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Can You Make a Living Trading Forex ?

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Introduction

In this article I will describe why I do not think that do people can earn a lot of money trading currencies for a living if they start with small amount of money. This is just article for thinking and I hope you think different than me…

Trading forex for a living

Trading forex for a living

So you’ve decided to start a career as a Forex trader, living off forex. Your first 3 questions will be:

1) Does anyone make money trading forex ?
2) How much do forex traders earn ?
3) Does forex really work ?

Can forex be traded for a living ?

Congratulations, you’ve taken the first steps towards a reward – both personally and financially – career.

But there are a few things you should know before you get going and put your money down on the table.

And even if you think you’ve thought of everything we ask that you take a pause and read this article.

We’ll not only tell you three things that we think every beginning Forex trader needs to know, but also we’re telling you this because we don’t these three tips are emphasized enough to beginners.

That’s because you can make a lot of money on Forex, but you can also lose a lot of money on Forex.

In fact, no matter how sophisticated a trader is, he or she will lose money one day. Your goal now and always is to limit the amount of money you do lose on Forex.

That might not sound as exciting as telling you about how much money you COULD make or better question: Can i make money trading forex

Yet we know for certain that if you don’t follow some baselines that your story will end up a tragedy. Such is the nature of trading foreign currency, but it is doesn’t have to be.

We don’t want to rain on your parade, we want to make sure it happens.

Before you make your first trade, read these three tips that will tell you what you need to know about trading Forex before you spend a dime:

Don’t Expect to Become a Midnight Millionaire and start making a living trading forex from the first day !

do not except to become millioner in forex

Probably the first misconception you need to dissuade yourself of immediately is the idea that trading Forex will make you instantly rich.

It won’t.

Don’t get us wrong. After years of sustained trading success and astute financial management, you can make a fortune off of trading Forex.

That takes a long time which is why Forex is a game for those with the patience to do it.

But, wait, you’re thinking, I have a lot of initial principal to invest.

After all, the more money you have to risk, the more money you can make, right?

You might even be thinking that you have enough training to know better than some general advice article, but you’d be wrong. The more you risk the more you will lose. If you’re just starting out, you don’t want to begin with losses. Losses over your career are inevitable, but they should be as small as possible and contained.

Don’t risk all of your capital at once and certainly don’t rely upon a “tried-and-true” strategy or a “surefire way” to make millions.

There is no better tried-and-true strategy than a sober, collected approach to trading.

Large Amounts of Initial Capital Can Lead to Enormous Losses with Short Periods of Time

Of course, you might think that this piece of advice is a no-brainer tip.

But, again, you’d be surprised how many traders disregard this advice. Whether it is because of a rushing bull market or emotions getting in the way of reason, risking a lot has huge rewards yet, in Forex, it can have devastating consequences.

First of all, this approach stems from a day trader’s mentality with stocks and securities.

Forex is not a stock or a security, it represents the exchange differential between two fiat currencies.

The predictive mechanisms for a currency’s value are almost as vast as the ocean itself and the factors that impact a currency’s value are equally voluminous and nearly impossible to comprehend alone.

Many traders have developed strategies and metrics that they like to use but those that tell you they just “know” when something is good or bad are not trying to obfuscate the issue or hide some unique strategy from you.

This is because, even in the best conditions, you will be wrong and you might be wrong more often than not. The key is to balance losses with huge gains, not recover from huge losses with depleted capital.

Never risk it all and, in fact, be conservative about how much you spend.
never risk it all in forex trading

You can always regroup after a small loss, but a huge loss might be enough to drive you out of the market.

And things can change in a heartbeat in Forex.

So we have to emphasize again: No matter how certain you are of your skill, strategy, or market conditions, a smart risk leads to a future. Dumb risks can ruin it.

It’s that simple.

One tool that every beginning Forex trader needs in their arsenal is the Speculative Sentiment Index or SSI. It is basically a measure of how many people are long or short for each currency pair being traded.

My personal opinion – Can I make money in forex trading or Forex Lies ?

If you think that you can put $500 and make to be $ 5 million dollars in few years – No. This is small probability event. There are no holly grail or some strategy that you can follow and earn money in trading industry. After 11 years of trading, working for several prop companies, I can for sure say that it is very small chance to success in and trading industry with small capital. I believe in Prop trading, manage big portfolios and 10%-20% gain per year.

Percentage of the profit needed to recover a loss

Why I think like this – see Table above this text. This is the most important table for every trader who trade for a living. It shows Percentage of the profit needed to recover a loss.

Example 1 :
You risk 1% of your portfolio. If you trade and after few months you have 10% loss you can recover as same as you made loss. So after 11% gain you will be break-evan.
Example 2:
You risk 5% of your portfolio. If you trade the same positions as in Example 1, after few months you will have 50% loss. So after 100% gain you will be break-evan.
Example 3:
You risk 9% of your portfolio. If you trade the same positions as in Example 1, after few months you will have 90% loss. So after 900% gain you will be break-evan.

