:What Is The Difference Between Forex and Futures?

1. A Forex trader could trade more transaction compared to the futures market (the trading volume could be a times larger), and the risk will be strictly under control. The trading volume of the Forex market is 46 times larger compared to the futures market, moreover Forex traders could make more profit from the Forex market due to the larger trading volume (the transaction volume is a few times larger), the REFCO Switzerland rich transaction platform allowed transaction between 1-100 times to be carry on, moreover a Forex trader could decide his or her own transaction amount, for example: Your account has $30,000, the basic transaction unit is each $1,000 (which transaction amount in $1.00, million), namely, so the proportion of the margin of each transaction unit is 100:1.
   
   
2. The risk of the Forex trader is under control, such margin call will not happen compared to futures, through the Forex trading system, your risk will receive the strict limit, even if your margin if lower then the deposit required, the Forex trading system will automatically settle your position, this means even if a Forex trader suffered losses, moreover if the market is suffering from a disaster fluctuation, your loss could not surpass your account amount. In order to understand the advantages, please apply for the demo account to carry on the complete zero risk.
   
   
3. A Forex trader will receive a large limitation of liquidation and a relatively fair market because the trading volume of the Forex market is large and it is also the largest liquidation market in the world. At present the trading volume in the Forex market is 140 billion Dollars, such big market will completely digest your transaction cash.
   
   
4. A Forex trader may do 24 hours transactions and other markets are different, the Forex market is a 24 hour linkages market, it starts from every Sunday before dawn Australian Sydney market, substandard collect the transaction center Singapore, Tokyo, London, Frankfurt to New York continuously to open, such linkage market enable you to do 24 hours transactions, also provide flexibility for Forex trader to do transaction.

7 Golden Rules Of Successful Forex Trading

If you want to be a successful Forex trader I highly recommend that you read this article to the end and apply the 7 Golden rules of successful Forex trading:

1. Never trade without a system - Many traders play by hunches. This means they're not really traders. They're gamblers. If you turn Forex into a casino, you will lose your shirt in the long run. Never trade without a system, it's the only way to generate long term Forex profits.

2. Never trade without an exit strategy - You should always know how you will get out of the trade before you enter into it. This way, you don't have to monitor the market constantly because you know how much you can profit, and you don't risk too much because you have a Stop Loss in place.

3. Don't trade with a high leverage - You can be a profitable Forex trader without going overboard with leverages. Remember, using high leverages also places you in considerable risk. Don't go over a 1:10 leverage.

4. Choose your broker carefully - You need to trade through a Forex broker which is reliable, easy to use, simple to operate, and which gives you low spreads.

5. Don't fall in love with Forex robots - Using automatic Forex robots is something which a lot of traders do and you can do it too. However, always work on your manual trading as well so you're not dependant on just one tool or program.

6. Make time for Forex on a regular basis - You don't have to trade each and every day but make Forex a part of your routine so that it becomes more like a business and less like a hobby.

7. Always learn more - The market is always changing so you need to continue investing in good Forex trading education to remain on top of the game.

There's a lot of money in Forex trading. Follow the above rules and you will be successful.

To get Free Forex trading tips .

John Drummond works from home. He writes often on business, trading, and finances. There is more than one forex trading software. To read John Drummond's review of the 3 best ones, click here: Automatic Forex Trading Software Review.

:: Forex Charts

Forex charts assist the investor by providing a visual representation of exchange rate fluctuations. Many variables affect currency exchange rates, such as interest rates, bank policies, geopolitics, and even the time of day may affect exchange rates.

In order to help the investor attempt to predict when or in what direction a rate may change, advisors provide forex charts. Quality forex websites provide subscribers with a daily newsletter that includes a forex chart, forex signals and a forex forecast.

There are a variety of forex charts available for the investor to use and study. Some are very simple using only a couple of forex signals or indicators and are ideal for beginners. Others include 30 or 40 forex signals or indicators and live on-line streaming data so that the investor may analyze trades quickly and accurately.

In order to make an accurate forex forecast, it would seem that the more indicators, the better, but some analysts prefer a simpler system.

The idea behind studying forex charts is that history repeats itself. Instead of trying to “see the future”, a forex forecast evaluates the past. That is to say that the analyst who is responsible for attempting to predict future currency moves analyzes what happened to an exchange rate yesterday, last week, last month or last year and uses this knowledge to the best degree he knows how.

Some people trade short term, some intermediate term, and some long term. All three types of traders may benefit from the use of forex charts, just adapted to their own trading time frame.

Investors also create their own forex charts to evaluate their own performance. Creating a forex strategy for oneself is the goal of many investors. Instead of looking to a professional to analyze forex signals, these investors choose to create their own forex forecast.

Others, however, create their own strategy but also follow the opinions of professional currency traders at the same time. It all depends on your personal preferences.

There are other forex charts that deal with known correlations between two currency pairs, that is, how they move in relation to each other. Some exchange rates are known to affect other exchange rates, either by moving in the same or the opposite direction depending on the correlation.

Charts are available that explain these correlations in detail and show which pairs have strong correlations or strong negative correlations, so that an investor can use the movement of the exchange rate of one currency as a signal to trade another currency. These correlations are also the basis for some forex forecasts.

