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Sam

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  1. Hello Earnest, While trading using a mini account, the lot size needed is one-tenth of the standard lot. A standard lot is usually about $100,000. Unlike a standard lot where it is equal to $10, a mini lot is generally similar to $1. Mini lots are best for beginner traders, and you can only deal with them if you set up a mini account with your Forex broker. While dealing with a mini account, the initial capital you need is small, mostly between $100 and $500. However, this amount will largely depend on the Forex broker you are using. It is an excellent account if you are looking at learning how various currencies to trade, and you are not ready to risk so much of your money. Though the upfront capital in this account is minimal, the leverage you choose to employ could pose risks if the currency pairs you are using move against you. You can manage this leverage if you introduce more than the minimum amount required as your initial capital. While using a mini account, you can trade more than one lot at any given time. You can trade like ten mini lots per trade, which are equal to one standard lot. Trading using mini lots will enable you to control your risk as well as modify your trades. In mini lots, the broker may offer you a considerable amount of leverage. Vast amounts of leverage usually lower the risks for the brokers by reducing the trade volume. You can use a mini account to get additional leverage. However, you can continue to trade in 100,000 units, which is equivalent to 10 mini lots. When the risks are highly modified, and large leverage amounts are accessible to you, you will significantly benefit in trading using a Forex mini account. If you are not new to the forex world, you can use a mini account to check the effectiveness of a new technique you intend to employ. You should, however, manage this mini account as your standard account for accurate results. Briefly, a mini account is excellent for minimizing your risks as you practice trading in the Forex market. This account is also useful to experts examining new trading strategies and want minimal exposure to risks.
  2. Hey Earnest, The contract for differences is a derivative instrument that will allow you to take a market position depending on the price changes of the underlying asset without necessarily owning it. You agree to exchange the difference between the opening and the closing price of the essential asset; this difference will be your profit, known as the spread. You can trade CFDs on leverage; therefore, you will contribute simply a portion of the total value needed as your initial capital. When you use leverage, your initial investments will be higher. Therefore, your chances of making losses are high, but if you make profits, they will be significant. When a CFD is volatile, there is a high chance of making significant profits from a high volatile CFD compared to the regular one. In CFD trading, you have an array of markets you can trade with if a trading opportunity comes up, and some of these opportunities may be highly volatile. In regular trading, you buy your asset directly with the whole amount that is required. In CFD trading, leverage will allow you to enter a market position at a much lower price. You will deposit a fraction of the amount needed, and your broker will lend you the rest. The amount you deposit is known as the margin. Leverage is an excellent factor while trading volatility. While trading volatility in CFDs, you can use direct market access; therefore, you can directly interact with the market and state the prices you want to deal with. This is different in regular trading since your broker is the one who will set the price. You have no say in this market. CFDs are an excellent tool for hedging your portfolio, more so if the market is highly volatile. For example, if you hold a position in a particular company for a long time and speculate that the price will decline, you can reverse it to manage this risk.
  3. Hi Earnest, A market being volatile is not a new term in the CFD market and many other financial markets. The market volatility in one market is usually different from another market, and how you will handle may generally depend on your preparedness. There may be times where you wish that the market volatility is high so that you can make a good profit from a significant move in the price and others you want the volatility to become low so that you can have some good rest without worrying whether the market prices will change in your sleep. The introduction of the Chicago Board Options Exchange has significantly helped in tracking volatility in many financial markets. They have named the measure of volatility VIX. It is important to keep in mind several strategies you can employ while trading volatility in a CFD market. One of them is that you need to avoid at all costs taking unnecessary risks. If you know that certain events will affect the market volatility, then you better not place any trade. You need to use stop-loss orders when placing your trades to protect yourself from risks that you may face.
