Take a look at our list of the financial terms associated with trading and the markets. From beginners starting their trading journey to experts with decades of experience, all traders need to clearly understand a huge number of terms.
Short selling is a trading strategy where an investor borrows shares of a stock or security they believe will decrease in value, and then sells it on the market. If the price of the stock or security falls as expected, the investor can then buy the shares back at the lower price, return the borrowed shares, and keep the difference as profit. Short selling is considered a high-risk strategy because theoretically there is no limit to how high the price of a stock can go, so the potential loss is theoretically infinite.
What is the benefit of short selling?
The benefit of short selling is that it allows investors to benefit from a decline in the value of a security. While traditional investors can only benefit when the prices of the assets they hold increase, short sellers can do well when the prices decrease as well. This allows investors to potentially profit in both rising and falling markets. Additionally, short selling can also be used as a hedging tool, to offset the risk of long positions in a portfolio.
Is Short Selling a good idea?
Short selling can be a good idea for some investors, but it is considered a high-risk strategy and is not suitable for all investors. It requires a great deal of knowledge and experience to correctly identify the securities that are likely to decrease in value and to correctly time the trade. Additionally,because the potential losses from short selling can be theoretically infinite as explained above it is important for investors to fully understand the risks and potential rewards associated with short selling before engaging in this strategy.
ProShares UltraShort Russell2000 (TWM) is a leveraged product that seeks to deliver twice the inverse of the daily performance of the USA2000 Index. Results aims to be 200% of the opposite to the movement of the index. This is a daily-bet, so results will vary dramatically for positions held longer than one day.
The USA2000 Index covers US small cap companies and a broad range of sectors including finance and tech. Holdings include Etsy, Planet Fitness and Hubspot.
Amortization is the process of charging the cost of an asset to expense over a specific timeframe. Amortization also defines the practice of spreading the repayment of a loan. This shifts the asset from the balance sheet to the income statement.
Amortization reflects the consumption of an intangible asset over what is considered a useful timeframe. It is used for the gradual write-down of the cost of those intangible assets that have a specific useful life. It is common to charge interest which is calculated based on the duration and other variables.
Amortization should not be confused with Depreciation. The difference between them is that amortization is about charging “Intangible Assets” to expense over time. While depreciation is about charging “Tangible Assets” to expense over time.
How to calculate amortization?
As we do not provide economic or trading advice we can only include here what is considered to be a generally agreed upon explanation. As stated, generally an Amortization can be calculated by using a straight-line formula such as: (book value - residual value) / useful life.
A share is a partition of the total value of a company. Each share represents a unit of ownership in that company, and therefore also the value that it holds. Should a company choose to sell shares as a means of fundraising, this is known as equity finance.
A share owner is called a shareholder (or stockholder). The ongoing value of a share, once it is introduced to the market, is its trading value at any given time, which can be either lower or higher than the original value. A share is worth whatever price it is currently trading at. An actual transaction of shares between a buyer and a seller is usually considered to provide the best market indicator as to the "true value" of that share at that time. The difference between current price and open price will represent either a profit or a loss to the investor who purchased it.
There are different types of shares in the trading domain, including Cumulative & Non-cumulative Preference Shares, Participating & Non-participating Preference Shares, Convertible & Non-convertible Preference Shares, Redeemable & Un-redeemable Preference Shares.
It is also possible to use CFDs to trade shares. This enables traders to take a leveraged position on whether a share rises or falls. This different type of share trading opens up more trading opportunities by either buying or selling the asset without physically owning it.
ProShares UltraPro Short QQQ (SQQQ) is an inverse leveraged ETF that tracks the performance of the Nasdaq 100 index. This ETF aims to deliver a daily output that is three times the inverse of the daily performance of the Nasdaq 100. That means SQQQ will deliver results that are 300% opposite to how the index has moved. They are a useful product for traders looking to go short or to hedge their other positions.
The Nasdaq 100 includes the largest companies on the Nasdaq stock market and holdings include Apple, 21st Century Fox Inc, Kraft Heinz and Facebook. This is a single-day bet and is not recommended for use for longer than periods of one day, as the results will differ. Leveraged products carry more risk.
ProShares UltraPro Short S&P500 (SPXU) seeks daily investment results that are 300% the inverse of the daily performance of the S&P 500. This is a single day bet for traders looking to go short on S&P500 or hedge other trades. Like any leveraged product, there is more risk involved in this ETF than in unleveraged products.
S&P500, the index that it inversely tracks, is considered a benchmark for large-cap US equities. It comprises 500 leading companies, many of which are household names, and a broad range of sectors – although tech firms feature heavily. Holdings include Microsoft, Apple, Amazon, Berkshire Hathaway and Johnson & Johnson.
ProShares UltraShort QQQ (QID) aims to deliver daily investment results that are twice the inverse daily performance of the Nasdaq 100 Index. This is a single-day bet and traders are advised that returns can vary dramatically if they hold positions for longer than one day. This is the sister product to QLD, which delivers two times the daily performance of the Nasdaq 100.
As with most inverse and leveraged products, this fund is designed to provide inverse exposure on a daily basis, not as a long-term inverse bet against the index. All leveraged products carry more risk. Nasdaq 100 holdings include Apple, Amazon, Facebook and Tesla.
ProShares UltraShort S&P500 (SDS) looks to deliver daily investment results that are twice the inverse of the daily performance of the S&P500. This is a leveraged product and designed as a single-day bet. Returns for periods longer than one day could expose investors to performance drift.
S&P500, the index that it inversely tracks, is considered a benchmark for large-cap US equities. It comprises 500 leading companies, many of which are household names, and a broad range of sectors – although tech firms feature heavily. Holdings include Microsoft, Apple, Amazon, Berkshire Hathaway and Johnson & Johnson.
A share buyback, also known as a stock repurchase, is when a company buys back its own shares from the open market. This reduces the number of outstanding shares and increases the ownership stake of existing shareholders. Buybacks can be used as a way for a company to return excess cash to shareholders, increase earnings per share, or signal confidence in the company's future prospects.
Is share buyback a good thing?
Share buybacks can have both positive and negative effects on a company and its shareholders. On one hand, buybacks can be seen as a sign of a company's financial strength, as they suggest that the company has excess cash and believes its own stock is undervalued. Additionally, buybacks can help to boost earnings per share, which can increase the company's valuation. On the other hand, buybacks can also be criticized for diverting resources away from investments in growth or other opportunities, or for being used as a way to artificially boost the stock price. It's important for investors to evaluate the company's financial situation and the reason behind the buyback before making a decision on whether it is good or not.
What happens to share price after buyback?
Share price can be affected by a buyback in different ways, it will depend on the market conditions, the company's financial situation and the reason behind the buyback. In general, a buyback can help to boost the share price by increasing earnings per share and reducing the number of outstanding shares. Additionally, the announcement of a buyback can also signal confidence in the company's future prospects, which can attract more buyers to the stock. However, a buyback doesn't guarantee an increase in the stock price, if the market conditions are not favorable or if the company's financial situation is not good, the stock price could remain unchanged or even decrease.
What is the reason for share buyback?
A company may choose to buy back its own shares for a variety of reasons, including:
-Returning excess cash to shareholders: A buyback can provide shareholders with a more direct benefit from the company's cash reserves, rather than leaving the money idle or reinvesting it in less profitable ventures.
-Increasing earnings per share: By reducing the number of outstanding shares, buybacks can increase earnings per share, which can make the company look more valuable to investors.
-Signaling confidence: A buyback can signal to the market that the company's management believes the stock is undervalued, which can attract more buyers to the stock.
-Boosting stock price: By purchasing shares in the open market, a buyback can help to boost the stock price, which can benefit existing shareholders.
-Mitigating dilution: If a company issues new shares, it can dilute the value of existing shares, buying back shares can help to mitigate this dilution.
It's important to note that buybacks can also be used as a tool by management to artificially boost the stock price in the short term, rather than for the benefit of long-term shareholders.
A spot price is the current market value of an asset or security. It's the amount you would pay to buy or sell it at that exact moment in time. Spot prices are constantly changing, as they depend on supply and demand forces in the marketplace. Spot prices provide important insights into market trends and can be used by traders to make investment decisions.
Why is it called a spot price?
It is called a "spot" price because it refers to the price at which an asset can be bought or sold "on the spot" or immediately.
How is spot price calculated?
The spot price of a commodity, security, or currency is typically determined by supply and demand factors in the market. The price is influenced by a variety of factors such as production costs, political and economic conditions, and speculation.
What are Support Levels?
Support levels refer to the levels at which the price of an asset tends to stop falling and stabilize. These levels are determined by analyzing past price movements and identifying a floor at which buying pressure is strong enough to prevent the price from falling further. Traders and investors use support levels as a guide for placing buy orders, and as a signal for potential buying opportunities.
What does support level mean in Crypto?
Support levels mean the same thing regardless of the asset class in question.
What is the best indicator for support and resistance?
There are several indicators that can be used to identify support and resistance levels in a market. Some commonly used indicators include moving averages, Fibonacci retracements, and pivot points. However, no single indicator is considered to be the "best" as different indicators may work better in different market conditions and for different traders. Ultimately, the best indicator is the one that works best for you and fits your individual trading style and strategy.
