Cryptocurrency trading for dummies

Trading Speculate in cryptocurrency for dummies

Speculation in cryptocurrencies At a time when the traditional markets and safe havens seem to offer us little return, it is no more than normal for investors to look for other places. Many people who have considerable assets imagine that this capacity must be able to achieve lasting growth. That is not always obvious, certainly not when the markets worldwide can count on a lot of confidence.

In these times it is often interesting to look at slightly more volatile investment products that have not yet been accepted by the masses. The best example of this is the cryptocurrencies. Are you also interested in speculating in such virtual coins, but you have no idea how to do that exactly? Then read on and discover this fantastic “speculate in cryptocurrencies for dummies” manual!

What are cryptocurrencies exactly?

Let us first look at what cryptocurrencies are. This is namely virtual currency that can operate independently of not only banks, but also governments. This does not alter the fact that it can be dealt with and speculated in an excellent manner. Cryptocurrencies actually differ relatively little in this area compared to the regular, regular currency. Since the launch of the now extremely popular Bitcoin in 2009, many other cryptocurrencies have also been born. This means that today’s investor who wants to speculate in cryptocurrencies nowadays has a lot of different options.

The difference between buying and speculating cryptocurrencies
CryptocurrencyThere are two different possibilities to realize a certain profit with an investment from cryptocurrencies. In the first instance you can of course choose to just buy a certain cryptocurrency and then sell it back for a while later with a profit.

However, another option is to speculate on the rate of the cryptocurrency that you find most interesting. In the latter case, you do not in principle become the owner of the virtual currency, but you make a profit or loss depending on what the exchange rate does. At first sight both options seem to do more or less the same thing, but in practice that is much less the case.

How to Trade in cryptocurrencies?

Trading in cryptocurrencies is done by means of so-called CFDs. At first glance, speculation in cryptocurrencies may seem a bit complex, but practice will show that this is actually not too bad. We have already listed the various steps that you must go through to speculate in cryptocurrencies:

1. Opening an account
It is a common misunderstanding that as a CFD investor you must always be in possession of a particular cryptocurrency as the default currency for the account with which you wish to invest in cryptos. A wallet to manage your tokens with is also not a requirement for this form of investing. The only thing you need is an account with a CFD provider. In the majority of cases, this can also be opened completely free of charge.

2. Immerse yourself in the cryptocurrencies market
As an investor it is never interesting to take a leap of faith. As a beginner, it is therefore always worthwhile to get to know the market where you are going. Are you going to speculate in cryptocurrencies for the first time? Then this means that it is always good to get to know them first. You will be able to use this knowledge when it comes to realizing a good profit.

3. Determining a strategy
The next step is to determine a specific strategy for your investment in cryptos. For example, do you want to speculate in the short, medium or long term? What goal do you also have in mind? Defining a clear strategy ensures that you can optimize the return on your investment.
4. Opening a position in cryptocurrencies
The time has now come to open your first position in cryptocurrencies. Opening a position means that you must not only enter the trade size, but also set the stops. Once you have set everything up, click on “buy”, after which your position will be opened and you can start speculating on the price of cryptocurrencies!

5. Closing a position
To redeem your winnings, it is ultimately always a requirement to close your opened positions in cryptocurrencies at the right time. The fairly volatile nature of cryptos ensures that it is always worthwhile to monitor the evolution of the rate and the impact of certain events on the same price.