Thursday, September 27, 2007

Forex , Option, and Commodity? are they the same or different? -

I m confuse. i want to start trading but not sure what the differents between Forex , Option, and Commodity? whats is less risker but higher returns? thanks for all your answers. I really like this Qamp;A in yahoo. so many smart people here and its great to have there ideas on things. Forex - this is the foreign exchange market in which currency pairs are traded such as the USD/CAD. Within this market you can trade the spot market, which is the most recent price changes, similar to buying and selling stocks, typically through the use of leverage (for every $1 put up you could control $100). You can also trade futures and options on the future price of currencies. The more leverage you use the more risk but the higher the potential return. Optios - this is a contract that gives you the right but not the obligation to buy the underlying security at a set price before a set date. A call option gives you the right to buy while a put option gives you the right to sell. While you effectively control a lot more of the underlying security with a smaller outlay with an option they are a risky investment for the average investor. Commodities - in terms of the commodity market this is simply the trading of commodity products such as oil, gold, beef, etc. The typical way to trade these are through futures, which is a contract to purchase or sell the underlying commodity at a set price by a set date. This market is considerably more advanced and risky for the average investor. For more information on each: Commodities - http://www.investopedia.com/articles/tra... Forex - http://www.investopedia.com/university/f... Options - http://www.investopedia.com/university/o... Check this http://people.stfx.ca/kmacaula... out too. Report Abuse For forex you can learn more at http://the-forex-trading.blogspot.com

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