ProShares UltraShort Bloomberg Crude Oil (SCO), aims to deliver results that are twice the inverse daily performance of the Bloomberg WTI Crude Oil Subindex. It is an ETF product for traders looking to short crude oil in a single day bet. Trades that last for more than a day are not expected to see the same returns.
The subindex reflects WTI Crude Oil prices and only consists of futures contracts on WTI Crude Oil. This is a leveraged product, all leveraged products carry more risk than unleveraged products.
The FTSE/JSE index, also known as the South Africa 40, is a market capitalisation-weighted index of the largest and most liquid 40 companies trading on the Johannesburg Stock Exchange.
The index was launched on 24th June 2002, with a base date of 21st June 2002 and a base value of 10300.31.
The largest sector in the index is Media, which accounts for 22.27% of the total index weighting. Basic Resources is the second largest, accounting for 19.9% of the total weighting, followed by Personal & Household Goods and Banks, with 12.43% and 12.35% respectively.
South Africa 40 futures allow you to speculate on, or hedge against, changes in the price of major stocks on the Johannesburg Stock Exchange. Contracts rollover on the second Friday of March, June, September, and December.
Trading charts are used to display historical price data for a security or financial instrument. They typically include a time frame on the x-axis, and the price of the security or instrument on the y-axis. Candlestick charts, bar charts and line charts are the most common types of charts used in trading. Candlestick charts are the most popular and provide a visual representation of the opening price, closing price, highest and lowest price of the security in a given period of time. It also shows the direction of the price movement, whether it went up or down. Traders use different technical analysis tools like trendlines, moving averages, and indicators to interpret the charts and make trading decisions. There is a great deal of nuance in reading charts and doing it correctly will require experience and an understanding of how your chart of choice is presenting information to you.
How do you predict if a stock will go up or down?
Traders use different technical analysis tools and techniques to predict if a stock will go up or down using trading charts. These include:
Trendlines: By connecting price highs or lows over a period of time, traders can identify the direction of the trend and predict future price movements.
Moving averages: By plotting the average price over a period of time, traders can identify trends and potential buying or selling opportunities.
Indicators: Technical indicators, such as the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD), are mathematical calculations that are plotted on charts to help traders identify trends, momentum and potential buy or sell signals.
Chart patterns: Traders also use chart patterns such as head and shoulders, double bottoms, and triangles to identify potential reversal points in the market and make predictions about future price movements.
It's important to note that technical analysis is not an exact science and it's not a guarantee of future results. Traders should always use technical analysis in conjunction with fundamental analysis, which looks at a company's financial and economic conditions, to make informed trading decisions.
How do you know if a chart is bullish?
A chart is considered bullish if it is showing an upward trend or pattern, indicating that the price of a security or financial instrument is likely to rise. Bullish chart patterns include upward trending lines, ascending triangles, and bullish candlestick patterns such as the hammer or the bullish engulfing pattern. Traders often consider a stock to be bullish when it's trading above the moving average, especially when the moving average is trending upward.
ProShares UltraShort 20+ Year Treasury (TBT) aims to deliver daily investment results that reflect twice the inverse of the daily performance of the ICE US Treasury 20+ Year Bond Index. Traders would look to get a 200% return opposite to the movement of US Treasury Securities.
This is a leveraged product, and so carries more risk. As with many leveraged ETFs, it delivers daily results and it designed as a single day bet. Positions that are held for longer than a day will get differing results. This ETF can be a useful tactical position or hedge against rising interest rates.
Soybeans are a “soft” commodity - referring to those that are grown and not mined. It is one of the world's most important legumes and is an essential source of protein. It is used extensively in cooking, both soybeans and soy oil, and is also used for animal feed in the form of soy meal.
Soybean is priced in USD per bushel. In July 2012, Soybeans reached an all-time high of $1790, while it reached a low of $208 in September 1959.
The US are the biggest producers of Soybeans, followed by Brazil, Argentina and Paraguay. Together they account for 85% of total production, and 94% of total exports. China is the biggest importer of soybeans.
The price of soybeans is affected by a number of factors, including growing conditions, the demand for biofuel and the strength of USD.
Soybean futures allow you to speculate on, or hedge against, changes in the price of soybeans. Futures rollover on the fourth Friday of February, April, June, October, and December.
iShares MSCI Taiwan (EWT) ETF tracks the investment results of an index composed of Taiwanese equities. The ETF provides exposure to large and mid-sized Taiwanese companies and can be used to access to the Taiwanese stock market. EWT includes 90 of the top companies on the Taiwanese Stock Exchange. It is heavily weighted toward the information technology and finance sectors, which account for 55.5% and 18.5% of the portfolio respectively.
The top ten holdings include Taiwan Semiconductor Manufacturing, Hon Hai Precision Industry Ltd, Formosa Plastics Corp and Chunghwa Telecom Ltd.
The term Spreads in trading is defined as the gap between the highest price to be paid for any given asset, to the lowest price the current asset holder is willing to sell at. Different markets and assets generate different spreads. For example, the Forex market, where both buyers and sellers are very active with this “gap” or spread will be small.
In trading, a spread is one of the key costs of online trading. Generally, the tighter the spread, the better value traders get from their trades. Also, spreads are implied costs, where it is presented to traders in subsequent trades, as the assets traders buy on leverage must increase above the level of the Spread, rather than the above the initial price, for traders to make profit.
What is the importance of a Spread?
The Spread is important, even a crucial piece of information to be aware of when analysing trading costs. An instrument’s spread is a variable number that directly affects the value of the trade. Several factors influence the spread in trading:
• Liquidity. How easily an asset can be bought or sold.
• Volume. Quantity of any given asset that is traded daily.
• Volatility. How much the market price changes in a given period.
Synthetix (SNX) is a decentralized protocol that lets users gain exposure to assets like other cryptos, gold, and stocks, without actually holding the underlying resource. These synthetic assets are backed by the platform's cryptocurrency, Synthetix Network Token (SNX), which is staked as collateral in order to generate rewards. It is priced in USD and can be traded using the SNX/USD symbol.
Corn is a soft commodity - referring to those that are grown rather than mined - and is valued for its versatility. As well as being a dietary staple it has many other uses, from biofuels to animal feed.
Corn is grown in every continent on the globe with the exception on Antarctica. 40% of global corn supplies are produced in the US, while China, Brazil, the EU, and Argentina are also major players.
Corn is priced in USD per bushel. In August 2012 corn struck a record high of $849, while the lowest price ever recorded was $22.90 in November 1932.
As corn is a soft commodity, prices are vulnerable to weather conditions which can affect harvests. The strength of emerging market economies also affects prices, as demand for meat products rises as incomes rise, and much of the corn produced each year is used for animal feed.
Corn futures allow you to speculate on, or hedge against, changes in the price of corn. Futures rollover on the fourth Friday of February, April, June, and November.
Cotton is a “soft” commodity - meaning it is grown and not mined - and has for thousands of years been one of the most important crops. Its lightweight and absorbent fibres mean that cotton is the most popular natural fibre on the planet.
China, India, and the US are the top producers of cotton in the world; in the US cotton primarily comes from Florida, Mississippi, California, Texas, and Arizona.
The fibre is priced in USD per lb. It reached a record high price of $210.64 during March 2011 and struck a record low of $5.66 during December 1930.
As well as weather conditions, cotton prices are heavily influenced by demand for competing synthetic fibres and changes in government policy. Cotton farmers enjoy heavy subsidies in the US, so a change here could have significant consequences.
Cotton futures allow you to speculate on, or hedge against, changes in the price of cotton. Futures rollover on the third Friday of February, April, June, and November.
Wheat is one of the world's most important agricultural commodities, with around two-thirds of global production for food consumption. It is a “soft” commodity, which means it is grown and not mined.
Wheat is priced in USD per bushel, it reached a record high of $1194.50 in February 2008, but slumped to a record low of $192 in July 1999.
An incredibility versatile grain, wheat is harvested somewhere in the world every single month of the year. There is more land used for wheat production than any other crop worldwide, and it is behind only corn and rice in total production.
Wheat prices are affected by a number of factors, including import/export restrictions, stock levels and the strength of the USD. However, one of the biggest drivers of substantial volatility is supply-chain disruptions caused by natural disasters and extreme weather events.
Wheat futures allow you to speculate on, or hedge against, changes in the price of wheat. Futures rollover on the fourth Friday of February, April, June, August and November.
What is a Lot in trading?
In trading, Lots are defined as the number of units of a financial instrument bought or sold on an exchange. A Round Lot is made of 100 shares, where an Odd Lot can be made of any number of shares less than 100. As for bonds, their lots follow a different set of rules. They can range from $1,000 to $100,000 or $1 million. In Forex, trade is done via lots, which are essentially the number of currency units traders buy or sell. As such, a “lot” is a unit measuring a transaction amount. The standard lot is 100K units of currency. Additionally, there are also mini lots valued at 10K units of currency, micro lots valued at 1K units of currency and nano lots that contain 100 units of currency.
What is a lot size in trading?
Lot size in trading refers to the number of units or shares of a security that are traded at once. It's a way to measure the amount of a security that is being bought or sold in a single transaction.
How many shares are in a lot?
The number of shares in a lot can vary depending on the security being traded and the exchange or platform it is traded on. For example, in the US stock market, a standard lot size is 100 shares, but it can be different in other markets or for other securities such as futures or forex.
What is a good lot size?