It can be difficult and overwhelming to enter the world of forex trading alone. Experts recommend education, practice with a demo account and advice from a reputable broker who is backed by a quality institution. Learning to read forex charts and evaluate forex signals is a skill that comes with time, skills that are essential when an accurate forex forecast is the the goal.

Managed Forex Accounts

Managed Forex Accounts

Discover the returns possible in the world's largest financial market,ithe off-exchange foreign currency market (Forex). Forex is where banks, corporations, and whole countries make investments. It is just over the past few years that private investors, such as yourself, have been getting more involved with these opportunities. A managed Forex account gives an investor who cannot watch the market 24 hours a day the chance to participate in the world's largest market - Forex. These accounts are an ideal consideration for those who prefer to have their capital managed by professionals. Studies of professionally managed Forex accounts have often shown high returns not related to the performance of the stock market. Consequently, allocating a portion of an investment portfolio to a Forex managed account can be a great way to enhance the overall performance of your portfolio, independently of what the stock markets are doing very slow.

How to win the Forex Battle

How to win the Forex Battle

Every trading activity is in fact participating in a battle. Winning the battle is a matter of knowledge, skill and experience. If you miss any of those you are going to join the long line of losers. Some says that 95 to 99 percent of the traders are lining up on the loser’s side.How to win the battle in the currency market? It is easy to answer that question, based on the above approach – prepare yourself for the battle. If you treat currency market activity as a hobby you’ll ultimately lose all investments there. If you treat it as a business you still may loose everything.The correct approach is: consider each pressing of the Buy/Sell button as entering a battlefield. If you enter it without having a knowledge, skill and experience on how to win, you are destined to fail. You may have some lucky trades in the beginning, though. That, by the way, is the worst case scenario for the rookie in trading.The earlier you get your “bad” lessons, the better for your overall experience. No mater how good you consider yourself prepared, after demo trading lessons, you have no idea of the forces ruling on the real market.In fact the worst enemy you are going to face in the very beginning is not hiding behind the walls of the global currency trading centers. Your most dangerous foe is hiding deep inside of you. That enemy is so powerful that you will be amazed how quickly it will wash away all your carefully considered decision.No one has been able to evade the force of that destructive power. No one can understand or realize that force unless it has been confronted face to face. Start trading with real money and you will face it too. Fear, Greed or Hope are some of the names of that power.Fear forces you to sell near the bottom and buy near the top. Greed forces you to get out of the market prematurely. Hope will keep in the trade until you loose everything. Fear may save you but hope may wreck you completely. Greed will never make you rich.It is easy to give advice to trade without emotions and use the logic, only. How you can achieve that if you never have been there. You need to go through that turmoil, pick up your loses due to your emotional decisions and than analyze.Study all your “bad” trades, because they are the most precious gifts on the way to proficiency in trading. Growing as an experienced trader is possible only after getting your losses in the beginning. Then sit down and carefully study the lessons they brought to you.One thing traders never want to do is to admit of being wrong. The market is a constantly changing and it demands flexibility in taking decision. That implies monitoring and constantly adjusting, changing your decision and action. When your logical analyzes suggest that you are wrong – get out, quickly.Once you overcome the emotions, concentrate on developing your signature way of trading. You can start with following different advisors and system and picking from them the things you like. Demo trade and test your ideas until you find the trade system which is matching completely your personality.Now, you have to go back to emotion in a controlled way. Every time your system suggests a trade look inside you and see how you feel about this trade. You feel bad – discard it. If you feel good – keep it.Here comes the final step: Looking for the final approval sign before submitting the trade. Here is the time, where the mastership shows up. Your weapon is loaded, the target is clearly seen on the visor and the finger is on the trigger. You have to make that final exhale, get the target over the cross point and shoot it.How much knowledge, skill, experience and patience you need to build within in order to reach that very final stage of trading proficiency? Only you’ll know that and only you can do it. The rest is just numbers in your bank account.Building a fortune by trading currency is not a mirage in the desert of live. There are hundreds of traders who are making living of that business and you can do it too. Study all you can find on the net and follow the steps of the best if you want to win that battle.

The Ideal Forex Trading Plan

The Ideal Forex Trading Plan

When entering the foreign currency exchange market known as Forex, an investor should have a plan. Forex is the oldest, safest and most lucrative investment market in the world.The Forex Investor is in control of his portfolio at all times. There are few fees in Forex Trading and there is no threat of insider trading.In order to be successful in Forex Trading, an investor will begin by educating himself on the many variables that are inherent to Forex. He should enroll in a reputable course in Forex online and familiarize himself with the currency market by setting up a demo account on one of the many online sites. A demo account does not require any capital, but it does train an investor in how to approach Forex trading.A Forex investor must learn to maximize his profits and minimize his losses. He can do that by learning to analyze corporate and governmental press releases and economic forecasts. An investor must seek out and incorporate sound investment strategies and learn how to read charts and graphs pertaining to the currency trade.Forex trading has the highest volatility in the investment market, and it is tempting to just jump into the trading and make decisions based on the spikes and dips in currency values, but a successful Forex trader knows that he must never buy or sell using his emotions as leverage. He never trades out of fear or greed.To be successful in Forex, a trader should stick to a strategic plan that adheres to what was successful in past trading and what makes sense according to reputable strategists.

