How to Earn Money from Spot Trading
Hi everyone viewer if earn money from spot trading simple steps follow this article. This post complete guide on how to
make money with spot trading in every derivatives exchange.
First of all you any centralized exchanges will be created an account and download this Apk android app, you depend on the chosen derivatives exchange for spot trading.
Top of the best derivatives exchange in the world, Five of the best, and top of favorite centralized exchanges.Now depending on the chosen derivatives exchange for spot trading, create any exchange account and complete the KVC and another account verification, and deposit the money or amount from P2P account and Debit card.
What is Spot Trading?
Spot Trading is a new trading paradigm that effectively places an investor’s risk out of the equation. It puts the power of strategy to move in the hands of the investor, rather than a “generalist” choosing the best strategy to suit his or her needs.
A generalist’s “tradeable” strategy is likely to produce either high profit or losses. In his opinion, a strategy that can’t be changed no matter what happens. At worst, it makes the trader dependent on the strategies of others.
But how do you start Spot Trading? Here we show you how to get started.
A Good Strategy
On the first day of trading, we applied a long/short strategy that has been proven to perform very well over the long term. But how could we protect ourselves against intraday losses or late-day gains?
This is where the recent changes in the stock market come in handy. The spread on a single trade represents approximately 5% of the total daily trading loss in the market. Let’s put it in context: the wider spread on a single stock trading is usually 25% more of that loss.
The location of the spread on trade matters. On the long side of a current trading day, we would buy 100 shares at the “real” price of the stock (i.e. over 70% above the current market price), holding to the stop loss or a profit margin.
Not only that, but we would also have a small capital cushion as stated in an online trading book.
In contrast, if we were short-term investors, then in order to protect ourselves, we would put in place our own stop-loss – preferably before the decline in the stock price becomes noticeable.
Short Term Trading
Looking for a potential candidate for a short-term strategy? PFC adds 3% to the short position, roughly doubling up the potential loss by losing a part of the position in a short-term move (i.e. 3% of the short position).
Now that we have chosen a short-term strategy, how do we approach the stock in question?
The best answer is to try and imitate the moves in the stock by making a short-term call option. According to our research, the option purchased shares over 500% less than the current price.
If we look at the call options at $38.00, the profit then generated will be 822%.
And this would be the true short-term strategy: short-term call options to offset the initial premium to buy shares.
And what about the long term? Short-term option strategy has been effectively proven over the long term.
We would hold those shares the same and review the below chart for comparison:
Long Term Strategy
What about the long term,?
PFC describes long-term strategy as buying shares with a margin between $28,700 and $78,000 (which is $600 and 822% of the average price), then locking it in with short call options.
Time will tell the rest…
Our Pick’s Ratio
Recently, investors have adopted a sign-up character to consider leverage.
When it comes to trading leverage, we would go short call options to take full advantage of the short call instrument.
The short call option is one of the safest tools in Spot Trading.
The sample shown above depicts the percentage of long call options taken as a % of the maximum closing price (the final value recorded by the market closing at the end of the trading day).
Those numbers would be far better if represented as % of leverage.
Here’s a chart that shows the stock’s price near the option’s expiration.
This sample format is interesting in that it depicts the true amount of money committed to the strategy.
Did you ever wonder why a stock will trade up 50% higher than the current price in the first few hours after you buy the stock? It’s all because of the daily call options, that trade instantly after the last trade.
Let’s see what happens when put options are used:
Post setting, the next trading day, the average value of the call options (S) per call on the board changes to $705.