Tag Archives: forex

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In essence, brokers are our representatives in the market. They buy and sell in behalf of us and negotiate deals for us. In exchange for their services, they get commissions and fees. Much are expected of them because our money is entrusted to them. As such, assumptions are made of them. Majority believe that these brokers are professionals that are experts on their field. We believe that they always know what’s happening in the market and that clients’ have their full attention at all times. Well, the majority are simply wrong.

They are ordinary people like you and me
One thing that clients like to believe is that brokers are super human beings that have special licenses, accomplished awards, and advanced degrees. In truth, those are not requirements. To become a certified broker, aspirants need only pass a few exams before they can legally advise and represent you in the market. Most of the times, these certified brokers have no prior experience and sometimes even their collegiate degree doesn’t even relate to the field. Of course, not all brokerage apply this kind of screening. There are some who put up high requirements. If broker background is an issue for you, you can go ahead and research about brokers that have high standards.

They don’t know what will happen next to the market
An assumption that majority of market participants have is that brokers know more about future market movements than the average trader. This is simply not true. Just because they execute trades for you doesn’t mean they know what will happen next. As advisers as well, brokers are expected to have a better idea of what will go on in the market. The truth is that they know as much as the next person. The market is an unpredictable place and the best that your broker can do for you is speculate based from facts and other factors. So put faith in them to advise you well but ultimately, understand that nothing in this world is 100% sure.

They are brokers not because they represent you but because they are selling to you
The main appeal of brokers is that they are in the market to represent you. However, the truth is that brokers are essentially salesmen too. This may pose as a concern because the main goal of salesmen is to make a sell. Brokers are there to sell you their services. Whether you win or lose, they will profit. This may give rise to a conflict of interest for the broker and the client. Not to say that brokers are against you, but always be aware that business is business. What we’re saying is, get to know your broker if you can so you’ll know what you’re getting into.

We entrust so much to these brokers that we forget that they too are humans prone to mistakes just like us. While we don’t belittle the power of a good broker and adviser, it’s always best to have full control of your trades. Incorporate their wisdom and expertise but don’t let your assets go to waste. Be in the know. Get the best broker through extensive research and informed decisions. And remember, having a representative on the market doesn’t relieve you of your responsibility to take care of your assets yourself. After all, no one will care about you more than you, yourself.

The Forex Market is a busy place where traders and investors meet to deal and execute, buy and sell, and to bet and hope for wins. However, despite this complex and seemingly overwhelming industry, it is actually something that affects even the most disinterested person. Even without transacting or having anything to do with the forex market, everyone is affected by what happens there. By simply purchasing goods or travelling overseas or saving money in the bank, you are inadvertently participating in the market.

Here, we will be presenting concepts of the Forex Market that both traders and the normal citizen needs to know if they want to understand their money and the economy they belong in better.

The Eight Major Currencies
What separates the stock market form the forex market is the focus. In the stock market, there are thousands of companies and stocks to choose from. Not only that, there are also a numerous markets across the globe: the New York Stock Exchange (NYSE), the NASDAQ in the US, the BM&F Bovespa of Brazil, the Shanghai Stock Exchange, the London Stock Exchange, Deutsche Börse of Germany, the Bombay Stock Exchange, and a whole bunch more. You’ll get your head twisted and confused with the volume of possibilities in the stock market.

Meanwhile, in the forex market, you only have to watch out for the eight major currencies: the US dollar (United States), the euro (Eurozone: Germany, France, Italy, and Spain), the yen (Japan), the pound (United Kingdom), the Swiss franc (Switzerland), the Canadian dollar (Canada), the Australian dollar (Australia), and the New Zealand dollar (New Zealand). By keeping track of these eight major currencies, you are already monitoring the general status of the world’s economy. The reason for this is because the countries where these currencies reside are movers of the world. What happens in their economy will always have an effect on the rest of the world.

To keep track of the major currencies, simply look on financial websites. Economic data, currency performance, and news events are available to anyone. Traders and investors can use it in their trades and investments while the average citizen can use it to be in the know.

The Inconsistent Interest Rates

Interest rates are controlled by the central banks of the respective countries. They are adjusted according to the state of the country. This is used to help in inflation and controlling prices of goods. For market participants, it is crucial to know whether interest rates will go up or down because it will have significant effect on the assets and other financial instruments.

Interest rates are adjusted depending on the country’s economic health. In general, countries whose performance is characterized by rapid growth is likely vulnerable to hiking inflation. To help control such growth, interest rates may be raised. Meanwhile, if a country looks like it’s on a downhill path with recession looming and growth slowing down will have their interest rates lowered. Reducing interest rates will help in boosting the economy.