FOREX Trading Fundamentals

FOREX Trading Fundamentals

Online FOREX trading is a huge business

The Foreign Exchange Market – better known as FOREX - is a world wide market for buying and selling currencies. It handles a huge volume of transactions 24 hours a day, 5 days a week. Daily exchanges are worth approximately $1.5 trillion (US dollars). In comparison, the United States Treasury Bond market averages $300 billion a day and American stock markets exchange about $100 billion a day.

Forex Online Trading System Overview

Forex Online Trading System Overview

What with the financial meltdown and the vagaries of the financial market, it is no surprise that the generation of today is trying to make as much money as it can, to save for the not-so-good days. The global financial scenario is throwing even established firms to the ground, so we know what the state of the common man is. One of the ways that is gaining popularity of late as one easy way of making money from the comfort of our homes, is forex trading. Since this depends on the world wide financial market and the individual economy of the nations, where their currencies undergo inflation or deflation, this is beginning to gather mass now. Forex trading is nothing but taking advantage of the differences in the currencies of different foreign money and making maximum advantage in the bargain. If you own a computer with an internet connection you can open a live forex account and participate in forex trading. Forex trading is a business of selling and buying foreign currency and making profit out of it.

However, many people don’t realize the risk involved in the forex trading. It is an astonishing fact that more than seventy percent of them lose large money which is more than they can afford to. The only way to face such a consequence is to undergo some forex courses before jumping into the pond. These courses can guide you on what to and what not to invest. You can easily learn on how to make good money from forex trading. They can also teach you about how actually forex operates and those loops involved in the trading strategies. It is a known fact that the trading window is open almost all the time and online trading can be done which paves way for you to earn from home. Forex trading is the all time craze among the people and the intensity of the market can be felt all the time. It is necessary to shine among those who trade and that could be possible through forex courses. They make experts out of individuals in forex trading and thereby leading to a direct increase in the inflow of money!

Another interesting ploy to lose less of one’s money in the forex trade during the initial stages is to take up forex trading as a personal desire and not as financial dependability. Basically the requirement would be to look at forex trading initially as just a source of additional income and when you become more well versed on the plot, you can make a high jump start into the forex trading market full time. The markets nowadays are ever stable and it requires deep analysis and pure expertise to decide on the investing factors in the current trading. Recent meltdown has made the investors cautious enough to hold their hands on the dangers spots of the market. It is always advisable to learn advice from experienced person, particularly at these situations when you are a novice.

Foreign exchange or Forex as it is commonly called is the art of dealing with currencies of different countries. The Forex market is the most liquid market in the world and it is supposed to be three times bigger than the New York Stock Exchange.

Trading in Forex can be one of the most simple yet most intelligent activities that a trader can do. One has to be really cautious while trading in Forex. Though the returns are huge, the effort and risk to be taken are equally huge. Forex trading is nothing but taking advantage of currency rate differences. This is the most beneficial aspect of a Forex market. Millions and millions of dollars are traded every day in the Forex market, with currencies like Pound Sterling and Indian Rupees. Lots of traders have been earning profit by diligently trading in the Forex market.

Forex trading is mainly about purchasing a quantity of one currency by paying in another currency. In this way, the trader can get more value for his goods and also make a reasonable profit on his trade. Suppose a trader wants to trade his INR for USD, then before entering into the intricacies of the Forex trade the basic concept to be understood are the base currency and the quote currency. In this scenario, the base currency is INR and the quote currency is USD.

The example explained here is one that is happening over a week. For example, on a Monday I USD equals 45 INR. The trader would want to purchase a few USD. He pays 450 INR and buys 10 USD. He keeps following the Forex market daily to watch if INR has depreciated further. On a Wednesday 1 USD equals 48 INR. This is the case where the INR has depreciated in value and where, for the same one dollar, one has to shell out more INR. This case is profitable to the trader explained in the example, though it is bad for the Indian economy as a whole. Hence on a Wednesday, the trader walks up to the Forex market and sells the 10 USD that he had purchased on a Monday. Though he had spent only 450 INR for purchasing, he now gets 480 INR while selling his 10 USD. This is a very small example of the scenario happening in the Forex market. Hence within two days, a trader can convert his belonging to cash and get a good deal in his transaction. Similarly, there are millions of traders, trading in millions of dollars of currencies of various nations and making a huge profit out of this. Forex is the easiest way of converting one’s trade into cash and hence it is undoubtedly one of the most liquid markets in the world. Liquidity is a term used to refer the process of converting net worth into cash and it symbolizes the Forex Market so perfectly. The Forex Market has lots of businessmen, international banks, huge MNCs etc as its core members.

Forex trading is one such activity that is slowly catching up heat. Forex trade or currency trade is gaining popularity among many today. This is nothing but buying and selling of foreign currency. This trading is done online with just a computer with an internet connection and a current forex account. This trading involves risk as well as the statistics say that every seventy out of hundred people lose their investments badly and money does not come to us free of cost! The bad financial times that the world is currently seeing only adds to fuel to the fire of loss and hence extreme caution has to be exhibited while trading in forex.

It is imperative for the individuals planning to engage in forex trade to go all out to learn what it takes to make their venture a success. It has to be put down in black and white that among the best ways to avoid loss in forex, wise option is to opt for a forex course that could help you learn in and out of the practice. They teach you on how forex is carried on and what the better options are to choose from at critical times. The knowledge added by these courses will definitely help you gather several questions about forex in the quest to learn more. It is mandatory that you know about any business you are planning to take up and forex is one form of business that could be expertise through forex learning courses.