  4. Hi Earnest, Silver is one of the most precious metals in the world. It usually ranks slightly below gold. These two are gaining much attention in the world since many assume that the federal serve notes are becoming valueless. Therefore, valuable metals such as gold and other material things are growing in demand; hence their prices are rapidly increasing. Buying silver when its prices are low, holding it for quite some time, and selling it when its price increases are one way you can make significant profits from this metal. However, this method is quite challenging, and trading it using a contract for differences is the solution to this bugbear. You may tend to think that since silver and gold are one of the most valuable metals, they carry the same aspects. This is not close to being right; many points separate them from one another. There is so much gold left in the world mainly in the form of jewelry, gold bars, and other items; contrarily, there is miniature silver remaining in the world as for what has already been mined. The main reason being it gets consumed various industrial operations. Silver has unique elements; hence it is highly used for industrial purposes. It is very efficient to trade silver in the contract for differences. The margin required to start trading silver in CFD is about 0.5%. The leverage to margin ratio is 200:1. While trading silver using CFD, you may exchange it at the prevailing market or set an agreement with your broker on the future price you intend to sell it. CFD will also help you make profits when the value of silver falls as well as an increase in the cost, which means that you can make money when the prices are merging. It is effortless to know this since the main cost you will be incurring is the spread. Leverage being a functional element in this trading may, at times, not favor you, leading to significant losses. Before you invest your silver in CFD, you need to clearly understand how it works and minimize your losses when you are about to lose a trade.
  5. Hi Stella, By definition, a market order is an instruction to buy or sell a stock at the best prevailing market price and. A limit order on the other hand operates by allowing the investor to set the price at which they wish to buy or sell their stock. Because market orders have no stock price limits, they are executed on an immediate basis as long as the prevailing market price is deemed profitable. Limit orders however have a set stock price and so can only be executed when the set stock price surpasses the level that was predetermined. Another way to look at these two types of orders is in times of time. Market order investors are those individuals who have the urgency to buy or sell without delay. Unlike market orders, In the case of a limit order, an investor has the opportunity to buy and sell stock at a certain price in the future. Market orders do not guarantee a specific buying or selling price; they only guarantee their execution and fill. Limit orders on the other hand guarantees that the stock will be sold or bought at s specified price. The major disadvantage to limit orders is that the order does not get filled if the selling or buying prices fail to reach the set target level. Therefore, limit orders can be used to set stop loss while market orders cannot be used to set stop loss. Meaning in the case of limit orders, as an investor, you have more control of the amount of loss you may be willing to take or make unlike in the case of market orders whereas the investor, you have no control. An understanding of these differences will be vital to your success as a stock trader; always knowing which kind of stock to buy at what time and how to minimize your losses.
  6. Hi Stella, Stockbrokers are people who act as middlemen in the stock market by helping average investors to buy and sell stocks in the exchange market. The stockbrokers buy and or sell stocks through renowned stock markets such as the New York Stock exchange, NASDAQ, and the London Stock exchange among others. Stockbrokers have extensive knowledge about how the financial markets operate and are best suited to determine the best opportunities for buying or selling stocks. As an investor working with a stockbroker, your stockbroker seeks out opportunities with the best prices for you to either buy or sell stocks. Other than directly executing trades, the stockbrokers also offer advises to their clients about stock trading The stockbrokers majorly earn a living through commissions. They get paid a commission in exchange for executing a trade and offering stock market trading advice. The commissions are determined based on the total value of trading transactions executed and their respective outcomes. The commission charges are expressed either at a fixed flat rate or as a percentage of the value of the transactions executed. With dedication and consistency, one can make a decent living as a stockbroker. Also, for people who are interested in becoming stockbrokers, there are no specific academic requirements. You are however expected to pass the general securities Representative Examination to become a legal broker. Additionally, having knowledge and skills in certain career fields can also give you an added advantage. Having knowledge and skills in fields such as mathematics, statistics and quantitative analysis coupled with a diploma, an undergraduate, or a master’s degree in business and or Business administration will be s significant added advantage towards making a successful career as a stockbroker. Finally, the popularity of stockbroking is getting fast replaced by online automated trading platforms, which do not necessarily rely on human stockbrokers’ input though there are instances where a human broker would be more preferable that an automated electronic system.
  7. Sam

    What is a bid Ask?

    Hi Milan, Bid-ask can also be called the bid and offer. A bid-ask, therefore, is a measured two-way price quotation that highlights the best possible price at which a security can be traded (bought and or sold) at any given point in time. The highest price a buyer is willing to pay for a stock or security becomes the bid price and the asking price is the lowest price a seller is willing to accept for the same security. A trade is executed when the buyer and the seller agree on a common bid and ask price for the same security. The agreed price must therefore not be lower than the asking price and not higher than the bid price. The resultant difference between the bid and ask price or the spread for a particular security or asset, therefore, becomes the indicator of the level of liquidity for that same security or asset.
