Prepare your basket because, today, it is time to go to the market. But no. You are not going to buy meat or fish, fruits or vegetables. Today the only thing you are going to purchase are financial assets.
The time has come to discover what the 5 favorite markets of traders are and learn a little more about each of them.
1.THE EURO DOLLAR
If you are one of those who only knows the Euro and the Dollar, rest assured, we have not just invented a new currency.
The euro dollar records the variation in the exchange rate of the euro against the US dollar.
Basically, when the price of the euro dollar rises it is because the euro increases its value against the dollar. On the other hand, when it loses value, the euro dollar falls.
These fluctuations in the value of the two currencies are those that must be carefully observed if you want to trade in this market.
We cross the ocean to travel to the finance giant: the US. There, one of the big markets is the S&P 500.
In fact, it is one of the oldest stock indices in the world. It was born in 1923, with 233 companies, but currently the 500 most important companies in the American economy are listed.
To be part of this index, among other requirements, you must have a market capitalization greater than $4.2 billion. Come on, if you have a small or medium business, forget submitting your application. But if you are the owner of Amazon, Microsoft or McDonald’s, don’t worry, you are already inside.
This market is extremely influential and its movements have immediate effects on the rest of the global economy.
This is the world’s first electronic stock exchange and the second largest in the US. It is the preferred market for technology fans because it has more than 3,800 companies in this sector.
But, in addition, it has 3 subscripts: the NASDAQ Composite, the NASDAQ Biotechnology and,
most importantly, the NASDAQ 100.
The latter is made up of the
100 most powerful American companies according to the volume of sales of their shares
the latter is where trades generally happen.
Surely you did not think that watching your favorite Netflix series or buying the latest Electronic Arts video game could influence the financial market. Well, you were wrong.
The fourth market is precisely the one that registers the price of this precious metal.
The price of gold varies every day and these variations can help traders to obtain profits.
You just have to know how to buy or sell at the right time. So, if you want your finances to awaken a new golden age, this market can be of great assistance.
But there is another gold that does not shine so bright and with which we can also trade: OIL. AKA Black gold.
There are two oil prices, West Texas (American) and Brent (European). Both are tradable and they have different prices. Traders generally prefer to trade West Texas (American)
The world’s most sought-after
fuel also plays an essential role
in the financial sector.
Its quoted price determines the movements of this commodity market
which is one of the most influenced by geopolitical issues.
Not surprisingly, then, this is an index dominated by the US government, (only West Texas) which is the country that produces the most oil in the world. So it is essentially Trump who decides to refine the market in favor of your operation or make it look very… black.
That all said, you can now add one more stop-off to your shopping route. After the fishmonger, butcher, and greengrocer, stop to buy currency, business stocks, and raw materials. Dare to fill the finance cart, because the power is at your fingertips.
Trading is not for everyone. It is a risk. It is rewarding. You must be prepared for the unpredictable, and for that the best thing to do is to study with the best trading teachers.