Sunday, August 5, 2012

How To Trade And Win Binary Options Daily report 3rd August S&P 500 Emin...



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The contracts are subject to a daily financing charge, usually applied at a previously agreed rate linked to LIBOR or some other interest rate benchmark e.g. Reserve Bank rate in Australia. The parties to a CFD pay to finance long positions and may receive funding on short positions in lieu of deferring sale proceeds. The contracts are settled for the cash differential between the price of the opening and closing trades.
Traditionally, equity based CFDs are subject to a commission that is a percentage of the size of the position for each trade. Alternatively, a trader can opt to trade with a market maker, foregoing commissions at the expense of a larger bid/offer spread on the instrument.
MarginTraders in CFDs are required to maintain a certain amount of margin as defined by the brokerage or market maker (usually ranging from 0.5% to 30%). One advantage to traders of not having to put up as collateral the full notional value of the CFD is that a given quantity of capital can control a larger position, amplifying the potential for profit or loss. On the other hand, a leveraged position in a volatile CFD can expose the buyer to a margin call in a downturn, which often leads to losing a substantial part of the assets.
CFDs allow a trader to go short or long on any position using margin. There are always two types of margin with a CFD trade -
1.Initial Margin - (normally between 3% and 30% for shares/stocks and 0.5% - 1% for indices, foreign exchange and commodities)
2.Variation Margin - (which is then 'marked to market').
Initial margin is fixed at between 0.5% and 30% depending on the underlying product and overall perceived risk in the market at that time. For example, during and after 9/11 initial margins were massively hiked across the board to counter the explosion in volatility in the world's stockmarkets.
Many refer to initial margin as a deposit. For example, for large and highly liquid stocks such as Vodafone the initial margin will be nearer 3%, and depending on the broker and the client's relationship with the firm the deposit maybe even lower. However, with a smaller capitalised and less liquid stock the margin is likely to be at least 10% if not a lot higher.
Variation margin is applied to positions if they move against a client. For example, if a CFD trader was to buy 1,000 shares in ABC stock using CFDs at 100p and the price moved lower to 90p the broker would deduct £100 in variation margin (1,000 shares x -10p) from the client's account. Note, this is all done in real-time as the market moves lower, so called 'marked to market'. Conversely, if the share price moved higher by 10p the broker would credit the client's account with £100 in running profits.
Variation margin can therefore have either a negative or positive effect on a CFD trader's cash balance. But initial margin will always be deducted from a customer's account and replaced once the trade is covered.
 LeverageOne of the benefits (and risks) of trading CFDs is that they are traded on margin meaning that they provide the trader with leverage. Leverage involves taking a small deposit and using it as a lever to borrow and gain access to a larger equivalent quantity of assets. The margin requirements on CFDs are low meaning that only small amount of money is required to take large positions.
Stop loss ordersA stop loss order can be set to trigger an exit point as pre-determined by the trader e.g. Buy at $3.00 with a stop loss at $2.60. Once the stop loss is triggered, a sell signal is activated to the CFD provider and actioned in accordance with their terms of business and taking into account available liquidity to action the request. DMA providers typically receive the stop loss value via the phone or online ordering and will place the order in the market to be actioned at the pre-determined price to a limited price range e.g. to a maximum 6c further,and providing there is matching liquidity. If the stop loss price is triggered and the price then rapidly moves outside the 6c range in this example, or there is insufficient liquidity for your order and considering other people that have orders at that price point, your stop loss sell order may not be triggered and you remain in the position.

How To Trade And Win Binary Options Daily report 3rd August Euro USD 6E ...



If you trade the S&P 500 Emini Futures, or trade the Nasdaq, Dow Jones, Rusell mini futures, or if you trade Forex and Crude Oil you need to check out www.sceeto.com for one of the worlds most advanced indicators. A no obligation Free Trial is availible.www.sceeto.com

