Trading with financial fixed odds is a truly great way to profit from movements in financial markets. It stands out from other trading methods for a number of key reasons. In this article we recap the key reasons why this method of trading should be in every traders toolbox, no matter what other forms of investing they undertake.
The Mechanics Of Fixed Odds
Most forms of investment will require you to purchase and hold an asset. With share or stock investments for example you purchase a quote of stock giving you what is known as a holding in the company. This in effect provides you with a level of ownership and ties you to the fortunes and performance of the company. In order to make money from your holding you will need the profits of the company to rise in order to increase the valuation of your holding. This can be a lengthy process, if it happens at all and will normally require you to make a large investment in order to see a decent return on your investment.
Fixed odds is different. When you place a fixed odds contract on an asset you are never in a position where you own part of the underlying asset. Instead you are simply buying a contract that will let you wager on its price future price movement. if you think that the price of the asset will rise then you buy a contract in your account to reflect this. Alternatively if you think the price of the asset will fall then you can purchase an asset to reflect this move too. The length of time that you want the contract to run for it determined when you place it. If you are prediction is correct then you earn the stated payout
Contacts can be placed to run for just a few minutes to over several hours or even days. It really is down to you how long you want them to run for. Unlike traditional investment approaches this means that you can see a fast return on your investments. The profits that you earn for a successful fixed odds contract are determined by the amount of risk that you want to take. Naturally the more risk you take on, the higher the return you can earn. However typically you can earn 20-100% of your original investment back for a medium risk contract.
As well as trading on stock you also gain access to a wide range of additional markets when using fixed odds for your investment purposes. Contracts can be placed on foreign exchange pairs and even entire market indices. Once you get used to making investments with these contracts you will find that you can start to take advantage of the trading opportunities on all of these different markets that are on offer in your account.
Trading with fixed odds is a simple and convenient way in which to get started with investing on financial markets. This coupled with the short term payouts in fixed odds make it a much more attractive for of investment than traditional buy and hold methods used in stock investment.
This article if provided by Fixedoddsinvestment.co.uk the portal for financial fixed odds trading.
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