Page 34 - NEW FOREX FULL COURSE

FOREX TRADING COURSE FOR BEGINNERS

total value of the fund hopefully rises in value. Of course if the fund goes up in value, then
securities owned by the fund will rise.

What are mutual funds and what is dividend reinvestment?
Through investing in top mutual funds, investors earn capital gains when the fund manager sells
securities at a profit. The investor can then choose to have the fund automatically reinvest the
money in more fund shares, known as dividend reinvestment, or they can keep additional funds
in a cash account. This concept is referred to as capital gain distribution.

What are mutual funds and what are the risks?

This is a question asked by investors no matter the type of investment, however, it is a common
conception that mutual funds are relatively low in risk and are a great way to build a strong
portfolio. The risks are minimal and are basically obvious. You can potentially lose money or you
may not achieve your goals, and of course your investment funds may depreciate in value instead
of rise. This again points out the benefits of a fund manager when you invest in mutual funds.

What are mutual funds you ask? Well, they are definitely worth looking into and can provide a
great income at a relatively low risk. This information alone should be enough to get you started.

TRADERS
TRADER IN COMMODITIES

Traders who trade commodities so do for many reasons. One reason is that commodities provide
the opportunity for investors to make huge profits in a relatively short period of time. Also,
futures trading as it relates to commodities, is not as complicated as trading stocks. There are
only about forty markets to speculate on when trading futures compared to trading stocks where
there are literally thousands of stocks to choose from. Additionally, futures are very easy for
investors to buy and sell and there is the potential for profit whether or not prices go up or down.
Not to mention the fact that commission fees are much lower than the commission fees when
trading stock.

Futures trading involve the speculation of whether or not the price of a commodity will rise or
fall. It is not like buying stocks and bonds in which you physically own something. Investors will,
for example, speculate on the price of soybeans. If the trader thought that the prices of soybeans
was going to rise, then he or she would purchase a soybeans futures contract. On the contrary if
the investor thought the price of soybeans was going to fall, then he or she would sell their
soybean futures contract.

Another plus to trading commodities is that you can begin trading with very small purchases. Of
course the smaller the trade, the smaller the profit, but there is also a lower risk with smaller
trades. This is an advantage because it allows traders to get up to speed in the futures markets
before they begin to place larger trades. Additionally, may investors will implement a stop loss
order in order to minimize risk. This stop loss will automatically happen when the set price is

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