Can you make a living trading forex ?

Trading for a living might be seen as a risky adventure that no one should go on by some persons who think having a job offers more security; but for others there is nothing secure about working for a boss who can have a change of heart and fire you at any time. These persons will constantly learn about the many ways in which they can be the best trader so they can make a lot more money than the salary they would be getting if they had a job.
Having a job puts persons in a position where they will always be job seekers until they retire, being an investor/ trader means you will constantly be looking for and finding opportunities to earn a lot more than what the job offers. You will be putting yourself in a position to be the boss as you can constantly improve your ability to earn, by simply learning more about the skills you’ll need to increase your investment. You can look at the many earning opportunities you will have when you become a trader.

Do people make money in forex ? Yes but can they be successfully several years in future not just few months ?

Proprietary Trading- the Pros, Cons and more Important Information

There are day trading firms that offers traders to trade with a pool of capital instead of their own money in an arrangement that helps all the parties involved to benefit. You’ll be entitled to a cut of the profits that are generated through trades. However, there are challenges that makes it difficult at times for persons to generate profits.

When proprietary day traders do a few trades a day for bigger gains or many small trades per day, you can work as a contractor for them. If you have been making profits and you are seen by persons as an experienced trader, you can work from home with these proprietary trading firms, but before you have earned that reputation you might still be hired by these firms. During this time, you will be asked to pay for training, as the firm uses this method to eliminate persons who are not serious about trading.

You will need to decide on what your own preferences are so you can put yourself in the position you want to be in. You will think about the type of trading you are best at and find ways to improve your knowledge about that way of trading so you don’t waste time learning about everything when you could be earning and becoming more experienced in one area.

Technology has caused a change in the way persons can work for these firms and there are persons who work for firms while they are with their children at home; as markets can be accessed with ease.

However, it can take several months before you are experienced enough to earn a living from trading, so if you are in a job it is not good for you to leave it too quickly.

It is important for you to make a trading plan or business plan
You can run a search for the proprietary trading firms in your area and start learning more about them, if you are planning to work with them in the future. You will be choosing between two model types. One that takes 20 to 50 percent of your profits; or others that takes a little of your profits and gives you up to 90% of your earnings after you have used your own money to trade.
You can also be hired by a company to work on their trading floor and you’ll be trained and given a salary plus bonuses. As a prop trader you’ll be working up to eight hours per day or you could work from home for 3 to 4 hours, it all depends on what is needed. However, these firms make a profit by charging fees for software, seats, training and more.


Finding out what markets you’ll be trading in depending on your capital and interests.

Persons who want to become traders will benefit from working for a trading firm as they will have access to more trading capital than they would have on their own, they will be surrounded by traders who can help them to become profitable, they won’t need to worry about having a balance that is too low to trade in stocks, they will have access to training from professional day traders at a cost, reduced commissions when it is compared to what other day traders face.
New traders are always in need of training and it is best for you to be trained by persons who produce successful traders. You should do some research as you constantly pay attention to your likes and dislikes, as well as the time you can spend on trading, the markets you want to trade in, your personality and circumstances. When you know what is available to you, you’ll be putting yourself in a position to make better plans after you decide what trading method suits you best.

Forex for a living and psychology of trading

When you are willing to do what it takes to overcome the many challenges and learn about the psychology of trading, by remembering that fear and greed are two emotions you should avoid because they will have a negative impact on your ability to make profits; you will also need to know about trading strategies and risk management techniques, how to bounce back after a trading loss, to pursue profits so you will be one of the experienced traders who earn a living by trading as a proprietary day trader.

Even though firms are now online as they reduce their costs and you won’t be sitting among experienced traders when you are starting to trade, chat rooms and skype are useful tools but getting answers for your questions might be difficult, competition for seats on a physical trading floor is now higher than before, retail day traders access trading platforms and internet speeds rival most proprietary resources, the fees charged to traders by some firms could reduce your profits and be a deterrent.

Other Trading Options
Persons who do full time trading and have advanced degrees and a lot of experience are not confined to working in investment banks and you don’t need a lot of expendable time and a huge amount of capital to start trading.
However, it is possible for persons who are not university graduates to start trading and get on the path that leads to wealth creation.
Persons can trade independently by choosing the easiest and flexible ways by including trading in their daily lives, trading from their homes
Even though trading stocks from your home is a very capital intense arena as the lowest equity requirement for trader who are designated day traders is $25000 and this amount will have to be maintained. If the balance should go below the prescribed amount the trader will not be trading until the lowest amount needed is restored, when money or securities are deposited in the account.
New traders need to be aware of all the markets, as a lower barrier-to-entry that requires less capital can be a better option sometimes.
The currency markets or forex markets offer a number of alternatives these days. There are times when traders can open accounts for as low as $100 with leverage, meaning a huge amount of funds can be controlled with just $100, during the week the market is now opened 24 hours per day. Persons who are not able to trade during the, day time can trade when it is convenient for them.