  8. Hi Eric, Stock trading can be a profitable investment venture but only if you have the requisite skills and resources to consistently and sustainably keep trading. While there is no golden rule to becoming a successful stocks trader, as a beginner, you may need to put the following into consideration: Knowledge: Knowledge is the number one requirement. Before you venture into day trading, gather the right information about all the important components of day trading. There are numerous platforms online that offer courses and insights about day trading. Do extensive research and understand in detail what you need to do. In addition to having the right knowledge, as a beginner you u Understand how day trading works, and then you must always endeavor to keep up with the current stock market trends, news, and other related events that affect stock markets. Capital: You need funds to start trading but as a beginner, it is important that you understand your risks by constantly assessing how much you can risk on each trade. As a beginner, the recommended limit should be about 1% to 2% of your total trading account capital. Only commit funds that you are comfortable losing if that is the outcome so that you don’t lose everything all at once. Time: Day trading requires time and consistency.to became a successful day trader you will have to keep track of the financial markets and identify trading opportunities. In day trading, impeccable timing coupled with swift action is a necessity if you want to succeed as a day trader. Patience and discipline: Patience and discipline will keep you from making rash decisions that can lead to unnecessary losses. Successful day trading will be significantly determined by your patience and discipline. Start small, be realistic about your targets, and develop a working trading strategy.
  9. Hi Eric, There are currently four major types of limit orders that is; buy limit, sell limit, buy stop, and sell stop. Buy limit is an order that directs that security must be bought at a price similar to or below a specific limit. The success of the trade depends on the limit order being placed on the correct side of the market to guarantee stock price increment. Buy limit orders are therefore placed at a price below the prevailing market bid. Sell limit just like a buy limit order; becomes an order that ensures that security is sold at a bid or price above a specifically predetermined limit. The order is placed at a limit at or above the prevailing market asks thereby guaranteeing that there will be an improvement in the selling price. A buy stop is an order to buy a security at a price above the prevailing market bid. This kind of order is only activated when the specified price level has been reached. A buy stop order is converted to a market or limit order as soon as the set stop level is reached. The opposite of a buy stop order is a sell stop order. A sell stop is an order to sell a security at a predetermined price which has been purposely set below the current market ask in order to generate profit. Just like in the case of a buy stop order, a sell stop order becomes active only when the set price limit has been reached. Finally, other than knowing about these four types of limit orders, as a stock trader, you should also be aware of other additional stock order types including stop-loss order, a stop-limit order among other common terminologies used in stock trading.
  10. Hi Milan, If you are interested in hiring the services of a Robo-Advisor, it is essential that you know the shortcomings associated with using the automated decision-maker. Understanding the cons of the financial advisor makes it easy to perform a risk analysis before using the services of the companies. However, the risks differ from company to company. Different companies broker Robo-Advisors with different benefits and disadvantages. Common disadvantages associated with the use of Robo-Advisors include the following. Robo-Advisors do not offer face-to-face meetings. If you prefer personal interaction, you might find it hard to employ the services of a Robo-Advisor. Robo-Advisors work best with individuals that efficiently work without face-to-face interaction. However, some companies offer face-to-face interaction but at an additional cost. The option seems unfavorable if you do not have the funds to pay the additional fees that the brokerage companies charge. Second, Robo-Advisors do not offer completely automated services. You still require talking with a professional via the chat options provided on the websites. The automated advisor does not provide complete advice; for example, you will not receive information on how much you have to save or how to diversify assets and investments. You do not rely on the advisor since you might still require talking to support to help you through challenging questions that the Robo-Advisor does not answer. Furthermore, Robo-Advisors lack feeling and emotion. They do not persuade or reassure investors in case they make the wrong decision. You do not get a complete hands-on experience similar to that of a financial adviser. Lastly, Robo-Advisors do not simplify the decision-making process. Professionals who require completely automated services still have to log in to approve some of the decisions. Additionally, you still have to log in to input necessary data whenever you want advice on a particular issue. The service still requires human input and approval to perform investment decisions. Therefore, your involvement is still needed, although minimal.
