Trading Online: LE BASI per Principianti [Lezione 1]

Summary

The script outlines the fundamentals of online trading, highlighting its popularity due to the ability to conduct both long and short operations and the accessibility for short-term investments. It introduces key concepts such as shares, forex, indices, and commodities, and explains the importance of a solid foundation for trading. The use of a demo account for practice is recommended, and the video discusses the concept of margin and leverage, the costs associated with trading, including spread and funding, and different order types. It emphasizes the importance of a money management strategy and touches on the distinction between technical and fundamental analysts. The video concludes by encouraging viewers to subscribe for more content and offers a free demo account for practice.

Takeaways

• 📚 The importance of foundational knowledge in trading is emphasized, with the speaker committing to summarize key points from a trading course for educational purposes.
• 📈 Online trading has become popular due to its ability to facilitate both long (upside) and short (downside) operations, as well as allowing for short-term trades accessible to a wider audience.
• 💹 The first lesson covers basic concepts like shares, forex, indices, and commodities, highlighting the differences and how they can be traded.
• 🌐 The speaker uses a demo account with Kimura Trading as an example, stressing the importance of reliability and customer service in choosing a broker.
• 💰 The concept of contract value per point is introduced, explaining how it represents the amount of money handled for each contract in trading.
• 🔄 Margin and leverage are discussed, illustrating how a small percentage of a contract's value can be used to control larger amounts of money, with associated risks.
• 💸 The costs of trading are outlined, including margin interest rates and the spread commission, which are applied by the broker and affect the profitability of trades.
• 🛒 Different ways to buy assets are explained: market orders, limit orders, and stop orders, each with its own advantages and risks.
• 📉 A basic money management strategy is suggested, focusing on setting stop losses and targets for gains to ensure a positive risk-reward ratio.
• 📊 The distinction between technical and fundamental analysts is made, with technical analysts relying on past price trends and fundamental analysts focusing on news and financial reports.
• 🚀 The speaker encourages viewers to follow the series for more lessons and provides resources for a free demo account with Kimura Trading.

Q & A

Why has online trading become so popular?

Online trading has become popular because it allows for both upside and downside operations, enabling investors to capitalize on price increases or decreases. Additionally, it facilitates short-term operations that are accessible to a wider range of people, not just institutional investors or large financial funds.

What are the two main types of operations in trading?

The two main types of operations in trading are long operations, where one invests expecting the price to increase, and short operations, where one invests expecting the price to decrease.

What are the major currencies in forex trading?

Major currencies in forex trading are the most liquid ones with more money involved and lower volatility. They include pairs like Euro/US Dollar and US Dollar/Japanese Yen.

What is the significance of contract value per point in trading?

The contract value per point indicates how much money is being handled for each single contract. It can be, for example, 10,000 or 100,000 euros, and it determines the potential exposure and risk in a trade.

How does margin work in trading?

Margin allows traders to control a larger contract value than the amount of money they have in their account. It provides leverage, which multiplies the potential gains and losses. For instance, a 3.33% margin on a 100,000 euro contract provides a 30:1 leverage.

What are the two main costs associated with trading?

The two main costs associated with trading are the margin interest rates, which are applied when a position is held open past a certain time, and the spread, which is the difference between the buying and selling prices and serves as the broker's commission.

What are the three ways to buy a stock according to the script?

The three ways to buy a stock are: 1) buying at market price, where one buys at the current market rate; 2) placing a limit order, where one specifies a price at which they want to buy; and 3) placing a stop order, where one buys the stock when the price reaches a certain level, anticipating a rise or fall in price.

How does a stop loss work in trading?

A stop loss is an order placed with a broker to sell a stock when it reaches a certain price. It is designed to limit an investor's loss on a position by automatically selling the stock if it reaches a specified, unfavorable price.

What is the goal of a trader according to the script?

The goal of a trader is to increase the probability of successful operations by conducting analysis to add value to their choices. They aim to make informed decisions that will result in gains that are greater than their losses.

What are the two main categories of traders?

The two main categories of traders are technical analysts, who base their analysis on past price trends, and fundamental analysts, who focus on news and financials related to the assets they are trading.

What is a money management strategy in trading?