Last Question – How much do forex traders earn ?

When you work for prop company average trader who manage $100 000 account can earn average $1000 per month. It is around 1% per month. So when you earn $2000 you need to split and share money with Prop company. Senior Traders manage more than 1 million dollars in smaller companies and in large corporations they manage much much more.

If you are trader and trade your own money and if you risk more than 2% of your portfolio based on several data from brokers – you will in 94% all of time lose money instead to earn money. I worked 1 years as affiliate manager for one reputable broker and I saw that from 3 000 traders that I tracked in one year all 98% of them had bigger loss than profit on the end.

Brokers are not guilty – risky traders are!

The Contract for Difference (CFD) Market

The (CFD) or contract for difference market can also be entered with low requirements and it is best for persons who want to get involved with trading to do extensive research and learn about what has caused this market to expand. An electronic agreement between two persons doesn’t need to own the asset that is being used, is a CFD. Gains are captured for a fraction of the cost of owning the asset.
The contract allows room for profits and losses to be earned, but the CFD contract can be used to trade in the foreign exchange (forex) markets, even though the assets are never owned by the traders. There is speculating on the underlying stocks or indexes as its movements are mirrored, so that profits or losses are reaped in this way.

If a trader does not have a lot of money, this way of trading can be beneficial.
You can educate yourself on the risks involved in this way of trading as you build a trading plan that is strong.

Conclusion

However, you should remember to always strive to be the best trader. As you continue learning from the best as there is no other way for you to continually increase your profits and reduce the impact of the issues that would be seen as a deterrent. Always remember it is easy to quit when you suffer a loss, but you can always learn more and become one of the professionals who are earning huge sums of cash every day.

You can earn money as trader trading from your home. But remember that risk is something that can be your biggest mistake. Prop company traders for me have great advantage because they can manage larger sum of money and have small controlled risk.

Is Forex Trading Legal in Canada

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canada flag and birdsYes, forex trading is legal business in Canada (and in the world) but brokers need to be regulated. We see a lot of titles in internet blogs such as “is forex trading illegal in canada” or India or Australia or any country. This is wrong question. Currency trading is one of the biggest business in the world. Trading forex refers to the exchange of different currencies with the help of a trusted and experienced broker and gets things done smoothly and effectively. Canadian citizens can avail this opportunity by dealing and engaging with brokers who are registered with the Investment Industry Regulatory Organization of Canada (IIROC). IIROC is a not for profit and apex financial regulatory body for forex trading market in Canada. The Canadian forex trading has gained some attraction recently in the media due to enhanced security measures and tight regulations that they offer to small businesses.

The Forex Market, being a global market in Canada and other countries is popular with investors, banks, brokers and finance based companies and institutions. This also ensures Canadian citizens to take care of their collateral and security and not end up in a situation losing their entire capital and suffer bad losses on their investment. Canadian citizens can thereby avail this opportunity to raise their bars and make use of this effective forex trading system in their region which can act as their greatest strength during difficult times. The Trading Forex in Canada provides a good opportunity for its citizens The Canadian government provides a very simple and effective way to deal with forex trading. There are some agencies being run by the government and privately to regulate the flow of capital in the trading market. All disputes and work-related issues between the brokers and the citizens are controlled by IIROC. Canadian forex brokers offer reduced leverage in helping citizens gain maximum returns on their investments. Hedging options are minimized or negligible due to tight regulations and increased security. It is also required to raise a decent and adequate capital by the investors to run out of risks and other scams that can affect the transactions. There are certain norms set up by the governing body to allow forex trading to happen for an individual investor depending on his income, assets and financial ability. These restrictions, however, prevents the involvement of any individual into forex trading and limits his abilities to invest in the forex market due to unavailability of adequate funds required at the time of investment. Each province of Canada has a different forex trading regulatory framework Trading Forex is an important aspect of Ontario’s province where forex arrangements are treated equally as securities and by-products. In Quebec, forex trading is governed by Authorities Marches Financiers (AMF).

British Columbia – forex tradings as securities

In British Columbia, forex tradings are considered as securities. Registrations and regulatory laws are not imposed to that level in British Columbia as compared to other regions of Canada. In other provinces of Canada, there is no acting or governing body and they are mostly regulated by the different national bodies. The Canadian securities personnel has set up new norms and principles for forex trading in Canada in the year 2009. Other regulatory bodies like CFTC, NFA, and CIPF regulate forex trading for different individuals and firms. Thus, Canada has failed to obtain a united forex trading system in the country due to different laws and regulations and each province has unique sets of rules and principles to follow and abide by with respect to forex trading. The traders in Canada have the freedom to trade as per their requirements and priorities The rules of the respective provinces are aligned with the trading forex system and are one of the unique advantages of forex trading in Canada.

