion surrounds this type of trading, with a seemingly unlimited scope for the buying and selling of orders. Historical data sets and statistical analysis are seen as particularly promising areas of algo trading, with formulae designed to ditch poor strategies automatically by making predictions based on previous market behavior.

Advantages of Algorithmic Trading

Some of the advantages of algorithmic trading are probably fairly obvious. Firstly, the reduced potential for human error, bias, or manipulation means that markets should, in theory, be more stable. Secondly, trades can be executed faster, more reliably, and at the best possible prices, with reduced transaction costs helping to sweeten the deal. Additionally, instant orders can be placed with high degrees of accuracy to give traders a better chance to execute at preferential levels.

Algorithmic Trading and Regulation

Among the less obvious benefits of algorithmic trading is its potential to provide the requisite proof of best execution. As market regulations become more comprehensive, and particularly in light of the MiFID II framework, the sell-side is obliged to provide more information than ever before. The data based nature of algorithmic trading makes this process easier by removing the human element and providing continual and accurate data to support choices made.

What Does this Mean for Individual Traders?

It is estimated that something like 70% of all trades are currently executed using algorithms—and it looks as though they are here to stay. It is also thought that algorithms will continue to grow in number and complexity, meaning that everyone within the industry should at least have a rudimentary understanding of how they work and the implications they bring. Whether learning to build your own, or simply selecting a few existing algorithms to become familiar with, it is important to be aware of their existence.

For anyone wishing to try their hand at algorithmic trading, then a broker neutral platform such as this will provide the right tools for the job. With an open architecture to create and deploy complex strategies and access to algorithms from brokers and other third parties, traders have the opportunity to study and experiment with algorithmic trading. Naturally, as with any type of trading, the goal is to make a profit but in the complex world of algo trading it is important to understand the fundamentals first and build a winning strategy from there.

Ramaphosa’s job isn’t an easy one, the current president of South Africa having to pick up from where Jacob Zuma left off in February of 2018, trying to gradually undo all past mistakes by committing the government to allow private investments. Some criticize the current president for holding meetings and summits where nothing really appears to get done, but a little patience should be granted in this case, especially considering that there are at least 10 companies willing to invest in the progress and development of the country, helping create new jobs in the process to aid resolve the issue of high unemployment stats.

As there was a great loss of credibility during the Zuma era, the country facing a severe image damage inflicted by the opaque and unpredictable government formed by the prior ruler. Thus, Ramaphosa has been facing a great challenge since the get-go under the form of credibility recovery. For this reason, summits and meetings are held often, the president trying to convince investors to drop a dime and aid the country’s development process go smoothly.

Companies have already pledged to invest

On the second day of the Investment Summit, 10 pledges had already been amassed. Rain Mobile commits R1 billion to build a new 5G network that would help improve the telecommunications sector considerably, while the Mara company is said to invest R1.5 billion towards the same sector, putting a bigger emphasis on creating more jobs to concomitantly help lower the unemployment rate as much as possible.

Ivanplats, a subsidiary of Ivanhoe Mines, is willing to invest R4.5 billion in the local economy, Sappi pledging R7.7 billion for the same purpose with the added intent of focusing on manufacture and textiles more. Naspers intends to invest R4.6 billion while setting up a tech innovation hub to create more jobs. Vedanta offered a staggering R21.4 billion for the metal industry, while Mercedes-Benz South Africa gave R10 billion and Mondi pledged R8 billion for the country. The biggest surprise yet came from Anglo American, a mining company that commits an R71.5 billion investment in the mining industry that spans over the next 5 years.

Up to this point, R134.1 billion have been raised and the good news keeps rolling in, a positive outlook on the country’s situation not seeming as impossible as it did the past years. As long as Ramaphosa will have a strong hold over government and not allow the internal situation to decay as his predecessor did, investors are bound to aid as they won’t fear losses, and South Africa will be on the right path to economic growth and development.

Oppressing developmental issues that Ramaphosa must tend to

Poor regulation of the energy, telecommunications, and water industries must be fixed under his presidency for him to regain credibility in the eyes of foreign investors. Evidently, when discussing these industries we must take into account the impact held on country inhabitants as some major issues emerge:

• People don’t have the same access to information and communication means as those in better-developed countries do, which harms a number of life quality aspects, education receiving the biggest blow.
• Water pollution is a major issue that has led to serious health detriments for inhabitants, thus decimating the number of people who are apt to work and who would have otherwise contributed to a more rapid development. At home sanitation doesn’t come as easily for inhabitants as it does in developed countries as earnings are significantly lower, so it is up to the state to fix this oppressing matter.
• There can be no real development without the energy department thriving as it is needed not only for life quality increase among the populous but for sustaining the rest of the industries that can help South Africa in its developmental process. As it basically stands at the core of all actions, energy is the department where Ramaphosa and the government must get most heavily involved.

What the future holds

Aware of how important Africa’s development is for Europe as well as the rest of the world, Chancellor Angela Merkel has personally urged companies to shift their focus towards this continent to back efforts in prosperity so that the people of the continent will finally enjoy the same luxuries as the rest of the world. With backing from one of the most respected political figures at the moment and Ramaphosa on the right track towards winning trust, the future seems brighter than ever for South Africa in particular.

The summit might have seemed a bit too pretentious to some as its showbiz style scene and the fanfare were indeed over the top, but this isn’t what we should take away from it. The vast audience that tended to the event, which was composed of approximately 1300 business and government leaders, was pleased with the outcome as pressing issues regarding the country’s reliability when it comes to investment were clarified, the president reassuring the business community that their properties and investments are now safer than ever and will remain this way.

In the event that even more businesses commit to aiding South Africa in its journey toward growth, people who live in unsanitary conditions, who are faced with pollution-induced health issues, who live in poverty, and who don’t have proper access to education will likely see an end to their troubles as not only will new jobs invade the market, but life expectancy and quality will grow as a result of industrial and economic growth.

Summary:

With South Africa’s economy struggling, the recent investment summit led by Cyril Ramaphosa was intended to revive economic growth in the region. Addressing the structural weaknesses in the economy and improving the investment framework could be the moves that will eventually lead to a fix, especially with the right external help.