A money management strategy in trading is a plan that helps traders decide how much they are willing to risk and how much they aim to gain on each trade. It includes setting stop losses to limit potential losses and take-profit points to secure gains.

Outlines

00:00

📚 Introduction to Trading Basics

The speaker begins by explaining the purpose of the video, which is to provide a summary of trading lessons, starting from the basics. They mention watching the first two hours of a trading course and taking extensive notes to share key points. The video is part of a playlist intended to teach viewers about trading, starting from scratch and gradually advancing to more complex topics. The speaker emphasizes the importance of building a solid foundation before delving into advanced trading strategies. They also mention the popularity of online trading, citing its ability to allow both long and short operations and its accessibility to a wide range of investors. The paragraph concludes with a quote from Warren Buffet, highlighting the importance of investing in what one knows.

05:00

💡 Understanding Online Trading Mechanics

This paragraph delves into the mechanics of online trading, explaining the concept of margin and leverage. The speaker clarifies how a small percentage of the contract value (margin) allows traders to control a larger sum of money (leverage). They illustrate this with an example, explaining the risks associated with leverage, such as magnified gains and losses. The speaker then discusses the job of a trader, emphasizing the need for analysis and strategy over mere speculation. They also touch on the costs of trading, including margin interest and spread commissions, and provide insights on how to manage these costs effectively. The paragraph concludes with a brief overview of different order types for buying shares, such as market orders, limit orders, and stop orders.

10:05

📈 Developing a Trading Strategy

The speaker discusses the importance of having a trading strategy, focusing on money management. They explain how to set a stop loss and a target price based on a percentage loss tolerance. The concept of aiming for gains that are double the losses to maintain profitability is introduced, along with the idea of combining strategies to manage risk and maximize returns. The speaker then differentiates between technical and fundamental analysts, briefly explaining their approaches to trading. The paragraph ends with a call to action for viewers to follow the trading series, like the video, and leave comments for questions. They also remind viewers about the availability of a free demo account for practice.

Keywords

💡Online Trading

Online trading refers to the practice of buying and selling financial instruments such as stocks, forex, and commodities through the internet. It has become popular due to its accessibility, allowing both retail and institutional investors to participate in the markets. In the video, the speaker discusses the benefits of online trading, including the ability to conduct both long and short operations, and the capacity to engage in short-term trades that were once only accessible to large financial institutions.

💡Long and Short Operations

Long and short operations are two fundamental strategies in trading. A long operation involves buying an asset with the expectation that its price will rise, while a short operation is when an investor sells an asset they do not own, with the expectation of buying it back later at a lower price to profit from the price decline. The video emphasizes the importance of understanding these operations as they form the basis of market speculation.

💡Forex

Forex, short for foreign exchange, refers to the market in which currencies are traded. It is the largest and most liquid market in the world, where traders can invest in the value relationships between different currencies, such as Euro/USD or USD/Yen. The video touches on forex as one of the asset classes that can be traded online, highlighting the importance of focusing on major currencies due to their liquidity and lower volatility.

💡Indices

Indices are baskets of stocks that represent a specific market segment or a group of companies. They are often used as benchmarks to gauge the overall performance of a market or a particular sector. In the context of the video, indices are presented as another asset class that traders can invest in, with examples like the DAX index, which includes the 30 largest German companies by market capitalization.

💡Leverage

Leverage in trading refers to the use of borrowed funds to increase the potential return on investment. It allows traders to control a larger position with a smaller amount of capital. However, while leverage can amplify gains, it also magnifies losses, making it a double-edged sword. The video explains how leverage works, using the margin requirement as an example to illustrate the concept.

💡Margin

Margin is the deposit required to open a position in a financial instrument. It represents a percentage of the total contract value and is used to control the risk associated with leverage. In trading, margin allows traders to enter into larger positions than they could with their account balance alone. The video discusses margin as a key component of leverage, emphasizing its role in enabling traders to access more significant contract values with a smaller initial investment.

💡Spread

The spread is the difference between the buy and sell prices of a financial instrument. It essentially represents the commission that brokers charge for facilitating trades. A narrower spread indicates lower transaction costs, while a wider spread signifies higher costs. In the video, the spread is explained as an inherent cost of trading that begins with the opening of a position and affects the profitability of trades.