Canada forex brokers

The brokers may not be authentic or reliable so it is required to perform adequate and extensive research on this field before making any solid investments.For example HF Markets forex broker is regulated in Canada (see review). The losses can be significantly high and can affect the individual investor in an adverse and unfavorable way. The regulatory bodies can give accurate and precise information about the broker and his credibility. It is better to remain protected and get scammed by unreliable forex brokers due to lack of proper and sound research before carrying on investment activities at a considerably higher level. The investors must check the authenticity and legal standards of forex trading in Canada before dealing with brokers and take responsibility for their own decisions. The maximum leverage depends on the exchange of foreign currencies and value The leverage potential depends on the value of the currency. It is directly proportional to the current limit; Higher the currency value, greater is the leverage. The greater expansion has therefore taken place in the forex trading market due to higher currencies and individuals willing to take additional risks to earn a high income and settle their future. Lower currency exchange rates decrease the leverage but the forex trading process is different in each country and the government has made it mandatory to trade in the same currency and not with a different one as per the location. In Canada, forex trading is considered legal and has an established presence throughout the country and popular with good investors and brokers. Forex Trading in Canada has a promising sign for investors and brokers who wants to make the most of it and gain good profits on their investments. CFD’s and FX comprises a greater risk of failure resulting in loss Trading with CFD’s and FX have an additional risk of losing money so proper attention and care should be taken to ensure that investors are aware of the risks and the hazards of dealing with cryptocurrencies.

There is no guarantee that such investments can lead to business profits although previous data has shown up a good percentage of profits on investments made through these channels. The online brokers seem to work with the forex team and solve issues related to accurate data diagnosis and reporting. Canada offers forex trading with good and better avenues for trading platforms, nice spreads, proper execution, and 24/7 support to its citizens. The forex trading system in Canada is, therefore, a blessing helping millions of citizens reach their targeted revenue generation on investment of CFD’s and forex trade. There is no restriction imposed on a fellow citizen to trade with any particular broker in the region so the options are endless and depend on the individual preference. Canada has a competitive edge over other countries related to Trading Forex, CFD’s and cryptocurrencies. The different norms and regulations prevailing in certain provinces have made things look more secured and promising for investors to think about their investment potential complying to good standards and practices. The rate of investment is directly proportional to the currency value and investors, therefore, opt for higher amounts when they decide to go for forex trading in their respective provinces and earn good returns and profits on their invested capital amount.

Trading forex in Canada is therefore lucrative and profitable from investments and point and has a good name in the country helping its citizens raise their income standards and living potential.

Future Impact of Artificial Intelligence and Machine Learning in Finance

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Future Impact of Artificial Intelligence (AI)

Wikipedia:

In computer science, artificial intelligence (AI), sometimes called machine intelligence, is intelligence demonstrated by machines, in contrast to the natural intelligence displayed by humans

While artificial intelligence (AI) has long been considered a potentially disruptive technology, it is beginning to evolve into a concept that could actually turn the entire value chain of the financial sector upside down. This change is a consequence of the enormous potential of artificial intelligence. AI technologies are increasingly being used to bring new products to the consumer, to improve existing solutions, to increase the operational efficiency of business processes, and to explore new discoveries that lead to innovative business ideas.

Artificial intelligence does not describe a single technology, but the combination of different technological developments. These include text generation and machine processing of natural language, so-called automatic reasoning, pre-habilitation methods, machine learning, autonomous and intelligent agents. In search of perfect solutions, they have all been brought together to what we now call artificial intelligence. They describe abilities that resemble or even surpass those of a human being. But despite all these advantages, not all aspects of artificial intelligence have reached the same level of maturity. Some of them need decades of development, including so-called ” strong artificial intelligence” That could eventually enable machines to mimic the intelligence, plasticity, and understanding of the human brain.

artificial intelligence and machine learning code on screen

The Effect of Machine Learning in Finance

Machine learning in finance industry is based on different fraction use cases. Generally speaking, machine learning in industry is lesser than the outsiders’ imagination. Long before the term machine learning was not that pronounced in industry. Then one would that means of analyzing data and making predictions would be complex. But not so, because there are direct solutions to finance problems that doesn’t require formula.
Some examples of machine learning in trading community are given below:

SIGNAL GENERATION AND TESTING: The term ‘signal’ depicts the ultimate goal of trading which is to creates trade. To create signal from past data, machine learning methods are important. Particularly, fine-tuning the approaches in machine learning areas around validation and importance of statistical testing are very germane. The difference between success and failure is a result of getting the important part wrong. Linear regression can be used to make actual prediction.

