How to Get Started
People are introduced to the exciting world of foreign exchange in many ways: friends, current events, newspapers, television, and many others. For those of you who are new to forex, the following guidelines cover the basics of currency trading.
Step 1: "Practice makes perfect"
Demo trade. The demo account was designed to help traders gain familiarity with the speed and movements of the market. When you are demo trading, you should learn how to: 1) place market orders to enter a trade, 2) place stop-loss orders to protect your positions, and limit orders to take profits, 3) place OCO orders and If Done Orders to execute more advanced strategies.
DealStation Video-Tutorials
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Downloading the DealStation Trading Platform Logging-in to the DealStation Placing a Market Order Placing a Stop Order Placing a Limit Order |
Step 2: "Study, Study, Study".
Forex traders use fundamental analysis, technical analysis, quantitative analysis and sometimes a combination of all three to make their trading decisions. Fundamental analysis involves the use of economic, financial and political news to determine trading decisions. Technical analysis involves the study of Charts to predict future price movements based on past price patterns and trends. Quantitative analysis consists of the use of preset statistical models and properties in quantifying price formations such as averages, retracements as well as identifying oversold and undersold situations.
In order to help novice and experienced traders alike, MG has developed www.forexnews.com, a leading site on foreign exchange analysis, news and education. Comprehensive previews and summaries updated 4 times per day, insightful editorials covering the latest market developments and an open forum for discussing trading tips and ideas, are just some of the many features of Forexnews.com and MG’s commitment to educating and informing Forex participants.
Step 3: Manage your money wisely.
You should always be aware of the amount of money in your account before placing a trade. If you think a long-term trend is developing, then you should consider whether you have enough funds to maintain your margin and withstand any movements against your position(s) that may occur. We encourage everyone who opens an account with us to ask themselves the following questions prior to entering each trade:
1) How much am I willing to risk?
2) What is my upside and downside potential?
3) What are the market conditions? (Is the market volatile or calm?)
4) What is the logic behind entering this trade?
5) When can I conclude if the assumptions/logic behind the trade are/is correct or wrong?
Before entering an order, you should consider both your entry and exit points. One of the mistakes most commonly made by traders, especially new traders, is letting emotions get in the way of their strategy.
Step 4: Stay Connected:
It is impossible to follow the forex market 24 hours day, 7 days a week. For better management of your account, we encourage you to use our Wireless Service and alert!FX™.
Step 5: Open a Live Account.
If you feel ready to trade this market, fill out our application forms and submit them today. Since the emotional factor may be higher than it was when you were demo-trading (as you are now committing real money), it is essential that you develop an effective strategy while demo-trading and plan to abide by it when trading your live account.
We hope you enjoy trading with us and wish you the best of luck
http://www.mgforex.com/eng/new-to-forex/content/start-trading-forex.htm
Although the Forex market is by far the largest and most liquid in the world, day traders have up to now focused on seeking profits in mainly stock and futures markets. This is mainly due to the restrictive nature of bank-offered Forex trading services.
Unlike others, NorthFinance offers both online and traditional phone Forex trading services to all investors, with minimum account opening values starting at 100 USD.
There are many advantages to trading spot Forex as opposed to trading stocks and futures.
In the peoples mind there is this opinion that brokerage firms and analysis’s can change the flow of the currency. But in reality, FOREX is an independent international foreign exchange market which can be influenced by many factors but NOT by the wants(wills) of traders and brokerage firms.
Because of its diversity you are able to trade FOREX 5 days a week, 24 hours a day. US, Europe and Asia the major trading sessions enable you to trade on your own schedule and make a quick respond to breaking news from all continents of the world no matter where you are located.
Complied benefits from both high leverage and potential profits from both rising and falling market, Forex is very interesting for speculators from every point of view.
For example, with $10,000 cash in a standard account that allows 1:100 leverage (1%), you can control up to $1,000,000 in notional value.
NorthFinance charges NO commissions or fees, simply take all your profits with you. Commission-free trading is one of the most attractive features of NF. The dealing spreads are as low as 2 pips(for EUR/USD). Providing a more comfortable environment when trading. Versatility all around
The overall volume of FOREX market is $2 trillion. Almost all the amount of the volume involves trading of the major currency pairs, NorthFinance clients enjoy tight spreads on these pairs.
NorthFinance clients have the ability to trade in both directions, compared to other equity markets where it is more difficult to make certain trades. This gives an advantage to all our clients.
