The trading concept came into this world a long time ago, dating back to ancient Mesopotamia with the exchange of grain futures. Trading of financial instruments such as stock and forex trade emerged by exchanging debts among moneylenders in the 1300s. Trading in assets and instruments progressed rapidly as many people started taking an interest in investing in stocks and foreign currencies. People with considerable funds were most involved in the financial markets. Both these are speculative trades involving high risks and offer higher returns to those investors who achieve competency in the trade.
Concept of trading
Trading is a broad term and covers many financial markets, not limited to stocks and forex trades. Investors have their clear choices to invest in stocks, forex, commodities, precious metals such as gold, and even mutual funds. More activities in trade markets are exchange-traded funds, options, and contracts for difference (CFD); cryptocurrency is the latest in trading markets, added in the traders’ portfolios. The cryptocurrency trade ideology was evolved with the advent of Bitcoin, the first crypto coin developed over a decade ago.
Trading methods and technologies
The trading methods, techniques, and strategies have improved and developed over time with traders’ changing attitudes. First came an era of technology with the advent of the internet that shifted traditional trading activities from manual exchanges to online exchanges. Then came a period of blockchain technology used in crypto trading. Newly evolved technologies such as the internet and blockchain have made trading more accessible to the investors. Traders feel more comforts of trade using these advanced technologies. Online and crypto exchanges are much faster than traditional manual exchanges. They bring opportunities for more trading and more profits within a short period of investment. Concurrently, they have opened up lower market entry levels in terms of capital requirements.
The trading spirit has boosted ever since new technologies have become operational, despite the risk level remaining the same. Artificial Intelligence and machine learning technologies have filled more passion for trading in new users of advanced platforms. Anyone can do completely safe, secure, and protected Bitcoin trading comfortably here.
Traders understand that outcome can be both positive and negative, but trade with enthusiasm. Cryptocurrencies have presented new opportunities to enthusiastic traders. No doubt, all existing types of trade are more stable, regulated, and highly secured. Yet, the promise of extremely high returns in the Bitcoin trade suppresses the stability and security factors.
Trading and Investing
Both trade and investment are correlated terms. A trader is also an investor, though their aims and strategies set them apart. Trading and investing carry the potential for the same outcomes. However, the primary difference between trading and investing is in the timeframe over which assets are held; trading indicates short to medium-term involvement but investing means long-term commitment to assets. In real trading practice, investors buy and hold assets, called holding in the crypto world, for an extended period to build profit. The profit gradually accrues throughout holding. Holding is a strategy that tends to defy the trends followed by traders. The primary objective of holding is to wait for the price increase of the purchased assets regardless of the market trend when an indication of future price surge is explicit. The period of holding and profit determines the percentage return on investment (ROI).
In other trading activities such as stock, forex, etc., liquidity is higher than crypto trade; therefore, holding for an extended period is not a good practice in these trading activities. Cryptocurrency or Bitcoin has a volatility factor due to which its holding for the long-term can bring higher returns than other trade instruments.
The outcome of Bitcoin trading
Why should you do Bitcoin trading? The primary aim of Bitcoin trading is to benefit from the opportunity to buy and sell Bitcoin at a low and high price, respectively. Bitcoin trading has added a new dimension to currency trading, after forex trading, but it is better than the latter in the following aspects:
- Bitcoin trading provides the experience of dynamic force and volatility.
- Bitcoin trading creates the possibility to benefit from high yields.
The real outcome of Bitcoin trading is a high amount of fiat currency for a low amount of Bitcoin.
