Fixed odds financial trading is a relatively new and potentially profitable way in which profits can be made from the financial markets. It is designed to be both simple to understand and easy to execute, making it particularly suitable for newcomers looking to profit from the financial markets.
A unique feature of fixed odds and one of the big attractions is that your financial risks when trading are limited. Traditionally financial investments, particularly speculation on markets has a reputation for being risky. This view is perpetuated by stories of individuals losing huge sums on leveraged products. Often they will lose their entire accounts and then some. However trading via financial fixed odds is different.
When you place a fixed odds trade your liability (i.e. what you could potentially lose) is known at the outset. This is prior to you actually placing the trade. This is because your maximum loss is limited to the stake you place on a trade outcome. As a result your risk management becomes much easier. Similarly you will also know your maximum profit at the outset as well. This will of course depend on the odds you took at the time of placing the trade.
For example, you may believe that the EUR/USD is going to move higher over the next few days. So you log onto your Fixed odds platform and check the return they are offering. Here you set the level that you think the market will not touch and are quoted a price for the trade. This is your stake. You are also given both the potential profit for the trade and the percentage return on your stake. If you are happy with the quote then you simply go ahead and place the trade.
Remember that even if you got this catastrophically wrong, you would never lose more than the original stake you placed. And if the market did move against you after placing the trade, you can actually ‘sell’ the bet back to the broker. The ability to do this helps to preserve some of your trading capital without letting the bet expire worthless.
Additionally as you can only trade with money deposited to your account there is no chance of running up huge debts with your broker. There is no requirement to have a deposited margin with your broker so any money in your account can be fully used for trading. Once your bet has finished both your stake and profit are credited straight back to your account allowing ready for you to place your next profitable trading opportunity.
Disclaimer: Please note all prices are for information only, they should not be relied upon for accuracy or trading. All prices quotes are based on CFD prices and are similar though not always identical to real exchange prices. STOCKTRKR or anybody connected with STOCKTRKR will not accept any liability for loss or damage arising from use of any information/commentary/charts or articles which is provided 'as is' for educational purposes only, nothing contained on this website should be considered as investment advice - please seek proper investment advice from registered financial broker or institution if you wish to trade on global markets and ensure you are familiar with the risks.
