They say buy new bottoms and sell new highs. Anyway, there are plenty of assets to trade. However, contracts for differences (CFDs) are some of the best assets to trade, especially as some of them are currently undervalued.
Some traders are scared away by crisis. That is why they do not make money. At the same time, other traders see a crisis as an opportunity to make money because there is always a recovery (and growth0 after a decline. So now we buy in order to sell later. Obviously, there are many factors to consider when buying at or around bottoms. When it comes to conventional trading, you need to take into consideration the near- and mid-term economic prospects.
However, when it comes to trading CFDs, even a mediocre trader can make money relatively easily, especially when he/she trades via ActivTrades, a major UK broking company and a TOP member of ’s rating of Forex brokers . By the way, recognized the Best UK Forex Broker 2012.
ActivTrades was one of the first broking companies to introduce CFDs on US and European stocks to MetaTrader 5 users.
Trading Stocks Via “CFD MetaTrader 5”
According to Alexander Elder, a trading guru, the market doesn’t try to deceive you but you should learn do perceive the signals it gives you. It is true in essence. However, some people still cannot or do not want to see those signals.
According to Yuri Borovoy, a representative of ActivTrades’s Russian office, the ability to perceive and interpret market signals is one of the cornerstones of successful trading. In this aspect, CFDs offered by ActivTrades via MetaTrader5 (some people call them the future of trading) are some of the most convenient trading instruments. They allow traders to transform market signals into perfect trading opportunities. You get stable results and optimal portfolios.
CFDs differ from other conventional trading assets as you do not buy or sell real commodities. You trade contracts on stocks, futures, commodities (oil, gold, natural gas, wheat, coffee etc). Later, you sell the assets, thereby making money on the difference between the initial price of the underlying asset and the current price. If you have expected the price to go up and this is the case, you make money. The same is true for bearish forecasts.
CFDs provide access to more controllable and liquid instruments. While Forex trading can be risky due to volatile markets, CFDs are less risky because there is only one risk – if the sell or buy price is worse than your forecast. There is an edge over futures as well. With CFDs, you can make a deal whenever you want, which next to impossible when you trade contracts for obligatory delivery of the underlying commodity.
Now let’s consider an example:
Let’s assume you want to invest in the stock of Eni, a major Italian oil-and-gas company (With ActivTrades, you can trade major companies from the Netherlands, Great Britain, Italy, France, Portugal , Belgium etc).
ActivTrades provides a 5% margin and 1:20 leverage. That means that you need only $1000 to purchase the amount of shares equal to $20 000. This is how it looks in the MetaTrader 5 trading terminal:
We purchase a CFD on Eni’s stock as we expect the price to grow (a long trade):
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Then we sell the CFD after the rally (profit taking) as we expect the price to retrace:
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How To Profit From Eurozone Crisis Trough CFDs?
At this point, European stocks are extremely undervalued as investors are unsure about the prospects of the eurozone. However, history shows that any crisis attended by market weakness is followed by recovery and growth. The thing is that most market participants become aware of that when the recovery is underway. At the same time, smart traders and investors start making money when the crisis is not over yet (but is about to end).
Let have a look at the same example. There are a lot of bullish factors. We decide to buy a CFD on 1000 shares of Eni’s stock. The open price is €18. Indeed, the price grows. You decide to take the profit and sell the CFD at €22 per share. Therefore, you earn €4 per share, which is €4000. If the price dropped you would lose the same €4000.
CFDs are rather risky derivatives even though they are quite profitable. You cannot play bingo when trading CFDs. It is necessary to consider a range of factors if you want to make decent trading decisions.
As a truly client-oriented company, ActivTrades developed a whole new approach towards trading CFDs – futures on CFDs. As the expiration date is predetermined, ActivTrades doesn’t charge clients with commissions for trades left overnight. Moreover, on expiration, all trades are closed automatically at the price of the corresponding futures.
Another benefit is a wide range of underlying assets available for trading: commodities (including precious metals, crude oilб natural gas, stock indices etc.
And finally, ActivTrades PLC is authorised and regulated by the Financial Services Authority (FRN 434413) and is a member of the Financial Services Compensation Scheme, which guarantees the safety of your funds as well as reliability and transparency of all transactions.
Taking into account all the information given below, we can conclude that ActivTrades is a perfect option for professional traders who need a reliable broker.
