Taking Risk is what matters

Taking risk is the key

Risk-taking is a key concept to all types of financial trading. Irrespective of what instrument is being traded, who is buying or selling or whether the trade takes place on exchanges or over-the counter, balancing potential profit against risk is what trading is all about.

How good you are at predicting whether something will go up in price, or down, is what really matters. If you get it right, you get rewards. And if you get it wrong, you could lose a lot of money.

How much information do you really need?

Unless you want to be an academic, you should acquire enough functional knowledge to help make informed trading decisions .

By the time you finish the course you will be in a position to understand:

• what to trade

• when to buy or sell

• when to exit

• How to execute the trades online using a PC or Smartphone

• How a blackbox , robot-like trader, is helpful in controlling psychology?

• How to avoid market noise

It is quite tough analysing each event, its effects on investment or trading and trying to time the market turns and really not necessary.

The course will equip you with just enough knowledge (without making you a zombie) to plunge into trading quickly. You will have enough information not to make costly mistakes. You will be taught how to look out for trading opportunities, manage the risk, and the techniques used by the professionals to become consistently profitable traders.

However, it is incumbent upon you to avoid overloading yourself with information. We have filtered knowledge so that you can focus on what is essential to be a real trader and take decisions, without being affected by market noise.

What is technical analysis?

Most of the trading theories we know today appeared decades ago. All revolved around using moving averages and attempted to define some kind of winning formulas. Not much has changed except that a lot of new-age technical analysts have appeared on the scene who are interpreting the market in a new way using various statistical indicators and expert advisors and trying to find some sort of a "holy grail". You will find many technical trading methods out there on the internet that promise the sun and the moon to make you rich overnight. Most of them are unrealistic or impractical.

On our part, we teach targeting specific historic/seasonal/repeatable patterns through technical analysis. At the end of the day, you don't have to follow other people's plans. You can try 4-5 trade plans before identifying which works for you, and that too consistently.

What is fundamental news?

Financial markets move for a reason. Capital markets, Currencies, Commodities have own fundamentals and mostly apply to specific instruments. Some affect all financial instruments.

Economic events typically have the greatest impact in markets based in the country where the release occurs. This list briefly explains some of the markets impacted by typical events.

1. Currencies (also knows as FX or FOREX)

Currency pairs, such as EURUSD, are affected directly by events of the two regions: EUROPE and USA.

Example: A positive surprise of the USA GDP (3.0% vs. expectation of 2.3% ), will impact that currency pair in such a way that the USD will get stronger over the EUR. This is bearish for the EURUSD forex pair.

The logic behind this: Higher than expected GDP means that the economy is in better shape than estimated. This new information enters the market and increases the probability that the US central bank will raise interest rates. Higher interest rates on a currency will typically push the currency to get stronger.

2. Commodities (OIL, GOLD, Silver, etc.)

Commodities tend to react to macro data such as the Unemployment rate, GDP, and CPI. Additionally, there are events related directly to commodities, such as OIL Inventories.

Example: Crude OIL Inventories releases every Wednesday at 10:30 EST. Of course, the price of oil is impacted by these releases.

The logic behind this: Fewer barrels in the inventories implies that there is more demand for oil than expected.

3. Indices (S&P 500, DAX, CAC40, NIKKEI225)

Economic indicators measure the economic trends and activity at the country level, the stock indices are a reflection of the economic behavior in the country.

Example: If the US Building permits release is stronger than expected, it could push the S&P 500 higher.

The logic behind this: In a healthy market, housing makes up roughly 20% of GDP. The housing market does this in two basic ways:

(a) through the physical construction of homes; and (b) through consumer spending on housing services. This impact is in turn felt throughout other industries affecting important metrics such as earnings.

4. Government Bonds:

Government bonds reflect the current interest rate and expectation for changes in the interest rate over time. Many economic events connected to inflation and growth have an impact on bonds.

Example: If the US Unemployment rate is lower than expected (4.4% vs. expectation of 4.6%), this is a positive release for the economy.

The logic behind this: Less unemployment means the economy is in better shape and probably inflation is ahead of us. This may lead the Federal Reserve Open Committee (FOMC) to hike interest rates sooner than expected, which means that the government bonds may drop as well (bond prices go down when interest rates go up).

Stocks and equities

Stock indices are more correlated to government news releases than specific stocks like Facebook or Amazon are. If you like to trade stocks around economic events, it’s better to focus on sectors like trading the building sector stocks after Building Permits, or housing starts. Specifically, any data which is expected to impact the price or perceived value of a stock. Some of the fundamentals of stocks include cash flow, return on assets, and conservative gearing. Earning reports also move stock markets substantially.

What is more important for a retail trader - analysing technicals or fundamental news or both?

Technical analysis helps you look back at history and see if the past data could provide some guidance for moving forward.

Fundamental news analysis sharpens the ability to assess the probabilities and do some forecasting.

You would need to use both.

As a self-directed trader you may ask whether you should really learn to do all - technical analysis, fundamental news analysis and transactions execution?

No. As a trader it is not necessary for you to analyse the market in any way since you have a few other choices:

1. Do all by yourself which normally an entrepreneur lacking enough financial resources likes to do. This course will teach you doing this. At least a couple of times you must trade manually to gain an understanding of the trading processes whether you wish to engage in automated or semi-automated trading. This helps even developing your own quality control system to select external wealth managers or advisors for outsourcing the jobs.

2. Semi-automatic trading: Split the trading into the parts that you want to do and the ones you don't want to do for any reason. Luckily, the web provides resources that can help you. Again, this course will show you the way. It is our preferred way of trading.

3. Outsource the job to a digital wealth manager or advisor : If you have the temperament to trust and assess advisors' quality and know how to farm out work or know ways to leverage the web resources, then you don't have to do any of the trading chores, including the execution of the trades. This course will show the way to do.

4. Automated Trading or using black boxes: You have to understand the mechanics of both algorithmic as well as quant trading in order to automate the process of trading without you having to analyse, select and execute trades. You will have to learn coding or using programmers. The course will expose you to the basics of this process.

5. OK, I know how to deploy manpower or web resources, assess quality control and set up performance metrics. So how do I go about it?

This guide will convert you into a business manager of your own or family forex trading business enterprise without really employing any fund manager. Set up your own 8 Cs Quality Control System