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How to choose the right trading bonus for you

‘Hooray’! This is the word used to express traders’ joy when they find out that their favourite broker is offering a new bonus. 

 

A trading bonus is an opportunity for traders to receive extra funds to trade, and/or some other rewards too. 

 

As you may have already seen, there are several types of bonuses: deposit bonuses, no-deposit bonuses, welcome bonuses, and others with fancier and more imaginative names. 

Before you decide which bonus you’d like to claim, you’d better get an idea of how each one works and what you can achieve. 

 

Although there are various differences between trading bonuses and promotions, there is one common truth behind them: if you use them wisely and responsibly, they can benefit you. You should also bear in mind that there are specific requirements (minimum deposit, minimum trading volume etc.) that you might need to meet to get/use your bonus.

 

The advantage of bonuses, especially for new traders, is that even when your trading budget is minimal, you have the potential to receive some extra money to boost your trading activity. The same applies to experienced traders in that bonuses will give them the opportunity to trade larger amounts of capital.

Different traders, different needs, different types of bonuses

Let’s recap on the three main types of bonuses: 

 

Deposit bonus: You can claim this bonus either with your first deposit or with every deposit you make, depending on the offers. Deposit bonuses are beneficial for traders since once the bonus is unlocked, they can trade bigger sizes and more assets. In general, brokers offer 100% or less for deposit bonuses, but some (such as Eurotrader) might more-than-double your deposit

 

No-deposit bonus: The no-deposit bonus doesn’t require the trader to deposit any funds. As there is no risk of losing your own money, the worst-case scenario is losing your bonus. But the best case is that you can successfully trade your bonus and make profits out of it (though it’s worth noting that you usually have to trade a specified total volume before you can withdraw such profits). A no-deposit bonus is great if you want to try different trading strategies or even the broker of your choice and their trading conditions. 

 

Welcome bonus: Usually, the welcome bonus is what its name suggests: a complimentary welcome treat, like a fruit basket waiting for you at a Mediterranean coast hotel. This kind of bonus is usually transferred to the trader’s account following the registration and verification process. Sometimes you can get it automatically (like a no-deposit bonus), or you should first make a minimum first deposit (deposit bonus). The welcome bonus is usually a one-off, fixed sum equal for all new clients.

 

An important note is that you should always check the terms and conditions of each bonus to be sure that the one you chose is right for you, your trading experience level and your strategy.  

 

Speaking of bonuses, why not check out Eurotrader’s 111% deposit bonus? Just deposit between $50 to $20k to trade forex and metals, and we’ll match it by 111%. Promotion T&Cs apply.

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Climate change stocks to watch ahead of COP26

What do Mumbai, Miami and the Maldives have in common? Due to rising sea levels, they are all at serious risk of being completely submerged in the coming decades. 

 

This Sunday 31 October, Glasgow will host the 2021 United Nations Climate Change Conference, also known as COP26.

 

As more people shift to more sustainability-conscious lifestyles, the pressure is mounting on political leaders to take immediate action. 

 

The growing interest in climate change has also trickled into the trading sphere, namely in the form of climate change and green energy stocks. These stocks might be challenging to trade, however, since the future trend is towards a more sustainable and greener world, now is the time to build momentum and get to know such green assets.

Paint your portfolio green with renewable energy stocks

Renewable energy (biomass, hydropower, wind energy, solar energy and geothermal power) and waste management are the primary green investment sectors. 

 

States and industries all over the world pursue decarbonisation plans while demand for clean energy increases. In the United States, renewable energy firms are also set to benefit from the Biden administration’s clean energy plan. 

 

Investments in clean energy confirm that the renewable energy industry is growing at a faster rate. However, because the market is still growing, the high competition is causing drastic swings in prices. 

 

Tesla [TSLA.O: NAS] is a game-changer when it comes to clean energy and innovation. Apart from being a prominent player in the automotive industry, Tesla has expanded its activities into renewable energy generation and storage solutions. The company has become the first clean energy company to attain a market valuation of $1 trillion.

 

Following a recent shift towards residential solar power, SunPower Corp [SPWR.O: NYS] is now leading the market in solar energy stocks. Wall Street is beginning to warm up to the critical solar sector as a whole, lifted by the green wave.

 

Another well-known company in the renewable energy industry is Nextera Energy Inc [NEE.N: NYS]. NextEra is the largest electric utility holding company by market capitalisation. It’s also the largest in the US in terms of retail electricity produced and sold with about 58 GW of generating capacity. What’s more, NextEra is the world’s largest producer of wind and solar energy.

 

If you want to go green with your portfolio, why not try trading climate change stock CFDs? Check out our product page to find all the mentioned companies and more!

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What costs are involved in CFD trading?

Surprises can be very hit-and-miss. Some people love a surprise, some people loathe a surprise. Of course, it depends on the type of surprise you get – a winning lottery ticket is far more welcome than coming home to find your dog has torn your sofa to pieces. Perhaps something everyone can agree on, however, is that nobody likes a surprise that leaves you out of pocket.