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Text Courtesy Of Wikepedia
Example 1 - an Equity based CFD tradeIn this example we show an equity based CFD trade. The share price of Apple Inc is $194.38. We believe that the share price will rise and so decide to take a long CFD position. Our CFD Provider is quoting a price of $194.36 bid and $194.42 offer.
Step 1 Opening a position 
Buy 100 Apple CFDs at offer price 100 x $194.42 = $19,442.00
Margin requirement is open position x margin percentage. Typical margin for equities is 3%-15% depending on the liquidity of the underlying instrument. In our example Apple CFDs require margin of 5%. $19,442.00 x 0.05 = $972.10
You get charged commission of 0.1% on this transaction $19,442.00 x 0.001 = $19.44
Step 2 Overnight Financing 
To hold this position a financing charge is made each night. This is normally based on a benchmark rate per cent like LIBOR + broker margin per cent / 365. For simplicity we will assume the price of Apple shares stayed the same until the market close and so no P&L was generated on this day. $19,442.00 x (0.0025 + 0.02) / 365 = $1.20
Step 3 Closing the position 
The next day Apple share price has risen by $6.15. Our trade has moved in our favour and we decide close the position and take profit. 
Our CFD provider is quoting $200.50 bid and $200.58 offer. 
Sell 100 Apple CFDs at bid price 100 x 200.50 = $20,050.00
The position is now closed and so margin requirement is now zero $0.00
You get charged commission of 0.1% on this transaction $20,050.00 x 0.001 = $20.05
Gross profit is difference between opening position and closing the position $20,050.00 - $19,442.00 = $608
Net profit is gross profit less costs. The costs are commissions and overnight financing. In this example we have been charged commission twice, once to open the position and once to close it, and we have been charged one day overnight financing. $19.44 + $20.05 + $1.20 = $40.69
Profit & Loss shows a profit after costs $608.00 – $40.69 = $567.31
In summary we have had to deposit $972.10 to cover margin on this trade and made a profit of $567.31. If the price of Apple shares had instead dropped by $6.15, we would have sustained a loss of $647.47 ($608 plus commissions).
[edit] Example 2 - An Index based CFD trade on the S&P 500 IndexIn this example we show an index based CFD. The S&P500 Index is at 1093.9. We believe that the Index will go down and so decide to take a 'short' position. Our CFD broker is quoting 1093.7 bid and 1094.1 offer.
Step 1 Opening a position 
Sell 10 S&P500 CFDs at bid price 10 x $1093.7 = $10,937
Margin requirement is open position x margin percentage. Typical value for major indices is 0.5% 10,937 x 0.005 = $54.68
Commission – typically no commission is charged on index CFDs 
Step 2 Overnight Financing 
To hold a position a financing charge is made, however as we are holding a short position we will instead receive the financing. The rate is normally based on a benchmark rate per cent like LIBOR, from this we subtract the broker margin and divide by 365 to get the daily financing. For simplicity lets assume the US interest rate is 4% and the broker margin is 2%. $10,937 x (0.04 - 0.02) / 365 = +$0.60
Step 3 Closing the position 
The next day the S&P has dropped by 10 points to 1083.7 bid and 1084.1 offer 
Our trade has moved in our favour and we decide to take profit and close the position 
Buy back the position at the lower price 10 x 1084.1 = $10,841
The position is now closed and so margin requirement is now zero 
Gross profit is difference between opening position and closing the position $10,937 - $10,841 = $96.00
Net profit is gross profit less costs. In this example financing is actually positive and there are no other costs. So we get a credit of $0.60
Profit and Loss shows a Profit after costs $96.00 + 0.60 = $96.60
In summary we have had to deposit $54.68 to cover margin on this trade and made a profit of $96.60. If the S&P 500 Index had risen instead by 10 points we would have sustained a loss of $95.40 ($96.00 + Costs). Note that the amount of gain or loss was bigger than the margin requirement. In other words, you would have gained or lost more money than you deposited.

How To Trade And Win Binary Options Daily report 3rd August Crude Oil Fu...



If you trade the S&P 500 Emini Futures, or trade the Nasdaq, Dow Jones, Rusell mini futures, or if you trade Forex and Crude Oil you need to check out www.sceeto.com for one of the worlds most advanced indicators. A no obligation Free Trial is availible.www.sceeto.com