A good lot size in trading depends on the specific circumstances and goals of the trader. A lot size that is too small may not be cost-effective and may not allow the trader to achieve their desired position size. A lot size that is too large can be too risky and may not be affordable.
An Order in trading is a request sent by a trader to a broker or trading platform to make a trade on a financial instrument such as shares, Crypto, CFDs, currency pairs and assets. This can be done on a trading venue such as a stock market, bond market, commodity market, financial derivative market, or cryptocurrency exchange
What are the most common types of orders?
Common types of orders are:
• Market Orders. A market order is given by traders and investors as an order to immediately buy or sell an asset, security, or share. Such an order guarantees that the order will be executed, yet the actual execution price is not guaranteed.
• Limit Orders. A limit order is an order to buy or sell an asset such as a security at a specific price or better than that price. Traders wishing to define a maximum price for either buying or selling an asset can use limit orders.
• Stop Orders. Stop orders instruct brokers to execute a trade when the asset’s price reaches a certain level.
iShares MSCI South Korea (EWT) ETF tracks the investment result of an index composed of South Korean equities. It provides traders with exposure to large and mid-sized South Korean companies and is a way to access the South Korean Stock Market. EWY follows 114 of the top companies listed in the South Korean Stock Exchange, and reflects the market well.
With Samsung as one of the major companies represented in the portfolio, it is unsurprising that Information Technology companies comprise a large part of this ETF. Almost 30% of the portfolio is IT, the next largest sector is Finance with 14.06%. Hyundai, LG and Kia also feature in this ETF.
WisdomTree U.S. LargeCap Dividend (DLN) consists of the 300 largest companies ranked by market capitalisation from the WisdomTree Dividend Index. The Index is a fundamentally weighted index that measures the performance of large-cap dividend-paying US companies.
The top ten stock holdings account for 26.76% of the index and include Microsoft, Apple, Exxon Mobil and Verizon Communications. Four sectors (Information Technology, HealthCare, Consumer Staples and Financials) account for 56.4% of the index’s holdings. This ETF is a good option for traders looking for exposure to large cap equity from dividend-paying companies.
A Stop Loss Order is a type of order that investors can use to limit losses when trading securities. This order instructs a broker to automatically sell a security when it reaches a certain price, known as the stop loss price. By using this order, investors can reduce their risk exposure by locking in gains and preventing larger losses.
How does a stop-loss order work?
A stop-loss order is an investment strategy that helps you limit losses by automatically selling your securities when they drop to a predetermined price. By setting up this order, you can avoid having to monitor the stock's performance every day and ensure that any potential losses are minimized.
What is the difference between a stop-loss and a stop limit order?
A stop-loss order is used to limit losses on a security position by automatically selling when the price drops below a specified level. Whereas a stop-limit order combines the features of a stop-loss with those of a limit order, enabling traders to specify both the price at which they are willing to sell and the maximum loss they are willing to take.
What is a good stop-loss order?
A good stop-loss order is one that is placed at a level that effectively limits potential losses on a trade. The specific level at which to place a stop-loss order will depend on the trader's risk tolerance and the price action of the security being traded. Generally, traders will place stop-loss orders at levels that are below the current price for long positions, or above the current price for short positions, in order to limit potential losses if the price moves in the opposite direction. It's important to note that stop loss orders act as a protective measure, but they don't guarantee that a trade will be executed at the exact stop loss level.
The Proshares Bitcoin Strategy ETF (Bitcoin ETF) offers managed exposure to bitcoin futures contracts. The Fund does not invest directly in bitcoin and may also invest in other instruments. It’s one of the first of its kind and marks a new way to get exposure to cryptocurrency price movements.
The WisdomTree Emerging Markets High Dividend ETF (DEM) tracks the WisdomTree Emerging Markets Dividend Index. The index is a fundamentally weighted index that is comprised of the highest dividend-yielding common stocks selected from the WisdomTree Emerging Markets Dividend Index. This provides it with some downside protection from market volatility.
DEM is an equity fund, and has a mix of market sectors. It includes stocks from key emerging markets such as Russia and China, with assets including China Contruction Bank, China Mobile and Norilsk Nickel.
XLM, or Lumens, is Stellar network’s cryptocurrency. It is designed to support instant global transactions to give access to low-cost financial services. Trade XLM/USD spot rates with this instrument.
Futures contracts for Orange juice (ORA) are based upon frozen concentrated orange juice (FCOJ).
Brazil is by far the world's largest producer of oranges, harvesting 20 million metric tonnes per year. China is in second spot, but still far behind, with an annual yield of 7 million, followed by the EU (6.5 million), the US (4.8 million), and Mexico (4.6 million).
Factors that can affect the supply - and therefore the price - of orange juice include weather, crop disease, and the strength of the US dollar. For instance, orange juice futures often increase in price when hurricanes travel towards Florida, a key growing region. Consumer demand often plays a role as well; orange juice is a popular breakfast staple, but a move away from drinks with high sugar content has seen demand decline in recent years.
Heating Oil is a low-viscosity petroleum product derived from crude oil. Around 25% of the yield of crude oil is devoted to heating oil, the second most after gasoline products. As a result, prices often closely follow those of WTI crude.
It is priced in USD per gallon, and has a historic high of $3.32 in April 2011. The record low was $0.87 in January 2016.
Heating oil is used as a fuel for furnaces and boilers to heat homes and businesses. It is especially popular in the British Isles and the North-eastern US. As a result, demand fluctuates seasonally, peaking in the colder months between October and March.
Price is, as a result, also affected by cold weather. Other factors affecting price include the price of alternative heating options, energy efficiency and insulation, refining costs and government regulations.
Heating Oil futures allow you to speculate on, or hedge against, changes in the price of Heating Oil. Futures rollover on the third Friday of every month.
Stock trading is the practice of buying and selling stocks, or shares of ownership in a publicly-traded company, with the goal of making a profit through price appreciation or by receiving income in the form of dividends. Stock traders buy and sell shares in the stock market using a brokerage account, and they use a variety of strategies and techniques to determine when to enter and exit trades. Stock trading is a popular form of investment, but it also comes with risks and profits are in no way guaranteed. You should acquire a good understanding of the market and individual stocks before making trading decisions.
How are Stocks Different from Other Securities?
Stocks, also known as equities, represent ownership in a corporation, while other securities represent claims on an underlying asset. Other types of securities include bonds (debt securities), options, and derivatives.
How Do I Start Trading Stocks?
You can trade stocks using a stock exchange. Platforms like markets.com offer CFDs on stocks and other securities so you can start assembling and get trading outcomes of your own!
Stock dilution is the decrease in existing shareholders' ownership of a company as a result of the issuance of new shares. It typically occurs when companies raise capital by issuing additional shares, thereby reducing the stake of existing shareholders.
Why do companies dilute stock?
Companies dilute stock to raise capital for future growth and investments, often through the sale of additional shares. This allows companies to raise money without having to take out loans or issue bonds. Diluting stock can help reduce overall debt and create a healthier financial situation for the company.
Is stock dilution a good thing?
It depends. If done properly, diluting stock can help raise funds for business operations and growth. It also encourages investors to purchase shares due to the lower price per share. However, too much dilution can weaken shareholder equity and damage investor confidence.
What does dilution do to stock price?
Dilution decreases a stock's price by decreasing its earnings per share (EPS). This happens when a company issues new shares to the public, increasing the total number of shares outstanding and resulting in lower EPS for existing shareholders. Dilution can also occur through corporate acquisitions, mergers or issuing debt that is converted into equity.
A quoted price is the most recent price at which an asset was traded at. Global and local events, either of a financial nature or completely unrelated to finances continually affect the quoted prices of assets such as stocks, bonds, commodities, and derivatives changes continually throughout a trading. Additionally, It is often the price point where buyers and sellers agree on, the most up-to-date agreement between buyers and sellers, or the bid and ask prices. It is also where supply meets demand.
Is a quoted price legally binding?
In most cases, when trading in an exchange, the quoted price is binding and the trade is executed at the quoted price, with the exchange acting as a counterparty to the trade. However, when trading OTC (over-the-counter), the quoted price is not necessarily binding as the parties have more flexibility in negotiating the final price, and the counterparty risk is higher.
Spread Betting is a type of financial speculation which allows you to take a position on the future direction of the price of a security, such as stocks, commodities or currencies. You can choose to speculate whether an asset will go up or down in value, without having to buy or sell it. Spread Betting enables you to take a view on the markets and gain access to the financial markets with limited capital outlay.
How does a spread bet work?
A spread bet is placed by betting on whether the asset's price will rise or fall. The investor can set their own stake size, which means they can take more or less risk according to their preferences. Spread bets are flexible and convenient, allowing you to benefit from even the slightest market movements.
What does a negative spread mean?
A negative spread in trading refers to a situation where the ask price for a security is lower than the bid price. This means that a trader could potentially sell a security for a higher price than they would have to pay to buy it. This is an unusual situation that can occur due to a temporary market anomaly or a technical error. Negative spreads are rare and they tend to be corrected quickly, as they represent an opportunity for arbitrage. Traders should be cautious when dealing with negative spreads and should consult with their broker or trading platform to understand the cause of the negative spread and its potential impact on their trade.
Stop Orders are a type of stock order that helps limit the investor’s risk. The order triggers a purchase or sale once a set price is reached, either above (stop buy) or below (stop sell). Stop Orders are used to protect investors against an unfavorable price movements and lock in potential gains.
