What are the advantages of trade gold commodities? Why join this trade? Do you want to know the answer to this question? Please read more. Trading Commodity Gold Online
Before starting trade gold commodities online, of course you need to get to know it first. Online gold trading is online gold trading in the forex market without any physical transfer of gold assets.
Trading gold can be said as one way to be able to profit from the rise and fall of the price of gold. Basically, the concept of trade gold is the same as forex trading.
You need to know that gold is considered a currency (symbol: XAU) in the forex market. In the forex market, usually gold is paired with us dollar currency in the form of a pair that is XAU / USD.
So, when the US dollar is predicted to decline then traders will put up a long position XAU / USD. That means buying XAU and selling USD.
But most traders trade gold to be used as protection of their investment assets in anticipation of various risks.
In currency trading that exists in the forex market. For example, when the value of the U.S. dollar weakens then the price of gold will rise.
Because market participants see there is an opportunity for gold investments to reduce losses on currencies. To find out what the benefits of trading other gold commodities, just go ahead, see the advantages of trading the following gold commodities. Advantages of Trading Profitable Commodity Gold
This time My Finance will share the various advantages of trading profitable commodity gold.
Here are some of the advantages of trading commodity gold.
#1 Very Liquid
The first advantage of trade gold commodities is very liquid. You need to know that the gold market is one of the largest markets in the world.
So trade gold commodities in the forex market is very liquid. It’s safe, and you don’t have to be afraid of going bankrupt.
But as an investor, you are advised to have a trading plan. In addition, you also have to be vigilant to deal with high price volatility in online gold commodity trading.
In fact, the price of gold can rise or fall by 800-100 pips in a matter of minutes.
Not only trading planning, you also have to have good financial flows and meet financial security before actually entering the world of trading.
This needs to be done as a preventive effort to lose against the risks that can be experienced during trading activities.
You can find out how to build a healthy money habit through the audiobook that has been prepared by Keuanganku below.
#2 Potentially Make a Big Profit
As already mentioned that the gold market is one of the largest markets in the world. Even the number of transactions per day can reach more than US $ 3.2 trillion.
That way, a trader can make trading transactions with a large volume to be able to achieve profit with as much as possible from the trade.
#3 No Physical Delivery (No Risk of Losing Physical Goods)
The second advantage of trade gold commodities online is that there is no physical delivery. Therefore, this can prevent us from the risk of losing gold physically.
Of course, this is the opposite of conventional gold investment where the investor must buy gold physically first. After that, you have to keep the gold in a safe place.
By trade gold commodities online, there is no physical transfer of gold. Therefore, you do not have to pay storage, transportation, and insurance costs for the gold.
Of course, this benefits investors because it can have the potential to be able to earn more profit than conventional gold investments.
#4 The existence of Leverage Facilities
Furthermore, in online gold commodity trading has leverage. Is a facility that allows traders to be able to obtain trading contracts with a certain amount and do not have to pay in full.
For example, a broker gives a leverage of 1:100. So, with just 1 dollar, you can already trade gold for 100 dollars. With leverage, limited capital is no longer a big deal.
#5 Time Flexibility
With the flexibility of time, online gold commodity trading is more flexible. You can trade gold in 24 hours from Monday to Friday (5 business days).
So, you are free to determine what time you want to trade online. Whether morning, afternoon, or night.
However, as additional information you need to note that in the Asian session (Tokyo), the lowest gold price movement occurs.
While in the New York session there was a movement in gold prices or the highest volatility.
Trading gold commodities online can be said to be simpler when compared to stocks for example. If it is stock, there are about 600 companies to choose from.
As for gold trading, only one is considered gold only.
#7 Relatively Low Transaction Costs
In online gold commodity trading, brokers only charge service fees from the difference in bid and ask prices or commonly called spreads.
In addition, there is also a swap fee (stay fee) in positions that have not been closed on the day. For swap fees, the fee is charged per day. Risks of trade gold Commodities
Of the various advantages of online gold commodity trading that exist, it does not mean that this trade is without risk. You still need to know the risks of this trade.
Here are some of the risks of trading commodities gold online.
#1 Risks from Leverage
The leverage facilities offered by brokers do benefit traders. However, on the other hand leverage also provides the potential for greater risk of loss as well.
Therefore, traders must be able to set margins, to reduce the risk of leverage.
In addition, traders must also have good financial management and choose leverage that is tailored to the trader’s own abilities.
#2 Risk of Interest Rate Changes
Another risk in trade gold commodities online is the risk of changes from interest rates relatively quickly. What is the effect of interest rates?
This interest rate affects the currency exchange rate of a country. That way, when the interest rate in a country increases, the country’s currency will also grow stronger.
This is due to the large flow of investment funds into the country. Vice versa, if the rate of interest in a country decreases, then the country’s currency will also weaken.
Therefore, the rise and fall of interest rates can trigger price fluctuations in the forex market (gold). Profit in Trading Gold Commodities
After knowing the various advantages of trading profitable gold commodities online, of course, makes you more interested, right?
As we explained above that this one trading also has its own risks.
Alright, therefore as advice from us, before you actually start trading this online gold commodity, we recommend that you read the following e-book.
For you have the basis of gold trading and the ability to manage the risk of trade gold online that you will do.