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Text Courtesy Of Wikepedia
Around 2001 a number of the CFD providers realised that CFDs have the same economic effect as financial spread betting except that the tax regime was different, making it in effect tax free for clients. Most CFD providers launched financial spread betting operations in parallel to their CFD offering. In the UK the CFD market mirrors the financial spread betting market and the products are in many ways the same. However unlike CFDs which have been exported to a number of different countries, spread betting relying on a country specific tax advantage has remained primarily a UK and Irish phenomenon.
The CFD providers started to expand to overseas markets with CFDs being first introduced to Australia in July 2002 by IG Markets and CMC Markets. CFDs have since been introduced into a number of other countries; see list above.
Until 2007 CFDs had been traded exclusively over-the-counter (OTC); however, on 5 November 2007 the Australian Securities Exchange (ASX) listed exchange-traded CFDs on the top 50 Australian stocks, 8 FX pairs, key global indices and some commodities. There were originally 12 brokers offering ASX CFDs, but as of 2009 there are only five.
In June 2009, the UK regulator the Financial Services Authority (FSA) implemented a general disclosure regime for CFDs to avoid them being used in insider information cases.[3] This was after a number of high profile cases where positions in CFDs were used instead of physical underlying stock to hide them from the normal disclosure rules related to insider information.[4]
CFDs are traded between individual traders and CFD providers. There are no standard contract terms for CFDs, and each CFD provider can specify their own, but they tend to have a number of things in common.
The CFD is started by making an opening trade on a particular instrument with the CFD provider. This creates a ‘position’ in that instrument. There is no expiry date so the position is closed when a second reverse trade is done. At that point the difference between the opening trade and the closing trade is paid as profit or loss. The CFD provider may make a number of charges as part of the trading or the open position. These may include, bid-offer spread, commission, overnight financing and account management fees.
Even though the CFD does not expire, any positions that are left open overnight will be ‘rolled over’. This typically means that any profit and loss is realised and credited or debited to the client account and any financing charges are calculated. The position then carries forward to the next day. The industry norm is that this process is done at 10pm UK time.
CFDs are traded on margin, and the trader must maintain the minimum margin level at all times. A typical feature of CFD trading is that profit and loss and margin requirement is calculated constantly in real time and shown to the trader on screen. If the amount of money deposited with CFD broker drops below minimum margin level, margin calls can be made. Traders may need to cover these margins quickly otherwise the CFD provider may liquidate their positions.
To see how CFDs work in practice see the examples of typical CFD trades. The ‘margin percentage’, and ‘charges’ shown may vary from provider to provider, but are typical of CFD providers.

How To Trade And Win Binary Options Daily report 3rd August Russell TF F...



If you trade the S&P 500 Emini Futures, or trade the Nasdaq, Dow Jones, Rusell mini futures, or if you trade Forex and Crude Oil you need to check out www.sceeto.com for one of the worlds most advanced indicators. A no obligation Free Trial is availible.www.sceeto.com

How To Trade And Win Binary Options Daily report 3rd August Russell TF Futures.
How To Trade Russell Tf Futures  Russell Free order Flow Information signals from Sceeto.You can get a free trial to Sceeto by visting http://www.sceeto.com . You can also monitor WIND free at http://www.binaryforecast.com Wind is our real time trend indicator which can warn you in real time and a lot of time before a move happens. Today Sceeto's indicators for crude proved again to be the best thing any trader can have in their toolbox for trading these markets. Sceeto will help you win more trades pure and simple.

Text Courtesy Of Wikepedia
In finance, a contract for difference (or CFD) is a contract between two parties, typically described as "buyer" and "seller", stipulating that the seller will pay to the buyer the difference between the current value of an asset and its value at contract time. (If the difference is negative, then the buyer pays instead to the seller.) In effect CFDs are financial derivatives that allow traders to take advantage of prices moving up (long positions) or prices moving down (short positions) on underlying financial instruments and are often used to speculate on those markets.
For example, when applied to equities, such a contract is an equity derivative that allows traders to speculate on share price movements, without the need for ownership of the underlying shares.
CFDs are currently available in the United Kingdom, Hong Kong, The Netherlands, Poland, Portugal, Germany, Switzerland, Italy, Singapore, South Africa, Australia, Canada, New Zealand, Sweden, Norway, France, Ireland, Japan and Spain.
CFDs were originally developed in the early 1990s in London as a type of equity swap that was traded on margin. The invention of the CFD is widely credited to Brian Keelan and Jon Wood, both of UBS Warburg, on their Trafalgar House deal in the early 90s.[1][2]
They were initially used by hedge funds and institutional traders to hedge their exposure to stocks on the London Stock Exchange in a cost-effective way. Mainly because they required only a small margin and avoided the UK stamp duty tax, as no physical shares changed hands.
In the late 1990s CFDs were first introduced to retail traders. They were popularised by a number of UK companies, whose offerings were typically characterised by innovative online trading platforms that made it easy to see live prices and trade in real time. The first company to do this was GNI (originally known as Gerrard & National Intercommodities); GNI and its CFD trading service GNI touch was later acquired by MF Global. They were soon followed by IG Markets and CMC Markets who started to popularise the product in 2000.
It was around 2000 that retail traders realised that the real benefit of trading CFDs was not the exemption from stamp tax but the ability to trade on leverage on any underlying instrument. This was the start of the growth phase in the use of CFDs. The CFD providers quickly responded and expanded their product offering from just London Stock Exchange (LSE) shares to include indices, many global stocks, commodities, bonds, and currencies. Trading index CFDs, such as the ones based on the major global indexes e.g. Dow Jones, NASDAQ, S&P 500, FTSE, DAX, and CAC, quickly became the most popular type of CFD that were traded.