Smith
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Hi Benjamin,
Robo-advisors are automated financial services that use advanced programs and computer algorithms to control your investment portfolio. Some sites also offer re-balancing and tax optimization. Though the programs require minimal human interaction, some have individual advisors to handle your queries. Robo-advisors cost less than financial consultants with most companies imposing fixed monthly charges or taking a 0.25-0.50% cut from your assets. You can even enjoy platforms like SoFi for free. Unlike traditional portfolio managers, robo-advisors don’t demand hefty starting balances. You can open a Betterment, Fidelity Go, and Wealthsimple account without a cash balance. The low costs also extend to cheap deposits and withdrawals. However, you’re supposed to meet the underlying investment fees, for instance, ETF and mutual fund expense ratios. Such charges are subtracted from the asset funds before the investor gets the returns. Don’t mistake robo-advisors with financial planners. As such, you need personal approaches to unique investment strategies. What’s more, they’re not effective in managing multiple accounts.
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Hi Jovan,
Although blockchain’s decentralized structure reduces government interference, economists remain unconvinced of crypto’s staying power because of its disparities with cash.
The absence of a body to regulate supply and maintain its value renders crypto an unsuitable unit of account. While numerous stores allow cryptocurrency payments, it’s not an accepted medium of exchange because of its high transaction fees, especially during network congestion. That’s why most users change it to cash before use. What’s more, volatility prevents virtual coins from storing value.
For example, the amount you use to buy bread today could get you a car years later. Even if these issues are addressed, most digital coins are limited in supply. Bitcoin, for instance, has 21 million units that cannot be shared in a growing economy. This would mean frequent pay cuts for workers and slashing of commodity prices to match the coin’s dwindling supply. -
Great question, Benjamin. Let me add something to what the others have advised.
While it’s impossible for day traders to make profits without market swings, unstable prices can lead to the loss of your capital. That’s why you need volatility indicators to track a security’s movement from its average directional value. While high volatility stocks stray from the mean direction, low volatility stocks remain near the average.
These indicators fall into two categories, namely, oscillators and channels. First off, oscillators compute a value and illustrate it on a different chart. The relationship between past and existing values is essential for the prediction of future trends. Conversely, channels are overlaid on the central trading diagram that relies on volatility to project price ranges. Though these indicators support numerous trading strategies, volatility alone shouldn’t be used to make investment decisions.
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You should pay attention to the following points prior to trading cryptocurrencies, particularly if you are a neophyte.
Target large market capitalization. Cryptos with large supply in circulation and high market cap make them less vulnerable to wild volatility and manipulation.Small market cap cryptos face wild price changes on negative or positive news, therefore easy manipulation targets for large holders.
Big trade volumes denote easy coin buying or selling. Low volumes point to liquidity challenges and traders struggling to make buys or disposing positions.
Stop-losses and taking profit may not play well into analytics of digital assets. However, do make sure you have a plan for each trade. That way you won’t mess up with emotion inspired trading.
Safely store your coins, for there is a saying you trade and keep funds on exchanges you risk losing. Proficient traders maintain digital asset wallets offline where no one else has access but them.
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Hi Melinda,
StableCoins are cryptocurrencies pegged to other assets. They are crypto-dollars that act as a stable asset when trading crypto on exchanges.
They are currently used by crypto traders to move from one investment position to another flawlessly and create leveraged positions devoid of volatility.
These cryptocurrencies aim to give price stability, unlike other highly volatile cryptos like Ether and bitcoin. The high volatility of other cryptocurrencies makes them unsuitable as a common currency. This comprises its purchasing power and use as a mode of storage, which is the backbone of any currency.
Stablecoins are backed by a reserve asset, and they endeavor to give price stability, confidentiality, scalability, redeemability, and decentralization. Stablecoins are a class of cryptocurrencies that try to base their market value on external references. They are therefore categorized according to the external reference they use as follows.
• Crypto-Collateralized Stablecoins
These are stablecoins that use other cryptocurrencies as collateral. Given cryptocurrency is digital, units are issued using smart contracts. Regular monitoring and audits help reinforce the price stability of stablecoins. Examples include MakerDAO/DAI,celo, and haven.io, among others.
• Fiat-Collateralized Stablecoins
These use fiat currency as collateral to issue an ideal number of crypto coins. The most popular reserve for stablecoins using fiat as collateral is the US dollar. Other than fiat currency, commodities and precious metals can be used as collateral. The custodians of these reserves are independent, and they subject them to regular audits to ensure they adhere to compulsory compliance. Examples include USDC, GUSD, tether and Gemini Dollar
• Algorithmic or Non-Collateralized Stablecoins
These stablecoins do not use any reserve but use a mechanism like central banks do to maintain a stable price. They get their peg by using smart contracts and algorithms which control the supply of issued tokens. An example of algorithmic stablecoin is NuBits. -
Hi Lindsay,
Current news has the potential to influence CFD asset prices while creating new opportunities. Many traders have adopted monitoring headlines as an avenue to determine an overriding bias, in the process, creating strategies for entry into new market positions.
Economic Data News Headlines
A market position strategy will rest on data that various countries release into the market. Such releases tend to enhance price volatility within the short term. Releases cover job additions or losses, trade balances, manufacturing production data, inflation figures, or interest rate decisions.
In most cases, news releases have a predetermined schedule with reports made available to every market participant at the same time. All CFD traders benefit from relatively predictable volatility in an environment where insider information is not a requirement to create an edge over the market.
The First Friday Example
The United States Nonfarm Payrolls, a leading market movement news release, happens on every first Friday of the month. It reveals the total number of jobs that have been created during the month.
CFD analysts deem the figures to be the first gauge of the status of the US economic health. In the past, all CFD asset classes have undergone sweeping price swings, whether the number is negative or positive. CFD pricing, after this release, creates new CFD trading entry points.
Other News Releases
Usually, timing a market moving release presents CFD traders with a predictable strategy creating tool. Dividend announcement reports are planned well in advance while earning reports come out in each quarter.
There are announcements, however, that take the market by surprise. Mergers and acquisitions and management changes are examples. Such situations may create negative impacts on open positions. They provide opportunities for proficient traders, who monitor news feeds actively, and are quick to take new positions based on such surprises. -
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The WTO chief has tendered his resignation that will be effective in August 2020. How will the global trade be affected by this move?
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How will Shopify benefit from its new Crypto payments partnership?
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Hi there,
I am wondering what I can do to save my investments in a falling market.
Which are the best cybersecurity ETF to invest in?
in ETF
Posted
Hi Danny,
One strategy to tap into the rapidly growing online security market is investing in cybersecurity ETFs. Star ETF performers within the cybersecurity industry include:
(HURNTR) L&G Cyber Security UCITS ETF
This online security ETF concentrates on tracking the ISE Cyber Security UCITS index. It is an index of publicly quoted firms trading on assorted stock exchanges worldwide. These are firms making their highest revenues from products and services in the online security industry.
(HACK) ETFMG Prime Cyber Security ETF
HACK happens to be the biggest online security ETF. It has a portfolio of 52 stocks, directly or indirectly, attuned to the cybersecurity sector. Among its biggest holdings are FireEye Inc, Cisco Systems, and Tenable Inc.
(CIBR) First Trust NASDAQ Cybersecurity ETF
The CTA Cybersecurity Index is the foundation upon which this ETF rests. In its portfolio are 38 stocks of public firms who build, implement, and manage online security.
These firms concentrate on firms servicing security for public and private networks, mobile devises, and computers.