  11. Hi Milan, Many individuals with specific individual financial plans do not see the need for hiring a Robo-Advisor. Financial investment advice is fundamental to various individuals. Financial information helps you make sound decisions on which investments to make or avoid. There are four kinds of individuals who can benefit from hiring a Robo-Advisor. If you fall under the following categories, you should seek the services of an automated financial advisor. Beginners Beginners refer to novel entrepreneurs or individuals that are starting their investment journey. Such individuals lack the exposure or experience required to make an informed financial decision. Some beginners also lack the services of any financial adviser. A Robo-Advisor would help you learn how to manage your investments. Additionally, the Robo-Advisor will also help you learn about financial investments as your investments grow. Investors who do not Want the Services of a Financial Advisor Some individuals see that they do not require the services of a financial advisor. Other investors lack the funds to hire a professional financial advisor, but they need the help of an advisor. Robo-Advisors help you get quality advice with=out having to spend. Additionally, Robo-Advisors give their clients the monopoly that they desire in their investments. You can easily make your decisions without having to rely on a financial advisor. Investors with Simple Strategies Some investors with simple investments often find that they do not require a lot of input from professionals. Robo-Advisors make it easy to handle simple investments. You do not have to struggle with the simple strategy. Additionally, the Robo-Advisor helps manage the simple strategies because of the objectives that you feed the algorithm. Consequently, you find it easy to manage simple investments. Professionals Many professionals often seek the services of qualified individuals to manage their investments. As a professional, you feel overwhelmed with other duties that make it hard for you to have the time to make investment decisions. An automated decision maker performs the cumbersome activity while you continue with your daily activities. You do not have to worry about the financial decisions since the Robo-Advisor can automatically make the tough decisions. Additionally, you find it easy to monitor your assets and investments. Overall, there are for categories of individuals that should hire the services of a Robo-Advisor. The four types include beginners, investors who do not want a financial advisor, investors with simple investments, and professionals. You should hire a Robo-Advisor depending on where you fall among the four categories of individuals.
  12. Hi Milan, Robo-Advisors refer to digitally-driven platforms that offer computerized financial services to investors. Robo-Advisors explicitly use data-driven algorithms to provide financial advice to human beings. The platforms offer financial planning services to their customers with little or no human supervision. The digital platforms provide affordable financial services to you by using specific techniques to develop the best advice. First, Robo-Advisors gather your financial information using surveys and questionnaires. The data collection techniques focus on specific financial information, such as the value of your assets and investment opportunities. The report helps in the development of customized advice to the client. Furthermore, the Robo-Advisor asks you questions on financial objectives and goals that you might have. The questions target the generation of guidance that helps in the achievement of the prior set goals. Lastly, the advisor compiles the information and develops practical steps that you will use as a client. Consequently, the information gathered helps in developing advice on sophisticated tasks such as retirement planning, investment management, tax-loss harvesting, and optimized portfolios for social investing. The applications of Robo-Advisors are limitless since the growth of technology expands the abilities of the automated advisors. Currently, many Robo-Advisors utilize Modern Portfolio Theory (MPT) to exploit passive indexing strategies. MPT enables you to perform a myriad by maximizing the expected return from risk by assembling the portfolio of assets. As a result, MTP performs actions such as mimicking a hedge fund, halal investing, and the development of tactical strategies that meet today's investment strategies. Just a recap, a Robo-Advisor, simply helps you make investment decisions by using data collected through online surveys and questions. The advice is generated using Modern Portfolio Theory utilized in the passive indexing strategies. The use of data-driven algorithms simplifies the process of decision, making it fully automated. Lastly, Robo-Advisors perform various functions such as optimized social investing, halal investing, investment management, and retirement planning.
