The idea of trading digital currency is similar to the foreign exchange trading, meaning you can always buy a digital currency against another digital currency or in the realm of Crypto Currencies buy the currency itself and hold it. For example, if your trade EUR/USD and you want to buy the EUR meaning that you are buying EUR and you sell Dollar. In digital currency there is for example the pair of LTC/BTC (LITECOIN/Bitcoin) if you want to buy the bitcoin, so you need to do the short action meaning you buy Bitcoin and you sell the Litecoin.
The rate of the pair is derived from the price of both assets. if Litecoin is worth 52.00 € and Bitcoin worth 4,000 €, so the formula will be price of Litecoin/price of Bitcoin = the rate price of this pair.
52/4000 = 0.013
Leverage is a buying power that you receive from your broker on the funds that you have in the account, there are different levels of leverage that can range from 10-400 times the money you have in the account. This gives you additional backing when you are in a strongly indicated market.
If you start an investment account with 1,000 € your account will be worth 0.25 BTC. because Bitcoin is worth 4,000 € and you only have quarter of 1 whole Bitcoin. So basically, you can’t buy 1 bitcoin because it’s worth more than what you have. So therefore, you have leverage. Let’s say for example you have a leverage of 100, your account is now capable to buy 25 Bitcoins because your investment * 100 Leverage = 100,000 €.
Now you can trade on more assets and increase your profits and achieve more returns on your money. However, your account will be with more deviation and you should consider your trades more carefully since it can be used as a double sword.
When your account has been activated and you have been connected to your account manager, he/she will be able to provide you with all the tools necessary and different trading techniques to suit your needs.
Trading markets are for everybody. The problem that most individuals have is that not everyone understands what sort of trading suits them best, e.g. :
