GOLD SPREADS: TRADE YOUR EDGE WITH DOMINION MARKETS
Traders make money in the financial markets by trading various instruments, including gold. However, new traders must exercise extreme caution and know how to select the appropriate broker. Selecting a broker with the lowest spread when trading gold is critical. Dominion Markets has some of the lowest gold spreads in the industry. The broker is the best for beginner and expert traders when dealing with gold.
WHAT IS SPREAD AND WHY DOES IT MATTER?
Before we get into how to find the top gold lowest spread brokers, it's important to understand what spread is and why it's so important in the trading process. In currency and commodities trading, the spread is the difference between an asset's purchasing and selling price.
The spread is the broker's charge for facilitating the trade, and a lower spread is advantageous because it means a cheaper cost to enter and exit trades. Narrower spreads help traders to benefit sooner because the asset's price does not need to move considerably to cover the spread.
When trading gold on Dominion Markets, the size of the spread in gold markets matters a lot. It determines the transaction cost and provides information about market mood and asset liquidity.
Market liquidity increases with a decrease in the spread. Assets with a wide spread are more volatile and less liquid. Currency is regarded as the most liquid asset in the world, with one of the smallest spreads in the currency market. Less liqads-what-every-trader-should-know/uid asset classes and commodities may have spreads of at least 2% of the asset's value, although the Zurich gold market has a spread of 0.10% to 0.20%.
FACTORS TO CONSIDER WHEN CHOOSING THE LOWEST GOLD SPREAD BROKER
As mentioned earlier, low spreads in gold are a key determinant when choosing a broker. Below are some factors you should consider when choosing a low gold spread broker.
REGULATION AND REPUTATION
The first step in selecting a broker for gold trading is to look for a broker with a solid industry reputation. A well-established, trustworthy broker must be authorized by a financial authority that assures brokers follow high financial standards, protecting users from unscrupulous activity. To establish the broker's regulated status, visit their official website or the regulatory body's portal.
Among the well-known regulatory bodies are:
- The Financial Conduct Authority (FCA) – United Kingdom
- U.S. Commodity Futures Trading Commission (CFTC) – United States
- The National Futures Association (NFA) – United States
- International Brokerage and Clearing House
Dominion Markets LLC is an LLC registered in Comoros Union (company number HY00723020) with its registered address at Bonovo Road – Fomboni Island of Mohéli – Comoros Union. Dominion Markets Management LLC's management office is in Dubai, UAE, with license number 1207512.
The company holds an INTERNATIONAL BROKERAGE and CLEARING HOUSE LICENSE under IBC REGULATION ACT 2014, with license number T2023340. This authorizes Dominion Markets to provide services such as Currency Trading (FOREX), Stock and Securities Brokerage, Financial Advisory, Asset and Fund Management, Custody Services, Transaction Clearing, Payment Processing, Issuance, and Underwriting of Securities.
Your trading experience heavily depends on the trading platform the broker supplies; it must be user-friendly and intuitive. MetaTrader 5 (MT5) is a prominent option known for its ease of use and excellent functionality. Dominion Market offers Metatrader 5 and cTrader. These platforms have excellent user interfaces.
A new trader must minimize trading costs, so you should look for brokers that offer low spreads for gold, as these can vary greatly between brokers. A fixed spread remains consistent regardless of market conditions, whereas a variable spread fluctuates with market volatility. Make sure to compare all of your available possibilities.
Keep in mind that ultra-low spreads do not always indicate a trustworthy broker since some brokers with exceptionally low spreads compensate by collecting hidden costs. Access the trading costs, including spreads, commissions, and other fees, for a fuller perspective.
Dominion Markets excels in low spreads. Here, you can get the tightest spreads on gold in the industry, starting from 2 cents.
WHY TRADE GOLD ON DOMINION MARKETS?
Gold is a haven asset that shields investors from excessive market volatility. At the very least, safe-haven assets ensure capital preservation during difficult times. For a long time, gold has shown to be a haven asset, preserving or increasing in value during periods of instability when virtually all other assets have declined in value.