  13. Hello Milan, Despite the differences that exist between a Robo-Advisor and a financial Advisor, there are similarities between the two. First, both advisors work towards achieving the objectives of the client. The Robo-Advisors receives the client's objective and goals from the online survey filled when hiring a Robo-Advisor. Financial advisors collect information from the client when they meet. As a client, you are encouraged to talk about your goals and objectives so that the advisor can tailor your advice accordingly. Additionally, both advisors focus on long-term financial investment. A financial advisor focuses on retirement opportunities that you can invest in. The financial advisers wish that you spend your finance accordingly to ensure that you still have money post-retirement. The advice entails systematic short-term and long-term goals. Similarly, Robo-Advisors want you to meet your long-term goals. The use of Portfolio Management Theory and tax-loss harvesting ensures that the decision-making process ensures that you grow your investment in a short period to prepare for long term objectives. Finally, both advisors are interested in your financial well-being. A Robo-Advisor wishes to generate wealth for you through sound investments. The investment techniques used to aim at improving the wealth of the client. A financial advisor wants to improve your overall economic life. A financial advisor focuses on general financial decisions and is not limited to investment. A financial advisor advises you how to invest, save, and plan by making sound financial decisions daily. Overall, financial advisors and Robo-Advisors help you generate more wealth through investment and financial management. The insight offered by both investors is handy when it comes to the growth of investments and saving. Furthermore, both investors can be used when needed and are not mandatory. Similarly, you can seize paying for a Robo-investor to how you can stop employing the services of a human, financial advisor.
  14. Hi Milan, Robo-Advisors offer multiple benefits to individuals; however, they are not suitable for everyone. Some people might find it challenging to use the service depending on the personal preference of clients and the nature of investments that some clients have. Notably, three kinds of individuals find it hard to employ the services of a Robo-Advisor. If you feel that you often require a human touch in everything that you do, you should not seek the services of a Robo-Advisor. Robo-Advisors offer a computerized approach to decision-making, which might feel stressful. The advisor primarily works on the internet and applies web-interfaces to interact and develop sound decisions with customers; you will not interact with a human advisor. However, if you deem it necessary to have human assistance while still using the services of a Robo-Advisor, you will have to pay additional costs that make the option expensive. Additionally, if you have multiple investments, a Robo-Advisor would not work best for you. A Robo-Advisor is best tailored for advising an individual based on one investment account. Having multiple accounts, such as company accounts and personal accounts, complicates the decision making process. A Robo-Advisor cannot handle 401ks while also handling other investment decisions. Lastly, if you prefer systematic investment advice, a Robo-Advisor would not be suitable for your needs. A Robo-Advisor helps manage your assets and manage different types of investment; however, it does not provide you with specific information. For example, a Robo-Advisor does not tell you how much you have to save or how to distribute your investments across different accounts. You would find it hard to diversify investments or make quality decisions by using a Robo-Advisor. In Summary, Robo-Advisors do not meet the needs of everyone. You should not seek the services of a Robo-Advisor if you like a human touch in everything that you do. Human assistance requires additional fees to the usage of the Robo-Advisor. Robo-Advisors are not suitable for individuals who have multiple accounts since they do not support diversified investment decision-making. Lastly, Ro-advisors do not offer systematic decision-making concerning crucial matters like how much you need to save or diversify your assets.
  15. Hello Eric, Try not to contribute enormous sums. Try not to lean a lot on these unsafe speculations. Penny stocks ought not to represent over 10% of your all-out value portfolio. This implies if your all-out speculation portfolio is Rs 20 lakh and 30% (or Rs 6 lakh) is in stocks, at that point, the greatest you should place in these high-hazard stocks is Rs 60,000. Contribute just what you can stand to lose. Put resources into under three stocks. The standard of expansion doesn't work here. Rather than getting countless penny stocks, put resources into just a bunch of scrips. Spreading your cash over a bushel of low-valued stocks won't let you win important comes back from them. Try not to contribute and overlook. Putting resources into penny stocks ought to be viewed as a momentary trick, not a drawn-out methodology. If the stock observers a sharp ascent, it might be an ideal opportunity to exit or if nothing else book incomplete benefits. A few speculators may imagine that on the off chance that they sit tight for a year, the increases will be tax-exempt. In any case, the stock may have fallen by at that point. Set an objective and leave when it is accomplished. Try not to hold penny stocks until the end of time. Try not to accept anybody. The online gatherings of monetary entryways are flooded with exhortation and data on penny stocks. Try not to accept an expression of what different financial specialists bring to the table. In this section, everyone is looking for the more noteworthy idiot who will follow through on a greater expense for the garbage in their portfolio. Likewise, take the cases of the administration with a touch of salt. They, for the most part, paint a ruddy picture. Purchase stocks with high volumes. Some penny stocks are daintily exchanged. For example, the normal day by day volume of Titan Protections for as far back as the multi-month has been just three offers. So on the off chance that you have 5,000 portions of the organization, it will be very hard to offload them when you need to leave the stock. Purchase stocks that have sensibly high exchanging volumes so that there is plentiful liquidity. Try not to take a gander at one day's exchanging yet think about the month to month normal.