How long do stop orders last?
Stop orders are instructions given to a broker to buy or sell an asset when its price reaches a predetermined level. Stop orders remain in effect until the stop price is triggered, at which point the order becomes a market order and will be executed. This means that stop orders may last for an indefinite amount of time. It is important to monitor the current market price closely as stop orders do not guarantee execution.
Are stop orders a good idea?
Stop orders can be useful as they can help limit an investor's loss or protect a profit on a security. They are often used to automatically exit a position when the market moves against the investor. However, the use of stop orders may be subject to market conditions and the specific investment strategy of an investor, so whether or not they are a good idea depends on the individual's financial situation and risk tolerance.
Working orders, also known as pending orders, include Stop orders and Limit orders. Essentially, they’re instructions for a broker to perform a trade when an asset hits a certain price. These orders inform brokers that traders wish to make that trade only if something happens to the asset price.
What is the best order type when buying stock?
The best order type depends on the individual's specific needs and market conditions. It's important to understand the trade-off between speed and price certainty when choosing an order type. Market orders provide immediate execution but at the current market price, while limit orders offer price certainty but may not be executed if the desired price is not reached.
What is an open work order?
An open work order in trading is an outstanding order to buy or sell a security that has not yet been executed. It remains open until it is either filled or cancelled by the trader.
ProShares Ultra QQQ (QLD) aims to deliver daily investment results that are twice the performance of the Nasdaq 100 Index. This ETF provides leveraged exposure to a market-cap weighted index of 100 non-financial stocks listed on the NASDAQ. This is a single-day bet and traders are advised that returns can vary dramatically if they hold positions for longer than one day. All leveraged products carry more risk than unleveraged products.
The Nasdaq 100 is dominate by tech firms, so the performance of the index is closely tied to the sector. Top holdings include Apple, Amazon, Facebook and Tesla.
Earnings Per Share (EPS) is a financial metric that measures the amount of profit a company makes for each outstanding share of its common stock. It's calculated by dividing net income by the number of shares outstanding. Investors use EPS to measure how profitable a company is and to compare different companies in the same sector.
What is a good earnings per share? Is it better to have a high or low earnings per share?
There is no definitive answer to what constitutes a "good" earnings per share (EPS) as it can vary depending on the industry, the size of the company, and the expectations of the market. Generally, a higher EPS is considered better, as it indicates that a company is generating more profit per share of stock.
What is earnings per share vs dividend?
A dividend is a payment made by a company to its shareholders out of its profits or reserves. Whereas EPS is an indicator of a company's profitability.
The Hang Seng Index, also known as the Hong Kong 45, is an index of the top companies listed on the Stock Exchange of Hong Kong Main Board. Stocks are free float-adjusted but there is a 10% cap on weighting.
The Hang Seng is the bellwether index for the Hong Kong market. Because Hong Kong is a special administrative region of China, many Chinese companies are listed on the Hong Kong Stock Exchange.
The index was launched on 24th November 1969, but has a base date of 31st July 1964. it's baseline value is 100. The index reached a record high in January 2018 of 33,154.12 and recorded its lowest level in August 1967, when the index fell to 58.61.
Financials dominate the index with a weighting of 48.22%. Properties & Construction is the next largest sector with a weighting of 11.20%, followed by Information Technology with 10.24%.
Hong Kong 45 futures allow you to speculate on, or hedge against, changes in the price of major Asian stocks. Futures rollover on the 4th Friday of each month.
SLV, also known as iShares Silver Trust, tracks the price of silver bullion held in London. This ETF provides investors with direct exposure to silver as the ETF physically holds the precious metal in vaults in London. This fund is one of the most liquid of its peer group and is popular among retail and institutional investors.
This ETF is suitable for buy and hold strategies. Traders should consider this asset to gain exposure to the day to day price of silver bullion, to get access to physical silver or to diversify your portfolio and protect against inflation.
ProShares Ultra Silver, also known as AGQ, is a single-day bet, not a buy-and-hold ETF. AGQ is a leveraged ETF that aims to deliver daily investment results that equate to twice the daily price performance of silver bullion, measured by US Dollar for delivery in London.
The Sprott Silver Investment Trust (PSLV) seeks to provide a secure, convenient, and exchange-traded investment alternative for investors interested in holding physical silver bullion without the inconvenience that is typical of a direct investment in physical silver bullion. The Trust intends to achieve this by investing primarily in long-term holdings of unencumbered, fully allocated, physical silver bullion and does not speculate with regard to short-term changes in silver prices.
The Direxion Work From Home ETF (WFH) offers exposure to companies across four technology pillars, allowing investors to gain exposure to those companies that stand to benefit from an increasingly flexible work environment. The four pillars include Cloud Technologies, Cybersecurity, Online Project and Document Management, and Remote Communications. Companies are selected for inclusion in the index by ARTIS, a proprietary natural language processing algorithm, which uses key words to evaluate large volumes of publicly available information, such as annual reports, business descriptions and financial news.
ProShares Ultra Bloomberg Crude Oil ETF (UCO) is a leveraged asset that seeks to deliver twice the daily investment results of the Bloomberg WTI Crude Oil Subindex. This is a single-day bet and is not suitable for buy-and-hold investors. Results can vary significantly if held for periods longer than one day. This is a leveraged ETF so traders take on more risk than with an unleveraged product.
The foreign exchange market, also known as forex, is a decentralized market where currencies are traded 24/5. It has an average daily trading volume of over $5 trillion and facilitates the exchange of one currency into another for businesses, investors, and traders. It is influenced by economic and political events.
Why is Foreign Exchange important?
The foreign exchange market is important because it allows businesses, investors and traders to convert one currency into another, facilitating international trade and investment. It also enables countries to maintain control over their monetary policy and stabilize their economies. Additionally, the foreign exchange market is a major source of financial market liquidity and is used by a wide range of market participants, including banks, corporations, governments, and individual traders. It also enables people to manage the risk associated with currency fluctuations.
How is Forex trading done?
Forex trading is done by buying and selling currency pairs, using a platform provided by a Forex broker such as markets.com. Traders use different strategies and analysis to predict the price movements and decide whether to buy or sell a certain currency pair. It can also be done through contracts for difference (CFDs) which allow traders to speculate on price movements without owning the underlying currency.
The iShares Global Clean Energy ETF (ICLN) seeks to track the investment results of an index composed of global equities in the clean energy sector.
The iShares MSCI KLD 400 Social ETF (DSI) seeks to track the investment results of an index composed of U.S. companies that have positive environmental, social and governance characteristics as identified by the index provider.
The iShares MSCI USA ESG Select ETF (SUSA) seeks to track the investment results of an index composed of U.S. companies that have positive environmental, social and governance characteristics as identified by the index provider.
The iShares ESG MSCI USA Leaders ETF (SUSL) seeks to track the investment results of an index composed of U.S. large and mid-capitalization stocks of companies with high environmental, social, and governance performance relative to their sector peers as determined by the index provider.
iShares MSCI Mexico ETF (EWW) offers traders exposure to a broad range of companies in Mexico and access to targeted Mexican stocks. It has 58 holdings, which include America Movil L, Formento Economico Mexicano, Walmart de Mexico and GPO Finance Banorte.
The fund has almost no technology, energy or utilities stocks as these sectors are government-run in Mexico. The sector-mix is 29.57% Consumer Staples, 21.13% Communication, 15.48% Financials, 12.27% Materials, 10.92% Industrials and the remaining split between real estate, consumer discretionary and health care.
The Federal Reserve bank, or the ‘Fed’ for short, is the central bank in charge of monetary and financial stability in the United States. It is part of a wider system – known as the Federal Reserve system – with 12 regional central banks located in major cities across the US.
What does the Federal Reserve do?
The Federal Reserve performs five main functions to promote the effective operation of the U.S. economy and, more generally, the public
interest. It:
• Conducts the nation’s monetary policy
• Promotes the stability of the financial system
• Promotes the safety and soundness of individual financial institutions
• Fosters payment and settlement system safety and efficiency
• Promotes consumer protection and community development
Who Controls Federal Reserve?
The Federal Reserve is governed by a Board of Governors in Washington, DC, and 12 regional Federal Reserve Banks located throughout the country. The Board of Governors is an independent government agency appointed by the President and confirmed by the Senate. The Chairman of the Board of Governors also serves as Chair of the Federal Open Market Committee, which sets monetary policy.
The Heikin Ashi chart is a type of chart pattern used in technical analysis. Heikin Ashi charts are similar to a candlestick charts, but the main difference is that a Heikin Ashi chart uses the daily price averages to show the median price movement of an asset.
How do you use a Heikin-Ashi chart?
Heikin-Ashi charts resemble candlestick charts, yet have a smoother appearance as they track a range of price movements, instead of tracking every price movement the way candlestick charts do. As with the standard candlestick charts, a Heikin-Ashi candle has a body and a wick. Yet , these candles do not have the same purpose as on a candlestick chart. The last price of a Heikin-Ashi candle is calculated by the average price of the current bar or timeframe.
Is it better to use Heikin-Ashi or candlestick?
Heikin-Ashi averages out price data to create a smoother, easier-to-read chart, while traditional candlestick charts provide more detailed price information. It ultimately depends on the investor's preferences and trading strategy which chart type is better.
Are Heikin-Ashi candles accurate?
