It is important that anyone dealing with money in this day and age understand the risks of their investments says ValueMags. The Chicago based magazine marketing agency is a boutique agency that does marketing for magazine companies. In their recent research, they have realized an increase in articles about students and young people losing their money because of poor investments. Here are a few definitions ValueMags believes are essential to understanding the investment market and finance in a realistic way.
Money: Money is temporary storage. It stores the value of what you’ve earner to bordering and risk.
Arbitrage: In simple terms, arbitrage is free money. It is taking advantage of a price difference between two or many markets to make profits. ValueMags believes this is one of the most important definitions on the list.
High-Frequency Trading: High-Frequency Trading is the same thing as trading stocks on computers but every day people can not do it. It occurs on high-speed computers and is done so quickly they trades are measured in NANO seconds.
Insider Trading: Insider trading is when people trade with the knowledge and information that is not public – making it illegal.
CDS – Credit Default Swap: Credit Default Swaps are more commonly known now because of the 2008 crash when a couple of smart investors realized how large the American housing market bubble was. It is a form of house insurance.
The definitions above can lead to bigger subjects and can be elaborated on but they are starting points for individuals to get interested an educated. These can sometimes seem very complicated when they are not. It is simply the way they are explained says ValueMags. For that reason, ValueMags encourages people to ask questions and educated themselves by doing individual research on theories and truths that can one day highly impact their lives.