💡Stop Loss and Take Profit

Stop loss and take profit are risk management tools used in trading to limit potential losses and lock in profits. A stop loss is an order placed below the purchase price for a long position or above the selling price for a short position, to automatically close the trade if the price reaches that level. A take profit order is set at a predetermined target price to sell the asset and realize gains. The video emphasizes the importance of these tools in protecting capital and securing profits according to a trader's strategy.

💡Technical and Fundamental Analysis

Technical analysis and fundamental analysis are two main approaches used by traders to analyze and predict market trends. Technical analysts rely on historical price data and chart patterns to forecast future price movements, believing that all relevant information is already reflected in the price. Fundamental analysts, on the other hand, focus on economic indicators, financial statements, and other qualitative and quantitative data about a company or economy to determine the intrinsic value of an asset. The video outlines these two categories of analysts and their distinct methods of investment decision-making.

💡Money Management Strategy

A money management strategy is a plan that traders use to allocate their capital in a way that minimizes risk and maximizes profit potential. It involves setting rules for how much to invest in each trade, when to cut losses (stop loss), and when to take profits. The goal is to ensure that potential gains outweigh losses, creating a sustainable trading approach. The video briefly touches on the concept of money management, emphasizing the importance of aiming for gains that are double the size of potential losses.

💡Demo Account

A demo account, also known as a practice or virtual account, is a platform feature offered by brokers that allows traders to simulate real trading conditions without risking actual money. It is used for educational purposes, to familiarize traders with the trading platform and to test strategies without financial consequences. The video mentions the use of a demo account with Kimura Trading for the speaker's first pen tests, highlighting its value in learning and practicing trading skills.

Highlights

The speaker begins a series of trading lessons, starting with the basics.

Online trading has become popular due to its ability to conduct both long and short operations, allowing for investment based on price increases or decreases.

Another reason for the popularity of online trading is the ability to perform short-term operations, which were once accessible primarily to institutional investors and large financial entities.

The first lesson focuses on shares and forex, explaining that purchasing a share represents a small portion of ownership in a company, while forex involves investing in currency exchange rates.

Major currencies are recommended for initial investment due to their liquidity and lower volatility.

Indices are baskets of stocks, such as the DAX index, which includes the 30 largest capitalized German stocks.

Commodities are also an asset class available for investment.

The speaker uses the Kimura trading platform for analysis, highlighting its reliability and customer service.

The contract value per point indicates the amount of money handled for each contract, which can vary based on the chosen value.

Margin and leverage allow traders to control a larger contract value with a smaller investment, but also magnify both potential gains and losses.

Traders aim to increase the probability of successful operations through analysis, starting with a 50% chance and aiming to add to this through informed decision-making.

Trading costs include margin fees, leverage fees, and spread fees, which are commissions based on the difference between buying and selling prices.

There are three ways to buy: at market price, with a limit order, or with a stop order, each with its own risks and benefits.

A money management strategy is crucial to ensure gains outweigh losses, with stop losses set to limit potential losses and targets set to achieve desired gains.

Technical analysts base their analysis on past price trends, while fundamental analysts study news and financial reports.

The speaker concludes the basic lesson and encourages viewers to follow the series for more information.

Transcripts

water bottle glass sheets pen let's start let's start the trading lessons starting from those

basics which are 23:49 don't ask me why I'm recording this video now I will watch the

first two hours of this course taking all possible notes after which I will do you summarized

with the key points so that you too can start learning something about trading this

is the first video of this playlist and this is the basic course obviously starting from scratch

this thing will be gradually advanced to delve into deep trading if you can say

now starts after which I get summarized explanation it's 26 I just finished

watching the first lesson it was really basic basic anyway I took lots of notes and

then tomorrow morning I tell you all most of these things I already knew them first thing

obviously you have to build solid foundations on which you can then start assembling the

various things now it's their time to sleep and then tomorrow morning I'll give you a summary of all the

things I've learned hello good morning first thing let's start with a quote from a

not very trivial person called warren buffett I think you know him he says I only invest in things