Heikin-Ashi candles can be an accurate tool for gauging market trends, although they are often regarded to be less accurate than standard candlestick charts.
Amortization is the process of charging the cost of an asset to expense over a specific timeframe. Amortization also defines the practice of spreading the repayment of a loan. This shifts the asset from the balance sheet to the income statement.
Amortization reflects the consumption of an intangible asset over what is considered a useful timeframe. It is used for the gradual write-down of the cost of those intangible assets that have a specific useful life. It is common to charge interest which is calculated based on the duration and other variables.
Amortization should not be confused with Depreciation. The difference between them is that amortization is about charging “Intangible Assets” to expense over time. While depreciation is about charging “Tangible Assets” to expense over time.
How to calculate amortization?
As we do not provide economic or trading advice we can only include here what is considered to be a generally agreed upon explanation. As stated, generally an Amortization can be calculated by using a straight-line formula such as: (book value - residual value) / useful life.
ProShares UltraShort Bloomberg Crude Oil (SCO), aims to deliver results that are twice the inverse daily performance of the Bloomberg WTI Crude Oil Subindex. It is an ETF product for traders looking to short crude oil in a single day bet. Trades that last for more than a day are not expected to see the same returns.
The subindex reflects WTI Crude Oil prices and only consists of futures contracts on WTI Crude Oil. This is a leveraged product, all leveraged products carry more risk than unleveraged products.
Corn is a soft commodity - referring to those that are grown rather than mined - and is valued for its versatility. As well as being a dietary staple it has many other uses, from biofuels to animal feed.
Corn is grown in every continent on the globe with the exception on Antarctica. 40% of global corn supplies are produced in the US, while China, Brazil, the EU, and Argentina are also major players.
Corn is priced in USD per bushel. In August 2012 corn struck a record high of $849, while the lowest price ever recorded was $22.90 in November 1932.
As corn is a soft commodity, prices are vulnerable to weather conditions which can affect harvests. The strength of emerging market economies also affects prices, as demand for meat products rises as incomes rise, and much of the corn produced each year is used for animal feed.
Corn futures allow you to speculate on, or hedge against, changes in the price of corn. Futures rollover on the fourth Friday of February, April, June, and November.
Cotton is a “soft” commodity - meaning it is grown and not mined - and has for thousands of years been one of the most important crops. Its lightweight and absorbent fibres mean that cotton is the most popular natural fibre on the planet.
China, India, and the US are the top producers of cotton in the world; in the US cotton primarily comes from Florida, Mississippi, California, Texas, and Arizona.
The fibre is priced in USD per lb. It reached a record high price of $210.64 during March 2011 and struck a record low of $5.66 during December 1930.
As well as weather conditions, cotton prices are heavily influenced by demand for competing synthetic fibres and changes in government policy. Cotton farmers enjoy heavy subsidies in the US, so a change here could have significant consequences.
Cotton futures allow you to speculate on, or hedge against, changes in the price of cotton. Futures rollover on the third Friday of February, April, June, and November.
ProShares Ultra Bloomberg Crude Oil ETF (UCO) is a leveraged asset that seeks to deliver twice the daily investment results of the Bloomberg WTI Crude Oil Subindex. This is a single-day bet and is not suitable for buy-and-hold investors. Results can vary significantly if held for periods longer than one day. This is a leveraged ETF so traders take on more risk than with an unleveraged product.
Heating Oil is a low-viscosity petroleum product derived from crude oil. Around 25% of the yield of crude oil is devoted to heating oil, the second most after gasoline products. As a result, prices often closely follow those of WTI crude.
It is priced in USD per gallon, and has a historic high of $3.32 in April 2011. The record low was $0.87 in January 2016.
Heating oil is used as a fuel for furnaces and boilers to heat homes and businesses. It is especially popular in the British Isles and the North-eastern US. As a result, demand fluctuates seasonally, peaking in the colder months between October and March.
Price is, as a result, also affected by cold weather. Other factors affecting price include the price of alternative heating options, energy efficiency and insulation, refining costs and government regulations.
Heating Oil futures allow you to speculate on, or hedge against, changes in the price of Heating Oil. Futures rollover on the third Friday of every month.
Earnings Per Share (EPS) is a financial metric that measures the amount of profit a company makes for each outstanding share of its common stock. It's calculated by dividing net income by the number of shares outstanding. Investors use EPS to measure how profitable a company is and to compare different companies in the same sector.
What is a good earnings per share? Is it better to have a high or low earnings per share?
There is no definitive answer to what constitutes a "good" earnings per share (EPS) as it can vary depending on the industry, the size of the company, and the expectations of the market. Generally, a higher EPS is considered better, as it indicates that a company is generating more profit per share of stock.
What is earnings per share vs dividend?
A dividend is a payment made by a company to its shareholders out of its profits or reserves. Whereas EPS is an indicator of a company's profitability.
The Hang Seng Index, also known as the Hong Kong 45, is an index of the top companies listed on the Stock Exchange of Hong Kong Main Board. Stocks are free float-adjusted but there is a 10% cap on weighting.
The Hang Seng is the bellwether index for the Hong Kong market. Because Hong Kong is a special administrative region of China, many Chinese companies are listed on the Hong Kong Stock Exchange.
The index was launched on 24th November 1969, but has a base date of 31st July 1964. it's baseline value is 100. The index reached a record high in January 2018 of 33,154.12 and recorded its lowest level in August 1967, when the index fell to 58.61.
Financials dominate the index with a weighting of 48.22%. Properties & Construction is the next largest sector with a weighting of 11.20%, followed by Information Technology with 10.24%.
Hong Kong 45 futures allow you to speculate on, or hedge against, changes in the price of major Asian stocks. Futures rollover on the 4th Friday of each month.
The foreign exchange market, also known as forex, is a decentralized market where currencies are traded 24/5. It has an average daily trading volume of over $5 trillion and facilitates the exchange of one currency into another for businesses, investors, and traders. It is influenced by economic and political events.
Why is Foreign Exchange important?
The foreign exchange market is important because it allows businesses, investors and traders to convert one currency into another, facilitating international trade and investment. It also enables countries to maintain control over their monetary policy and stabilize their economies. Additionally, the foreign exchange market is a major source of financial market liquidity and is used by a wide range of market participants, including banks, corporations, governments, and individual traders. It also enables people to manage the risk associated with currency fluctuations.
How is Forex trading done?
Forex trading is done by buying and selling currency pairs, using a platform provided by a Forex broker such as markets.com. Traders use different strategies and analysis to predict the price movements and decide whether to buy or sell a certain currency pair. It can also be done through contracts for difference (CFDs) which allow traders to speculate on price movements without owning the underlying currency.
The iShares ESG MSCI USA Leaders ETF (SUSL) seeks to track the investment results of an index composed of U.S. large and mid-capitalization stocks of companies with high environmental, social, and governance performance relative to their sector peers as determined by the index provider.
The Federal Reserve bank, or the ‘Fed’ for short, is the central bank in charge of monetary and financial stability in the United States. It is part of a wider system – known as the Federal Reserve system – with 12 regional central banks located in major cities across the US.
What does the Federal Reserve do?
The Federal Reserve performs five main functions to promote the effective operation of the U.S. economy and, more generally, the public
interest. It:
• Conducts the nation’s monetary policy
• Promotes the stability of the financial system
• Promotes the safety and soundness of individual financial institutions
• Fosters payment and settlement system safety and efficiency
• Promotes consumer protection and community development
Who Controls Federal Reserve?
The Federal Reserve is governed by a Board of Governors in Washington, DC, and 12 regional Federal Reserve Banks located throughout the country. The Board of Governors is an independent government agency appointed by the President and confirmed by the Senate. The Chairman of the Board of Governors also serves as Chair of the Federal Open Market Committee, which sets monetary policy.
The Heikin Ashi chart is a type of chart pattern used in technical analysis. Heikin Ashi charts are similar to a candlestick charts, but the main difference is that a Heikin Ashi chart uses the daily price averages to show the median price movement of an asset.
How do you use a Heikin-Ashi chart?
Heikin-Ashi charts resemble candlestick charts, yet have a smoother appearance as they track a range of price movements, instead of tracking every price movement the way candlestick charts do. As with the standard candlestick charts, a Heikin-Ashi candle has a body and a wick. Yet , these candles do not have the same purpose as on a candlestick chart. The last price of a Heikin-Ashi candle is calculated by the average price of the current bar or timeframe.
Is it better to use Heikin-Ashi or candlestick?
Heikin-Ashi averages out price data to create a smoother, easier-to-read chart, while traditional candlestick charts provide more detailed price information. It ultimately depends on the investor's preferences and trading strategy which chart type is better.
Are Heikin-Ashi candles accurate?
Heikin-Ashi candles can be an accurate tool for gauging market trends, although they are often regarded to be less accurate than standard candlestick charts.
iShares MSCI Taiwan (EWT) ETF tracks the investment results of an index composed of Taiwanese equities. The ETF provides exposure to large and mid-sized Taiwanese companies and can be used to access to the Taiwanese stock market. EWT includes 90 of the top companies on the Taiwanese Stock Exchange. It is heavily weighted toward the information technology and finance sectors, which account for 55.5% and 18.5% of the portfolio respectively.
The top ten holdings include Taiwan Semiconductor Manufacturing, Hon Hai Precision Industry Ltd, Formosa Plastics Corp and Chunghwa Telecom Ltd.
