Financial Markets is all about buying and selling the assets in the markets in order to make profit like – such as commodities, precious metals (Gold,Silver) currency pairs like (gbpusd, eurusd , usdjpy, gbpjpy) stocks like (Nvidia, Apple, Tesla) oil like (crude oil, brent, usoilspot). Types of financial market .
Types Of Financial Markets
1. Stock Market:- In stock market , we buy and sell the stock in stock market through the registered broker and exchange. It opens for the limited period of time in a day like for 7 hours or 8 hours
2. Commodities:- Like the stock market. we buy and sell commodities through the registered broker and exchange like Gold and Silver. It remains open after the stock market but also for the limited time like 10-12 hours
3. Forex Market:- In this market we trade in currency pairs as i mentioned above like gbpusd, eurusd , usdjpy, gbpjpy. It runs 24 hours 5 days a week
4. Derivative Market:- Here we trade in future and options segment of the instruments. It opens for the limited period of time in a day like for 7 hours or 8 hours
5. Crypto Market:- Here we trade in coins like dogecoin, solana and many more . It runs 24/7
How Do We Earn In Financial Markets
We earn profits in financial markets by doing trading or investing in instruments like stocks, precious metals or (you can say commodities) crypto etc. First we will talk about trading then investing. If we talk about trading, trading involves different styles, different timeframes and many more which are discussed below.
Types of trading.
1. Scalping:- It focuses on entering with more quantity and targeting less profits than usual with the duration of 1-2 minutes. We focuses on finding trade every minute or every hour in scalping. It involves more risk.
2.Intraday:- It focuses on entering with the normal quantity and targeting atleast 1:2 or more risk to reward in the particular trade. In this type of trading we tend to find trade each and every day. It involves moderate risk.
3.Swing Trading:- It focuses on entering with the normal quantity and targeting atleast 1:5 or more risk to reward in the particular trade. In this style of trading we find 1-2 trades in the month. It involves less risk.
Timeframe
There are different types of time frames in trading:
1. 1 minute
2. 5 minute
3. 15 minute
4. 1 hour
5. 4 hour
6. 1 day
7. 1 week
8. 1 month
Different Timeframes For Different Style Of trading
1. 1 minute is typically used for scalping trading.
2. 5, 15 minute and 1 hour is used for intraday trading
3. 1 hour, 4 hour and 1 day is used for swing trading.
Types Of Trends In The Market
1.Bullish:- When the market is making higher high or higher low which means that the current low is above from last low and the current high is above from the last high, it’s considered as the bullish market.
2.Bearish:- When the market is making lower low and lower high which means that the current low is below from last low and the current high is below from the last high, it’s considered as the bearish market.
3.Consolidation:- When the market is moving between last high and last low, it’s considered as the consolidation in the market.
Investing In Financial Markets
If we talk about investing in the financial markets, it’s a safest option for those who want to do something in the financial markets but due to their job and business they can’t spend some time with the charts. If you don’t have to stand in the long queue, tired of doing paper formalities while depositing or releasing your funds, then you can try investing in the financial markets, because it doesn’t involves any paper formalities while depositing or releasing your funds and you can see anytime how much you have earned per day or per month in your portfolio section. Have you ever wondered how this big institutions gives you interest per year, how they earn and why do they give interest per year? They directly invest or trade in the financial markets. They give you some percentage of what they earn because you give them your funds in the form fixed deposits, they invest or trade with your funds and make the x amount of returns, now just think the amount of they earn, we can’t assume. So when big institutions invest or trade directly in the financials markets and make the x amount of returns, then why can’t you. Whether it trading or investing in the financial markets it involves risks because the nature of financial markets is unpredictable but with stop loss and time to time watch you can make the returns in the financial markets. But before investing in the financial markets, you should know about the types of investing in the financial markets.
Types Of Investing In The Financial Markets
1. Short-Term Investing :- Short-term investing involves the duration of investing in financial markets is 6-12 months, which means you are investing your funds for 6-12 months in the markets in order to make some profit with your investments. So if your capacity of holding your funds for the horizon of 6-12 months then it’s a short-term investing.
2.Long-Term Investing:- Long-term investing involves the duration of 1-5 years in the financial markets. So if you hold your funds from 1-5 years in the financial markets then it’s a long term investing.
Conclusion
Whether you are trading or investing directly into the financial markets it involves risk but with good risk management you can excel in the financial markets.
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