Page 194 – XTrade

Why Invest In Forex Today

Investing in stocks and commodities is too difficult for some to handle. By devoting time to invest in forex however, traders will have some unique benefits.

Why Invest in Forex Today

The forex market offers much more range of choice and flexibility than any other market. So that hardly ever a day goes by when there is no an interesting potential for trading, in some currency pair. All this flexibility makes things easier for the beginner, who want to learn how to trade forex in a feasible, realistic way. Sure enough, good trading requires you to be a specialist and not jump from market to market, so you might think that having to choose one pair out of so many, on a daily basis leaves little room for being a specialist. But it is possible, all one has to do is choose few currency pairs of interest, pairs that are not crosses of the same currency. That way, flexibility really becomes possible, and each different pair will trade independently of the other. Which is what flexibility really is all about. You will need to use all the usual tools, such as charts, LSS pivot numbers and so on, which is all possible in today’s embedded software, all in one forex calculator. The forex market is very liquid, reliable, allowing you to trade with confidence and even possibly become very profitable within your first year or so. There is no rule that you will have to go through a 5-year learning curve just to have your first profitable month. It is possible to be profitable from an early stage, as long as one refrains from impulsive trading. Many traders lose money trading forex, but also a good 30% actually do win, as opposed to the 5% myth. Broker statistics show that anything from 20% to 60% of their clients actually have profitable years. But there is no guaranty that those profitable will remain so forever, or that losing clients will always be losers. Trading habits and methods change, and so do these statistical figures.

Why Invest in Forex and Persevere to Win

Real life trading has shown that those who persevere in their efforts to trade well, actually become profitable sooner or later. These clients never regret their decision to invest in forex, and end up making a full living trading currencies. It comes as no surprise, since some investment banks actually make as much as 60% of their profits in the forex market. And what is forex trading if one does not persevere for success, just like those investment bank traders did. These banks are taking the same risks every day, as every other trader on the planet does. And their techniques for trading are not written in the bank’s manual, but they come from its traders. In fact, the bank’s managers, are not aware of how each trader makes decisions and ends up making money. That is secret to each individual trader who works there, and if a trader feels underpaid, they are free to go and join another investment bank. These traders are all single minded people, and they simply follow only the general guidelines that their employer requires. Some investment banks have no requirements at all, show them that you can make them money in the forex market, in any way possible, and they will hire you to trade for them.

The Quest for the Best Forex Indicator

Traders use many methods and indicators for trading. In their efforts to find the best forex indicator the goal proves to be elusive, but their efforts do pay.

What is the Best Forex Indicator

Many traders have embarked on the quest of finding the holly grail method for trading the markets. Among them is the goal of finding the best forex indicator, for predicting currency movements. It all looks possible on the forex charts, at least in hindsight but when one deals with live forex rates and fast trading things are really put to the test. Markets are tough to beat, some believe that all indicators are bound to fail big time, at some unexpected time. And that the predictability of the financial markets is severely limited. Maybe that is the case indeed, after all, if one has found the holly grail and their trading is limited and well hidden, we will never know. Some technicians believe that the information is somehow encoded on the market charts, in metrics such as momentum and daily trading range. Others believe that the secret lies in intermarket analysis, and others believe that all indicators are good once in a while, but no single indicator can work in continuous mode. Indicators tend to be all over the place, and never agree with each other at any randomly chosen time.

Figuring out the Best Forex Indicator from Price Action

The best forex indicator may be some indicator which best predicts a particular time frame, where false signals are somehow revealed easily to the trader. It is unlikely that one indicator, no matter how good, can work on various time frames. The global forex converter mechanism hides many dangers to investors and traders. And it does so because history does not exactly repeat itself, rather something new, never seen before, is bound to happen every now and then in the markets. This is the reason why forex robots end up failing after a while, because the programmer cannot dynamically model the markets in their computer code. Traders who have been successful, so successful that their trading cannot be attributed to luck and the use of simple indicator, are likely to actually have used simple indicators. It all boils down to how they used these indicator and how they were able to filter out false signals. It is unlikely that the holy grail is some kind of mathematical formula or algorithm, if it is then it would have to be enormously complicated that only the quantum computers of the future would be able to handle. Then again, it might be a simpler formula used together with the trader’s own judgement. The most logical explanation is that super successful traders did a lot of research beforehand. Research that was specific to the time period of trading, and the markets they traded so successfully.

How to Implement a Forex Investment

A good forex investment should be implemented in a selective way. By taking into account macroeconomic factors and the state of the national economies involved.