What is a Lot in trading?
In trading, Lots are defined as the number of units of a financial instrument bought or sold on an exchange. A Round Lot is made of 100 shares, where an Odd Lot can be made of any number of shares less than 100. As for bonds, their lots follow a different set of rules. They can range from $1,000 to $100,000 or $1 million. In Forex, trade is done via lots, which are essentially the number of currency units traders buy or sell. As such, a “lot” is a unit measuring a transaction amount. The standard lot is 100K units of currency. Additionally, there are also mini lots valued at 10K units of currency, micro lots valued at 1K units of currency and nano lots that contain 100 units of currency.
What is a lot size in trading?
Lot size in trading refers to the number of units or shares of a security that are traded at once. It's a way to measure the amount of a security that is being bought or sold in a single transaction.
How many shares are in a lot?
The number of shares in a lot can vary depending on the security being traded and the exchange or platform it is traded on. For example, in the US stock market, a standard lot size is 100 shares, but it can be different in other markets or for other securities such as futures or forex.
What is a good lot size?
A good lot size in trading depends on the specific circumstances and goals of the trader. A lot size that is too small may not be cost-effective and may not allow the trader to achieve their desired position size. A lot size that is too large can be too risky and may not be affordable.
iShares MSCI South Korea (EWT) ETF tracks the investment result of an index composed of South Korean equities. It provides traders with exposure to large and mid-sized South Korean companies and is a way to access the South Korean Stock Market. EWY follows 114 of the top companies listed in the South Korean Stock Exchange, and reflects the market well.
With Samsung as one of the major companies represented in the portfolio, it is unsurprising that Information Technology companies comprise a large part of this ETF. Almost 30% of the portfolio is IT, the next largest sector is Finance with 14.06%. Hyundai, LG and Kia also feature in this ETF.
The iShares Global Clean Energy ETF (ICLN) seeks to track the investment results of an index composed of global equities in the clean energy sector.
An Order in trading is a request sent by a trader to a broker or trading platform to make a trade on a financial instrument such as shares, Crypto, CFDs, currency pairs and assets. This can be done on a trading venue such as a stock market, bond market, commodity market, financial derivative market, or cryptocurrency exchange
What are the most common types of orders?
Common types of orders are:
• Market Orders. A market order is given by traders and investors as an order to immediately buy or sell an asset, security, or share. Such an order guarantees that the order will be executed, yet the actual execution price is not guaranteed.
• Limit Orders. A limit order is an order to buy or sell an asset such as a security at a specific price or better than that price. Traders wishing to define a maximum price for either buying or selling an asset can use limit orders.
• Stop Orders. Stop orders instruct brokers to execute a trade when the asset’s price reaches a certain level.
The Proshares Bitcoin Strategy ETF (Bitcoin ETF) offers managed exposure to bitcoin futures contracts. The Fund does not invest directly in bitcoin and may also invest in other instruments. It’s one of the first of its kind and marks a new way to get exposure to cryptocurrency price movements.
Futures contracts for Orange juice (ORA) are based upon frozen concentrated orange juice (FCOJ).
Brazil is by far the world's largest producer of oranges, harvesting 20 million metric tonnes per year. China is in second spot, but still far behind, with an annual yield of 7 million, followed by the EU (6.5 million), the US (4.8 million), and Mexico (4.6 million).
Factors that can affect the supply - and therefore the price - of orange juice include weather, crop disease, and the strength of the US dollar. For instance, orange juice futures often increase in price when hurricanes travel towards Florida, a key growing region. Consumer demand often plays a role as well; orange juice is a popular breakfast staple, but a move away from drinks with high sugar content has seen demand decline in recent years.
The iShares MSCI KLD 400 Social ETF (DSI) seeks to track the investment results of an index composed of U.S. companies that have positive environmental, social and governance characteristics as identified by the index provider.
The iShares MSCI USA ESG Select ETF (SUSA) seeks to track the investment results of an index composed of U.S. companies that have positive environmental, social and governance characteristics as identified by the index provider.
iShares MSCI Mexico ETF (EWW) offers traders exposure to a broad range of companies in Mexico and access to targeted Mexican stocks. It has 58 holdings, which include America Movil L, Formento Economico Mexicano, Walmart de Mexico and GPO Finance Banorte.
The fund has almost no technology, energy or utilities stocks as these sectors are government-run in Mexico. The sector-mix is 29.57% Consumer Staples, 21.13% Communication, 15.48% Financials, 12.27% Materials, 10.92% Industrials and the remaining split between real estate, consumer discretionary and health care.
Short selling is a trading strategy where an investor borrows shares of a stock or security they believe will decrease in value, and then sells it on the market. If the price of the stock or security falls as expected, the investor can then buy the shares back at the lower price, return the borrowed shares, and keep the difference as profit. Short selling is considered a high-risk strategy because theoretically there is no limit to how high the price of a stock can go, so the potential loss is theoretically infinite.
What is the benefit of short selling?
The benefit of short selling is that it allows investors to benefit from a decline in the value of a security. While traditional investors can only benefit when the prices of the assets they hold increase, short sellers can do well when the prices decrease as well. This allows investors to potentially profit in both rising and falling markets. Additionally, short selling can also be used as a hedging tool, to offset the risk of long positions in a portfolio.
Is Short Selling a good idea?
Short selling can be a good idea for some investors, but it is considered a high-risk strategy and is not suitable for all investors. It requires a great deal of knowledge and experience to correctly identify the securities that are likely to decrease in value and to correctly time the trade. Additionally,because the potential losses from short selling can be theoretically infinite as explained above it is important for investors to fully understand the risks and potential rewards associated with short selling before engaging in this strategy.
ProShares UltraShort Russell2000 (TWM) is a leveraged product that seeks to deliver twice the inverse of the daily performance of the USA2000 Index. Results aims to be 200% of the opposite to the movement of the index. This is a daily-bet, so results will vary dramatically for positions held longer than one day.
The USA2000 Index covers US small cap companies and a broad range of sectors including finance and tech. Holdings include Etsy, Planet Fitness and Hubspot.
A share is a partition of the total value of a company. Each share represents a unit of ownership in that company, and therefore also the value that it holds. Should a company choose to sell shares as a means of fundraising, this is known as equity finance.
A share owner is called a shareholder (or stockholder). The ongoing value of a share, once it is introduced to the market, is its trading value at any given time, which can be either lower or higher than the original value. A share is worth whatever price it is currently trading at. An actual transaction of shares between a buyer and a seller is usually considered to provide the best market indicator as to the "true value" of that share at that time. The difference between current price and open price will represent either a profit or a loss to the investor who purchased it.
There are different types of shares in the trading domain, including Cumulative & Non-cumulative Preference Shares, Participating & Non-participating Preference Shares, Convertible & Non-convertible Preference Shares, Redeemable & Un-redeemable Preference Shares.
It is also possible to use CFDs to trade shares. This enables traders to take a leveraged position on whether a share rises or falls. This different type of share trading opens up more trading opportunities by either buying or selling the asset without physically owning it.
ProShares UltraPro Short QQQ (SQQQ) is an inverse leveraged ETF that tracks the performance of the Nasdaq 100 index. This ETF aims to deliver a daily output that is three times the inverse of the daily performance of the Nasdaq 100. That means SQQQ will deliver results that are 300% opposite to how the index has moved. They are a useful product for traders looking to go short or to hedge their other positions.
The Nasdaq 100 includes the largest companies on the Nasdaq stock market and holdings include Apple, 21st Century Fox Inc, Kraft Heinz and Facebook. This is a single-day bet and is not recommended for use for longer than periods of one day, as the results will differ. Leveraged products carry more risk.
ProShares UltraPro Short S&P500 (SPXU) seeks daily investment results that are 300% the inverse of the daily performance of the S&P 500. This is a single day bet for traders looking to go short on S&P500 or hedge other trades. Like any leveraged product, there is more risk involved in this ETF than in unleveraged products.
S&P500, the index that it inversely tracks, is considered a benchmark for large-cap US equities. It comprises 500 leading companies, many of which are household names, and a broad range of sectors – although tech firms feature heavily. Holdings include Microsoft, Apple, Amazon, Berkshire Hathaway and Johnson & Johnson.
ProShares UltraShort QQQ (QID) aims to deliver daily investment results that are twice the inverse daily performance of the Nasdaq 100 Index. This is a single-day bet and traders are advised that returns can vary dramatically if they hold positions for longer than one day. This is the sister product to QLD, which delivers two times the daily performance of the Nasdaq 100.
As with most inverse and leveraged products, this fund is designed to provide inverse exposure on a daily basis, not as a long-term inverse bet against the index. All leveraged products carry more risk. Nasdaq 100 holdings include Apple, Amazon, Facebook and Tesla.
ProShares UltraShort S&P500 (SDS) looks to deliver daily investment results that are twice the inverse of the daily performance of the S&P500. This is a leveraged product and designed as a single-day bet. Returns for periods longer than one day could expose investors to performance drift.
S&P500, the index that it inversely tracks, is considered a benchmark for large-cap US equities. It comprises 500 leading companies, many of which are household names, and a broad range of sectors – although tech firms feature heavily. Holdings include Microsoft, Apple, Amazon, Berkshire Hathaway and Johnson & Johnson.
