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Financial Markets

November 20, 2017

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The financial markets can be broadly defined, however, as an active trader and investor we look at four core tradable instruments

  1. Stock Market: We can buy and sell stock in this market.  We buy a stock for a few reasons, 1) growth 2) dividend 3) cash flow.  We sell stock to make money as the stock goes down in price.
  2. Options Markets: This market is traded in contracts.  While there are two types of options, calls and puts, each are traded in contracts.  Each contract controls 100 shares of stock.
  3. Futures Market: Commonly referred to as the commodity market.  However, you can also trade market indexes, currencies as well as your commodities.  It is also a 24 hour market
  4. Forex Market: The largest of the markets by a mile but dominated by your major currencies such as the USD, EUR, JPY, GBP, CHF, CAD, & AUD.  Similar to the futures market, it is a 24 hour market.

 

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