While trading in the financial markets, you have an array ofdifferent assetsto choose from when buying and selling. These assets are usually categorized like this: equities, bonds, commodities, and currencies, all of which are common assets for trading in the financial market today. In the equity market, you buy and sell certificates of fractional ownership in large companies, commonly referred to as stocks. In the commodity market, you trade physical or cash settles futures contracts in commodities like oil, cocoa, wheat and so on. However, a new hot asset class has emerged, and that’s the cryptocurrency market. Here you’ll find Bitcoin, which is the most prevalent one, as well as the altcoins like Ethereum, Litecoin etc.
If you, like many others, are just getting interested in Bitcoin trading, you should certainly keep on reading. For those of us who traded the cryptocurrency market in 2017 or even before that, know what kind of wild animal Bitcoin can be and how the price just kept on going up.
However, back then trading market for trading Bitcoin was just in its infancy. You had to open a wallet and pay high commission rates for buying and selling crypto. The risk management tools were also non-existent.
Now, the climate for investing in cryptocurrency is just the opposite. There are futures contracts, ETFs, and CFDs available. All these for way less commission than before. Moreover, the introduction of crypto trading products through online brokers, like Plus500, meant that you now can trade with more risk control tools. Utilizing stop loss orders as well as take profit orders, helps traders size their positions correctly and not risking more than originally planned. By using these tools you can also tip your toes into leveraged positions, if you require higher return on your capital. The Plus500 Bitcoin product (Bitcoin offered as a CFD) is a great way to start trading the Bitcoin market.
One of the most respected and data-driven analysts in the Bitcoin space is PlanB @100trillionUSD on Twitter. He has build his own proprietary stock-to-flow model based on the original concept laid out in the book The Bitcoin Standard by Saifedean Ammous, which is regarded as the Bitcoin Bible.
The model has been very accurate to explain the price of Bitcoin in the past. Should we trust this model to be right again, we are looking for in access of $100,000 price for a Bitcoin within a couple of years.
An even more outlandish yet plausible long-term price target is as high as $1,000,000 from the year 2024 and onward. These prices may sound like fantasy land right now, but remember that Bitcoin’s price went from around $900 to almost $20,000 in 2017. This equates to a whopping 22-fold or 2,122% increase in the price of the cryptocurrency.
Understanding Plus500 Bitcoin CFDs
Generally, bitcoin trading can be done in many ways. As a trader, either you can go through the traditional way of trading or CFDs. CFD is a contract where it is linked with the price of the currency. You can trade in the market through two types of positions. One is for a long position, and another one is for a short position.
If you are trading an asset in a long position, you are investing with the purpose of profit from a price increase. So, when the price goes up, you can be rewarded handsomely However, if the price goes down, you will lose money in a long position.
And on the contrary, if you are trading an asset in a short position, you will make money if the value of Bitcoin starts to fall. And, likewise, you will lose money if the price of Bitcoin is going up when you are in a short position.
Please note: Keep in mind that CFDs are complex instruments that instruments and come with a high risk of losing money rapidly due to leverage.
If you are a new Bitcoin trader, keep in mind that there are many competitors in the market trying to navigate the market just like you. This mean that your trading operation need to expect some ups and downs in performance, especially if you are a newbie. Without enough practice and experience, it is a smaller chance of profiting in the forex and cryptocurrency markets. Many trading brokers offer a demo account where you can practice trading. This is an excellent opportunity for beginners. They can open a free account and trade with fake money to understand how to trade, while avoiding the risks.
One of the top CFDs trading platforms in Europe is Bitcoin Plus500. With their trading platform, Bitcoin, which is a popular and traded product in the financial market, can be traded. As this CFD provider is authorized and regulated by FCA, it should be safe to open an account with. However, traders should also consider the high risk of trading as many traders blow up their accounts trading with too much leverage. So, trade wisely and do not over-trade or over-leverage.
Plus500 offers its services in more than 50 countries, many of which are located in Europe.
CFD is a unique type of contract between a buyer and a seller. It offers the trader to buy and sell their products with the fluctuation of price without actually holding or possessing the products. This means that you can get low fees (Plus500 does not have commissions of any kind), but, on the other hand, it introduces a counter-party risk.