FEATURE ENGINEERING: Learning not supervise is not good for trading because there’s a need for feedback which is the link between profits and signals. The features can also be designed singly using any tools of choice. Introducing external data, for instance, satellite data or economist model for large trading and make use of complicated tools to feed the results into simple trading strategy is the work of good strategies.
BORROWING FROM SPEECH RECOGNITION METHODS: Here from the past one can predict the future. NLP and other similar areas of machine learning approaches have been found beneficial in trading space.
Option pricing, High frequency trading execution, portfolio strategy, management of risk do not rely on machine learning. Conclusively, machine learning is relevant in the area of finance, but not up to what people think, also the arms that use it depends on the modern machine learning than on specific models peculiar to academia.
One of the tools use to make predictions in trade by quantitative traders is machine learning, which is of great advantage in stock market. A fund manager or a trader question would be how to make use of this tool to create more alpha. In quant firms and algorithm, machine learning has been the talk of many in recent years.

MACHINE LEARNING GAINS POPULARITY IN ALGORITHMIC TRADING
Programming languages like C++ , python, R, etc. can be useful in applying machine learning techniques to trading. Machine learning packages are built within organization by firms that make it available for the users freely.
Machine learning packages has shoot up recently this has immensely enhanced access to various techniques in machine learning and also meeting the trading needs.

SOURCE:
How algorithm works is one of the basis of classifying it. One example of algorithm is ML algorithms which are classifying depending on their mode of work. For instance, to construct a model of decisions, decision tree algorithms are used. To find relationship between variables, regression algorithms are employed.
Some of these algorithms are listed here;
1. Linear Regression
2. Support Vector Machine (SVM)
3. Deep learning
4. Random Forests (RM)
5. K-Nearest Neighbor (kNN)
6. Logistic Regression
7. Classification and Regression Tree (CART)

The examples of ML algorithms given above are employed by trading firms for different purposes. Among which include;

1.To find optimal inputs to a strategy,
2. Using huge data sets historical market behavior can be analyzed,
3. It is also beneficial in making trade predictions, etc.

EXAMPLES OF MACHINE LEARNING:
RESOURCES TO STUDY MACHINE LEARNING
In the world today, one must keep on updating oneself with new emerging technology. Machine learning offers opportunity to full time traders to improve their knowledge. Course in machine learning are present in some reputable university across the world.

OTHER RESAERCH AREAS
Various markets, for example forex market make use of machine learning techniques. Knowledge of programming, technical analysis, basic statistics, etc. are also useful to any traders that wants to improve their trades with machine learning technique.

MACHINE LEARNING COMPETITIONS
This machine learning competition is targeted at improving traders’ knowledge. There are many site implicated in hosting ML competition. This competition even though does not directly target the application of ML in trading, exposes different ML problems through the competitions. Thus expanding participator ML knowledge.
Some of the examples of ML hosting sites are:
1. CrowdAnalytics
2. kaggle
3. NUMERAI
4. Topcoder, etc.

FUNDS USING MACHINE LEARNING TECHNIQUES
Machine learning are used for trading in established funds like Citadel, Shaw, Medallion funds and so on. The impact of ML techniques in trading and is unclear to people. So also is the role of machine learning strategies in funds overall effect.

FUTURE OF MACHINE LEARNING IN TRADING.
Recently, automated trading has been increased by advancement in technology and electronic trading. Globally, machine learning has been adopted by big and small firms.
At this time better understanding of machine learning is paramount to traders so as to maintain their productivity in the world of trade. There’s also new developments in machine learning support by hard ware.

Future Impact of Artificial Intelligence and Machine Learning in Finance

However, there are already tasks that have hitherto only been attributed to the human mind that is already performed by artificial intelligence – in a process that reflects the replacement of human labor with industrial machinery. The financial sector is a good example to show how AI is already working on different levels:
– Improving customer experience and customer relationships through more human interaction with chatbots, virtual agents, and intelligent systems that can communicate and communicate with each other based on text generation of natural language machine processing
– Through a clearly demand-oriented offer of services such as Robo-Advisors, individualized products and the registration of new customers completely on an online basis, based on machine learning – By automating internal business processes, including mechanical and cognitive processes, by replicating human cognitive abilities, such as finding and understanding the meaning in a variety of documents, recognizing hidden patterns, and creating complex systems
– Through the full effective use of financial data, where machine learning can help uncover abnormalities, combat white-collar crime, and automate processes in an infinite array of financial product specifications. In which areas can artificial intelligence influence the financial business the most? The financial sector is currently being shaped by artificial intelligence. Technology has shown that with its disruptive nature, it actually has the potential to change financial processes. This change holds many opportunities and possibilities: pure research projects result in the actual change of the most important business processes.

