A lot has changed in the past fifty years when it comes to emancipation. Today, many women are employed and earn their own money. Still, in many households, it’s normal that the husband takes care of financial decisions. How much can be spent? How much goes towards living expenses like rent, groceries, incidental expenses and insurances? How much can be saved or invested – and where?
How come that it’s still men, who decide over the financial situation and future of a family? Many women still take themselves back from the financial discourse, simply because it’s always been like that. But a woman, who is able to earn her own money and to make her own decisions in so many other fields, can also make her own decisions when it comes to finances.
Which Types of Investment Are Popular with Women
We just stated that women don’t need a man to assess their financial situation and to make choices about possible investments. Still, the heading sounds a little discriminating – as if only certain types of investments were possible or advisable for women. That’s not what it´s like, though. But there are indeed investments that women prefer. Generally speaking, women are sometimes more venturesome than men. That leads to a much bigger choice of possible assets.
Derivatives
Trading is very popular. Most investors trade shares, cryptocurrencies, resources or foreign currencies. But you can invest in all of those things without actually having to purchase them. Derivatives are a lucrative alternative. Instead of buying a value on the exchange market, you invest in a contract foretelling the development of a certain price.
A legit online broker for derivatives is the most crucial prerequisite for successful trading. Many women enjoy trading at Pocket Station as the broker offers a broad variety of options, derivatives and markets to invest in. At the same time, Pocket Station works in a very transparent and efficient manner. That means, your funds and your data are safe throughout the entire process of trading.
What Exactly Are Derivatives?
In order to understand why derivatives are so popular, it is important to understand how they work compared to direct investments in exchange values: When directly investing in a certain value, you purchase a share, cryptocurrency, or something else and administer it in your portfolio or crypto wallet. Depending on which style and trading strategy you use, you hold the value for a while and sell it at the highest price possible. The difference between the price you´ve bought it for and the price you can sell it for is the basis of your profit.
Fees and taxes will need to be deducted. That means, you only get to generate winnings if your purchased value follows an upward trend. If the economic situation is unstable due to a crisis like the pandemic or due to political elections, you may have to mentally say goodbye to the prospect of a financial plus.
A derivative however functions differently and allows you to successfully speculate without depending on an upward development of the market and your market values. But how does that work?
How Do Derivatives Work?
Derivatives are contracts that are set between at least two parties. Their value depends on the asset that they are based on. Options, futures, swaps, and forwards are the most common types of derivatives there are. You can also foretell a downward trend. All derivatives have in common that they can be leveraged. The leverage effect allows the investor to benefit from the smallest fluctuations of the underlying asset.
Thanks to possible leverage, derivatives have high potential. But you should be aware that this potential goes both ways: Earnings can turn out higher, but the loss can be enlarged as well. For derivative trading, it takes women with a clear financial goal in mind, who are not afraid of the market fluctuations. If that’s given, this type of investment can lead to lucrative outcomes.
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