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Trading is all about risk vs reward. It is because trading without leverage increases potential rewards exponentially. Still, the same multiplier applies to losses, meaning that should the price suddenly move against you, your loss will be exponentially more significant than your profit should the price suddenly turn around in your favour.

Position trading is one of many forms of trading available and falls under the umbrella of ‘algorithmic trading’. Position traders make trades on a slower time scale than day-traders or swing traders – using indicators that give them buy/sell signals at longer intervals (orders can last for months rather than minutes).

Indicators that are used include moving averages, Ichimoku Clouds, Bollinger Bands and RSI. A typical position trade will utilize all of these indicators to give a buy signal at the lowest point in a downward trend and a sell signal when prices return to an upward trend after touching the bottom of a downward one.

Once you have your signals, you’ll need to make sure to place an order with your broker. It is where things get tricky for new traders – most brokers only accept market orders, not limit orders.

Market Orders:

A market order will execute an order at whatever price it finds on the other side of the trade – so should you put in a market buy order when RSI is giving an oversold signal. Still, someone has already put in their sell-order at the current low price; then your buy-order will be executed at this ‘market’ price, not the price you set when placing your order.

Limit Orders:

A limit order is where you set a take-profit or stop loss for your position and only execute the trade should prices reach this point. For example – if RSI is giving an oversold signal, Bollinger bands are tightly around the current price. It’s not safe to place a market buy order yet as there could be considerable downside before any upward trend begins. Instead – try putting in a limit buy order at 1% below the current market value. This way, if prices drop suddenly due to news etc., your position will only be executed once markets return to their normal range.

Common Position Trading Strategies

Traders who use position trading methods can focus on the long-term picture rather than reacting to short-term market noise. Position traders disregard minor trend fluctuations. Therefore they need strategies that are rooted in rationality and analysis.

Breakout Trading Strategy

Traders in a breakout trading strategy wait for the price line to cross a support or resistance level. When the overhead resistance is broken, the trader enters an extended position. Conversely, when the price breaks through the support line, he closes his trade. This trading technique will pay off if you are adept at detecting recurring support and resistance levels.

Pullback and Retracement Trading Strategy

The fact that traders use pullbacks to plan entry demonstrates how important they are in the market. Traders look for pullbacks in their trading techniques to guide their entry. The policy is to buy low and sell high, which means you should buy low and sell high when the price drops during a pullback. When the price drops during a pushback, traders enter the market.

Range Trading

When the price moves within periodical highs and lows, traders employ a range trading method without any apparent trend. Traders utilize price range methods to identify oversold assets to buy and overbought assets to sell.

Conclusion

Position traders rely on fundamental and technical analysis to understand the market movement. These techniques aren’t simple to follow, especially for inexperienced investors, but if you’re interested in positional trading, they’ll help you become more comfortable with your decisions.

If all of that sounds a bit complicated, then don’t worry – it is! Trading isn’t for everyone, and I’d recommend starting by reading as much material on investing as you can before making any moves. A perfect place to start learning about trading is at Saxo Bank. Check them out!

People, for their nature, are in a constant quest for finding ways for making money or profiting from their capital. Due to the recent events though, this attitude has begun to be predominant for those restricted at home, and that’s how online stock trading began its unstoppable rise.

Between the many broker firms you can find online, there are some which may be considered more trustworthy than others. Traders tend to make a difference between regulated brokers and non-regulated ones, and for a good reason: brokerage services which are not regulated by a regulator lead often to scams and money-losses.

That’s why today our focus will be addressed towards one of the most famous regulated brokers available online: eToro.

In this eToro review we’ll discuss main features related to the eToro trading platform, regulation, fees and everything you need to know before start trading with it.

eToro: Why It’s Safe

Born in 2007 as “Retail FX” in Tel Aviv, this brokering service has now reached and surpassed $800 million in value and it’s used by +10 millions people across the world.

This achievement has been reached for many reasons, and one of these is surely being a very well-regulated broker. In fact, eToro has a presence worldwide with many offices across the world and different entities for different regions, and each one of those are regulated from local and internationally recognized top-tier regulators such as CySEC, ASIC, FCA and FinCEN.

Additionally, this broker offers high protection standards for its client’s funds. We’re speaking in regards to two measures enacted by eToro: negative balance protection and segregated accounts.

While negative balance protection consists in an automatic block of the trader’s balance before it goes in red, segregated accounts are an extra-precautionary measure useful in the unlikely case of the broker’s bankruptcy. With segregated accounts, traders’ money cannot be touched by liquidators or anyone else outside of the one who made the deposit, because they’re the only one allowed to access the bank account.

eToro: Why It’s Famous

eToro has become an international phenomena for plenty of reasons, but one of the strongest has always been related to that revolutionary idea called Social Trading.

