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Balancing and diversifying a portfolio
Balancing and diversifying a portfolio
Balancing and diversifying a portfolio:To balance and diversify a portfolio in Zulutrade we can associate each of our traders with a quantity of lots. A lot is the amount of currency you will buy or sell each time you trade.
Type of lots
- Standard: Each pip is about $ 10. The standard lot is usually too large for most small investors.
- Mini: It’s a tenth of a standard lot and therefore each pip equals $ 1. If the market goes up 100 pips, you will have won $ 100 (approximately and depending on the currency crossing).
- Micro: It’s the tenth of a mini lot, so each pip equals only $ 0.10. In this case if you win 100 pips you will win 10 $. Zulu4me usually uses the micro lots to have more traders in our portfolio and better diversify our investments.
Create synergies between traders
The Zulu4me portfolios already come balanced by default, that is, some traders can use 3 micro batches and some use only 1 micro batches. This is because the trader who carries 1 micro batch can have a risk 3 times greater than that which uses 3 micro batches. In this way, traders with different risks are balanced and can create synergies.
Diversify a portfolio
Now all traders have the same weight within the portfolio and this improves our diversification. Zulu4me always seeks to reduce volatility, if you believe that you can withstand greater risks you can increase the lots of each of your traders. Likewise, you can reduce the micro batches if you think fit.
We hope you have been helpful in knowing how to balance and diversify a portfolio. If you have specific doubts about your wallets do not hesitate to contact us at info@zulu4me.com.
Remember
Zulu4me is free, you just have to open a Demo or Real Account through our link to obtain all our advantages. We are traders like you doing our best in Zulutrade and sharing it for free.
To create a Demo Account:
- Open a Demo Account in Zulutrade here, we help you: Open Demo Account
To create a Real Account you have two options:
- Real Account with AAAFX broker (recommended): Open Real Account (AAAFX Broker)
- Real Account with other brokers: Open Demo Account (Others Brokers)
You have more information in our section about Zulutrade. (Article: Balancing and diversifying a portfolio).
Zulu4me Team
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Currency trading with leverage implies an important risk for the investor and there is always the possibility of losses. These instruments carry a high risk if they are not managed properly and a profit can quickly become loss as a result of price changes. Due to the risk factor inherent to this type of trade, only funds intended for risk investments should be used. If you do not have extra capital you may be willing to lose, you should not trade in the forex market. It has never been proven that there is any system or portfolio of systems that is completely safe and no one can insure future profits or losses. Before you start trading in the forex market you should think carefully about your goals as an investor, your level as an investor and your risk aversion to determine if this is the type of investment you want to make. If you are in doubt you should seek advice from a professional financial advisor to advise you about the investment. Search
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