An example is if you expect a specific asset to appreciate 2-3 cents, which is significant if you are trading high volumes, but with CFDs, it might not surpass the spread. CFDs are not for people who want to trade on small, short-term market trades. 5.Leverage Investment Remember you...
In the real economy, where trading activities come face to face with real-world pressures, business strategies and models need to evolve sustainably. Michael Spiegel, Global Head of Transaction Banking, Standard Chartered discusses the evolving environment. At the heart of every treasury is the under...
Disciplined use of stop-loss orders will keep you in the game even when trades go against you. Stephen Calder explains how to use technical analysis as a guide to help you set your stops in the right place. It is essential that CFD traders - in fact, anyone trading with leverage - use...
Undoubtedly, a plan is required for any business to succeed, even more so when you are dabbling in international trading. Once you have a clear understanding of the markets you plan to enter and their respective nuances, developing a clear and detailed plan is the next ste...
first issue traders face when trading cryptocurrency derivatives is called convexity. In this situation, the margin deposit changes its value as the underlying asset’s price oscillates. As Bitcoin’s price increases, the investor’s margin rises in U.S. dollar terms, allowing additional leverage....
Traders like to use currency options trading for several reasons. They have alimit to their downside riskand may lose only the premium they paid to buy the options, but they have unlimited upside potential. Some traders will use FX options trading to hedge open positions they may hold in the...
There is nothing wrong with these unique processes, but all traders should consider their impact before using leverage. Price decoupling, higher fees and liquidation impact should be analyzed when trading in futures markets. The views and opinions expressed here are solely those of theauthorand do ...
Let’s go back to the example we used above, where you were buying at the money call options on Company X stock at $2 with a strike price of $20 and Company X stock was trading at $20. Assuming these contracts had a delta value of .5, the leverage would be calculated as follows...
When you trade with leverage, you wouldn’t need to pay the 10,000 euros upfront. Instead, you’d put down a small “deposit”, known asmargin. Leverage is theratioof the transaction size (“position size”) to the actual cash (“trading capital”) used for margin. ...
Further, I produce evidence consistent with announcements of such loans reducing information asymmetry which I proxy for with bid-ask spreads and trading volume. My final analysis examines evidence of bank specialisation. I find that borrowers from the industry leader in terms of loan origination (...