Forex trading community is one huge place one could of in terms of churning some good money. As a whole, the value of transactions per day could end up in jaw dropping astonishment. This could be a positive factor but it must also be understood that the competition is too high on the same grounds. The victor in this field demands a proper structure study of the market. That is offered by valuable online courses. The general paired methodology used in forex trading can be bought or sold in the market. These tactics of buying and selling can be learnt from the courses that are also offered online at your personal computer. There has been a revolution after the online trading system was established. Especially to the forex trading, people could trade from any corner of the world with just a personal computer and a good internet connection. When it has become too easy to earn money, intense care and responsibility is needed to overcome the various traps available hold us

How to Make Money With Forex Trading

How to Make Money With Forex Trading

Most of us are willing to make money online and don't relay hoe to it.so one of the best way is to use Forex because it is a great way to make quick money online.so to start work with forex you just have to know the basic skills for trading and then you will be able to start to make money at your home.so if you have this skill be ready to start to make your profit.

So what do we need to start to make money,for start we need a few guide line,for means,you have to start buying or selling in to make profit.so you must have to know that the currencies are sold in pairs, such as, EUR/USD. so you must have to learn and practice how to trade before you have your own account.

Start to learn all the forex terms that used at the forex trading, you can learn it ebook that you can read it online.Once you get comfortable with trading. Open a live account, you can open an account with as little amount.

Forex Investment

Forex Investment

Everyone can benefit from the great interests made in the Forex market, investment plans with interests starting from 10% MONTHLY are todays reality!

Everyone around the globe can invest, the new financial market offers great opportunities, and nowadays it is accessible to everyone who wants to be part of it.

The end of the monopoly of the banking entities in the Forex Market allowed that it is possible to invest directly in this impressive market. The Foreign Exchange or Forex Market is now more accessible to the public.You can earn interest rates previously enjoyed only by major financial institutions.

How is it possible to have high rates of returns on a monthly basis?

That is the strength of the Forex market. With nearly 2 trillion USD being traded each day, a 10% return each month is conservative, as long as you work with experienced market research analysts, invest through a solid Forex foreign exchange broker, and invest enough capital to allow for diversification.

FOREX Strategy

FOREX Strategy

Here are a few things you should learn about Forex trading if you want to make some real money.

Follow Trends. No matter how many factors you take into account, it still comes down to a degree of guesswork. There is a great deal of money to be made from simply following already existing, reliable trends than jumping in and out as it reverses.

Have a Trading Plan. Your plan doesn't have to be very precise. You have to set some limits for yourself. It takes a great deal of discipline to be a successful FOREX trader. Frequently you'll feel your emotions start to play into and affect your decisions, but you've got to do what's ultimately best, think rationally and sell when you need to sell.

Employ a Trading Program. FOREX trading programs are slowly becoming the new standard of trading, with over 30% of all traders currently using them now in 2009. These are programs which automatically trade for you by analyzing real time market data and reacting accordingly. They are equally as effective for beginners as well as experienced traderss.

Trading Psychology

Trading Psychology

There are some simple principles that are essential keys to unlocking the door toward becoming a millionaire, or at least gaining a little more than losing.

Have a Plan. Many traders do not realize that trading is more complex than it seems. It should not be driven by merely a hunch. A good trader is always ready with a realistic plan.

Cut your losses at an early stage and bó loyal to your profit earners. Some traders want to believe that their losses might still do well after a good waiting time. Do not be caught in the belief that every trade should be profitable.

Play Smart. Don’t let your emotions rule in trading. Always be objective with your decisions. While in the market, do not hope that it will move in a favorable direction just for you.

Do not overtrade. This is one of the most common mistakes traders make. Leveraging your account too high by trading far larger than before puts you in a very vulnerable position.One good tip is to limit your leverage at 10%; in this way, you won’t be forced to exit a position at a wrong time, before you even get a win.

Managed Forex Account

Many people are drawn to the forex market due to high liquidity, 24 hour trading, low startup costs, and a number of other attractive reasons. However, some traders are unable to sufficiently learn or trade currency due to a conflicting full time job or other obligation. Also, many investors like to supplement their existing portfolio without having to learn a completely new market. This is where the "managed forex account" comes in. A managed forex account is an established live forex account funded by the investor, and traded by a company or professional. This allows the investor a reasonable rate of return on an account he does not necessarily have to trade himself, and the opportunity to be a part of the largest market in the world.