Artificial intelligence future

What we still have not seen is the true potential of artificial intelligence. Over the next two to three years, we will witness a huge increase in processes and applications. Technologies are already maturing to challenge executives in which areas they want to use them to change their business processes. This can succeed, for example, by enhancing the customer experience and improving customer relationships by offering new services and automating tasks that require human, cognitive skills and exploring new areas to expose new and hidden knowledge. It is also important to distinguish between different areas: There are areas where AI is already well developed and where quick, direct successes are achieved. And there are other areas that require a more exploratory approach because the risks are higher, but there is potential for promising disruptive outcomes. require cognitive skills and exploring new areas to expose new and hidden knowledge. It is also important to distinguish between different areas: There are areas where AI is already well developed and where quick, direct successes are achieved. And there are other areas that require a more exploratory approach because the risks are higher, but there is potential for promising disruptive outcomes. require cognitive skills and exploring new areas to expose new and hidden knowledge. It is also important to distinguish between different areas:

There are areas where AI is already well developed and where quick, direct successes are achieved. And there are other areas that require a more exploratory approach because the risks are higher, but there is potential for promising disruptive outcomes. Apart from that, the management team must also carefully plan the implementation strategy. In order to do so, it can rely on the talents in its own company, attract external professionals, collaborate with FinTechs, purchase black box products, or provide advisory services. All of these possibilities can also be done in collaboration with internal analysis or innovation teams, by using them as playgrounds or by creating prototypes on a pilot project basis. One example is the GFT Innovation Lab, where FinTechs, technology startups, and financial institutions work together to explore and design different AI applications – both at the business and some level of technology – before integrating them into their enterprise. In addition, executives should think about and identify technology platforms that best fit their business and strategy. You can choose either internal or external developers to build core capabilities, use an open source infrastructure (such as Hadoop or TensorFlow), outsource data products and software as a service to FinTechs, or access cloud-based solutions (such as Amazon), IBM Watson, Google Cloud Platform and Microsoft Azure). Finally, those in charge should begin this process by identifying areas where artificial intelligence can be implemented to change business processes.

A strong change in human resources through artificial intelligence

The artificial intelligence will not completely replace the present – human – personnel, but it will greatly change the entire human resources. A different focus will bring unprecedented levels of collaboration between man and machine. Every disruptive technology also brings with it a wave of previously unknown jobs and tasks. As in the late 1980s, when the advent of computers cost thousands of jobs, we are once again facing a shift away from teams to more demanding jobs, such as tasks that require very good customer service. In addition, AI algorithms must be constantly reviewed by professional teams supported by more advanced AI technologies. In short, artificial intelligence technologies can be used to automate and industrialize the very intellectual tasks previously thought only of the human brain. That’s why they have the potential to completely revolutionize the financial services industry. All this is possible, no matter the difficulties, risks and unrealistic, short-lived expectations that each new technology brings with it.

Is GDP per capita the same as Income per capita?

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Is GDP per capita the same as Income per capita?
Answer : Is GDP per capita the same as average income. Answer is no. Gross domestic product measures how much every individual in the country has contributed towards production while per capita income measures the average income of every individual in the country.

Explanation :
GDP stands for Gross Domestic Product. It a measurement of a country’s overall economic activity. It helps to gauge the economic health of the country. Per Capita on the other hand means per person. Therefore, GDP per capita is the measure of a country’s economic output that accounts for the total number of people it has. It is achieved by dividing the country’s total GDP by the country’s total population in a particular year.

The income per capita measures the amount of money earned by each person in a certain region at a specified time. It is the average income per person for a country. It is achieved by dividing the country’s total income by its total population, it is used to measure the country’s standard of living. From these definitions, it is clear that there is a difference between GDP per capita and Income per capita. They, however, are measures of a country’s living standards and economic health.

GDP per capita helps compare the country’s success depends on its population size. A country with a higher GDP per capita can be said to be economically healthy. While a country may have a high Gross Domestic Product, it may not necessarily result in a higher Gross Domestic product per capita. Countries with very high population risk having a very poor Gross domestic product. China, for example, had a very high GDP in 2017 but its GDP per capita reduced significantly because of its high population. The higher the GDP of a country, the higher the country’s economic wealth of that country’s citizens. The income per capita is used to assess the country’s affordability including areas such as health and housing. It has been criticized as a way of measuring the quality of life in a country because it fails to account for inflation and it also includes everyone in the population even children and foreigners. It also does not account for non-monetary activities that its members may be involved in. The difference between the Gross National Income (GNI) and Gross Domestic Income is that, while GDP only considers income made from within the country, GNI is more comprehensive.

The formula for achieving gross domestic per capita and gross national income per capita is similar but difference in results exist.
The difference would only be noticeable if a country has a large number of its population working outside the country because it would then mean that the total population for its GDP and GNI duffer with a big number.

In conclusion, per capita income and Gross domestic income are very very similar because they measure the country’s standard of living. They, however, use different measures and measure other factors apart from the economic health of the country. Gross domestic product measures how much every individual in the country has contributed towards production while per capita income measures the average income of every individual in the country. All of this factors show the health of the country’s economy and should not be therefore different but the fact that one takes into account only the population in the country at that certain time while the other one takes into consideration incomes from outside the country brings about the small difference between the two.

Advantages and Disadvantages of Insider Trading

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Insider trading is something that is often talked about, but it is something that many do not fully understand or there is a concept of it, but no true comprehension of what it is and how it can occur. To learn more about insider trading, keep reading.