  16. Hi Eric, Experienced penny stock dealers: Many who flourish in the frantic universe of exchanging do as such via cutting out a specialty in a particular division or resource. Penny stocks are one such specialty, even though the quantity of dealers who exchange these stocks is a small amount of the individuals who exchange built up protections and blue-chip stocks. Experienced penny stock merchants aren't stopped by the segment's constrained liquidity, its wide offer ask spreads and its regular market evaluating control. For these players, there's little left to amaze them, even in such an unstable market as penny stocks. They can be informal investors or swing brokers, and they'll take both long and short positions. Corporate insiders: When corporate insiders, for example, top administration, purchase portions of their organization's stock, it's normally taken as an indication of trust in the organization's possibilities. On the other hand, when these insiders dump shares, it's frequently a sign that the organization is decaying and that its stock cost may fall. This dependable guideline doesn't exactly apply to penny stocks, be that as it may, as insider movement, as a rule, goes one way: the measure of selling, for the most part, predominates purchasing rates (to some extent because the organization might be moving toward chapter 11). These insiders frequently help coordinate controls in the penny financial exchange, having dealers misleadingly drive up the volume in a particular stock or gathering of stocks employing such activities as "siphon and dump" plans Multifaceted investments: While numerous budgetary organizations are disallowed from exchanging penny stocks, inexactly managed mutual funds have no such limitations. All things considered, most flexible investments won't exchange penny stocks on the long side: They far incline toward short-selling penny stocks that hope to have topped in the wake of being vigorously advanced. Penny stocks, although they frequently do in reality exchange for simple pennies, can at present be exceedingly hazardous to short on account of the danger of a short crush. So while the hazard reward result for shorting a penny stock is excessively slanted (i.e., offering a restricted prize if the short procedure works and a boundless hazard if it doesn't) to be advantageous for a normal speculator, the system may tempt a profound stashed support investments. Short merchants: Astute brokers know there's a whole other world to be made by short-selling penny stocks than by purchasing and holding them. Not at all like speculative stock investments; nonetheless, these dealers may do not have the capital expected to withstand the infrequent short crush. So they need to depend on systems administration and utilizing their experience and market insight to distinguish appropriate short focuses on whose offers will decrease steeply from current levels. These short-selling dealers are probably not going to be "contrarian" and short-sell a stock that is ascending because of substantially limited-time action. Or maybe, they may heap on the short positions once the stock starts sinking, planning to hurry its destruction. Pamphlet scholars: Some venture bulletin essayists will create sparkling reports about certain penny stocks, for which advertisers reward them with money and a lump of the stock being referred to. While their stock installment might be escrowed for a specific number of weeks or months to keep bulletin journalists from dumping it immediately, they're probably going to "sell into quality" when their lock-up period terminates. Financial specialist relations firms: Investor relations firms frequently offer types of assistance to penny stock organizations, for example, orchestrating gatherings for the board with speculators and experts, fitting corporate introductions, and scattering public statements. Consequently, they're regularly repaid with money and portions of the organization's stock. These organizations are probably going to be merchants of penny stocks instead of purchasers. Market producers: A market creator is a representative seller who encourages exchanging particular security by showing offer and approach citations for various offers. Market producers that endeavor to give liquidity to the penny financial exchange normally become huge supporters of exchanging volume. After getting a purchase request from a dealer, the market producer may either sell shares from its stock or get them from the market for ahead deal with the speculator. On the other hand, for a sell request, the market producer may either retain the offers into its stock or quickly dump them into the market. Examiners: Speculation is the backbone of the penny financial exchange. However, before any significant selling can start, a lot of purchasing needs to occur to blow up a penny stock's cost. Also, a lot of this purchasing originates from long haul theorists who are knowledgeable in the game and have benefitted from effective penny stock exchanges in the past. These players keep on conjecturing in the expectation of rehashing prior victories, yet there's typically a cutoff: Those who acquire steep misfortunes will probably quit exchanging penny stocks after long. Common financial specialists: Even experienced "conventional" speculators will, at times, capitulate to the draw of making a fast buck from an as far as anyone knows hot tip on a penny stock. It could be a companion or associate who proclaims to be within a track with the penny stock's advertisers, or the speculator may be persuaded by a talented pamphlet essayist who has created a strong sounding venture point. These speculators may fiddle with the penny financial exchange on more than one occasion; however, once they continue a few misfortunes, they're probably going to consider it daily and stick to exchanging what they know best: blue chips and senior protections. Unpracticed and unwary financial specialists: Then there are beginner speculators who accept they can become super-wealthy in penny stocks. They're enchanted by purchasing 10,000 portions of a 10-penny stock for just $1,000, and, when this 10-penny stock hits only 15 pennies, they'll have made a perfect half profit for their venture. The hard reality, in any case, is that such an evaluating move is very phenomenal. Regardless of whether it occurs, wide offer ask spreads and restricted exchanging liquidity regularly keeps the financial specialist from making a fast deal to close their position and lock in benefits. (See additionally: The Basics of the Bid-Ask Spread.)