This brokerage service has implemented autonomously a proprietary trading platform which has integrated many features inspired by main social media. Once you’ve opened eToro, you’ll find that assets are treated like Facebook’s posts or tweets, with other traders discussing and arguing on the last news regarding it.

Furthermore, what really made eToro’s fortune has been the most iconic feature of all: the Copy Trading.

This innovative feature made it possible, even to the less experienced trader, to copy other traders and their portfolio in an automated way. In fact, once enabled this feature opens any position opened in the selected portfolio, and so it will be for any future position.

Those targeted by this feature are usually a part of what we’d call “Influcencers” if we were on a social platform, but here they are called Top Investors. These kinds of traders are a sort of peculiar asset and you can invest in them depending on their risk level and your profit aims.

If you are a new trader though, we strongly suggest you to pick a Top investor with a low risk ratio.

eToro: Before You Start

If you want to start trading by opening an account with eToro, you can do it by doing a minimum deposit of only $50 if you’re a US resident. If you don’t want to commit and invest money straight away, this is not the only way to start.

As a matter of fact, eToro allows you to open a free demo account. By using this form of trading, you’ll be able to practice how much you want, without fearing making mistakes that will lead you to lose money.

If you have tried your hand at stock trading, you may know how a demat account works. When you buy equity shares, these get credited into your demat account. Similarly, when you sell those shares, they get debited from your demat account. The account functions like a savings bank account, except that instead of parking cash it stores your financial security certificates.You can open an account with a depository participant (DP) like a bank or broker. In return for the service, you will incur demat account charges.

Now, you know that an individual can hold multiple bank accounts. Does this option extend to demat accounts as well? The answer is ‘yes’. However, there are some conditions to bear in mind if you are planning to open a second or third demat account. Being aware of these restrictions will ensure a seamless demat account opening process.

Have questions about the implications of opening multiple demat accounts? Here are the answers to some common demat account questions:

1. Is it legal to have more than one demat account in India?

Yes, it is legal to hold more than one demat account. In fact, there are no restrictions on the number of demat accounts a person can have provided you keep paying the demat account charges.

Is there scope for confusion? Not really. That’s because each time you open a demat account, your Permanent Account Number (PAN) card serves as the unique identifier.No matter how many demat accounts you open, they will all be linked to the same PAN. All the security transactions you make through those multiple accounts will be reflected accordingly.

2. Can you open two demat accounts with the same broker?

Unfortunately,that is not possible. You cannot apply for another account with your existing broker. However, you can approach a different broker to openthe second demat account. Just ensure that the broker is registered with one of the central depositories, whether Central Depository Services Ltd(CDSL) or National Securities Depository Limited (NSDL).

3. Isit safe to keep shares in multiple demat accounts?

Your shares are secure in any demat account. Opening multiple demat accounts will not compromise their safety. In fact, you may be surprised to learn that stockbrokers have no control over demat accounts. Your shares in the demat account are held with a central depository—either CDSL or NSDL. The stockbroker is simply a depository participant (DP) acting on behalf of the depository.

4. Do multiple demat accounts need multiple trading accounts?

No, they do not. You can link your subsequent demat accounts with any existing trading account. For instance, if you engage in both trading and investing, you could maintain one demat account for stock trading and another for your investments.This would allow you to segregate your trading and investment portfolios with ease.

5. What pointers should be noted before opening multiple demat accounts?

• You will incur demat account charges for every account you hold. While some DPs waive the account opening fee, you will have to pay an annual maintenance charge (AMC) as well as transaction charges.The AMC would apply even if one of your demat accounts is lying idle.If you don’t really need the extra account, think about whether it is worth the extra demat account charges.

• It may happen that one of your demat accounts remains dormant for a certain period. In this case, the DP will freeze the account. You would have to fulfill the Know-Your-Customer (KYC) formalities all over again to reactivate the account.

• If an account is likely to be idle for a prolonged period, you could submit a freeze request to your DP. This ensures that your account cannot be misused during the dormant phase. However, corporate action benefits like dividend payments will continue to be credited to your account automatically.

• When you have multiple demat accounts, ensure that all the accounts are linked with your PAN card and Aadhaar card.

• A perk of having multiple demat accounts with multiple DPs is that you gain access to different trading platforms, products, and services. You can also gather valuable insights by accessing and comparing their research reports.

The bottom-line

As you can see, it is perfectly legal to have multiple demat accounts in India. However, you should weigh the pros and cons before applying for an additional account. While there are benefits to maintaining more than one account, you do incur extra demat account charges. Plus, you have to stay updated on all transactions across your different demat accounts by going through holdings and transaction statements with a fine-tooth comb.