There are literally hundreds of companies and investment firms that make use of an investor's money by establishing a managed forex account. Some of these companies and firms specialize in managed forex accounts, and spend all of their time and effort strictly in the currency exchange. This gives the investor confidence their managed forex account is being traded by a professional currency investor, and gives them a better chance of a steady monthly (or yearly) percentage of return. The returns on a managed forex account have been advertised anywhere from 5% to 20%+ monthly, with a 10% to 40% of the profit as a monthly (or yearly) fee to the company or firm. Alternatively, many companies and professionals may take management fees on the managed forex account even if the account is not in profit for the month. There are obviously many up sides to a managed forex account. The investor is able to achieve a steady rate of growth without having to spend all the necessary time and effort to trade the money himself. The investing firm or company that provides the managed forex account will take a small portion of the profit for the month or year, still assuring that the account is at steady growth. The forex market is a very liquid market as well, giving the investor a much more flexible means of withdrawing funds from the managed forex account. Also, trading currency allows profit potential in both rising and falling markets, giving the experienced money manager more opportunities to grow the investor's account. Two of the major types of managed forex accounts are those traded manually, and those traded by an automated "trading bot". Trading bots are pieces of software that automatically trade currency based on a hard coded set of rules. A coder will write the system and money management rules into a variety of programming languages to produce software that could provide a more regulated steady rate of return for the managed forex account than the manual trader. This gives the ability of the company or professional to advertise a set rate of monthly (or yearly) growth. Some of the more traditional companies and individuals alike prefer to have their funds traded manually, as the human interaction aspect can sometimes yield smaller drawdowns and larger returns. As a managed forex account seems like a very lucrative direction to take in the forex market, some people may still be drawn away from it for a few select reasons. Usually, many commercial brokers and investment firms have a minimum for the account to be traded. These minimums are usually around $10,000, and prove a hefty starting cost to the average trader.

Also, many of these companies can (and usually do) promise high returns. In spite of these statements, the majority charge a monthly management fee to your managed forex account.

About Forex Advice

Forex Advice was developed to give traders the edge they need to learn how to trade based on economic news events from around the world. The same edge the institutions use to make hundreds of millions and even billions of dollars in profit each year. Forex News Trading will provide you with the information you need to give you a true insider’s understanding of the Forex markets.

You will feel confident in your trading, and never doubt your trades again. Does this mean you will win every trade? No, of course not, but armed with the knowledge Forex Advice will provide you, you will never be afraid to take that next trade - as the odds will now be tipped in your favor. Each and every month there are a tremendous number of news releases for the Off Exchange Retail Foreign Currency Market (FOREX). Many of these events and announcements move the markets considerably.

But how do you properly capitalize on these moves? Get it wrong and you could be wiped out. Get it right and you can be in a small group of trading elite, consistently pulling pips out of the market each and every week. Our Forex Trading goal is to provide our visitors with the best trading strategies available. We work exclusively with Forex brokers who specialize in news trading, and also include extensive reviews on the best in the business. Any relevant and helpful information related to Forex news trading can be found on this site. There are many trading methods that exist to help you succeed as a trader, but there also many factors you need to consider before you execute your trades. Each news event moves differently. What we do is provide you with techniques and systems on how to trade these major news events. How can you maximize your gains and limit your loses? Not easily done, unless you truly know what you are doing.

Forex Advice will teach you the moves you need to make. In volatile or fast moving markets, such as news trading events, it is imperative to be completely focused and on top of your game. You need to constantly learn new styles and techniques if you want to stay ahead. Whether you profit, or end up like the other 95% of traders, depends on your ability, knowledge, patience, and how the market moves that day. With such a large world market there are numerous opportunities to pull profits on a consistent basis.

Forex Book

Forex trading can be one of the most rewarding and most exciting financial trading experiences for the prepared investor. For those unprepared, forex trading can be a downward spiral progressively becoming more and more painful as you proceed to lose more and more money, without knowing exactly why. When you're trading forex book yourself a ticket on a rollercoaster - it is just as exciting. Very often, especially in the loose regulatory environment (or lack thereof) on foreign exchange, you the investor are often left to decide for yourself if forex is a suitable investment opportunity for you. It becomes your personal responsibility to try getting a forex trading education.

One of the better ways to learn about forex is getting a good forex book that may share ideas about how to trade and how to analyse the various currencies before you make a trade. You will learn many of the forex trading tools from a comprehensive forex book. There probably will be discussions on such things as Fibonacci retracement levels, or moving averages, or candlesticks, or about so many other techniques that only a forex book can think of putting together. You should be aware, though, that while reading a good forex book gives you a store of knowledge which is important to a forex investor, having read a forex book can never be considered sufficient to provide a sound forex trading education. The forex trading market is far more demanding of one's skills and knowledge than that. The disciplines and lessons of actually participating in the marketplace will probably give a more far-reaching forex trading education than any forex book can provide.

On the other hand, your forex trading education will be significantly handicapped if you do not shore it up with the theoretical underpinnings that you can find in a fine forex book. It would seem that the best approach to raise your level of preparedness for the gruelling forex trading market is to try test runs on how the market operates, through a forex trading website, where there are simulated retail platforms that you can practise on. Some of these online forex trading sites provide a very realistic simulation of the forex trading experience. You can then follow through on the lessons and forex trading experience you obtain from these online sites by looking up the subject matter in a good forex book. For instance, if you are trying to learn how to do an analysis of the market through the candlesticks, you can read your forex book chapter on this topic, and then make sure you go through the simulation on candlesticks at the website. After your simulation sessions, you should go back to the forex book to reinforce the lessons. Your absorption and comprehension should be much improved. Somehow, complex subjects generally are better discussed and more clearly explained in a forex book.

