Trading: A trend that can pay off a lot

The current health crisis is changing the way we work and live. As proof, COVID19 has completely undermined global economies and markets are fluctuating again. According to the OECD (Organization for Economic Co-operation and Development), the current crisis has led to an economic recession never before seen. It is already called the “crisis of the century.”

An unprecedented recession

Since the onset of the health crisis in December 2019, economic authorities have constantly warned states that a major economic recession would soon occur. Due to the combination of a supply and demand clash, particularly for certain sectors, economic and social costs will be very significant in the coming months, both in terms of jobs and the well-being of populations.

Still according to the OECD, it is the European countries in particular that will pay the high price of the recession with historic GDP falls for Italy (-11.3%), Spain (-11.1%) and France (- 11.4%). In addition, other countries around the world have not come out of the forest with an unprecedented recession in India or even the United States.

The unemployment crisis is also one of the big problems of this crisis with a 4% increase in the UK, for example. All over the world, the total shutdown by confinement has reduced thousands of companies to nothing and pushed larger companies to issue social plans to avoid going bankrupt. The population therefore resorted to other sources of money, such as trade.

Online commerce as a new source of income

Trading is an English word commonly used in French to refer to exchanges and buying and selling transactions in the financial markets. With the increase in the economic crisis, the markets fluctuate and allow you to get rich quickly (but also lose everything).

What is an online marketer?

Specifically, an online trader is a person who places orders to buy or sell stocks on the stock exchange to make money. Thanks to the democratization of the Internet, e-commerce services have emerged. The good news is that you don’t have to be a professional trader to trade.

Where to start?

The first thing you need to do is choose what you want to do: think carefully about your investments, how you will invest them, and how much you estimate your return on investment. Also, set a realistic goal at the beginning and don’t be discouraged, trading can sometimes go wrong.

Nowadays, many sites allow you to trade online in a very simple and very fast way. However, scams do exist and be very careful when you start your business. Be sure to choose your trading venue carefully before you start fully.

Trading the EURO STOXX 50

If you’re not one of the great specialists in economics, you’ve probably never heard of that name. What is the EURO STOXX 50?

First of all, this title is an index, used to measure the current situation of the European economy. Like the CAC 40 in France, the EURO STOXX 50 takes into account the evolution of the markets around 50 large companies in Europe. In addition, these 50 companies alone account for more than 60% of the total capital of Europe, ie more than the majority of public shares.

Factors influencing the value of the index

This index is the result of a calculation around several factors. When these factors fluctuate, they cause the stock price to go down or up. Therefore, as a close trader, or as an expert, you must constantly follow the evolution of the CAC 40 and other indices.

The main factors are:

  • the economic indicators of the selected companies,
  • political and economic events taking place in the euro area,
  • movements in the euro exchange rates
  • and the pressure of exceptional U.S. policy in the event of a historic decision.

When you start trading in any market, you need to consider a large number of factors that can change from minute to minute.

A very advantageous market

To start trading, you must first know the market advantages that you will try to conquer. The EURO STOXX 50 has many advantages.

  • First, it is made up of stocks with a large volume of liquidity.
  • The companies considered in this index are part of a stable economy.
  • The vast majority of companies belong to the industrial sector, a sector in full development.

It operates with CFD in the European market

Contracts for difference, better known as CFDs, are contracts that involve differences in asset prices. Simply put, CFD trading allows you to trade with price movements to buy and sell and bet on whether an asset will go up or down.

In short, the main concept is to open a CFD when the market is about to go up or down to make money. With the EURO STOXX 50, you can benefit from many benefits such as expanding your portfolio across Europe (if required by law) or even reducing your financial risks associated with future price changes.

There are risks involved in online trading

Be careful though, if you decide to start trading, keep in mind this paragraph: E-commerce can save you a lot of money, that’s for sure, but it can also make you lose some. CFD trading, for example, is a practice that needs to be familiarized before starting because 83% of investors lose money when trading CFDs.

That’s why we recommend that you stay informed before you start operating. Your success depends essentially on your knowledge.

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