A share buyback, also known as a stock repurchase, is when a company buys back its own shares from the open market. This reduces the number of outstanding shares and increases the ownership stake of existing shareholders. Buybacks can be used as a way for a company to return excess cash to shareholders, increase earnings per share, or signal confidence in the company's future prospects.
Is share buyback a good thing?
Share buybacks can have both positive and negative effects on a company and its shareholders. On one hand, buybacks can be seen as a sign of a company's financial strength, as they suggest that the company has excess cash and believes its own stock is undervalued. Additionally, buybacks can help to boost earnings per share, which can increase the company's valuation. On the other hand, buybacks can also be criticized for diverting resources away from investments in growth or other opportunities, or for being used as a way to artificially boost the stock price. It's important for investors to evaluate the company's financial situation and the reason behind the buyback before making a decision on whether it is good or not.
What happens to share price after buyback?
Share price can be affected by a buyback in different ways, it will depend on the market conditions, the company's financial situation and the reason behind the buyback. In general, a buyback can help to boost the share price by increasing earnings per share and reducing the number of outstanding shares. Additionally, the announcement of a buyback can also signal confidence in the company's future prospects, which can attract more buyers to the stock. However, a buyback doesn't guarantee an increase in the stock price, if the market conditions are not favorable or if the company's financial situation is not good, the stock price could remain unchanged or even decrease.
What is the reason for share buyback?
A company may choose to buy back its own shares for a variety of reasons, including:
-Returning excess cash to shareholders: A buyback can provide shareholders with a more direct benefit from the company's cash reserves, rather than leaving the money idle or reinvesting it in less profitable ventures.
-Increasing earnings per share: By reducing the number of outstanding shares, buybacks can increase earnings per share, which can make the company look more valuable to investors.
-Signaling confidence: A buyback can signal to the market that the company's management believes the stock is undervalued, which can attract more buyers to the stock.
-Boosting stock price: By purchasing shares in the open market, a buyback can help to boost the stock price, which can benefit existing shareholders.
-Mitigating dilution: If a company issues new shares, it can dilute the value of existing shares, buying back shares can help to mitigate this dilution.
It's important to note that buybacks can also be used as a tool by management to artificially boost the stock price in the short term, rather than for the benefit of long-term shareholders.
A spot price is the current market value of an asset or security. It's the amount you would pay to buy or sell it at that exact moment in time. Spot prices are constantly changing, as they depend on supply and demand forces in the marketplace. Spot prices provide important insights into market trends and can be used by traders to make investment decisions.
Why is it called a spot price?
It is called a "spot" price because it refers to the price at which an asset can be bought or sold "on the spot" or immediately.
How is spot price calculated?
The spot price of a commodity, security, or currency is typically determined by supply and demand factors in the market. The price is influenced by a variety of factors such as production costs, political and economic conditions, and speculation.
What are Support Levels?
Support levels refer to the levels at which the price of an asset tends to stop falling and stabilize. These levels are determined by analyzing past price movements and identifying a floor at which buying pressure is strong enough to prevent the price from falling further. Traders and investors use support levels as a guide for placing buy orders, and as a signal for potential buying opportunities.
What does support level mean in Crypto?
Support levels mean the same thing regardless of the asset class in question.
What is the best indicator for support and resistance?
There are several indicators that can be used to identify support and resistance levels in a market. Some commonly used indicators include moving averages, Fibonacci retracements, and pivot points. However, no single indicator is considered to be the "best" as different indicators may work better in different market conditions and for different traders. Ultimately, the best indicator is the one that works best for you and fits your individual trading style and strategy.
The FTSE/JSE index, also known as the South Africa 40, is a market capitalisation-weighted index of the largest and most liquid 40 companies trading on the Johannesburg Stock Exchange.
The index was launched on 24th June 2002, with a base date of 21st June 2002 and a base value of 10300.31.
The largest sector in the index is Media, which accounts for 22.27% of the total index weighting. Basic Resources is the second largest, accounting for 19.9% of the total weighting, followed by Personal & Household Goods and Banks, with 12.43% and 12.35% respectively.
South Africa 40 futures allow you to speculate on, or hedge against, changes in the price of major stocks on the Johannesburg Stock Exchange. Contracts rollover on the second Friday of March, June, September, and December.
Trading charts are used to display historical price data for a security or financial instrument. They typically include a time frame on the x-axis, and the price of the security or instrument on the y-axis. Candlestick charts, bar charts and line charts are the most common types of charts used in trading. Candlestick charts are the most popular and provide a visual representation of the opening price, closing price, highest and lowest price of the security in a given period of time. It also shows the direction of the price movement, whether it went up or down. Traders use different technical analysis tools like trendlines, moving averages, and indicators to interpret the charts and make trading decisions. There is a great deal of nuance in reading charts and doing it correctly will require experience and an understanding of how your chart of choice is presenting information to you.
How do you predict if a stock will go up or down?
Traders use different technical analysis tools and techniques to predict if a stock will go up or down using trading charts. These include:
Trendlines: By connecting price highs or lows over a period of time, traders can identify the direction of the trend and predict future price movements.
Moving averages: By plotting the average price over a period of time, traders can identify trends and potential buying or selling opportunities.
Indicators: Technical indicators, such as the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD), are mathematical calculations that are plotted on charts to help traders identify trends, momentum and potential buy or sell signals.
Chart patterns: Traders also use chart patterns such as head and shoulders, double bottoms, and triangles to identify potential reversal points in the market and make predictions about future price movements.
It's important to note that technical analysis is not an exact science and it's not a guarantee of future results. Traders should always use technical analysis in conjunction with fundamental analysis, which looks at a company's financial and economic conditions, to make informed trading decisions.
How do you know if a chart is bullish?
A chart is considered bullish if it is showing an upward trend or pattern, indicating that the price of a security or financial instrument is likely to rise. Bullish chart patterns include upward trending lines, ascending triangles, and bullish candlestick patterns such as the hammer or the bullish engulfing pattern. Traders often consider a stock to be bullish when it's trading above the moving average, especially when the moving average is trending upward.
Soybeans are a “soft” commodity - referring to those that are grown and not mined. It is one of the world's most important legumes and is an essential source of protein. It is used extensively in cooking, both soybeans and soy oil, and is also used for animal feed in the form of soy meal.
Soybean is priced in USD per bushel. In July 2012, Soybeans reached an all-time high of $1790, while it reached a low of $208 in September 1959.
The US are the biggest producers of Soybeans, followed by Brazil, Argentina and Paraguay. Together they account for 85% of total production, and 94% of total exports. China is the biggest importer of soybeans.
The price of soybeans is affected by a number of factors, including growing conditions, the demand for biofuel and the strength of USD.
Soybean futures allow you to speculate on, or hedge against, changes in the price of soybeans. Futures rollover on the fourth Friday of February, April, June, October, and December.
The term Spreads in trading is defined as the gap between the highest price to be paid for any given asset, to the lowest price the current asset holder is willing to sell at. Different markets and assets generate different spreads. For example, the Forex market, where both buyers and sellers are very active with this “gap” or spread will be small.
In trading, a spread is one of the key costs of online trading. Generally, the tighter the spread, the better value traders get from their trades. Also, spreads are implied costs, where it is presented to traders in subsequent trades, as the assets traders buy on leverage must increase above the level of the Spread, rather than the above the initial price, for traders to make profit.
What is the importance of a Spread?
The Spread is important, even a crucial piece of information to be aware of when analysing trading costs. An instrument’s spread is a variable number that directly affects the value of the trade. Several factors influence the spread in trading:
• Liquidity. How easily an asset can be bought or sold.
• Volume. Quantity of any given asset that is traded daily.
• Volatility. How much the market price changes in a given period.
Synthetix (SNX) is a decentralized protocol that lets users gain exposure to assets like other cryptos, gold, and stocks, without actually holding the underlying resource. These synthetic assets are backed by the platform's cryptocurrency, Synthetix Network Token (SNX), which is staked as collateral in order to generate rewards. It is priced in USD and can be traded using the SNX/USD symbol.
A Stop Loss Order is a type of order that investors can use to limit losses when trading securities. This order instructs a broker to automatically sell a security when it reaches a certain price, known as the stop loss price. By using this order, investors can reduce their risk exposure by locking in gains and preventing larger losses.
How does a stop-loss order work?
A stop-loss order is an investment strategy that helps you limit losses by automatically selling your securities when they drop to a predetermined price. By setting up this order, you can avoid having to monitor the stock's performance every day and ensure that any potential losses are minimized.
What is the difference between a stop-loss and a stop limit order?
A stop-loss order is used to limit losses on a security position by automatically selling when the price drops below a specified level. Whereas a stop-limit order combines the features of a stop-loss with those of a limit order, enabling traders to specify both the price at which they are willing to sell and the maximum loss they are willing to take.
What is a good stop-loss order?
A good stop-loss order is one that is placed at a level that effectively limits potential losses on a trade. The specific level at which to place a stop-loss order will depend on the trader's risk tolerance and the price action of the security being traded. Generally, traders will place stop-loss orders at levels that are below the current price for long positions, or above the current price for short positions, in order to limit potential losses if the price moves in the opposite direction. It's important to note that stop loss orders act as a protective measure, but they don't guarantee that a trade will be executed at the exact stop loss level.
XLM, or Lumens, is Stellar network’s cryptocurrency. It is designed to support instant global transactions to give access to low-cost financial services. Trade XLM/USD spot rates with this instrument.