It is not always easy to understand the theoretical foundations of technical analysis and fundamental analysis - which are the basic analytical tools used in forex trading, but you can get solid discussions on these two topics in a forex book. You also need to obtain sound information about risk management, and management of your trades as well as your trading funds. A forex book on these subjects can give lucid explanations. If reading a forex book is too time-consuming, you can look up various websites that can offer a forex book in electronic format. The approach in these online forex books is usually simpler and easier to read. In some instances it will be possible to supplement the online forex book with video courses on forex trading. Having gone through a good forex book will round out your forex trading education, which is crucial to your gaining confidence for your foray into forex trading.

Forex Spread

The spread (of a group of people) is the difference between the bid price and the ask price quoted in pips. For example, if the quote(put forward or describe someone or something as being.) between EUR/USD at a given moment is 1.4222/1.4223, then the spread is 1 pip. If the quote is 1.4222/1.4242, then the spread is 20 pips.

The spread is also how banks and dealer make money. Wider spreads mean a higher ask price and a lower bid price. As a consequence,(a result or effect) you pay more when you buy and get less(fewer in number)when you sell, making it more expensive(costing a lot of money) for you. The difficulty lies in knowing whether a wider spread is based on market conditions or if it’s simply based on extra profit for the bank or dealer.

Banks and forex dealers typically don’t earn the full spread because they, in turn, must hedge out net client foreign currency exposure (the publicizing of information or an event) with other banks, which costs them the spread as well. The spread compensates forex dealers for taking on the risk that the price might change from the time they order a client’s trade to the time they safely hedge their net exposure with a bank.

Banks make money by creating trading volume that results in natural trading offsets Banks also make money by increasing (an instance of increasing) the spread charged in excess of the interbank spread for forex trading.

LiteForex

LiteForex offers revolutionary (involving or causing dramatic change) trading technology (the application of scientific knowledge for practical purposes) for beginner trader, and let you start trading in the Forex market depositing (a sum of money placed in a bank or other account) just ONE DOLLAR Your deposit appear in US cent on the Lite group account, so you feel like you are trading the same amount in US Dollar. This new technology allow Forex beginner to learn Forex in a REAL life situation with minimal investment!(the action or process of investing)

LiteForex also offer competitive (strongly desiring to be more successful than others) trading condition for Forex professional all around the world, and provide a dedicated (exclusively allocated or intended for a particular purpose) Forex trading server and experience customer support as well as analysis (a detailed examination of something in order to interpret or explain it) of Forex market and a professional affiliate program.

With more than 120,000 service user, more than 47,000 unique (being the only one of its kind; unlike anything else) and live Forex trading account, more than 295 new trader every day, and more than 705,000 live order every month, LiteForex is one of the most popular and fastest growing Forex companie in the world.

Forex Trading Firm

Markets
Markets is a leading online capital|(the most important city or town of a country or region, usually its seat of government and administrative centre) markets trading website. It offers both retail and institutional(impersonal or unappealing) investors with quick and easy access to a range of financial markets including Forex, oil/gas, metals, commodities(a raw material or primary agricultural product that can be bought and sold) and stocks. Trade all global capital markets from a single integrated account
IG Markets
IG Markets offers a professional(worthy of a professional person; skilful or competent) service to thousand of private client around the globe. IG Markets offers 3-PIP spread on all the major FX pair, plus a huge range of exotic and mini-forex contract available. A highly competitive commission-free solution for all your FX trading.
Man Financial Limited
The Man Group can trace its origin(a person's social background or ancestry) back to 1783 when James Man first established(set up on a firm or permanent basis) a sugar broking business in the City of London. Man Group plc is now a ftes 100 company (emg.l) and Man Financial(the financial situation of an organization or individual) is the Worlds largest Independent Futures Broker.

Introduction to Trading Forex

Foreign Exchange

This short introduction explains the basics of trading Forex online, a brief explanation of the markets and the major benefits of trading Forex online. There are also two scenarios describing the implications of trading in a bear as well as a bull market to better acquaint you with some of the risks and opportunities of the largest and most liquid market in the world.

As an additional aid for those who are new to Forex, there is also a glossary at the bottom of this text which explains some of the terms used in connection with currency trading.

Overview

Foreign exchange, Forex or just FX are all terms used to describe the trading of the world's many currencies. The Forex market is the largest market in the world, with trades amounting to more than USD 3 trillion every day. Most Forex trading is speculative, with only a low percentage of market activity representing governments' and companies' fundamental currency conversion needs.

Unlike trading on the stock market, the Forex market is not conducted by a central exchange, but on the “interbank” market, which is thought of as an OTC (over the counter) market. Trading takes place directly between the two counterparts necessary to make a trade, whether over the telephone or on electronic networks all over the world. The main centres for trading are Sydney, Tokyo, London, Frankfurt and New York. This worldwide distribution of trading centres means that the Forex market is a 24-hour market.

Trading Forex

A currency trade is the simultaneous buying of one currency and selling of another one. The currency combination used in the trade is called a cross (for example, the euro/US dollar, or the GB pound/Japanese yen.). The most commonly traded currencies are the so-called “majors” – EURUSD, USDJPY, USDCHF and GBPUSD.

The most important Forex market is the spot market as it has the largest volume. The market is called the spot market because trades are settled immediately, or “on the spot”. In practice this means two banking days.