  17. Hi Eric, In the past, you had to seek the services of a specific finance professional that helped you meet your set financial goals. The growth of technology has led to the development of Robo-Advisors that perform many functions that financial advisors performed in the past. However, distinct differences exist between a Robo-Advisor and a financial advisor. The first interaction between a Robo-Advisor and a client takes place online. You only have to fill a survey or questionnaire that communicates your long-term goals and objectives. The step takes a few minutes for you to open an account a start your financial investment journey. On the other hand, you require a meeting with your financial advisor to employ a professional's services. The first meeting helps in communicating the financial goals that you have. The financial advisor understands your goals while also taking the opportunity to know you as a person. A Robo-Advisor maintains the interaction as a professional. You only interact with a Robo-Advisor when you require advice on your investments or maintain your portfolio's progress. Conversely, financial advisers offer you a relationship that expands beyond the work setting. A financial advisor has to know you as a person for them to advise you accurately. A financial advisor can show up t your lunches and at your home to understand the short, mid, and long-term objectives that you have concerning your future. Lastly, Robo-Advisors offer sound financial advice at a lower price compared to financial advisors. Financial advisers provide a human touch, asking for higher fees than a Robo-Advisor would ask for. Moreover, many Robo-Advisors offer advice on investments while financial advisers advise you on overall financial well being. The opinion is not limited to securities and bonds. Financial advisors provide you with quality advice that teaches you how to invest now and when you retire. Overall, primary differences between a Robo-Advisor and a financial advisor arise from human interaction and the span of control. Robo-Advisors lack a human touch to advise while financial advisors become more than best friends. Financial advisors are always on call and offer long-term advice compared to Robo-Advisors. The choice of advisor depends on the preferences that you have the objectives that you wish to achieve when hiring a professional.
  18. Hello Eric, Robo-Advisors help in making financial decisions based on data collected from the user. The benefits of the Robo-Advisor usually depend on the developer and the broker. Some brokerage companies offer exclusively automated advisors, while others provide partly automated advisors. However, there are universal benefits that span across all Robo-Advisors regardless of the brokerage firm or algorithm in use. First, Robo-Advisors offer less fees to a customer. You do not have to spend a lot when it comes to acquiring a Robo-Advisor. In the past, investors spent a lot of money on financial advisors that offered their services at a basic rate of above 1% per Asset under Management (AUM). The fixed percentage meant that you spent more if you had more assets under management. Robo-advisers offer their financial services for less than 1% AUM. Some companies even offer between 0 and 0.25%. The reduced fees make it an ideal tool for investing and make it accessible to low-income and middle-class earners. Furthermore, some companies such as Wise Banyan offer low minimum balance making the services accessible to many individuals. During the inception of Robo-Advisors, you had to have a minimum balance of around $1000 or more before you could acquire its services. The platforms' growth has significantly reduced the minimum balance, ensuring that you get access to sound financial advice regardless of the amount you have as a minimum balance. Second, Robo-Advisors have simplified the investment process by making it possible for an individual to become their own personal advisor. In the past, financial advisors found it difficult to best advise a client because of the cumbersome process of selection of the best alternatives. Additionally, as a customer, you felt overwhelmed by the financial decisions that you had to make, especially if you could not afford a financial advisor. Robo-Advisors have simplified the process for financial advisors who rely on the algorithms to help in decision-making. Financial advisors use the information collected to provide advice to their clients. Similarly, clients depend on the Robo-Advisors to develop useful advice, which they apply. Lastly, Robo-Advisors have significantly reduced the time spent on financial decision-making. Today, you only have to spend a few minutes on the platform, and you get your results before the end of the day. Before the invention, you had to schedule several meetings with your financial advisor to get their services. The activity would spend a lot of time in-between meetings and waiting for feedback. Robo-Advisors have eliminated all the hustle, ensuring that you get quality advice if you have access to laptops and the internet. Overall, Robo-Advisors offer a myriad of opportunities for individuals who employ the services. You do not have to stress yourself by seeking the help of a financial advisor. In comparison, a Robo-Advisor is cheaper and yields better results compared to a financial advisor. Finally, Robo-Advisors simplify the process of investment and seeking advice from qualified professionals.