Plus500 started its journey back in the year 2008. Over time, it has become a popular trading provider for the people and also achieved different milestones. In 2009, it offered CFDs to the traders for the first time. In 2010 the web-based version was launched where the traders could get the opportunity to trade with the mobile phone. Different apps are built for iOS and Android to make trading easier for traders. From 2011, it reaches the highest peak of popularity. Now millions of transactions are placed every year with this provider globally.
The Goal of Plus500
Plus500’s goal is to facilitate a robust growth of transactions every year with the highest customer satisfaction. They are focusing on better user experience with their innovation and quality services. They want to grow more traders in Europe as well as in the global market.
How Do You Trade Bitcoin with Plus500?
To trade on their trading platform, you will need to have a computer and an active internet connection. Easy! You have to register at first with the required information. So, make sure you have your information ready, like ID, utility bill and bank statement. You would also need to consider if you would do a wire transfer or simply do a credit card deposit.
When you are ready to place your first order, simply go to the trade screen. You will be asked to select the instrument you wish to trade. For bitcoin trading, you will need to choose bitcoin obviously. A necessary margin is required for trading in this platform. So, you have to maintain it for trading. From the screen, you can also see the rate of bitcoin and the size of trading. You will also get the option to stop order. That is wise to use. It is essential to understand the market properly as the rate of currency changes rapidly. If you do not do risk management properly, there is a chance of losing an unnecessary amount of money.
Things You Should Know about Plus500 Trading
There are a few things you should know about Plus500 trading. Few types of trading are not allowed in the Plus500 platform. Hedging, scalping, automated data entry system, and trading, which are not permitted in other markets and considered as abusive, are not allowed in the Plus500 trading platform. If any trader is engaged in these types of trading, the provider has the right to close the account of that trader.
Due to a regulatory requirement from ESMA all brokers offer negative balance protection, hence you run no risk of losing more money than you have on deposit if you have this protection. However, traders do always need to monitor their account balances and have enough funds to prevent any problems. Remember that you are solely responsible for your own money and deposit.
Margin Trading with Plus500
Traders who want to trade with Plus500 need to have a proper understanding of margin calculation. The margin requirements vary significantly for different financial instruments. For the detail information and adequate knowledge of margin requirements, you can check the FAQ section of Plus500.
Plus500 Demo Accounts
Having a demo account is an excellent feature of Plus500. A trader can be benefited in numerous ways with the trial of a demo account. The beginner traders should get a trial with a free demo account for a few days. A demo account is just like the real account, but the currency of the demo account is not real. In the demo account, the traders can trade and understand how the trading platform looks and work. Trading on a demo account, you can improve your skills in trading and also learn about many strategies that can make you a much better trader.
How to open a demo account and trade Bitcoin risk-free? Click the button below and follow the instructions in the video. There is also a detailed step-by-step guide in the bottom of this article.
It is essential to verify the Plus500 account to secure your account. You will need to provide a few information to verify your account. Your name, address, e-mail address, phone number, payment method, etc. are enough for initial verification. However, you have to provide the phone number with country code, and when you give the phone number, they will call you or send a three-digit code as a message to verify your phone. You might also need to provide necessary documentation as valid proof of your identification. In your proof of identity, there should be your image, date of birth, name, etc. In proof of address, you will also need to provide your full address and name. You might also need to provide a copy of a utility bill, like electricity bill, phone bill, tax letters, etc.
On Plus500, you can use a separate payment gateway. For various types of payment methods, you will need to submit multiple documentation to verify the payment method. A scanned photo, proof of payment, bank details, etc. are required for checking your account. However, depending on the type of payment, each transaction might take a few business days to proceed.
Is This CFD Provider Safe for Traders?
Many new traders always have confusion about online brokers. But one doesn’t need to be worried about the safety and security of the Plus500 trading platform. As this provider is highly regulated with the FCA, you can be assured that your money will be protected. They hold the client’s fund on a segregated basis, which ensures the safety of the fund. Moreover, they use their own money for hedging in the market. So, as a trader, you should not have any risk of trading through this platform.