I know so first of all you have to thinking about learning I suggest you take

pen leaves in hand because I will start bomb why online trading has become so popular for

two reasons essentially because it allows us to do both upside and downside

operations and therefore invest on the long operation study that the price increases or investing in a

short operation and then investing after studying that the price will decrease plus another reason why

online trading has become so famous is because it allows us to do many

short-term operations and is more or less at the reach of all while once those who could

afford to make these operations were these strong hands these investors institutional therefore

large banks or large financial funds that therefore had a strong presence on

the stock exchange in what we can between giving and therefore investing we can invest in these asset

classes there are an infinity of different ones but in this first lesson luca mainly deals with

shares and forex when we talk about the purchase of a share we are talking about the purchase of an equity of

a company and therefore a small portion of that company of that company when instead we

talk about investing in forex we are talking about investing in foreign exchange and therefore in the value relationships between two

different currencies for example euro dollar dollar yen there are still many currencies and therefore

many different forex, those on which they recommend investing are initially called major currencies

which are therefore the most liquid ones with more money inside them and therefore also with a lower volatility

after which within the asset classes there are also indices and therefore baskets of these

stocks i therefore if you buy or sell an index you are buying a set of many companies or

many companies for example the dax index contains the 30 stocks with the largest capitalization in germany

after which among the asset classes there are not only these three but there are also commodities and many

others now let's start going a little more in detail regarding what we can find

within our investment platform and the tools that our

broker makes available to us as proof I have relied on the demo account of kimura trading

i have not been here to do analysis specifically on which broker to go as in the end they are almost

all very similar and the great importance in the choice that i have heard from luca and also from other

traders is the reliability and customer service since kimura Luca uses it and

23 other friends and me also use it have decided to open a demo account with them so it is completely

free so to do my first pen tests I know it is the best choice so now

the screenshots that will appear around here are taken from the demo platform of kimura trading

so if you want to follow this step by step I also leave you the link to open a demo account

with kimura so free it costs you nothing said this the analysis of the

important things that you will find within this platform began to do so the first thing is the

contract value per point so how much money we are handling for each single contract can

be 10 thousand euros can be 100 thousand euros and that is the value of every single contract

so when we buy when we sell when we are written 1 we know that we are handling

a contract that can be worth 100 thousand euros or 10 thousand euros now I leave you an example screenshot of

the kimura platform for example on kimura in euro dollar the value of contract per point

is 100 thousand euros and the minimum tradable value is one tenth of a contract so 10 thousand euros is now

there an interesting thing because I have to have 10 thousand euros to buy that contract no there is this

thing called margin according to which we can only have a percentage of that contract and

make us to stay the remaining money from the broker on kimura the margin 3.33 for one hundred which therefore

provides us with a leverage of 30 because one hundred divided by 3.33 is equal to 30 so summing up

we must have 3.33 percent of the contract to be able to buy that contract for

example if we want to buy a contract of 10 thousand euros which is the minimum contract that can be purchased

we must have 333 euros in our portfolio and therefore if we make 333 for

30 it makes 10 thousand euros and therefore we have a leverage of 30 on the money we invest I hope I

was clear but it's all one thing mathematics a 3.33 percent so percent divided by 3.33 is equal

to 30 30 our leverage on the capital we have invested but there is a great risk because if

we lose money we lose money in leverage here ndi multiplied by 30 times the same thing

if we earn money so if we earn money we earn that money multiplied

by 30 times so it is an advantage because it generates more earnings but also a disadvantage

because it multiplies our losses so what is the trader's job first of all the trading is a

job and must be taken as such we are not talking about playing with financial instruments but we are

talking about investing money by doing analysis and our work we have this big

pie divided into two buying and selling 50 percent of the chances that the market falls to 50

percent of the chances that the market saga what we traders must do so

that our choice which is a potential for success that 50 percent we have to

try to add through our analysis some slices to our choice we assume

we want to buy we fifty percent chance that that choice is

right through additional analysis ngiamo a little 10 percent and 20 percent

30 percent our goal is to increase the probability of success of our operation

and this happens through the analyzes we will talk about later said this how much it costs

to trade there are two big commissions a date from the margin and therefore from the leverage is a date

from the spread when the margin opens the money within that contract is not all

ours because on the 10 thousand euros we were talking about before we have invested and only 300 euros