  19. Hi Eric, Multiple brokerage companies exist on the internet. All the companies offer different benefits, which might fit your demands or not. If you are looking to hire a Robo-Advisor, you have to access the internet and have computer literacy. A search for Robo-Advisor generates multiple searches. The searches show different companies, which outline their services on the web-interface. There are several factors that you have to consider when looking to a hire a Robo-Advisor. First, you must assess your financial position to see if you can meet the fees that the different companies require. However, you should also note that the charges directly correlate to the services that the various companies offer. For example, a company that provides tax-loss harvesting will cost more than a simple investment advisor. Similarly, a company that provides virtual services of a human advisor also costs more than companies that only use automated services. Second, you have to consider the services that you want the Robo-Advisor to serve. Simple Rob-advisors offer Portfolio management services and asset allocation as the essential functions of the software. Other sophisticated Robo-Advisors have additional services such as tax-loss harvesting services, tax optimization strategies, and retirement. Lastly, you have to assess whether you would want a human advisor to help you in decision-making. Some companies offer human assistance via chat or online virtual platforms. Such companies provide Robo-Advisors at a higher cost compared to primary advisors. After considering the three factors and individuals can make a sound decision on which Robo-Advisor to select. The chosen service provider must meet the financial requirement and service requirements that you want. You will also have to decide between hiring a virtual financial advisor with similar services to the chosen Robo-Advisor. You will only have to select a Robo-Advisor that passes the evaluation process above.
  20. Hi Eric, Understanding the features of Robo-Advisers helps you learn how automated decision-makers work. The basic understanding makes it possible to assess whether you might want to employ the services or would prefer to invest without a Robo-Advisor as an investment partner. Robo-Advisors have two primary features that elaborate the blueprints of how the automated advisors work. Robo-Advisors use effective portfolio management and tax-loss harvesting as the basis for productive investment. Portfolio Management A Robo-Advisor analyzes the input data to create a portfolio that optimizes your return. Robo-Advisers effectively utilize Portfolio Management Theory to develop your portfolio. The theory helps in the assessment of your assets and optimal risk that you can handle when investing. The established portfolio maximizes your profits while still ensuring that you take as much as possible. Your optimal risk is determined by the data that you input to the system. Additionally, the theory ensures that all your funds are diversified. You do not invest in a single stock or bond; instead, a Robo-Advisor develops a portfolio that ultimately expands your investments across both risky and non-risky assets. Using your objectives as weights, the Robo-Adviser rebalances the investments to respond to changing economic conditions. Tax-Loss Harvesting Tax-loss harvesting involves the sale of investment at a loss to defer or minimize the tax paid after a specific financial period. The process consists of the sale of your securities at a lower price than the market price and then buying them at a higher rate after a specific period. The gains collected from other securities are significantly offset after purchasing the assets. Robo- Advisors employ this technique to grow your investments by ensuring that you defer your taxes until after you retire or end up paying lower taxes after a long period. Consequently, you increase the value of your investments without paying taxes for most of your investments by inducing a loss and harvesting it later.
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