One of the main reasons for this is that gold has retained its aesthetic appeal from ancient times. Its physical properties have always astounded man: malleable, almost indestructible, and extremely rare.
Gold is also limited in supply, unlike fiat currencies, which may be easily produced by underpinning governments or central banks. There will never be enough gold extracted, and even when new deposits are discovered, it takes many years from exploration to final production.
Gold shields investors during times of crisis and not always during periods of normalcy when investors are confident. Even so, learning how to trade gold when the market is volatile is critical. It has been noted that gold is a haven asset for a limited time during a crisis until investor confidence returns or volatility begins to subside.
This means that investors can buy gold during crises when volatility is high and then sell it a few days later when it returns to normal. In this method, investors can protect their wealth from significant market volatility while earning profits during a market slump. This also implies that gold can be used as a portfolio diversifier, lowering total risk while not limiting possible rewards.
After deciding to trade gold, pick a broker to help you make more in the market. Dominion Markets offers great spreads for gold. This means the broker will charge you a small sum to trade gold. Therefore, you have lower costs and make more profit.
HOW TO TRADE GOLD ON DOMINION MARKETS
Now that you know Dominion Markets offers great spreads for gold, you need to know how to capitalize on this. Below are steps that should guide you on how to trade gold on Dominion Markets.
UNDERSTAND WHAT MAKES GOLD MOVE
Gold, one of the oldest currencies, strongly influences the financial world. Despite widespread opinions, gold responds to a limited set of factors. These forces create changes that impact sentiment, volume, and trends:
1. Inflation and deflation
2. Greed and fear
3. Supply and demand
Trading gold based on one change when another drives price action poses a heightened risk for market players. For instance, if gold surges during a global market sell-off, some traders think fear drives it and join in. However, it could be inflation causing the market decline, attracting a technical crowd that sells against the gold rally.
UNDERSTANDING THE CROWD
Gold appeals to various groups with different interests. At the forefront are "gold bugs," passionate about gold. They invest heavily in physical gold and allocate a significant part of their family assets to gold-related investments like equities, options, and futures. Gold bugs are long-term players who are not easily discouraged by market downturns and tend to outlast less committed investors.
Retail participants comprise a significant portion of the gold bug population, and few funds are exclusively invested in gold. Gold bugs contribute substantial liquidity to the market, providing consistent buying interest at lower prices.
Moreover, institutional investors engage in significant hedging activity related to gold. They use bilateral, risk-on, and risk-off strategies to buy and sell gold with currencies and bonds. These strategies involve creating baskets of instruments that align with either growth (risk-on) or safety (risk-off). These institutional investors execute these trades swiftly using advanced algorithms
STUDY THE LONG-TERM CHARTS
Take the time to study the gold chart thoroughly, especially its long-term history spanning at least 100 years. These charts are available on the Dominion Markets platforms. Look for trends that lasted for many decades and instances where the metal stayed low for extended periods, causing challenges for gold enthusiasts. This analysis helps identify critical price levels you should monitor if and when gold revisits them
SETTLE ON AN INVESTMENT METHOD
The right way to invest in gold depends on your goal. You can buy gold directly as physical bullion or coins, but keep in mind there might be costs for storing and insuring it. Another option is investing in gold through futures and options markets. Many prefer mutual and exchange-traded funds (ETFs) like SPDR Gold Shares (GLD).
Alternatively, investing in shares of mining companies provides a different way to get exposure to gold, although the connection between mining stock prices and gold performance can vary. Dominion Markets offers you the best avenue to trade gold. With its tight spreads, you can profitably trade gold against the US dollar.
Spreads greatly affect how you trade gold. It has a direct impact on your profits per trade. You should, therefore, be keen when choosing a broker when trading gold.
Many brokers offer low spreads, but Dominion Markets offers some of the lowest. Join Dominion Markets today and trade gold with some of the tightest spreads in the industry!