 

If you’re new to CFD trading, you might not be aware of some of the associated costs that come with carrying out a trade. These fees can vary from broker to broker (so you should always check and choose carefully!), but it’s worth getting to know the transactional costs out there. That way, you can avoid any unwanted surprises and also plan your budget accordingly.

 

So, what do you need to look out for?

“It takes money to make money.”

There are two types of fees you might be subject to when you carry out a trade: trading fees and non-trading fees.

 

Trading fees are charged when you carry out a trade. Let’s take a look at some of the most common trading fees you might encounter. 

 

Many brokers will charge commissions for the use of their services, usually amounting to 0.1-2% of the trade’s underlying value. However, some brokers will offer zero-commission trading on certain securities; for instance, with Eurotrader, all stock CFDs are completely commission-free!

 

Traders will also typically have to pay spreads. This refers to the difference between the buy (bid) and sell (ask) price, and it reflects the supply and demand of a specific asset. Typically, higher volatility will lead to wider spreads (which are more costly), and lower volatility will result in narrower spreads. 

 

Some brokers might charge conversion fees if you trade, deposit or withdraw money using a currency that needs converting. For example, if your account is EU-based, but you deposit money from your US bank account, the broker will have to convert your dollars to euros to complete the deposit, and they may charge you for this process. 

 

Note: we at Eurotrader don’t charge conversion fees. Rather, we do conversions at spot market price – but be careful, as you may be charged conversion fees by your bank!

 

If you hold positions overnight, you may be charged an overnight fee. This is a daily cost that is calculated based on the size of the trade itself. More common in leveraged trading, these overnight fees are often referred to as ‘swaps’. However, some religious beliefs inhibit the payment or receipt of interest of any kind, which is why some brokers will offer swap-free accounts.

 

Now, let’s look at non-trading fees. These are the charges incurred which are not directly related to trading itself.

 

For instance, depending on your broker, you might need to pay a monthly account fee. Similarly, if you’re subscribed to any additional services (such as data feeds, VPS services, etc), you’ll often have to pay for a subscription.

 

Furthermore, some brokers will charge for withdrawals and deposits. These costs may vary depending on the method(s) used.

 

Finally, you should also check for whether your broker charges inactivity fees – the last thing you want is to take a break from trading, only to return to a charge you’ve not considered! Any brokers that do charge inactivity fees will specify the time period this will come into effect, so you can plan accordingly.

 

Eurotrader fees

 

Eurotrader has thousands of US, UK and European stock CFDs for you to trade, COMMISSION-FREE! Check out our product listings here.

 

We also don’t charge conversion fees (we do conversions at spot market price), account fees or inactivity fees!

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Why is copy trading so popular?

When entering new territory, it’s always reassuring to have someone with you that knows the field. For many, taking those first steps into the trading sphere can be a little daunting, but fortunately, it’s now easier than ever to learn directly from the experts.

 

Thanks to copy trading, new investors are getting a more confident start to their trading journey. As a quick recap, copy trading is just what it sounds like: it allows individuals to copy the trades of other investors.

 

Unlike mirror trading, copy traders are blind to the actual strategy (i.e. you watch the transactions, and not the layout of the process), but they can still gain experience by watching others trade.

 

Over time, copy trading has grown from being a trading method to a trending one. Today, more new investors are engaging with copy trading for its various perks, which help to give learners the best possible start.

 

So what is it about copy trading that has made it so popular?

 

Learning from the best

For new traders especially, copy trading can be a great way to see what makes good traders successful. With copy trading platforms, you can simply do what the experts do. In some cases, discussions will simultaneously take place on social media, so you can learn the whys and hows of each decision. This can be a really effective way for new traders to learn – and maybe become traders-to-copy themselves!

 

Of course, you might wonder what’s in it for the experts; usually, platforms will pay traders-to-copy when people mimic their trades.

Avoid rookie mistakes

By following experienced traders, new investors can learn to trade without making common beginner mistakes. There are many valuable lessons to be learned from knowledgeable traders, such as the importance of having a diversified portfolio, as well as how to think with your head and not your heart. 

 

Having said that, you must be mindful that an experienced trader is not a psychic (!), so you can’t be certain that each of their trades will be lucrative or risk- and mistake-free.

Saving time and effort

If time is money, then copy trading is a worthy investment. By bypassing the bulk of the work, copy traders can get started straight away, even with a limited trading knowledge.

 

For those who are eager to become an expert themselves, this free time could be spent reading up on copy trading blindspots. This includes understanding fundamental and technical analysis or learning to devise your own strategy. The added bonus of having copy trading experience is that you already understand the basic transactional framework of trading, so you can move on and flesh out your knowledge more efficiently.

Summary

Copy trading offers new traders a simple and effective way to get into trading, without excessive risk. For inexperienced traders, copy trading provides an option to learn while doing, while also avoiding mistakes that could cost them. What’s more, copy trading offers an easy route into trading that gives new practitioners a chance to do their research without having to halt their inclination to trade.

 

If you’re looking to get started with copy trading, sign up to a Eurosocial account today!