Before you start trading, any instrument, on any market, whether a beginner in the field of Finance or an experienced trader, you must first of all be familiar with the contract specifications for this instrument. You also have to read all the terms and conditions on all the markets and exchanges of trade as a broker, through which you are going to perform operations with contracts. Contract specification is a set of certain conditions, rules and restrictions on specific trading instrument.
What usually can be included in contract specifications?
1. The name of the trading asset that a trader wants to buy or sell, for example: shares of Apple Inc
2. Its symbol in the trading system that a trader uses, for example: _AAPL
3. The market on which is traded the basic asset, for example: American electronic stock exchange NASDAQ
4. Lot size or trade volume - the lot on the exchange is the unit in which is measured volumes of purchase and sale of assets. Lot is not simply chaotic and irregularly taken value. It is the equivalent of a pre-selected and calculated volume of goods. In this case, the standardized size and volume of transactions (or a contract) executed during the trading session, is strictly declared and set according to rules and regulations of stock exchange trading, for example: 100 shares in 1 lot
5. The minimum price change or tick is the minimum allowable change in the contract price, for example: 0.01 points
6. The maximum size of the order is the maximum quantity of lots that you can buy or sell for one trading operation, for example: 20 lots
7. The cost of one Point or tick shows how much of the currency is contained in the minimum price change or tick price of the contract, for example: 10$ per 1 point
8. Bail or margin requirements (bail) are the amount of funds that the investor must have in a margin account in order to be able to buy or sell assets on credit or using margin
9. Time of trade of the traded contract in the market or the exchange, for example: from 16:00 to 23:00
In addition to the above conditions, the contract specifications may include other terms and conditions, which may vary depending upon their types, the exchanges and where they have been traded.
Invest Life Ltd. offers its clients a wide choice of trading tools: currencies, metals, energy carriers and also contracts for difference prices (CFD) on shares of the world's largest companies, stock indices and other highly liquid assets. In this section you can find all the necessary information about our trading tools for all types of accounts.