Plus500 is the leading forex platform and offers both Bitcoin and Litecoin CFD trading. If you are new to CFD and confused about how to Sell (Go Short) or Buy (Go Long) coins then check the following post for basic details to get start. First of all check our previous post to Learn The Basics Of Bitcoin Trading : CFD Guide.
Bitcoins are a form of digital currency free from regulation. It’s free from the influence of Government or any other infrastructure. But these liberated form of currency faces a number of problems in terms of trading:
- Lack of liquidity causes the value to rise up or crash down without any warning.
- Companies that provide this service such as MtGox don’t have a verified method.
- There is no verified payment methods with this companies.
- Fraud scheme offering to trade bitcoin by setting up a fake industry is an open case now-a-days.
But there are some firms starting to offer Bitcoin as one of the trade currency. Trading Bitcoins using one of these brokers, is much enjoyable as they offer many benefits to the currency trading clients. Following is a step by step guide to trade Bitcoin, Litecoin on Plus500 trading engine.
Step 1 – Sign up for an account with Plus500
Plus500 is a Contract For Difference (CFD) trade engine that is approved and regulated by the Financial Conduct Authority and included on the London Stock Exchange. In today’s financial regulations this standard is like gold. It’s one of the most heavily used trading engine that offers CFDs on Bitcoin.
To get an account, register your account on official website (click here) and then click on the “Start Trading” link to register for an account, in next windows either choose to download trading software or . You can also direct download their trading software (Download Here)
Step 2 – Verify your account
Plus500 will send a verification link to your email address. Open your mail and click this link to verify your email address.
Then verify your phone number to get a £20 bonus. The link for this will be at the top right corner of the Web Trader screen, below your email address. When you click this, you will be asked for your name, address and phone number and a few questions about your experience trading different financial instruments.
After this, you be asked for a phone number to verify. If you enter a mobile number, you’ll be sent a verification number by text message. If it’s a landline, the computer will phone you and tell you the number. Enter this code in box, and your account will immediately be credited £20 that you can use for trading.
Step 3 – Fund your account and get promotional bonus
You will have to some amount of money before start trading Bitcoins with your account and you will get a £20 bonus. There is a link at the top right of the Web Trader screen to add some funds and get a bonus at the same time. A welcome bonus of up to £6000 is offered depending on starting deposit. Plus500 is also offering a limited time promotional bonus of first deposits on new accounts. You can enjoy the bonus by doing following steps.
- Login to your Plus500 trading software you downloaded earlier, if you haven’t download then Click Here to download and click on ‘New user’ and fill out the registration details.
- Look at bottom left corner and if you are in Demo mode then click on ‘Trade for Real’
- Click on ‘Funds Management’ in the lower left hand corner
- Select a deposit method
- Enter the bonus code (from the table below) in the deposit field
- The bonus amount will be added to your account once you have traded the required number of trader points
Plus500 will accept Credit cards, debit cards, PayPal, Skrill and Wire Transfers, so there are lots of options in terms of funding your account. Please remember, your capital may be at risk. Never trade with money you cannot afford to lose.
Step 4 – Place a trade
To place a trade, launch the Plus500 trading software you downloaded in Step 1. Once your desktop client or web trader is running, Click on Virtual under the Forex tab in left windows pane. The list of instruments in the right top pane will change and you can click on “Bitcoin / USD” or “Litecoin / USD” to update the chart with the Bitcoin / Litecoin price action.
If you think price will go down, place your bet on falling price and Click on the “Short” button to enter the details of your trade. If you think price will go upwards, click on “Buy” button and enter the details of your trade. For example have a look at following image where i placed a buy order with following details.
Here i placed 50 Litecoin buy order when current price was $17.14, i also put a stop profit @ $18.18 and stop loss @ 14.58, now if Litecoin price crosses $18.18 level i’ll get € 37.99 in profit, just in case market react opposite and price go downwards my stop loss will be active and cancels my order @ $14.58 with a total loss of € 94.
You may also noticed that i placed 50 Litecoin buy order totalling a value of $857 with a required securities of $171, in easy words i placed a $850 order while $170 in my account, this is possible due to leverage. Leverage is one of the best feature of CFDs, for example 1:5 leverage means for every dollar you deposited can be traded 5 times more in Bitcoin / Litecoin value. In easy words if you deposited 100$ you can trade up to 500$ in coins. Needles to mention, leverage can multiply your profits 5 times so does your losses.
Note : The number of Bitcoins have to be specified to target your profit and to stop loss points. Just keep in mind that this is only a CFD, not actual Bitcoin and Litecoin. One of the key benefits of using the Plus500 platform over buying Bitcoins in the market is that you can prevent the loss and target your profit. Any potential loss can be prevented using this trade engine
Benefits of using Plus500
- Fast and easy.
- Brokers regulated by government.
- Trades evaluated on margin.
- Leverage is used in Trades.
- No risk of positions loosing.
- UK government guarantees up to £50,000 deposit.
- Complete customer care and technical support.
- Risk of fraudulent transactions is minimum.
Disadvantages of Plus500
Please note that by trading CFDs customers can lose all the funds deposited. Please be aware of the risks involved. Plus500 is suitable for experienced traders and not for beginners.