The following are the questions beginner traders often ask. If there are additional questions you feel we should address, please notify us and we will list your questions to assist other clients. Please have in mind that this is a general trading-related FAQ, while there are other documents on this web site that address AGEA-specific topics.
To open and read a particular FAQ page, please click on its title.
1. General Information
1. General Information
The following Trading FAQ section contains general information about trading and financial markets.
1.1. What do I need to do in trading?
1.1. What do I need to do in trading?
Your goal in trading is to buy at a lower price and sell afterwards for a higher price. For example you can buy a market instrument (quantity of 10000) for 1.2349 and sell it later for 1.2458. You will make a profit of 109 (in currency the instrument is denominated in).
1.2. What can I trade on the market?
1.2. What can I trade on the market?
AGEA provides trading services through several platforms listed on http://www.agea.com/index.ncre?page=platform-services page. Please click on each of the platforms shown to get a list with detailed information on the instruments offered. The list of market instruments may change in the future.
1.3. When is the market open for trading?
1.3. When is the market open for trading?
You can trade from Sunday 21:30 to Friday 21:30 GMT on Streamster and from Sunday 21:15 to Friday 21:00 GMT on MetaTrader 4 platform. Virtual trading on the default Streamster platform is open at all times. Please type GMT in Google.com to find out the current GMT time. The following approximate market schedule is based on GMT: Japan markets open at 00:00 followed by Singapore and Hong Kong that open at 2:00. European markets open in Frankfurt at 7:00, while London opens an hour later. New York markets open at 13:00 (NYSE opens at 14:00). European markets close at 17:00 and Australian markets start again at 23:00.
1.4. Is there an easy way to start trading?
1.4. Is there an easy way to start trading?
The easiest way to start trading is to login to the default Streamster platform and click on a market instrument in a price window. When [Send Order] dialog shows up, you can set [Quantity] field to 1 or more (depending on the amount of money you have on currently active trading desk). When you click button, the order will go into the market. You can find a collection of introductory articles and various other resources to help you understand trading basics at http://extra.agea.com/en/resources page.
2. Trading Fundamentals
2. Trading Fundamentals
The following Trading FAQ section contains fundamentals about markets, trading processes and terminology.
2.1. What is long and short position?
2.1. What is long and short position?
Long (buy then sell) position and short (sell then buy) position are: a long position is simply one in which a trader buys a market instrument at one price and aims to sell it later at a higher price. In this scenario, the trader benefits from a rising market. A short position is one in which the trader sells a market instrument in anticipation that it will depreciate. In this scenario, the trader benefits from a declining market. For more details, please check http://extra.agea.com/en/resources/introduction-to-markets/orders-and-positions page.
2.2. What is entry limit and stop level?
2.2. What is entry limit and stop level?
A limit order is an order to buy below the current price, or sell above the current price. For example, if a market instrument is trading at 1.2952 / 55 and you believe that price is expensive, you could place a limit order to buy at 1.2945. If executed, this will give you a long position at 1.2945, which is 10 points better than if you had just bought the instrument with a market order. A stop order is an order where you buy above the current market price or sell below the current market price, and is used if you are away from your desk and want to catch a trend. If a market instrument is trading at 1.2952 / 55, you could place a stop buy order at 1.2970. In case the market moves up to that price, your order will execute and open a long position. If market continues in the same direction (trend), the position will bring you profit.
2.3. What is stop-loss and target level?
2.3. What is stop-loss and target level?
A stop-loss order ensures a particular position is automatically liquidated at a predetermined price in order to limit potential losses should the market move against a trader's position. Exit target level is a price level at which you want to close your position, when you reach certain profit. You can set the exit target level when you open your position or at any time while the position is open.
2.4. What is GTC, GTD and IOC order?
2.4. What is GTC, GTD and IOC order?
GTC (Good Till Cancelled) order will stay in the market until you cancel it and it is the default order duration type. GTD (Good Till Date) will stay in the market until a date you specify, and IOC (Immediate Or Cancel) order will be executed immediately (if other order conditions are met) or cancelled.
3. Trading Specifics and Facts
3. Trading Specifics and Facts
This Trading FAQ section explains trading specifics and facts.
3.1. What is point and position point value?
3.2. How do I calculate my profit?
3.2. How do I calculate my profit?
Your profit depends on your position size and difference in prices traded. If you buy a market instrument for 129.38 (quantity of 10000) and later sell it for 129.52, your profit will be (129.52 - 129.38) * 10000 = 1400. You can read more on how to calculate your profit at http://extra.agea.com/en/resources/introduction-to-markets/calculating-profit page.
3.3. Where can I see spread sizes?
3.3. Where can I see spread sizes?
Spreads between bid and offer (ask) prices are variable. For detailed information please visit http://www.agea.com/index.ncre?page=platform-services page and select the platform for which you want to review spreads. Price spreads often unexpectedly change and greatly increase during weekends, in after-hours trading, in case of market-related announcements or market turmoil.
4. Strategies and Techniques
4. Strategies and Techniques
The following Trading FAQ section contains information on different trading strategies and techniques.
4.1. How do I manage risk in trading?
4.1. How do I manage risk in trading?
The limit order and the stop-loss order are the most common risk management tools in trading. A limit order places restriction on the maximum price to be paid or the minimum price to be received. A stop-loss order ensures a particular position is automatically liquidated at a predetermined price in order to limit potential losses should the market move against a trader's position. For more details, please check http://extra.agea.com/en/resources/trading-techniques/controlling-risk page.
4.2. What kind of strategy should I use?
4.2. What kind of strategy should I use?
Traders make decisions using business reports, economic fundamentals, technical factors and other relevant information. Technical traders use charts, trend lines, support and resistance levels, and numerous patterns and mathematical analyses to identify trading opportunities, whereas fundamentalists predict price movements by interpreting a wide variety of economic information, including news, business reports, government-issued indicators and reports, and even rumors. The most dramatic price movements, however, occur when unexpected events happen. The event can range from a central bank raising domestic interest rates to the outcome of a political election or even an act of war. Nonetheless, more often it is the expectation of an event that drives the market rather than the event itself.
4.3. How long are positions maintained?
4.3. How long are positions maintained?
As a general rule, a position is kept open until one of the following occurs: 1) realization of sufficient profits from a position; 2) the specified stop-loss is triggered; 3) another position that has a better potential appears and you need these funds.
Send us your comments, suggestions and any questions you might have about the Trading FAQ. We look forward to receiving your input and developing content on this page to help you better understand trading.
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