The Dangers of Leverage
The idea of leveraging is very popular in the forex market. Leverage is basically borrowing capital to make an investment. This means that you have a greater potential for profiting. At the same time, you have the potential to lose bigger. Markets offer leverage of as much as 100:1. This means that you can manage $10,000 of assets using $100 as capital. The risk may seem tremendous but the forex market has a solution for these. Stop orders and limit orders exist to cap off big losses. They are automated transactions that make sure you do not lose what you can’t afford. They are available 24 hours a day, five days a week. In short, your account will never go negative.

There are more concepts that need to be learned in the forex market. However, you have to make sure first that you have a solid grasp of the basics.

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Trading forex has taken over the market as one of the most popular and most lucrative endeavors in the market. Its appeal stems from two key features of forex trading: accessibility and speed. This is because forex trading has proliferated to smartphones, tablets, and other gadgets.

Mobile trading has become a thing that people all over the world do. Everybody can access the market and trade instantly. Because of this, the smartphone application field has been that more competitive. Forex traders are in the hunt for the best forex application to complement and boost their trading skills.

We have narrowed the search down to the top three applications that we think deserve a spot on your smartphone’s screen. Check them out:

1. Thinkorswim Mobile
Thinkorswim Mobile is a full-service mobile trading platform application developed by TD Ameritrade. It is one of the highest-rated forex trading apps in the app market because of its user-friendly interface, comprehensive services, and exhaustive financial tools.

The mobile application is known to forex traders as one of the best because of several features. One of them is its wide range of financial instruments which includes currencies, options, futures, and stocks.

Thinkorswim Mobile also comes with the services needed by any forex trader in analyzing, processing, and executing trades. It offers live charts, updated business and financial market news, streaming CNBC broadcasts, and other educational trading materials for all the data you’ll need. Meanwhile, it has technical indicators, expert analyses, and other financial tools for monitoring positions, tracking trades, and modifying transactions all through smartphones only.

Another advantage that users enjoy with thinkorswim is that it has a community where users can interact with their fellow traders and discuss financial and trading topics.

Take advantage of thinkorswim and see why it’s one of the best forex apps out there.

2. Trade Interceptor

One of the highest trader forex trading app is the Trade Interceptor. The mobile application is available for both iPhone and Android users for free.

Trade Interceptor is a trading application that allows users to trade currency pairs, commodity futures, and binary options by using a host of forex brokers which traders can choose from. Along with this, traders can also browse through their app for forex analysis, trader opinions, and finance materials.

The mobile application has also made a name for itself due to its exhaustive financial tools such as analytical and technical indicators, charting properties, and comprehensive database (live stream of prices, news releases, economic calendars, and real-time market updates)

Try Trade Interceptor and see how you can maximize your options as a trader.

3. Bloomberg Business Mobile App
If you are a market participant or in any way aware of the finance world then you know of Bloomberg. Not only is it one of the biggest and most trusted financial media company, it also creates products, services, software, and data for traders.

Bloomberg has a wide variety of applications available for both iPhone users and Android users. Unfortunately, some of these mobile applications are available exclusively for Bloomberg subscribers. But fret not because there are some applications that don’t ask for membership.

The Bloomberg Business Mobile App is one of its basic apps. It gives users real-time updates on trading news, financial trends, and other market events. Moreover, it also offers other services such as portfolio tracking tools, market price check, and global financial analysis on local and international markets, companies, and other news. We recommend it because it’s information-rich and user-friendly. You can actually customize the app’s services to your preference by using the Watchlist feature where you can keep track of your financial tools, chosen market, and other data.

Keep updated with the Bloomberg Business Mobile App.

