Trading precious metals such as gold and silver presents a very unique investment opportunity offering the chance to diversify and extend your portfolio. During market volatility or uncertain political or economic times, many traders choose to diversify their risk by trading gold/silver and to create a well balanced trading portfolio.
Trading metal is also considered as safe investment during uncertain market conditions when value of metal such as gold typically tends to fluctuate and such volatile market movements may present trading opportunities that hold potential significant returns. Many investors also utilise metal trading for hedging opportunities, as trading metal creates great opportunities for hedging in every liquid market, with investors gaining more exposure with limited risk.
Gold Trading Example
Opening the Position
Opening price of the GOLD against the US Dollar (XAU/USD) is 1250.00 You decide to buy 1 standard lot (the equivalent of 100 ounces) at 1250.00. Margin required to open the position is 1*100*1250.00*1/100=USD $1250