Alternatives to Forex Trading

Stocks Futures and Options Trading

Stock, futures, options and 'swing' trading are also popular, and many of the principles and strategies are similar to forex trading, but the approach is somewhat different. Some people may be better suited to stock and futures trading than forex.

By definition "future trading" involves a standardized, transferable, exchange-traded contract that requires delivery of a commodity, bond, currency, or stock index, at a specified price, on a specified future date. Unlike options, futures convey an obligation to buy, but there are ways to circumvent this and trade on a 'day trade' basis. The risk to the holder is unlimited, and because the payoff pattern is symmetrical, the risk to the seller is unlimited as well. Dollars lost and gained by each party on a futures contract are equal and opposite. In other words, futures trading is a zero-sum game. Futures contracts are forward contracts, meaning they represent a pledge to make a certain transaction at a future date. The exchange of assets occurs on the date specified in the contract. Futures are distinguished from generic forward contracts in that they contain standardized terms, trade on a formal exchange, are regulated by overseeing agencies, and are guaranteed by clearinghouses. Also, in order to insure that payment will occur, futures have a margin requirement that must be settled daily. Finally, by making an offsetting trade, taking delivery of goods, or arranging for an exchange of goods, futures contracts can be closed. Hedgers often trade futures for the purpose of keeping price risk in check.  Also known as a futures contract.

Here's a training course integrated with a universal market trading system that was released recently in 2009 enabling traders to successfully trade in the forex, stocks and futures markets simultaneously. It's called the NetPicks Universal Market Trader. 

Trading the Futures Market

It's possible to make consistent profits by 'Day Trading' the Futures Market –whether it's going up or down...

Why work full time for a living when you can trade for a living? As an independent futures trader you get to call the shots. No employer, no troublesome employees; trade the hours that suit you; trade from almost anywhere in the world – with unlimited potential income. This really is a great business and the author is going to show you exactly how to get involved.

Learn how to trade futures successfully.
 

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Options Trading

Option trading is an important part of the financial system. An option contract describes a sale of a security or commodity that will occur at a specified later date and at a specified price if, and only if, one party to the contract – either the prospective buyer or the prospective seller – wants to go ahead with the sale. If the contract is a "call option," the buyer has the right to decide whether or not the sale happens; if the contract is a "put option", the seller decides.

Options can be bought or sold on many different items. In the United States there are option markets for shares of stock, for indexes based on stock portfolios, for foreign currencies, for bonds, for precious metals, and for futures contracts on physical commodities and financial instruments.

Options are traded either through a formally organized exchange or through a less formal over-the-counter (OTC) network of dealers. Whereas option contracts have been sold for centuries, stock-option exchanges in the United States are a recent phenomenon. The oldest, the Chicago Board Options Exchange, began trading options in 1973. Other major options exchanges are in Philadelphia, New York, and San Francisco. Outside the USA,the largest foreign options exchanges are in London, Amsterdam and Tokyo. In the international OTC option markets, commercial banks and broker-dealers trade options on foreign currency and debt.

Since the introduction of exchange-traded options, options-trading activity has grown tremendously, and a wide range of businesses and households trade options for hedging and speculative purposes. Along with the rise in trading volume have been equally dramatic advances in option pricing and trading techniques. The best known is the Black-Scholes option-pricing model, which values an option by identifying a strategy for trading the underlying security or commodity that results in the same payoff as the option contract.

Without doubt, there's only one place to study options and that's at the Options University. Find out more:

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