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Selecting the right bank for you is the first step to financial security. You may be tempted to just go with which bank is the most famous or the biggest or the most talked about. It is true that the big banks got to where they are because of years of development, however there is more to it than popularity.
History tells us that it doesn’t matter how big or small a bank is, every one of them are at risk of bankruptcy. That is why when selecting your bank, don’t simply go with the tide. You should consider the reputation of the bank but you should also factor in your preferences.
Here are 5 factors to consider in selecting your bank.
Before anything else, you should consider a bank’s Legitimacy and Reputation. In order to ensure the safety of your hard-earned money, you must make sure that the financial institution you are entrusting them to is legal and trustworthy. There are ways that you can do this. One of them is looking up your prospective bank on the list of Federal Deposit Insurance Corporation of legitimate banks. You also have a slightly safer choice with banks that have reputation.
Once you’ve guaranteed the legitimacy and reputation of your prospective bank, its time to consider your preference with the Location and Size of the bank. You must consider if you need to be close to your bank or not and whether there are ATMs available near you for your convenience. Sometimes you are better off using a local bank if you’re not keen on travelling. The size of the bank is important as it indicates accessibility. The bigger the bank, the more the branches it has internationally.
Another factor you should look at is the Charges. Banks vary in this sense as they have different charges and policies depending on the kind of savings you want to have. That is why you must do your research before entering into a transaction with a bank. You must know what banks cater to your needs whether you will be saving up long time or be proactive in your finances.
Your needs is another factor with the Accessibility of the bank to be considered. What kind of client are you? There are people who want personalized banking service while others are okay with impersonal but instant transactions such as online dealings. Make sure you are getting what you want depending on your banking needs.
The last factor to consider is your Savings Capacity. Some banks were made specifically for clients that have large amounts to deposit while other banks were customized to cater to clients that have small balances. Some banks were made specifically for different kinds of clients such as employees, trustees, etc.
Taking into account everything above will not guarantee you of a 100% risk-free banking experience but it will make sure that your money is at the safest place it can possibly be. Do your research, select your bank, and begin securing your financial future.

The Importance of Banks
Banks are financial institutions that are licensed to keep your money through withdrawals and deposits which may be owned or regulated by a central bank or the national government. They are vital institutions for the nation and the economy to function properly.
However, other than the essential part it plays to regulate the regulation and distribution of a nation’s money, banks are also important for the individual citizen. Here are three reasons why banks are important.
1) Banks are secure.
When you were a kid, you probably stashed the extra cash you had under the bed or in a piggy bank or in the corner of your underwear drawer. However, all these mentioned places are vulnerable. Your home, however safe you may think it is, is prone to disasters, natural and man-made. The cash under your bed could be left behind during a fire and burned to a crisp. Your piggy bank could be smash opened and your cash be stolen. Your underwear drawer could be drowned in a flood or hurricane. Worse, you could just altogether forget where you hid your money. Basically, the home is not an ideal place to keep your money.
Banks were made for the specific purpose of keeping your money for you. The key is to choose a legitimate bank protected by a legal insurance company. For example, in the US, banks under the FDIC or the Federal Deposit Insurance Corporation proved to be reliable despite times of financial crisis. Your money is really just safer in a bank.
2) Banks are convenient.
Banks provide convenience and practicality. With the rise of the internet, banking has changed forever. Aside from the thousands upon thousands of ATMs or automated teller machines that you can access anywhere there is available, online banking has also become available, allowing you to transfer money, pay bills and purchase stuff on the web. You can also keep track of your finances online, on your laptop, tablet, or phone.
3) Banks offer saving and investing.
Besides keeping your money safe and accessible to you, banks also offer the opportunity for your money to grow. By simply depositing money on a bank, it accumulates interest. There are also options for time savings, where you agree to keep your money in the bank at a specified time for increased interest rates. Investing is also an option to make your money work for you.
Banks have long stood the test of time as the keepers of wealth. Take advantage of the opportunities they provide. Save and invest.

Factors in Option Trading Costs
Forex Options have no definite price. Understanding the factors that affect this is essential for any trader that wants to conquer the field of Forex Options trading.
In pricing the options, there are several factors to consider to appropriately determine its value. Learning this is essential to understand how an option works.

  1. Volatility – Volatility is the measure of uncertainty or risk with regards to the size of change in an option’s value. Higher volatility means increased chances of hitting the strike price within the limited time period. This is why as the currencies get more volatile, the higher the options premiums are.
  2. Time Value – This is the length of time where the strike price can occur where pricing is uncertain. Naturally, the longer the time value is, the chances of hitting the strike price is increased that is why premiums are higher.
  3. Interest Rate Differential – The relationship between the strike price and  the current market rate is significantly affected by the changes in interest rates that’s why it is included in the computation of the premium price as a function of the time value.
  4. Intrinsic Value – The intrinsic value is the options price currently without the time value. It is used as basis to determine a strike price that can be one of the following:
    1. “In the money” – the current price is lower than the strike price.
    2. “Out of the money” – the current price is higher than the strike price
    3. “At the money” – the current price is the same value as the strike price

The first Russian Grand Prix in 100 years was held in Sochi last October 12, 2014 and InstaForex was part of the historic sporting event through its F1 team partner, Marussia.