the remaining 9,700 euro the broker lent them to us so the broker is carrying out the

so-called founding on that founding the broker is here to earn so every day he will apply

interest rates on that founding how can we avoid these rates

these rates are not applied to us if we close the operation before 11 while if

we close it after 11 in the evening that rate will be applied to us after which there is a second

paragraph ssion the commission on the spread that is the difference between those who buy and those who sell which is

also the commission that the broker receives according to the liquidity and volatility of a certain

market in a given period of time practically how it works when we are entering a

order to make a purchase a sale as we will immediately notice we will immediately start in

default of the spread for which we will pay at the opening of an operation and you will see

that each operation starts in negative just the cost of this commission so what to do

for sure the broker it will be facilitated by this thing because the more operations you make the more you will pay

this spread while if you do less for shares with a higher profit you will pay the spread only

for the number of operations you will do so when you go to open a transaction

also think about how much the you want to keep in your account how much you are going to pay for funding and

how many operations you are going to do now let's see how to buy there are three different ways

one is very simple to buy the market price the share of the banana spa now has the market costs 50

euros I buy a share of the banana spa for 50 euros this is the first way the second way is

to do a limit order the price of the banana spa is now at 50 but I don't want to buy it 50

I want to buy it if and when it reaches 45 so in the platform I place my order when and if

the price will reach 45 I want to buy an action set this order it is not said that then it will be

covered and that the action goes from 45 it can happen that this action never reaches 45 and my

order is never covered and therefore I never buy that action the third way and the order

stop what it means the action at 50 well now I don't want to buy it at 50 because I am uncertain

in its ascent and descent but I see depending on my studio that you get to touch

55 it is destined to always go up so I think ok I imposed an order to 5 5 because I know after doing

my study that if it reaches 55 it goes up in the sky and goes to 150 so inside the platform I say

well I want to buy a share of the banana spa when the price reaches 55 and only when the price reaches

55 I will buy this share as before it is not said that my order is covered

so the price touches 55 it can simply decrease continuously never touch 55

so the order is covered only when it reaches 55 once this contract has been bought

and therefore a once our order has been covered we must already know how much we aim to

resell that stock and how much we are willing to lose and all this according

to our money management strategy will now treat this very briefly with a simple

money management strategy we assume that we took the action at 50 we are willing to lose hicks

per cent for example out of 50 we are willing to lose 10 per cent so 5 then in the

plate taforma we will set a stop loss at 45 since we bought at 50 so if the action

after having made all its changes arrives 45 we directly sell that action and conclude

the operation with a loss while our target is the one to which we we assume to

arrive because we have obviously studied to gain not to lose is 60 a

money management strategy is precisely and make sure that we aim to have gains that are double

our losses so we can afford to lose twice and then earn a time

only because if you are trading for sure it will happen at the time when it concludes in

negative operation so if you foresee this thing in your money management structure

you must make sure that the losses are covered by the gains in this way we said 50

we bought 45 we set our sport plus and our target is at 60 so we aim

for double the gain compared to the loss all these things can obviously be set in

the platform and make automatic sales orders at 45 and 60 then you get to 60 sells

if you get 45 sells obviously you can also do combined strategies that for example if

the stock arrives 55 I sell half of the shares that I bought and I shoot on the stop loss no longer at 45 but 50

so in any case even if I conclude the operation I managed to make gains and there are

various other strategies that we could talk about later said this is the last basic lesson that

the world of traders is divided into two categories technical analysts and fundamental

analysts technical analysts say that the price has already been discounted by all the news that

can occur in the world and therefore they base all their analysis on the past trend of the price

then there are also fundamental analysts who therefore, instead of studying the price, study

the news for what concerns the forex and the news budgets for what concerns from the

shares then the former will invest based on the study of the price and the latter will invest based

on the study of the news that said the first basic smattering video is finished if you want

to continue following this series subscribe to my channel if the video was interesting

you liked it leave a like also because this video was not easy to make and you would

also give me a hand with the youtube algorithm if you have any question leave

it below in the comments then I remind you that all the information and if you want to use a free demo account

on kimura how i am doing i leave you everything in the description all the links all the things

said this see you at the next adventure at the next lesson hello to all guys