Finding opportunity in a time of volatility

A derivatives broker with crypto expertise is catering to smart traders who see the bright side of market adversity.

The bursting of the cryptocurrency bubble highlights the stark reality that no bull market will last forever, with stories of overnight riches replaced with hard-luck tales of investors losing large sums of ‘real’ money in the digital void.

The boom in ‘crypto’ assets coincided with the boom in traditional equities, bonds and commodities, which thrived on the seemingly endless pandemic-era bullish sentiment.

Eightcap director of operations Marcus Fetherston describes a new high-volatility “purgatory” environment where the old investment rules no longer apply.

“This really is a new era of trading,” he says. “It’s not a clear-cut recession or a clearcut bear market and so the rule book goes out the window.”

Founded in 2009, Eightcap is one of Australia’s leading derivatives brokers.

“We have seen a new demographic of smart traders stepping in to spot the opportunities amid the increased volatility,” Fetherston says.

“They aren’t only looking for products, but extra features that will enhance their trading.”

Periods of market adversity also create opportunities – and cryptos are no different. For example, the bitcoin price is showing signs of recovering after recent sharp falls and this is attracting traders who want to make use of the elevated volatility.

Fetherston says a new breed of smart traders is demanding additional tools, as well as better pricing and expert-led education.

“These factors are top of the list when a trader is hunting for a broker,” he says. “A simple buy trade won’t cut it any more, as clients want to trade both sides to take advantage of the volatility.”

After rolling out more than 300 crypto derivatives last year, Eightcap has stepped up its game in terms of providing cuttingedge tools for crypto traders. One example is exclusive indicators to ensure they don’t miss significant price movements and can act quickly.

Eightcap recently integrated with TradingView, a charting and trading platform that has more than 30 million monthly users. This tool allows Eightcap clients to trade directly off the charts, join a community of crypto enthusiasts and access its renowned charting tools.

The broker also gives clients access to Capitalise.ai, a tool that allows traders with zero technical knowledge to automate their trades.

“We cater to both new and experienced traders, and are committed to inspiring and exciting them,” Fetherston says. “We ensure that they have access to industry-leading tools and expert-led education so that they are fully equipped to trade derivatives.”

Eightcap also offers many thematic crypto assets, such as the top decentralised finance (DeFi) assets, as measured by market capitalisation.

“It’s not just about the trade, it’s about where and how you place it,” Fetherston says. “Currently, the cost of trading a bitcoin contract with Eightcap is $8-$12 per trade, depending on the prevailing market conditions.

“This is on average 500 per cent cheaper than other CFD [contracts for difference] providers and 1000 per cent cheaper than mainstream crypto exchange derivatives trading. With the current volatility, value trading is all the more important and traders are definitely taking this into account.”

Fetherston says he won’t sugar-coat the reality that as with any leveraged trading, CFDs entail inherent risk.

“However with high risk there are many opportunities for traders to take advantage of these products in their trading.”