Online Trading FAQ
Here are some of the frequently asked questions and our answers about online trading faq.
Q: What is Technical Analysis?
A: Technical analysis is the study of investment market price action, through the use of charts and indicators, for the purpose of forecasting future price trends. Technical analysis trading considers only the actual price behavior of the underlying instrument, based on the premise that price reflects all relevant factors at any given time, even before an investor becomes aware of them through other sources.
Q: What is the difference between online trading and investing?
A: Traders usually try to profit from short-term price volatility of Stocks, ETFs, or Commodity Futures with trades lasting anywhere from a day to several months. Most traders use use some type of technical analysis in their trading. Some traders use options to reduce risk or leverage their positions.
On the other hand, investors purchase Stocks, ETFs, Mutual Funds, Commodity Futures, or Options with the intention of holding for an extended period of time, usually several months to years. They rely primarily on fundamental analysis to make their investment decisions. Those investing in stocks consider themselves as co-owners in the companies in which they buy shares. Some investors use options to reduce risk by hedging or leveraging their investments.
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