Are you not happy with your current DP?Rather than open a fresh demat account, you could consider moving to another DP. For instance, to gain access to powerful trading and investment platforms, you could open an account with a tech-forward broker like Kotak Securities. Just make sure to shop around for a demat account and a DP that fits your bill of requirements.

The foreign exchange market, aka forex market, is famous for its extra-ordinary facilities when it comes to buying and selling various currencies all around the globe. Just like the stocks, the main objective of forex trading is buying low and selling high. In this way, traders can yield a net profit. There is a plus point of being a forex trader. They can pick any handful of currencies which stock traders can’t usually. Currently, there is no bigger trading market in the world than the forex market. Besides, there are no higher liquid assets than forex liquid assets. However, all these facilities do not mean that there is no risk in forex trading. Just like other trading centers, forex likewise comes with some potential risks. Today, we are going to demonstrate those risks. Let’s get started.

Exchange Rate Risk

When the value of currency changes, the exchange rate risk shows up. The volatile shifts and the demand balance are highly responsible for this type of risk. This risk is very generous and depends on the possibility of what direction the monetary standards will move.

Interest Rate Risk

Interest Rte Risk is one of the main aspects that can make the SPREAD range increased. Trading with floating spreads can be very hazardous as they keep on changing over time. The floating spreads can even go ten pips higher than the initial ASK price. This type of risk can happen at a specific time of the month, based on the participant’s country.

Credit Risk

The credit risk is an even more complex risk. But, one thing for sure is, it doesn’t have any impact on the average trader as long as he has the ability to take any side of the trade. You always need a broker to trade and a trading platform such as Q8Trade is your best option especially if you are based in Saudi Arabia, UAE, Kuwait, Bahrain and other countries in the Middle East and the North African region. Sometimes the brokers might be fraudulent, and you might end up losing your money.

Country Risk

The state of the currency is never the same in different countries. It’s optimal that you run a thorough research on the currency before even starting your trading exercises. In third world countries, the banks have to go through complications when it comes to maintaining the exchange rate. As a result, the currency gets devalued at times when the banks of the country go through any frequent deficits.

Transaction Risk

If you want to make the most out of your time, you have to make use of the value of currencies. If you don’t, the transaction risk shows up. Know the time difference between the beginning n the settling of a contract. If you want to make sure of the most value of the foreign currency, it’s optimal that you convert it to the domestic currency at the initial stage.

If you don’t stay aware of these potential risks, the chances are that you may end up losing all your hard-earned money while trading in forex. Along with the time differences, political issues can also play a great role in the forex risks. Hence, keep your eyes open and stay up-to-date while you are trading in forex.

Forex trading occurs on the world-wide decentralized swap that’s an over-the- counter-top financial market for your investing of currencies. The goal of currency Forex currency trading is to support international market and expenditure. The Forex trading market allows organizations to switch one money into another. For instance, in case a U.S. enterprise is importing Western goods, it’ll need to turn its dollars to Euros to be able to pay the Western European country. The Forex trading market aids in these kinds of transactions. Forex boasts the largest daily amount turnover of any economic market on the planet; this enables for very thick liquidity, which really is a bonus for just about any trader or trader.

Another big benefit of Forex trading is that it could be done from practically anywhere on the planet, which has a web connection. This physical dispersion is really a huge edge for traders seeking to get into currency Forex currency trading because it offers very low set up fees and severe versatility. The 24 each day and seven days a week functioning of the Forex trading market is quite advantageous since it allows for a lot more price action investing opportunities than marketplaces with standard morning open and shut hours. Longer time and more value movement mean even more options for speculators to create money and benefit from big price steps moves.

The currency Forex currency trading market can be a lot more conducive to value action research because you can find fewer factors mixed up in the movement of the marketplace. The catalysts for generating forex trading markets will be macroeconomic mechanisms such as for example, central bank interest levels, inflation procedures, and monthly fiscal reports. Therefore, these relatively steady mechanisms permit the currency forex currency trading market to be always a great fit in for technical investing and specifically for the occupation of price measures setups. There typically is a few big media release value spikes through the entire month however the remaining time the money market trades really technically so when mentioned in the past meshes completely with an approach to price action buying and selling.

The last major advantage that Forex trading has a total other market is kind of a variety of a couple of different facets. The first getting that some agents offer high leverage in Forex, this means it is possible to potentially make really big revenue with an extremely small in advance outlay of cash on your element. Essentially leverage lets you control an extremely massive amount of currency for an extremely little deposit. The other major advantage of money Forex trading will be that it enables traders who might possibly not have much startup money to begin Vantage Forex Trading, and it enables them to manage their consideration danger through micro-lots properly. Micro-lots basically allows an investor to trade posture sizes no more than one cent per point. This enables traders who may just have a handful of money, to begin with, to truly have a fighting likelihood at developing their trading bill with just a little effort and discipline.