How to earn by trading
When trading on the financial market, large-scale profits can be made from the diverse listings for buying and selling financial instruments, the worth of which changes daily under the influence of economic, political and social factors. It is particularly inviting that the majority of financial markets function on the basis of CFD. Therefore, to take a position for the sale of 100,000 Euros for example, a credit balance of only 500 Euros is sufficient and the remaining sum is provided at the expense of the leverage. The second interesting factor is that it is not necessary to own any Euros in order to sell them as the client ultimately deals with the price difference and there is no actual buying or selling of foreign currency. This means you can sell Euros even when you only have US Dollars in your account.
An example of how you can make profit from a reasonable analysis of market conditions
We will explain how this works. During trading on the market the option exists of selecting the scale of the leverage from 1:25 to 1:200. Leverage of 1:200 means that you must have access to an amount in your account with your broker that is 200 times smaller than the amount of the business transaction. Therefore, for buying 100,000 Euros with leverage of 1:200, only 500 Euros is required.
Let us assume that a purchaser buys 100,000 Euros at a market value of 1.3850, so for 138,500 US Dollars. Let us also assume that he correctly predicted how the market would move and the price exceeded the 1.3950 points mark. He could now sell 100,000 Euros for 139,500 US Dollars and earn 100 points, wherewith the profit would amount to 1,000 US Dollars.
Similar principles also apply to trading with other instruments.