Q. "I'm really stumped on this one. In February 2021, I made a promise to start real trading, after I saw Red Hot Storm Trader make positive returns year after year.
I decided to start out with a R1,000 portfolio, to test out a real account.
And last week, I took my first trade and bought 1 Aspen CFD, thanks to Timon's last RHT trade idea.
Now I'm old but I understand that the share was trading at R147.00.
And the CFD margin (deposit), according to my platform said R14.00 per CFD.
But when I bought the one CFD, I ended up paying R120.00 for the trade instead of R14.00. Can someone please explain this difference before I take my next trade!?"
A. Hi Gerhard, sure I'll be happy to help.
The margin per CFD is definitely one cost to consider when you trade.
However, there is another cost…
And that is the minimum brokerage.
Most CFD brokers and market makers have a minimum brokerage they offer traders.
And this can range from R100 up to R200. Any more, and I believe the broker is ripping you off...
That's why it's always crucial to take note of what the minimum brokerage is before you start trading on a live account.
The brokerage cost includes the cost of JSE live streaming data, privacy, security, taxes and other legal costs, not just the broker’s fee to facilitate the trade.
So, remember to find out what the minimum brokerage is before you take your next trade, so you’re not taken by surprise.
As Bitcoin Breaks Records, Target These Little- Coins Instead
Bitcoin has surged past $53,000 - the second all-time high in a matter of days.
, and you'll see where it could go from here.)
Understandably, it's been dominating headlines.
But listen - I'm not here to waste your time with the obvious story.
What isn't making headlines is your key to an even bigger profit opportunity.
“I have learnt so much!”
"Before Red Hot Storm Trader sent that Aspen trade last week, I saw that exact trading setup present before my very eyes. I have learnt so much from Timon and the service that one day I won't even need to continue with it... Thank you for an excellent service."
Haha, thank you for the kind words Lehlogonolo. Well that is the absolute end goal I have for my Red Hot Storm Traders
For them to know my strategy so well, that one day they can leave the service, take over, show their loved ones and together bank a consistent stream of income for the rest of their lives.
Prediction from the Group Publisher
The disconnect between indices and ‘small cap stocks’ is a worldwide phenomenon right now.
Giant stocks the world over are struggling.
Shift your focus to smaller stocks, and it’s a different story…
Francois’ prediction is this is only going to intensify in 2021.
Q. “With Red Hot Storm Trader and Pickpocket Trader, the brokers I'm trading with are apparently OTC. What does this mean?”
A. OTC stands for Over the Counter.
When you trade financial instruments like CFDs or Spread Bets, you always trade via an OTC.
This is a decentralised market that does not have a physical location (like an exchange) when a trade takes place.
And so, traders and even investors trade through an electronic trading system instead.
Once they buy or sell a transaction, the process is executed between two parties (you and the market maker rather than the public).
When you buy CFDs from a market, the market maker instantaneously sells them.
When you sell CFDs, the market maker buys that exact amount.
They are unbiased and instead of trying to win on the other side of the bet, they are just providing the liquidity (volume), so that you can gain exposure to any financial market they offer you.
Managing Editor, Trading Tips