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Week Ahead Preview: 6th of Oct

Trends & Analysis
News

Oil prices surge to highest since late September

News

Gold breaks above $4000. What’s next?

News

Big tech announces huge deals, AI boom drives shares

News

Gold surges past $3,950 to hit record high

News

Dow Jones, S&P 500 soar to record closing highs

News

Week Ahead Preview: 6th of Oct

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Financial instrument definition

A financial instrument is a product that allows investors or traders to access markets and participate in the price action of an asset. An instrument can be almost anything, from stock in a company to complex derivative contracts or cryptocurrencies, it just needs to be tradeable. This includes private market instruments such as private debts or mortgages.

 

Trading financial instruments

Each financial instrument has a different profile, and the way you access them in financial markets varies wildly. For example, to buy CFDs you will need to trade directly with a CFD provider, whereas you access the stock market (often also via a brokerage platform) using a stock exchange. Financial instruments are described as being ‘over the counter’ or ‘exchange traded’. Over the counter instruments are traded directly between two market participants who agree on a price; forex and forwards are the two main examples. This doesn’t mean that you need to find someone yourself to trade with – for most products, some firms act as market-makers and execute trades for a price.

 

Exchanges

Exchange traded products – stocks, futures and ETFs – are different in that they are accessed through a centralised exchange. This provides price transparency and can help reduce the risk of fraud while lowering transaction costs for everyone. Exchange-trading is not suitable for all instruments because it requires a certain volume of open interest to be viable. Thus, highly customisable contracts such as options do not use them. This is also the reason why very thinly traded stocks are regularly delisted from exchanges.

 

Start trading with ADSS

ADSS offers a range of global markets for traders, with CFD opportunities in indices, commodities, forex, equities and more. We also feature tutorials, how-to guides, and weekly webinars to help you navigate the financial markets and find better trading opportunities. You can start trading and investing online by opening a live trading or demo trading account.

 

See all glossary trading terms


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Investing in CFDs involves a high degree of risk that you will lose your money due to the use of leverage, particularly in fast moving markets, where a relatively small movement in the price can lead to a proportionately larger movement in the value of your investment. This can result in loses that exceed the funds in your account. You should consider whether you understand how CFDs work and you should seek independent advice if necessary.

ADS Securities LLC – S.P.C (“ADSS”) is authorised and regulated by the Securities and Commodities Authority (“SCA”) in the United Arab Emirates under First Category: Dealing in Securities and Fifth category: Arrangement and advice (Introduction). ADSS is a Limited Liability Company – Sole Proprietorship Company incorporated under United Arab Emirates law. The company is registered with the Department of Economic Development of Abu Dhabi (No. 1190047) and has its principal place of business at 8th Floor, CI Tower, Corniche Road, P.O. Box 93894, Abu Dhabi, United Arab Emirates.

The information presented is not directed at residents of any particular country outside the United Arab Emirates and is not intended for distribution to, or use by, any person in any country where the distribution or use is contrary to local law or regulation.

ADSS is an execution only service provider and does not provide advice. ADSS may publish general market commentary from time to time. Where it does, the material published does not constitute advice, or a solicitation, or a recommendation to a transaction in any financial instrument. ADSS accepts no responsibility for any use of the content presented and any consequences of that use. No representation or warranty is given as to the completeness of this information. Anyone acting on the information provided does so at their own risk.