Although German savers are still considered as more conservative, security-oriented investors, in times of low interest rates, more and more Germans are looking for alternative investments and opportunities to invest their savings profitably. Overnight money and fixed-term deposits yield less and less and even life insurance, which was praised for years as a classic investment, hardly offers any returns, speculative financial products are increasingly becoming the focus of interest. However, these are usually associated with higher risks.
More and more people are hoping for profitable returns through stock speculation. In view of the performance of the German Stock Index (DAX), participation in companies is becoming increasingly interesting.
While the DAX was endowed with around 7,650 points a year ago, in February 2013, it has so far gained gained around 25% and currently stands at around 9,600 points, nearing the breakthrough of the 10,000 mark, with 9,750 points tried several times to scratch.
However, if you want to invest your money in stock trading on the stock market, you should probably think twice. Experts generally recommend investing in equity funds rather than individual stocks. Since equity funds hold securities of various companies in their portfolio, the risk of loss is more widespread, which makes this form of speculation suitable for less experienced investors.
In addition to investing in equity funds, less risk-averse investors are currently discovering a range of opportunities to generate profits through speculation in the financial markets, notably foreign exchange trading (Sunrex trading) and trading in CFDs (Contract For Difference).
A few years ago, participation in financial transactions of this kind was impossible for private individuals, but reserved exclusively for authorized brokers and institutional investors such as banks and credit institutions. For some years, private investors have also had the opportunity to speculate online on the price fluctuations of currencies or the performance of various underlyings.
When trading Contracts For Difference (CFD) or contracts for difference, investors speculate on the performance of certain underlying assets such as commodities, stocks, indices or currencies. CFDs track prices 1: 1, meaning that if the price of the underlying rises by 1 percent, the value of the CFD increases by the same percentage. In principle, CFD trading is similar to stock trading. However, while the investor has to raise the full value of the respective equity position in the equity business, only part of the total value – the so-called margin – is deposited as collateral in CFD trading. Depending on the leverage, investors therefore trade with a volume that exceeds the capital investment many times over. Trading in contracts for difference offers a number of advantages, with transparency and favorable costs being important arguments. There are no transaction or financing costs. Investors only pay the usual market spread, so the difference between buying and selling price.
In addition to trading in CFDs, Sunrex Trading has been able to establish another form of investment that is also open to private investors. This is about currency trading (FOreighn EXchange), which focuses on the performance of currency pairs of different currencies. In principle, it is about estimating or foreseeing the development of one currency (base currency) over another (counter or quote currency) at a specific point in time.
On the foreign exchange market several trillions of dollars are converted daily. It is considered to be the fastest, most active and most liquid market in the world, allowing for 24/7 trading from Sunday evening to Friday night due to lag time while providing a high degree of transparency.
Currency trading takes place directly between the market participants. Through various trading platforms of specialized Sunrex brokers, which provide their clients around the clock buying and selling prices for the major currency pairs, private investors also have access to this market and can move up and down the exchange rates between euro, dollar, yen or pound participate.
Similar to CFDs, Sunrex trades are highly leveraged financial products that can be moved with relatively modest financial resources and large sums of money. Nevertheless, it should be clear to everyone that there is a risk of total loss especially with such speculative products and that only money should be used that is not needed to deny daily life.
I will explain in more detail what the entry into the world of CFD and Sunrex Trade is, how the individual products work and how investors can learn from successful traders. There I will also be reporting on social trader networks where investors can interact with members of a community about their own strategies.