Forward Outrights

For forward outrights, settlement on the value date selected in the trade means that even though the trade itself is carried out immediately, there is a small interest rate calculation left. The interest rate differential doesn't usually affect trade considerations unless you plan on holding a position with a large differential for a long period of time. The interest rate differential varies according to the cross you are trading. On the USDCHF, for example, the interest rate differential is quite small, whereas the differential on NOKJPY is large. This is because if you trade e.g. NOKJPY, you get almost 7% (annual) interest in Norway and close to 0% in Japan. So, if you borrow money in Japan, to finance the trade and buying NOK, you have a positive interest rate differential. This differential has to be calculated and added to your account. You can have both a positive and a negative interest rate differential, so it may work for or against you when you make a trade.

Trading on Margin

Trading on margin means that you can buy and sell assets that represent more value than the capital in your account. Forex trading is usually conducted with relatively small margin deposits. This is useful since it permits investors to exploit currency exchange rate fluctuations which tend to be very small. A margin of 1.0% means you can trade up to USD 1,000,000 even though you only have USD 10,000 in your account. A margin of 1% corresponds to a 100:1 leverage (or “gearing”). (Because USD 10,000 is 1% of USD 1,000,000.) Using this much leverage enables you to make profits very quickly, but there is also a greater risk of incurring large losses and even being completely wiped out. Therefore, it is inadvisable to maximise your leveraging as the risks can be very high. For more information on the trading conditions of Saxo Bank, go to the Account Summary on your SaxoTrader and open the section entitled “Trading Conditions” found in the top right-hand corner of the Account Summary.

Why Trade Forex?

• 24 hour trading

  One of the major advantages of trading Forex is the opportunity to trade 24 hours a day from Sunday evening (20:00 GMT) to Friday evening (22:00 GMT). This gives you a unique opportunity to react instantly to breaking news that is affecting the markets.

• Superior liquidity

  The Forex market is so liquid that there are always buyers and sellers to trade with. The liquidity of this market, especially that of the major currencies, helps ensure price stability and narrow spreads. The liquidity comes mainly from banks that provide liquidity to investors, companies, institutions and other currency market players.

• No commissions

  The fact that Forex is often traded without commissions makes it very attractive as an investment opportunity for investors who want to deal on a frequent basis.
  Trading the “majors” is also cheaper than trading other cross because of the high level of liquidity. For more information on the trading conditions of Saxo Bank, go to the Account Summary on your SaxoTrader and open the section entitled “Trading Conditions” found in the top right-hand corner of the Account Summary.

• 100:1 Leverage

  Leverage (gearing) enables you to hold a position worth up to 100 times more than your margin deposit. For example, a USD 10,000 deposit can command positions of up to USD 1,000,000 through leverage. You can leverage the first USD 25,000 of your investment up to 100 times and additional collateral up to 50 times.

• Profit potential in falling markets

  Since the market is constantly moving, there are always trading opportunities, whether a currency is strengthening or weakening in relation to another currency. When you trade currencies, they literally work against each other. If the EURUSD declines, for example, it is because the US dollar gets stronger against the euro and vice versa. So, if you think the EURUSD will decline (that is, that the euro will weaken versus the dollar), you would sell EUR now and then later you buy euro back at a lower price. In case that the EURUSD indeed declines, then you can take your profit. The opposite trading scenario would occur if the EURUSD appreciates.

Important Forex Trading Terms

• Spread

  The spread is the difference between the price that you can sell currency at (Bid) and the price you can buy currency at (Ask). The spread on majors is usually 3 pips under normal market conditions. For more information on the trading conditions at Saxo Bank, go to the Account Summary on your Client Station and open the section entitled “Trading Conditions” found in the top right-hand corner of the Account Summary.

• Pips

  A pip is the smallest unit by which a cross price quote changes. When trading Forex you will often hear that there is a 3-pip spread when you trade the majors. This spread is revealed when you compare the bid and the ask price, for example EURUSD is quoted at a bid price of 0.9875 and an ask price of 0.9878. The difference is USD 0.0003, which is equal to 3 “pips”.
  
  On a contract or position, the value of a pip can easily be calculated. You know that the EURUSD is quoted with four decimals, so all you have to do is cancel out the four zeros on the amount you trade and you will have the value of one pip. Thus, on a EURUSD 100,000 contract, one pip is USD 10. On a USDJPY 100,000 contract, one pip is equal to 1000 yen, because USDJPY is quoted with only two decimals.

Trading Scenario – Trading Rising Prices

If you believe that the euro will strengthen against the dollar you'll want to buy euro now and sell it back later at a higher price.

• You buy euro

We quote EURUSD at Bid 0.9875 and Ask 0.9878, which means that you can sell 1 euro for 0.9875 USD or buy 1 euro for 0.9878 USD. In this example you buy euro 100,000, at the quote price of 0.9878 (ask price) per euro.

• The market moves in your favor

Later the market turns in favour of the euro and the EURUSD is now quoted at Bid 0.9894 and Ask 0.9896.

• Now you sell your euro and get the profit

You sell euro at a Bid price of 0.9894.

• The profit is calculated as follows

Sell price-buy price x size of trade (0.9894 minus 0.9878) multiplied by 100.000 = USD 140 Profit (Note that the profit or loss is always expressed in the secondary currency)

Trading Scenario – Trading Falling Prices

If, on the other hand, you believe that the euro will weaken against the dollar, you'll want to sell EURUSD.

• You sell euro

We quote EURUSD at a Bid price of 0.9875 and Ask price of 0.9880 and you decide to sell euro 100,000 at a Bid price of 0.9875.