It is simple to open an account, you can do it on-line within 10 minutes. With multiple means of funding/withdrawing you can start trading within one hour. Access your trading account from anywhere in the world. Our company serves clients, from over 150 countries and with a large network of world wide located offices and representatives it makes contact us easy.
Trader Y opened an account of USD 50′000.
He buys EUR/USD 500′000 @ 1.3500 at the market and places a stop loss order at 1.3460.
This point shows that his maximum risk is USD 2′000 and his margin utilization is 10%, well above the minimum.
During the trading day the Forex market fluctuates and initially moves down to 1.3480.
At this point trader Y has an unrealized loss of USD 1′000 and his margin utilization has fallen to 98% reflecting the effect of the downward move on his margin capacity.
Later the price moves back up to 1.3600 and trader Y decides to take profit.
He sells at 1.3600 making a USD 5′000 profit which represents a 10% return on his account value.
Note that trader Y took only a risk of USD 2′000 and made a return of USD 5′000 this equates to a risk/reward ratio of 2.5. A high risk reward ratio is what every trader should be aiming for.
Please note that the example above is a random case and in no way is meant to illustrate that the potential for profit is always greater than the potential for loss in foreign exchange trading
Account Statement
Statement regarding the trades and conditions of the clients account with a broker for a chosen period.
ADV (Average Daily Volume)
The daily average volume of tenders is a level of activity of tenders on currency, futures or options. The increase in volume in a direction of a current price trend is an acknowledgement of this trend.
American options
The American option is an option which can be executed at any time during its existence.
AMEX
American Stock Exchange
Appreciation
Growth of cost of unit of one currency expressed in terms of other currency.
Arbitrage
No-risk type of trade when the same currency simultaneously is bought and sold against another for reception of profit because of a difference in the prices at two counterparts.
Ask (Offer) Price
The price of the seller. The price on which the client can buy the currency interesting him (the greater figure in the bilateral quotation).
Buying, Selling and the Exchange Rate
International trade is now a part of our everyday lives and the world we live in. Almost every time we make a purchase we are participating in the global economy and indirectly with the Forex trading systems. A currency exchanger is involved in most products and their components that come to our store shelves from all over the world. The foreign exchange rate market, or the "FOREX" market, is where the buying and selling of different currencies takes place. The price of one currency in terms of another is called an exchange rate. There are two reasons to buy and sell currencies, usually handled through a Forex brokerage. Approximately 5% of daily transactions come from companies and governments that buy or sell products and services in a foreign country, normally trading through Forex online. The remaining 95% is trading for profit. The foreign exchange rate market is considered an Over The Counter (OTC) or ‘interbank’ market, due to the fact that transactions are conducted between two counterparts over the telephone or via an electronic network. It is a global market build from forex brokerage firms that has no one central office or position. Forex online is one of the most common methods of trading within the market. This has created a market demand for an online stock broker , Forex dealers and a currency exchanger service. At NorthFinance we assist and guide our customers in trading with Forex online , offering a range of services to suit every customer’s need.
The Foreign Exchange Rate Market and its Participants
Trading with Forex online involves four major participants; it is worth noting that Forex trading systems are open to any individual or company that has the required minimum capital to begin trading on a currency exchanger. The most frequent and largest traders in the foreign exchange rate marketplace are banks and other financial institutions. They earn profits through Forex online by buying and selling currencies from and to each other. Almost two-thirds of all transactions involve banks dealing directly with each other. A Forex brokerage firm may act as intermediaries between banks. Dealers call them to find out where they can get the best price and exchange rate. This affords a level of anonymity to investors, a beneficial quality for trading with Forex online. Forex brokerage firms and brokers are also prominent dealers within the Forex online market; they operate similar to an online stock broker , arranging transactions for their clients. Customers utilizing Forex trading systems, mainly large companies and corporations, require a currency exchanger in the course of doing business or making investments. Other types of customers are individuals who buy a foreign exchange rate to travel abroad or to make purchases in foreign countries. This also includes individual investors trading independently of any online stock broker. Central banks, acting on behalf of their governments, sometimes participate in Forex online to influence the value of their currencies and exchange rate. With more than $1.2 trillion changing hands every day, the currency exchanger is a huge market, the activity of these four main participants affects the value of every dollar, pound, yen or euro. The participants in Forex online trade for a variety of reasons: to earn short-term profits from fluctuations in an exchange rate, to protect themselves from loss due to changes in an exchange rate, and to acquire the foreign currency necessary to buy goods and services from other countries. Each of the participants has different reasons and differing forex trading systems for trading with Forex online but all aim to earn profits and take advantage of this lucrative market.