As far as the question is for security and privacy, Plus500 assures not leaking the data. As the number of traders is growing with this provider, they have to maintain a large number of data and information, including personal information, bank details, and so on. However, all data is encrypted to the company’s website. Thus, as a trader, you can be ensured about the security and privacy of your provided data and information.
The login procedure to the Plus500 account is also secure and straightforward. You can get the authentication of your account through Facebook or Gmail account. The 2-step authentication system will secure your mind and give protection from the third party or intruder.
Transferring funds to other accounts requires a lot of security pass and verification. You have to follow different strict rules and regulations while transferring funds. Wire transfer might take two to five business days. On the contrary, the depositing method is simple and clear. However, the procedure becomes complicated when you want to withdraw money. For the withdrawal, one need to provide photo ID, national Id card, or other identification forms.
Is Plus500 a Suitable Provider for Beginners?
The short answer is yes. Plus500 has been attracting a lot of investors for a long time for its highly regulated market policies and trading opportunities over 2,000 instruments. But trading with the CFDs requires a lot of expertise and a broad understanding of the marketplace, which makes it quite challenging to understand for the beginners. As the trading type is more advanced than the traditional trading type, beginners should practice on Plus500’s demo account before diving into CFD trading with no knowledge. They also need to gather a lot of information about the marketplace.
How Much Funding Will You Need to Use the Plus500 Platform?
Plus500 CFDs are not like the other providers. Where other brokers have a broad list of charges and commission, Plus500 has the burden of spreads. For the inactivity in your account, you also need to pay $10. This fee applies if you do not log on to your account within three months. If you are going to hold a position over night, there is a small overnight fee calculated like this: The formula used to calculate the daily overnight funding amount of a position is:
The most fantastic thing about the Plus500 platform is customer support. They are offering 24/7 support through e-mail and chat. They provide service in more than 32 languages. However, you will get answers to most of the questions from their FAQ section. You will get to know anything related to the opening account, deposits, charges, financial instruments, withdrawals, and other many things from the FAQ section. For other complicated problems, you can contact the call center anytime.
It is essential to follow some strategies to take improve in Bitcoin trading. A few trading tips every trader should know are discussed below:
While opening a position, you should know the exit strategy with a stop loss. Stopping losses at the right time is essential to avoid large damaging losses.
By using margin your account balance will swing faster. In Plus500 trading, you will get the chance of margin trading. Margin trading allows you to trade more money than the money you actually have. This indicates you can make a profit quickly from the market, applying the right strategy, but at the same time, for the wrong step, you might lose money as well. So, one needs to be very careful while trading on margin.
Having knowledge of programming language and coding, one can do very well trading the markets. For making money and being calm, you will need to set proper strategy with the right calculation. If you can do both analysis and execution together, it would be easier for you to understand how trading looks like.
You will need to apply different methods and strategies at various times to to take advantage of it. When you use different methods and techniques in trading, it will help you.
For the beginners practicing on a demo accountis highly recommended initially. It will help you to learn how trading works and how to apply different strategies. The currency on the demo account will work as real money, and you can also get the feeling like trading in the real market. So, practicing a few days or weeks on the demo account will help you a lot to understand the market conditions and trading strategies.
Different brokers work differently. Finding the right broker is also important to make the right move while trading. Plus500 is a stellar CFD platform in Europe, but it might not be perfect for you.
Summary of Plus 500’s Bitcoin Trading
So, Plus500 is one of the most organized and regulated trading platforms. With more than 2,000 instruments, including Bitcoin and other altcoins, one can get a wide variety of options for trading. This well-designed platform offers Bitcoin CFDs for the traders. It can be used in both web browsers and mobile applications. Traders trading at this platform are generally happy to get customer support 24/7. Traders with strong knowledge and understanding of the market conditions can be engaged with Bitcoin trading.
Please note: 72% of retail investor accounts lose money when trading CFDs with this provider.
* Plus500AU Pty Ltd (ACN 153301681), licensed by ASIC in Australia, AFSL #417727, FMA in New Zealand, FSP #486026; Authorised Financial Services Provider in South Africa, FSP #47546. You do not own or have any rights to the underlying assets. Please refer to the Disclosure documents available on the website.
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