This trading FAQ for beginners gathers the questions that come up again and again, in the order most people ask them. Each answer is short on purpose. Where there is more to say, the answer links to the full long read, and the glossary explains any term you have not met before.
One answer matters more than the rest: DravoTrader is a reading site. We cannot open an account for you, look at your trades or tell you what to buy.
If your question is about a specific firm, app or person who has contacted you, the most useful place to start is not an FAQ but a checklist: our ten broker checks and the scam guide. If it is about the maths of a trade, the pip, position size and margin calculators show their working.
Readers also ask
Is DravoTrader a broker or exchange?
No. Despite the name, DravoTrader is an independent information site. We do not offer accounts, trading, deposits, withdrawals, signals or investment management, and we never contact readers about investments. Anyone claiming otherwise in our name is an impersonator.
What is forex trading, in one paragraph?
Forex trading is speculating on the exchange rate between two currencies, such as the euro and the US dollar. Retail traders usually do it through a broker using leveraged contracts, so small rate changes produce large gains or losses relative to the deposit. The forex guide covers the details.
How much can I lose trading with leverage?
At least your whole margin, and quickly. Retail clients in the UK and EU have negative balance protection, which stops losses exceeding the account balance, but firms outside those rules may not offer it. The margin calculator shows how much a position ties up.
Why is gold usually offered alongside forex?
Spot gold is quoted against the US dollar as XAU/USD and trades almost around the clock on weekdays, so brokers present it much like a currency pair. It is commonly traded in lots of 100 ounces and, for UK and EU retail clients, capped at 20:1 leverage.
Is buying shares safer than trading forex?
Buying shares outright without borrowing limits your loss to the money invested, while leveraged forex can lose a deposit much faster. But a single company can still fall sharply, so spreading money across many holdings reduces the risk of one failure.
Is crypto a good first investment?
We do not give personal recommendations. Crypto prices are very volatile, protections are weaker than for regulated investments, and the asset is heavily used in fraud. Read how crypto works before putting in any money you could not afford to lose.
What is USDT and why is everyone asking me to buy it?
USDT is a stablecoin meant to be worth one US dollar. It is widely used to move money between crypto platforms, which is also why fraudsters often ask victims to buy it and send it to a platform they control.
How do I know if a trading platform is legitimate?
Search your national regulator's register yourself, check the firm's website and phone number match the register entry, confirm which company would hold your money, and test a small withdrawal before sending more. The broker checklist sets out ten checks.
Someone online is teaching me to trade and showing big profits. Should I worry?
Yes. Unsolicited contact, a platform chosen for you and steady profits are the three core ingredients of the most common investment fraud. Stop sending money and read the scam guide before doing anything else.
What do the calculators on this site do?
They show the maths behind a trade: the value of a pip, a position size based on your risk, the margin a leveraged position needs and the profit or loss on a crypto round trip. They run in your browser and store nothing.