Stock trading is the practice of buying and selling stocks, or shares of ownership in a publicly-traded company, with the goal of making a profit through price appreciation or by receiving income in the form of dividends. Stock traders buy and sell shares in the stock market using a brokerage account, and they use a variety of strategies and techniques to determine when to enter and exit trades. Stock trading is a popular form of investment, but it also comes with risks and profits are in no way guaranteed. You should acquire a good understanding of the market and individual stocks before making trading decisions.
How are Stocks Different from Other Securities?
Stocks, also known as equities, represent ownership in a corporation, while other securities represent claims on an underlying asset. Other types of securities include bonds (debt securities), options, and derivatives.
How Do I Start Trading Stocks?
You can trade stocks using a stock exchange. Platforms like markets.com offer CFDs on stocks and other securities so you can start assembling and get trading outcomes of your own!
Stock dilution is the decrease in existing shareholders' ownership of a company as a result of the issuance of new shares. It typically occurs when companies raise capital by issuing additional shares, thereby reducing the stake of existing shareholders.
Why do companies dilute stock?
Companies dilute stock to raise capital for future growth and investments, often through the sale of additional shares. This allows companies to raise money without having to take out loans or issue bonds. Diluting stock can help reduce overall debt and create a healthier financial situation for the company.
Is stock dilution a good thing?
It depends. If done properly, diluting stock can help raise funds for business operations and growth. It also encourages investors to purchase shares due to the lower price per share. However, too much dilution can weaken shareholder equity and damage investor confidence.
What does dilution do to stock price?
Dilution decreases a stock's price by decreasing its earnings per share (EPS). This happens when a company issues new shares to the public, increasing the total number of shares outstanding and resulting in lower EPS for existing shareholders. Dilution can also occur through corporate acquisitions, mergers or issuing debt that is converted into equity.
A quoted price is the most recent price at which an asset was traded at. Global and local events, either of a financial nature or completely unrelated to finances continually affect the quoted prices of assets such as stocks, bonds, commodities, and derivatives changes continually throughout a trading. Additionally, It is often the price point where buyers and sellers agree on, the most up-to-date agreement between buyers and sellers, or the bid and ask prices. It is also where supply meets demand.
Is a quoted price legally binding?
In most cases, when trading in an exchange, the quoted price is binding and the trade is executed at the quoted price, with the exchange acting as a counterparty to the trade. However, when trading OTC (over-the-counter), the quoted price is not necessarily binding as the parties have more flexibility in negotiating the final price, and the counterparty risk is higher.
Spread Betting is a type of financial speculation which allows you to take a position on the future direction of the price of a security, such as stocks, commodities or currencies. You can choose to speculate whether an asset will go up or down in value, without having to buy or sell it. Spread Betting enables you to take a view on the markets and gain access to the financial markets with limited capital outlay.
How does a spread bet work?
A spread bet is placed by betting on whether the asset's price will rise or fall. The investor can set their own stake size, which means they can take more or less risk according to their preferences. Spread bets are flexible and convenient, allowing you to benefit from even the slightest market movements.
What does a negative spread mean?
A negative spread in trading refers to a situation where the ask price for a security is lower than the bid price. This means that a trader could potentially sell a security for a higher price than they would have to pay to buy it. This is an unusual situation that can occur due to a temporary market anomaly or a technical error. Negative spreads are rare and they tend to be corrected quickly, as they represent an opportunity for arbitrage. Traders should be cautious when dealing with negative spreads and should consult with their broker or trading platform to understand the cause of the negative spread and its potential impact on their trade.
Stop Orders are a type of stock order that helps limit the investor’s risk. The order triggers a purchase or sale once a set price is reached, either above (stop buy) or below (stop sell). Stop Orders are used to protect investors against an unfavorable price movements and lock in potential gains.
How long do stop orders last?
Stop orders are instructions given to a broker to buy or sell an asset when its price reaches a predetermined level. Stop orders remain in effect until the stop price is triggered, at which point the order becomes a market order and will be executed. This means that stop orders may last for an indefinite amount of time. It is important to monitor the current market price closely as stop orders do not guarantee execution.
Are stop orders a good idea?
Stop orders can be useful as they can help limit an investor's loss or protect a profit on a security. They are often used to automatically exit a position when the market moves against the investor. However, the use of stop orders may be subject to market conditions and the specific investment strategy of an investor, so whether or not they are a good idea depends on the individual's financial situation and risk tolerance.
ProShares Ultra QQQ (QLD) aims to deliver daily investment results that are twice the performance of the Nasdaq 100 Index. This ETF provides leveraged exposure to a market-cap weighted index of 100 non-financial stocks listed on the NASDAQ. This is a single-day bet and traders are advised that returns can vary dramatically if they hold positions for longer than one day. All leveraged products carry more risk than unleveraged products.
The Nasdaq 100 is dominate by tech firms, so the performance of the index is closely tied to the sector. Top holdings include Apple, Amazon, Facebook and Tesla.
SLV, also known as iShares Silver Trust, tracks the price of silver bullion held in London. This ETF provides investors with direct exposure to silver as the ETF physically holds the precious metal in vaults in London. This fund is one of the most liquid of its peer group and is popular among retail and institutional investors.
This ETF is suitable for buy and hold strategies. Traders should consider this asset to gain exposure to the day to day price of silver bullion, to get access to physical silver or to diversify your portfolio and protect against inflation.
The Sprott Silver Investment Trust (PSLV) seeks to provide a secure, convenient, and exchange-traded investment alternative for investors interested in holding physical silver bullion without the inconvenience that is typical of a direct investment in physical silver bullion. The Trust intends to achieve this by investing primarily in long-term holdings of unencumbered, fully allocated, physical silver bullion and does not speculate with regard to short-term changes in silver prices.
ProShares UltraShort 20+ Year Treasury (TBT) aims to deliver daily investment results that reflect twice the inverse of the daily performance of the ICE US Treasury 20+ Year Bond Index. Traders would look to get a 200% return opposite to the movement of US Treasury Securities.
This is a leveraged product, and so carries more risk. As with many leveraged ETFs, it delivers daily results and it designed as a single day bet. Positions that are held for longer than a day will get differing results. This ETF can be a useful tactical position or hedge against rising interest rates.
Wheat is one of the world's most important agricultural commodities, with around two-thirds of global production for food consumption. It is a “soft” commodity, which means it is grown and not mined.
Wheat is priced in USD per bushel, it reached a record high of $1194.50 in February 2008, but slumped to a record low of $192 in July 1999.
An incredibility versatile grain, wheat is harvested somewhere in the world every single month of the year. There is more land used for wheat production than any other crop worldwide, and it is behind only corn and rice in total production.
Wheat prices are affected by a number of factors, including import/export restrictions, stock levels and the strength of the USD. However, one of the biggest drivers of substantial volatility is supply-chain disruptions caused by natural disasters and extreme weather events.
Wheat futures allow you to speculate on, or hedge against, changes in the price of wheat. Futures rollover on the fourth Friday of February, April, June, August and November.
WisdomTree U.S. LargeCap Dividend (DLN) consists of the 300 largest companies ranked by market capitalisation from the WisdomTree Dividend Index. The Index is a fundamentally weighted index that measures the performance of large-cap dividend-paying US companies.
The top ten stock holdings account for 26.76% of the index and include Microsoft, Apple, Exxon Mobil and Verizon Communications. Four sectors (Information Technology, HealthCare, Consumer Staples and Financials) account for 56.4% of the index’s holdings. This ETF is a good option for traders looking for exposure to large cap equity from dividend-paying companies.
The WisdomTree Emerging Markets High Dividend ETF (DEM) tracks the WisdomTree Emerging Markets Dividend Index. The index is a fundamentally weighted index that is comprised of the highest dividend-yielding common stocks selected from the WisdomTree Emerging Markets Dividend Index. This provides it with some downside protection from market volatility.
DEM is an equity fund, and has a mix of market sectors. It includes stocks from key emerging markets such as Russia and China, with assets including China Contruction Bank, China Mobile and Norilsk Nickel.
Working orders, also known as pending orders, include Stop orders and Limit orders. Essentially, they’re instructions for a broker to perform a trade when an asset hits a certain price. These orders inform brokers that traders wish to make that trade only if something happens to the asset price.
What is the best order type when buying stock?
The best order type depends on the individual's specific needs and market conditions. It's important to understand the trade-off between speed and price certainty when choosing an order type. Market orders provide immediate execution but at the current market price, while limit orders offer price certainty but may not be executed if the desired price is not reached.
What is an open work order?
An open work order in trading is an outstanding order to buy or sell a security that has not yet been executed. It remains open until it is either filled or cancelled by the trader.
ProShares Ultra Silver, also known as AGQ, is a single-day bet, not a buy-and-hold ETF. AGQ is a leveraged ETF that aims to deliver daily investment results that equate to twice the daily price performance of silver bullion, measured by US Dollar for delivery in London.
The Direxion Work From Home ETF (WFH) offers exposure to companies across four technology pillars, allowing investors to gain exposure to those companies that stand to benefit from an increasingly flexible work environment. The four pillars include Cloud Technologies, Cybersecurity, Online Project and Document Management, and Remote Communications. Companies are selected for inclusion in the index by ARTIS, a proprietary natural language processing algorithm, which uses key words to evaluate large volumes of publicly available information, such as annual reports, business descriptions and financial news.
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