The Services of Forex Brokerage
A Forex brokerage firm offers many advantages to all types of clients and participants of Forex online; they operate in methods similar to that of an online stock broker . This is a relatively fresh and new market service that has been established following the increased activity in foreign exchange rate trading . There are numerous Forex brokerage firms offering various quotes on an exchange rate. A Forex brokerage can be situated anywhere to accommodate the global market place, meaning an exchange rate quote can be obtained from an online stock broker at any time. At NorthFinance we aspire to offer the most competitive and highest quality services to all our customers. NorthFinance company Ltd offers a full array of Forex brokerage services along with accompanying services including the availability of a futures broker, options broker, CFD trading, and varying size accounts depending on personal requirements. We offer real-time live execution, even for small deal sizes. Publishing real-time prices ensures that you always receive a firm, fair price on all Forex online transactions, and also facilitates instantaneous deal execution. Our Forex online software was designed for instantaneous dealing. Our customers consist of foreign exchange rate market participants, from institutional traders to asset managers and other Forex brokerage firms. We strive to be the most competitive online Forex brokerage firm in the world. Customers executing trades on our platform as opposed to one of our competitor’s platforms can save money whilst being educated and trained in the dealings of Forex online and the Forex trading systems
These days we hear all kinds of buzz words when it comes to working at home opportunities. But Forex currency trading is definitely a buzz you need to pay attention to. So what’s it all about?
There are many reasons that Forex currency trading an excellent way to enter the capital markets. Thanks to the internet Forex has become very accessible, and because the cost of transactions is low and there are no commissions anyone can get involved in this great opportunity to make money.
As with anything there are good and bad so you need to look for a good Forex broker because they will provide you with a trading account that offers what we just talked about. Some even offer what’s called Mini Forex Traders in which you can begin trading with only $250 capital. Now you have no excuse why not to give it a try?
When you are trading in the Forex markets online there’s no need to concern yourself with any of the usual broker fees and there’s no NFA or SEC fees.
Wondering how the Forex brokers can make money when they are not charging any fees when you trade? They make their money on the bid/ask spread. Good for them and good for you.
Once you decide to learn how to trade on the Forex currency trading market. Like with anything the more practice the better you will become and before long you will be a real Forex trading pro enjoying those profits.
But no one wants to practice and learn by playing with their own money which is why there are many several creative Forex trading simulations online. Just like the real thing with one thing missing – your real money.
When you’re confident in your skill level flip to the real Forex currency trading and enjoy that adrenaline rush when you reap those big profits
The carry trade is a popular online Forex strategy which takes advantage of the different interest rates between two currencies. If one currency has a relatively low interest rate it can be sold against a currency with a high interest rate and the trader may pocket the interest rate differential. Speculators are guaranteed rollover interest deposits in their account at the end of each trading day. This can provide a significant boost to trader’s profit. If, for instance, an investor buys the NZD against the JPY, which have interest rates of 7.25 and .25 respectively, the trader can make a profit of 7% provided the market doesn’t move.
However, even when exploiting interest rate differentials, there are still significant risks to a trader. Obviously, the market can still move against the trader’s position, though the rollover interest adjustments do help mitigate potential losses. Considering that most carryover traders use exceptionally high leverages to exploit interest rate differentials, even a small move against a position can lead to very high losses
Do you see the profit potential in trading currencies, but learning to trade just seems too daunting? Have you watched with excitement the recent crashing of the value of the USD, but simply don’t know how to get started trading?
While it is simple to begin trading Forex online, maintaining profitability in the long term is no easy task. You have probably heard that 90% of Forex traders lose their money in the long term. If indeed this is true, it is the result of a couple of different factors.
- Overtrading: Each trade costs you a couple of pips—Consider your trades well before you make them. Each faulty trade, even if exited quickly, drains equity.
- Bad money management: One bad trade can wipe out a year of patient, smart trading. Manage your risk using stop loss orders, so that you never risk too high a percentage of your equity on any one single trade.
- Lack of knowledge: If you have never traded Forex before, educate yourself! Successful traders are not born that way. The difference between success and failure in the Forex market depends in no small part on the knowledge and education of a trader. For the beginning trader, a proper education is essential before investing in the Foreign Exchange. Find a program you are comfortable with, and begin practicing on a demo account.
Trading on the foreign exchange offers unparalleled opportunities for profit, but it is also extremely risky. Make sure you know what you are getting into before you start trading, and start trading only when you are comfortable in your knowledge and ability.