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Asset Class’s Overview

In very broad terms there are the following asset classes

Stocks: This is where you take a small ownership in a company through share ownership.

ETF’s: Electronically Traded Funds (bundles of stock that represents a certain area of the market or an asset class)

Futures: There are Futures contracts on most indexes, Currency’s, Commodities such as Gold, Oil Wheat, Sugar, Treasuries etc.

Currencies:  You trade Currency Pairs so for example how the Euro currency trades against the US Dollar

Options: These are contracts where you basically agree to buy or sell at a certain price for a certain time period. This is a very simple description as this is a complex area, if you really want to trade options you will need to get a good education.

Most day traders tend to trade either futures or currencies, if you trade futures you can trade most of the currencies. The reasons to pick these area first is that these assets are very leveraged so you can make and lose a lot of money quickly but you need a lot less capital to make a good return on either futures and currencies trading. Also currencies and futures trade near enough 24 hours a day so where ever you are in the world or whatever time you have to trade there is normally a market for you to trade.

Options are very leveraged as well but are much more complex to trade for the beginner and are also tied to the US Market regular trading hours.

You can also trade stocks or ETF’s but again you need more funds and liquidity, for these assets and they only trade regular US market trading hours 9.30am EST to 4.00pm EST.

It is totally feasible to make $1000 a day with a minimum account of around $28,000 trading futures or currencies but a bit more challenging just trading stocks or ETF’s.