Insider Trading – What Is It?

Whenever a publicly traded company has stock that is sold by a person who may have any type of material information that concerns a particular stock that has not been released to the public at all, and it is then sold or bought, that is what insider trading is. This type of trading may be seen as being legal or illegal, however it all depends on whenever the trade has been made by the insider. It will be considered to be illegal whenever a stock is traded based on information which has not been released to the public or is considered non-public.

Definition from Wikipedia :

Insider trading is the trading of a public company’s stock or other securities (such as bonds or stock options) by individuals with access to nonpublic information about the company. In various countries, some kinds of trading based on insider information is illegal.

What is Material Information?

Any type of information that could impact the decision of an investor to purchase or sell a security will be considered to be material information. Any non-public information will be information that has not been legally released to the public about material information on a security.
A better understanding of what Insider trading is:

The SEC or United States Securities and Exchange Commission has defined insider trading to be seen as selling or purchasing a security, fiduciary duties are breached or other type of trust or confidence relationship, on a basis of non-public, material information about said security.
The overall question about the legality of insider trading is coming from the SEC attempting to keep the marketplace fair. Someone who happens to have access to non-public information will be seen as having an unfair advantage over any other investor who would not have similar access and that investor may end up making a much larger profit than any other fellow investors.

Whenever an investor begins to tip off other investors with any non-public information that they may have will be seen as being illegal insider trading. However, when a director of a company starts to sell or purchase shares, but this information has been disclosed about the transactions in a legal manner will be seen to be legal insider trading. However, the SEC does have a specific set of rules that are there to help protect any type of investment from any effects that may come insider trading.

Pros and cons of insider trading

There are no good things in insider trading – it is forbidden, not legal. Sometimes it is hard to proof illegal insider trading. Advantage of insider trading is profit (only benefits of insider trading) but here we will more discuss about disadvantages.

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Insider trading examples

1: MARTHA STEWART AND HIS CASE. In 2004, Martha steward, a famous television star and personnel, was convicted and charged with insider trading. It was reported that she received insider information about imclone systems company. She received that FDA had declined to review one of their developed drugs and that would incur a huge loss in future. In regards to that information, Martha sold a certain percentage of his shares to avoid the loss. Martha also lied that she had prior plans of selling the shares. This was later found to be a lie. She was convicted if two crimes. She was guilty of both insider trading and lying. The star was then sentenced for five years in prison.

Let we start from the beginning. It is not just a director of a company that could possibly be charged with insider trading. A very large and public case of insider trading happened in 2003 when Martha Stewart, a very popular household name has been charged securities fraud, obstruction of proceedings and this did include insider trading from the case of ImClone during 2001 by the SEC.

All of this happened when Martha Stewart sold around 4 thousand shares that she owned in ImClone Systems which was a biopharmaceutical company. Stewart had received information from a Merrill Lynch broker, Peter Bacanovic. Bacanovic had received a tip after the CEO of ImClone Systems, Samuel Waksal had sold all of the shares that he owned for that company. This had happened during the time when ImClone had been waiting to be approved for a new cancer treatment called Erbitux by the FDA.

However, after the stocks had been sold, Erbitux was rejected for approval by the FDA which had caused the shares to drop over 15% in a single day. Due to Martha Stewart selling these shares, it kept a loss of over $45,600 from happening. Yet, because this sale had been made using information that had been received from Bacanovic who had learned this information from Waksal when the shares of ImClone was sold, it had been considered to be non-public information.
Martha Stewart went to trial in 2004 and had been charged with crimes of conspiracy, providing the federal investigators with false statements, and obstruction of justice which caused Stewart to spend only 5 months within a federal prison.

2: MARK CUBAN AND HIS CASE. Mark Cuban, a famous entrepreneur and owner of Dallas mavericks, was accused and charged with insider trading from the mama.com stock. It was reported that Cuban got confidential information from the CEO of mama.com stock of a predicted loss. He then sold his shares early before the information was released to the public. This was a selfish act that made him avoided a loss of estimated 750 thousand dollars. This brought conflict between Cuban, exchange commission and securities,who reported a case against him in the year 2004.

3: CHRIS COLLINS AND HIS CASE. Chris Collins, a major shareholder of innate immunotherapeutic biotechnology company, was accused and charged with inside trading in August 2018. It was reported that Chris leaked internal information to his father in law. The information was about the negative test trial of sclerosis drugs that were made by the company. The drugs were mebt to cure his son. Prior to release of this information to the public, the two men sold their shares to avoid huge million dollars potential loss.

4: PHIL MICKELSON AND HIS CASE. Phil Mickelson, a professional golfer, was charged with insider trading in may 2016. It was reported that phil made stock trade with the dean food daily company, after he received insider tips making huge profits. However, there were no enough evidence against his accusations. He was then ordered a fine of giving up a certain percentage of his trading interest and profit.

