This past September has shown that cryptocurrencies can not only skyrocket in price but also fall precipitously. Bitcoin managed both to check-in at the height of $52,870 and find a local bottom at around $39,666, having lost about 25% of its value along the way. And, of course, this is a problem not only of the flagship coin but of the entire crypto market as a whole, which makes investors think: is it worth investing in it?
Reduce Your Risk 300 Times
Influencers promise unprecedented growth for bitcoin. According to some experts, its price may rise to $200,000, and even to $500,000 in the next few years. Maybe that’s the way it will be. Or maybe not. And at some point, the cryptocurrency market, crushed by legislators and regulators, may burst like a soap bubble. You don’t need to go far for examples; just remember recent decisions of the People’s Bank of China.
The goal of every person who turns to the digital market is to make as much money as possible.
- The first way is to buy bitcoin by paying $40,000-50,000 per coin, put it in your wallet and stay awake at night waiting for either the market to crash once again or hackers to steal all your digital savings.
- Or, with just $150, you can deposit it at a brokerage company and earn on both the growth and on the fall of digital gold. Is the market growing? Fine. Is the market falling? We can make a profit here as well.
Let’s go back to the above example. In the first case, having bought bitcoin in early September, you would have lost more than $10,000 in just two weeks. And if the fall continues, you risk losing 100% of what you paid for the token, which is about $50,000. That being said, you don’t have the slightest chance to earn anything or make a difference in any way.
But things are much better in the second case. Your risk will be over 300 (!) times lower since it does not exceed the named $150. And if you open and close the sell trade on time, the profit for the same two weeks can be about $10,000.
Agree, this is very impressive: having invested $150, you get a profit of $10,000 in two weeks. And this is at a moment when coin owners, having bought them on a crypto exchange, suffer enormous losses sobbing on drying wallets.
Two Mighty Elephants: Margin and CFD
Of course, the above example describes the ideal situation. But it is quite real with some experience and luck. And there are two reasons. Take a brokerage like NordFX, for example.
- First, becoming a client, you automatically get the opportunity to trade 11 leading cryptocurrencies on margin. As already mentioned, you only need $150 to open a 1 BTC trade. For an ethereum (ETH) transaction, the required deposit will be only $15; for EOS, it is $0.3, and for XRP, it is $0.02. At the same time, you can open trades of both smaller (up to 0.01 BTC) and higher (up to 10 BTC) volumes. It all depends on your desire and financial ability. By the way, deposits and withdrawals of funds are possible not only in dollars that are usual for CFD brokers but also in Bitcoins and Ethereum coins.
- The second reason lies in these three letters, CFD, which stands for Contract for Difference. It is a financial derivative that is actively used in trading in various financial markets. There is no real commodity delivery in CFD trading. That is, when you sell or buy, for example, 100 tons of oil, you don’t need to have a warehouse where barrels of that product are stored. Simply put, it is an agreement between the seller and the buyer to pay the difference between the value of an asset at the time of opening a position and its value at the time of its closing. And the broker plays a passive role here. All decisions are made by you. This also applies to the trade volume and its direction, sell or buy, opening and closing times, and what asset you’ll be trading.
All Markets in One Smartphone
And the list of assets NordFX offers its clients looks very impressive:
- Forex (33 currencies, from major ones like the dollar, yen, euro, or yuan, to quite rare ones like the Norwegian krone),
- 11 Cryptocurrencies mentioned,
- Precious metals (gold and silver)
- Major indices (Nasdaq, Dow Jones, Nikkei, etc.),
- CFDs on shares of nearly 70 world’s leading companies, such as JP Morgan Chase, IBM, Coca-Cola, McDonald’s, Mastercard, Microsoft, Twitter, UBER, eBay, Deutsche Bank, Alibaba, etc.
Transactions with all these assets can be carried out simultaneously from one account and from one terminal installed on your computer or smartphone. And such a variety of them allows you to hedge risks and diversify your trading strategies, getting additional profits significantly. For example, the leverage on gold and Forex currency pairs reaches 1:1000 at NordFX. That is, with only $100 on your account, you will be able to carry out transactions worth $100,000. And with $1000, accordingly, you can operate with 1 million dollars.
Reliability and Reliability Again
And another important point is the reliability and safety of your funds. Unlike crypto exchanges, the issues of Forex and CFD brokers have long been spelled out by law, so the investment risks are lower here. In addition, brokers who have been working in the financial markets for a long time have accumulated vast experience in repelling hacker attacks. So, for example, not a single cent of client funds has been lost or stolen over 13 years of NordFX’s activity. For this reason, the company has repeatedly received honorary professional awards. It has been recognized as the most trusted Forex and crypto broker, and the number of trading accounts opened by its clients out of almost 190 countries has already exceeded 1,500,000.