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Stock Market |
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Market Basics |
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Stock Trading |
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Types of Orders |
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Leveraged Strategies |
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Fundamental Analysis |
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Trading Theories |
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Stock Options |
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Introduction |
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Option Trading |
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Call
Option |
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Put Option |
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Options Strategies |
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Stock Options Prices |
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Types Of Option Orders |
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Compared to Stocks |
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Options Glossary |
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Forex Market |
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Introduction |
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Forex
Quotes |
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Leverage
and Margin |
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Calculating P & L |
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Sponsored Links |
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Stock Technical Analysis |
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Stock Ratings |
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All China Stocks |
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All Indian Stock |
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Stock Market |
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A stock market is a private
or public market for the trading of company stock and derivatives of
company stock at an agreed price; both of these are securities listed on
a stock exchange as well as those only traded privately.
The expression 'stock market' refers to the system that enables the
trading of company stocks (collective shares), other securities, and
derivatives. Bonds are still traditionally traded in an informal,
over-the-counter market known as the bond market. Commodities are traded
in commodities markets, and derivatives are traded in a variety of
markets (but, like bonds, mostly 'over-the-counter').
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Stock
Options |
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A stock option is a contract between 2 parties (a buyer and a seller)
that gives a person (the buyer of the contract) the right, but not the
obligation, to exercise the contract on or before a fixed future date
(the exercise date or expiration) to buy or sell the underlying stock at
an agreed price.
If you purchase a stock option for the right to buy the shares of ABC
company for $10 today, you can exercise that right to buy ABC company's
shares at $10 anytime in the future before the contract expires no
matter what price ABC's shares may be trading at that time. (Imagine
that stock trading at $100 and you own the right to buy it for only
$10!) Hence buying and selling stock options is not the same as buying
and selling the shares itself. You are actually buying and selling the
right to buy or sell the underlying asset at certain pre-determined
prices. |
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Forex Market |
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The Foreign Exchange market, also referred to as the "Forex" or "FX"
market is the largest financial market in the world, with a daily
average turnover of US$3.2 trillion.
"Foreign Exchange" is the simultaneous buying of one currency and
selling of another. Currencies are traded in pairs, for example Euro/US
Dollar (EUR/USD) or US Dollar/Japanese Yen (USD/JPY).
There are two reasons to buy and sell currencies. About 5% of daily
turnover is from companies and governments that buy or sell products and
services in a foreign country or must convert profits made in foreign
currencies into their domestic currency. The other 95% is trading for
profit, or speculation.
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