Held at Sochi’s storied Olympic Village with the Ice Stadium as its backdrop, the F1 leg included the German racing duo of Sebastian Vettel and Nico Rosberg, compatriots of the winner of the last Russian Grand Prix from way back in May 18, 1914, Will Scholl. With the race, the Olympic Village once again was filled with energy and cheers from F1 fans all over the world.

Even Vitaly Mutko, the Sports Minister of Russia, couldn’t resist the allure of the much awaited event and opted to be part of the crowd rearing to watch the best drivers in the world compete. Among them was Max Chilton, the driver for Team Marussia, the partner team of InstaForex. Although Max was unable to finish the race, he gave the other teams a good fight and showed his determination until the end.

At the end of the day, Lewis Hamilton earned the podium finish, dashing the hopes of the German drivers to bring back the trophy won by their compatriot a century ago.

The main attraction of the race, however, was that the Grand Prix has returned to Russia after a long hiatus. With its successful hosting that included a festive concert for attendees starred in by Lenny Kravitz, the F1 sporting scene looks to be alive once more in Russia.

InstaForex is proud to have been part of this historic international event and will look to continue bringing such venues for celebration and success in the future.

 

The partnership between HKM Zvolen, one of Europe’s top ice hockey clubs, and InstaForex, the multi-awarded Forex broker, has been strengthened with both groups extending their relationship.

Under the partnership, HKM Zvolen, whose name translates to the chivalrous “Knights”, was the champion of the Slovak Extraliga in 2013 and will continue bearing the name and support of InstaForex throughout the 2014-2015 season. Apart from its most recent trophy run, the team also earned the title of being the IIHF Continental Cup Champion in 2005 by beating the star studded team of Moscow Dynamo.

InstaForex continues to support teams and organizations who share a legacy of not only excellence and achievements, but also of always striving to reach new heights. Just like InstaForex, HKM Zvolen has proven that it is worthy of being among the world’s top clubs with its past and present performances.

HKM Zvolen begins the 2014-2015 season with the blessing of InstaForex to continue its history of greatness in the league.

 

Because of its accessibility, convenience, and potential for profits, the Forex has become the runaway leader in the list of the world’s biggest financial markets.

Part of the reason it has achieved this is that each major region around the world has its own home market. When the sessions of these markets are put together, the Forex practically becomes a 24 hour market that can be accessed by anyone around the world.

Not only do these sessions vary in terms of opening and closing times, they oftentimes have differences when it comes to activity levels or which currency pairs become more traded. Among the most active sessions that traders like you should be aware of are the London, New York, and Tokyo markets.

Since currency movements vary from session to session, it would be beneficial for you to know about these three.

London

Europe’s primary Forex market is the London session, which accounts for the most activity among all Forex markets. Not only is it the central financial district of Europe, it is also one of the most recognized and sought after locations for investors looking to become traders.  Because of this, almost all currency pairs become active when London is open, especially when it overlaps with Tokyo for its trading hour and with New York during the entire afternoon.

New York

The next most active market is in New York, which is the financial center of the United States. Since this is the home of dollar where news and policy changes are first announced, it is one of the most influential sessions that can spark a change in the direction of markets.

Tokyo

The Tokyo session is considered as the first market to open internationally. Among these three, it has the lowest level of activity since other locations around the world are likely to be closed. However, Tokyo is still an important market to keep track of since trends that begin here can continue to other sessions.

 

Besides from interpreting charts and applying formulas to predict its future movements, fundamental analysis can also be used when coming up with a trading strategy. Using this method, you will have to turn your attention away from charts and towards data on market developments.

The most often used data are called economic indicators which includes the consumer price index, or CPI, a commonly cited measure of an economy. The CPI is simply a tool used to determine the level of inflation, or the rate of how much prices of consumer goods are increasing.

Knowing the rate of inflation is valuable information to know because it can give you a general idea of how the economy behind a currency is doing. Healthy growing economies are often marked with moderate inflation levels, meaning that if the CPI turns out to be to as expected, it is likely that its effect on its currency will be minimal. Should the CPI turn out to be lower or higher, however, then you can start analyzing more data to see whether it will bring the currency down.

The reason for this is that an expanding economy means that its consumers hold jobs with wages that are enough to fund their lifestyle. As people get access to more money, prices will naturally increase since more people are willing to spend, increasing demand for various products and services.

The data on the consumer price index may come from various sources. Independent research organizations such as Markit Economics provide monthly updates to their inflation gauge, but it can also come from the official statistics department of governments. No matter the source, when the CP will be released is often announced ahead of time to give banks, investors, and traders like you time to incorporate it into your Forex strategy.