5: GEORGE SOROS AND HIS CASE. In 2002, George was charged with insider trading and was convicted in Paris court, leaving him a fine of more than two million dollars. It was reported that George Soros acquired confidential information about a corporate raid In Societe Generate bank. He then sold sold his shares to avoid loss, prior to release of that information to the public.

6: JEFF SKILLING AND HIS CASE. Jeff Skilling is a former CEO of the great Enron company. It was reported that Jeff illegally sold his huge shares from the company few months after he resigned as the CEO of that company in August 2001. This action left the company in bankruptcy. He then lied lied to the investors the reasons behind huge financial losses and bankruptcy in the company. He was charged and convicted in court for lies and insider trading.

7: JOSEPH NACCHIO AND HIS CASE. In the year 2005, the government accused and convicted Joseph Nacchio, the former chief of Q west telecom company, for insider trading. Why? It was reported that he gave false information to wall street about the growth the growth of this company. He took advantage of the company’s low moment and challenges, and dumped his stocks in the market making huge profit. This left the company at a huge loss of more than three billion dollars. In April 2007, Joseph was sentenced for six months in prison.

8: BILLY WALTERS AND HIS CASE. Billy Walters, a famous US gambler, has been charged with several cases of insider trading that has selfishly earned him huge profits. Billy Walters acquired insider information from Thomas Davis the former chairman of dean food company. He later bought stocks from this company to grab the opportunity of earning huge profit. The insider trader was then convicted and sentenced for five years in prison.

9: RAS RAJARATNAM AND HIS CASE. Ras is a famous famous business man and founder of galleon group of investors. He was accused and charged with insider insider trading which led to closure of his firm. It was reported that raj collaborated with castle hedge fund managers to acquire insider information about the firm. He later made stock market in that firm which made him huge profit. Raj was also involved in other scandalous activities with firms like google, Goldman Sachs and several other investors.

10: LEAN COOPERMAN AND HIS CASE. Lean cooperman, 73 year old CEO and founder of Omega advisors, was accused and convicted with insider trading in the year 2010. He allegedly collaborated with Atlas pipeline partners to acquire insider informal and traded stock securities in his favor.

11. The case of Amazon and Insider Trading
Brett Kennedy, a former financial analyst for Amazon.com Inc. or AMZN had been charged with being an insider trader during September of 2017. It was reported that Kennedy had provided Maziar Rezakhani, who was a fellow alumnus from University of Washington, with information for the first quarter of 2015 earnings before they had ever been released to the public. What made it illegal was that Rezakhani had given Kennedy $10,000 USD for this non-public information. It was because of the information that was provided by Kennedy that allowed Rezakhani to make over $115,000 in trading the owned shares of Amazon.

Legal Forms of Insider Trading

When insider trading starts to be used, this term is often in a negative manner. However, there is often insider trading happening legally in the stock exchange every single week. Although, this can only be done because of the requirements provided by the SEC that states that all transactions been electronically submitted in a specific time frame. All of the electronically submitted transactions go directly to SEC while this information is being disclosed on any website of the company as well.

One of the first steps in providing legal disclosure of company stock transactions was caused by the Securities Exchange Act of 1934. All major owners and directors are required to disclose transactions, stakes as well as any changes of ownership. There are specific forms that are used in order to show this information to the SEC. Form 3 will be used as the initial filing which shows stakes in a company. The next form that has to be completed is Form 4, which will be used in order to disclose any transaction of the company stock in a total of two days after the sale or purchase. The last form is Form 5, which will be used in order to declare any early transactions or for the transactions that are considered to be deferred.
Insider trading can be a concept that may be hard to comprehend at certain points, but the main takeaway points are as follows:
Based on information from the SEC, legal insider trading is possible as long as it can conform to all rules that have been made by the SEC.

Insider training is seen to be the sale or purchase of stocks a company that is considered to be publicly traded by a person who may have access to material information that is non-public or has not been released to the public about that particular stock.
Material information is seen to be the information that may impact a decision by an investor on purchasing or selling securities. Non-public information will be material information that has not been provided to the public legally.

Conclusion

There have been several scandalous cases of insider trading over the last years in different countries. The word insider trading has some negativity. I mean, it is perceived as an illegal and fraud kind of businesses, practiced all over the world. However, the rules and regulations governing this kind of trade are different and vary from one country to another. Far from expectations, insider trading can be legal. This is shocking, right? But yes! It is conditionally allowed in some countries. It is allowed depending on the time of trade. It is also allowed when corporate insiders trade public securities but report the matter to exchange commission or securities for public disclosure. What is insider trading? This is the buying and selling of public securities or stocks by selfish individuals in bleach of trust or confidence. They take advantage of power or while in possession of secret or non public information about the securities. More often than not, insider trading is termed illegal and unfair to the rest of the traders who cannot access first hand information. This is because each and every share holder has equal rights in an investment.