A trade is an operation of buying or selling a financial asset in a market. It can be a single movement of buying or selling, such as buying 100 shares of a company.
Why it is done:
Traders seek to profit from the price difference between buying and selling the asset.
How it works:
Traders use various market analysis techniques, such as technical analysis, to identify buying and selling opportunities and define short-term strategies.
Examples:
Buying stocks: A trader can buy shares of a company, hoping that the share price will increase and can be sold for a higher price.
Trading futures contracts: Traders can trade futures contracts for commodities, seeking to profit from price fluctuations of the products.
Trading cryptocurrencies: Cryptocurrency traders seek to profit from the price variation of virtual currencies.
Types of Trade:
There are different types of trade, such as:
Day trade: Short-term operations, where positions are closed on the same day.
Swing trade: Medium-term operations, where positions can be held for a few days or weeks.
Related Concept:
Trader: The person who conducts the trade operations.
Trading: The process of conducting trades.