• The market moves in your favour

The euro weakens against the dollar and the EURUSD is now quoted at bid 0.9744 and ask 0.9749.

• Now you buy back your euro

You buy EUR at an ask price of 0.9749.

• Your profit/loss is then

Sell price-buy price x size of trade (0.9875 minus 0.9749) multiplied by 100.000 = USD 1260 Profit

Remember that trading EUR 100,000 as we have done in our examples, does not mean that you have to put up euro 100,000 yourself. On a 2% margin means that you have to deposit 2.0% of euro 100,000, which is euro 2,000 on margin as a guarantee for the future performance of your position.

Further Reading

To see how you can trade the Forex market and benefit from our toolbox of information and live quotes, please proceed to the Forex Quick Start found under the Trading menu of SaxoTrader.

Glossary

• Appreciation

An increase in the value of a currency.

• Ask

The price requested by the trader. This usually indicates the lowest price a seller will accept.

• Base currency

The currency that the investor buys or sells (i.e. EUR in EURUSD).

• Bear

Someone who believes prices are heading down. A bear market is one in which there has been a sustained fall in prices and which does not look like it will recover quickly.

• Bid

The price offered by the trader. This usually indicates the highest price a purchaser will pay.

• Bid/Ask

The Bid rate is the rate at which you can sell. The Ask (or offer) rate is the rate at which you can buy.

• Bull

Someone who is optimistic about the market. A bull market is characterised by enthusiastic and sustained buying.

• cross

When trading with currencies, the investor buys one currency with another. These two currencies form the cross: for example, EURUSD.

• Cross rate

An exchange rate that is calculated from two other exchange rates.

• Depreciation/decline

A fall in the value of a currency.

• Exchange rate

What one currency is worth in terms of another, for example the Australian dollar might be worth 58 US cents or 70 yen. Currencies traded freely on foreign-exchange markets have a spot rate (applying to trades settled “spot”, i.e., two working days hence) and a forward rate. Countries can determine their exchange rates in a variety of ways. 1. A floating exchange rate system where the currency finds its own level in the market. 2. A crawling or flexible peg system which is a combination of an officially fixed rate and frequent small adjustments which in theory work against a build-up of speculation about a revaluation or devaluation. 3. A fixed exchange-rate system where the value of the currency is set by the government and/or the central bank.

• EURUSD

Means that you trade EUR against dollars. If you buy euro you pay in dollars and if you sell euro you receive dollars.

• FX, Forex, Foreign Exchange

All names for the transaction of one currency for another, e.g. you buy GBP 100.00 with USD 150.25 or sell USD 150.25 for GBP 100.00.

• Interbank

Short-term (often overnight) borrowing and lending between banks, as distinct from a banks business with their corporate clients or other financial institutions.

• Interest rate differential

The yield spread between two otherwise comparable debt instruments denominated in different currencies.

• Leverage (gearing)

The investor only funds part of the amount traded.

• Long

To buy.

• Long position

A position that increases its value if market prices increase.

• Liquid (-ity)

The capacity to be converted easily and with minimum loss into cash. A liquid market is one in which there is enough activity to satisfy both buyers and sellers. Ultra-short-dated treasury notes are an example of a liquid investment.

• Margin

The deposit required when entering into a position as well as to hold an open position. Your margin status can be monitored in the Account Summary.

• NYSE

The New York Stock Exchange.

• Open position

A position in a currency that has not yet been offset. For example, if you have bought 100,000 USDJPY, you have an open position in USDJPY until you offset it by selling 100,000 USDJPY, thus “closing” the position.

• Over the counter

When trading takes place directly between two parties, rather than on an exchange. Over the counter trades can be customised whereas exchange-traded products are often standardised.

• Pips

A pip is the smallest unit by which a Forex cross price quote changes. So if EURUSD bid is now quoted at 0.9767 and it moves up 2 pips, it will be quoted at 0.9769.

• Position

Traders talk of “taking a position” which simply means buying or selling currency cross. “Position” can also refer to a trader's cash/securities/currencies balance, whether he or she is short of cash, has money to lend, is overbought or oversold in a currency, etc.

• Risk

Trying to control outcomes to a known or predictable range of gains or losses. Risk management involves several steps which begin with a sound understanding of one's business and the exposures or risks that have to be covered to protect the value of that business. Then an assessment should be made of the types of variables that can affect the business and how best to protect against unwelcome outcomes. Consideration must also be given to the preferred risk profile – whether one is risk – averse or fairly aggressive in approach. This also involves deciding which instruments to use to manage risk and whether a natural hedge exists that can be used. Once undertaken, a risk-management strategy should be continually assessed for effectiveness and cost.

• Secondary currency (variable currency or counter currency)

The currency that the investor trades the base currency against (i.e. USD in EURUSD).

• Short position

A position that benefits from a decline in market prices.

• Short

To sell.

• Speculative

Buying and selling in the hope of making a profit, rather than doing so for some fundamental business-related need.

• Spot

A Spot rate is the current market price of an asset.

• Spot market

The part of the market calling for spot settlement of transactions. The precise meaning of “spot” will depend on local custom for a commodity, security or currency. In the UK, US and Australian foreign-exchange markets, “spot” means delivery two working days hence.

• Spread

The difference between the bid and the ask rate.