A Good Forex Investment Starts with Original Thinking

When one decides to implement a forex investment in any kind of currency, they inevitably have to analyse both that currency and their own national currency. Investing in foreign currency for anything beyond one month, requires imagination and original thinking. Much of the data can be found on forex charts, while finding other less obvious data requires ignoring the media and public opinion, and even possibly analysts’ opinions. Conventional wisdom for example, would have you believe that if interest rates go up in a specific country, then that country’s national currency must also appreciate over time. But this isn’t always the case, in fact it is perfectly possible for the said currency to depreciate over that period, thereby ruining one’s expectations and investment. The very first thing the investor should do, is look at long term charts, and see how that foreign currency has performed over the years, first against their national currency, and then against various other currencies. Much of what conventional wisdom teaches is right, but is only part of the truth. What really matters is how competitive and attractive a currency is to foreign investors, or how valuable it is to commodity buyers around the world. Economic numbers and interest rate policy are not enough to produce solid, durable price movements. So currencies can still trade in the most unexpected way possible, and investing becomes complicated.

Forex Investment Implementation through CFDs

Many investors who specialize in forex, when considering a forex investment always look at long term momentum and fundamental data. They prefer to invest through CFDs, and look for long term trends. As CFDs are more cost effective, and can even provide linear hedging for covering Carry currency investments. Live forex rates fluctuate up and down every day, and form trends over many days. These trends may reveal the existence of momentum, of false trends, as well as soon to happen trend reversal processes. These moves are fuelled by investors’ expectations of the near future, and not by current economic activity. Conventional wisdom often fails, because it focuses too much on current events. Sure enough higher interest rates will attract Carry investors, but these investors buy that currency long before rates are set higher. And then, what if another currency becomes more attractive, that would be one more reason not to invest in the high interest rate currency any more. All these factors are often ignored by analysts appearing on the media, and the markets end up proving them wrong time after time. That’s why making an investment on their advice is not a good idea. Investors should be original in their approach, and see the markets through the eyes of institutional investors around the world, such as investment banks. The markets are always different, every time, and history does not repeat itself in an exact, predictable pattern.

What You Should Know Before You Order Foreign Currency Online

There are some things every consumer should know before they order foreign currency online. It is possible to get a better rate, and even offset market risk.

What You Should Know Before You Order Foreign Currency Online

It is important to know that when you order foreign currency online, through your local bank or currency exchange, you actually are at disadvantage because of the high commission costs involved in the exchange process. These fees are only perhaps marginally better than exchanging the currency at any actual bank. But there’s more to foreign currency than just using it to pay for things and services abroad, or going on holiday. It is possible to use a broker, and actually trade these markets for all kinds of purposes. Typical purposes traders trade the forex market for, are pure speculation for a profit through price fluctuation, protection against risk, and profiting from interest rate differentials. Investing in foreign currency can always be highly beneficial, whether it is for few days or few months, it always pays to do your homework on various currency exchange rates.
Traders are all kinds of people, including merchants, ordinary citizens, speculators and investors. Hey all wanted to learn how to trade forex exactly because they want to capitalize on various opportunities. Even savvy real estate investors trade the forex market, before they actually buy any local currency. They do so to limit the market risk of adverse rate movement. So they have developed forex strategies of their own, but deep down they all rely on the same fundamental concepts.

So, How Does One Order Foreign Currency Online the Smart Way Then?

In order to order foreign currency online and not get a bad rate on the actual transaction day, one has to have studied the markets and rates in advance. A US based real estate investor for example, willing to buy a house in Australia, will check the rates very carefully and try to determine the currency price trends in development. If the Australian dollar is on a major rally, it doesn’t make sense to take out a local mortgage in Australian dollars. Rather, they will choose a falling available currency, perhaps the Euro or the Canadian dollar. For the long term the falling prices means that the repayment period will become shorter, as the US investor, paying with US dollars, will get an overall better deal in repaying his Australian mortgage. The actual value of the house will increase, from a global perspective, as a result of the local currency rising. But the buyer will get it for much cheaper, because they will be repaying a mortgage locked in a falling currency. There is also the factor of interest rates, as Australia has high interest rates, but other countries have much lower. Now as far as the actual day of converting currencies back and forth, especially large amounts through affordable online banks. One only has to do the same homework again. Not so much on interest rates, but on actual exchange rate trends, seasonal trends, and look to avoid buying at a medium term high. Wise forex traders have learned to figure these things out. And they can easily become smart real estate investors or merchants, because they already know how to trade forex. It’s a challenge, but anyone willing to learn, can reach that level of expertise.

What CFD Tutorial to Choose

CFDs are simple to learn, though they can get complicated on tax issues, as these are country specific. Any CFD tutorial focusing on one aspect though, is good.

One CFD Tutorial at a Time

Any CFD tutorial focusing on one aspect at a time, and doing some digging, will be good enough for most readers. Most articles and tutorial which are generic in nature don’t help much, but they are good for introducing the reader to the general concept of trading CFD. But in order to really go deeper on the individual aspects, such as hedging, stock specific hedging and trading, commodity hedging and tax benefits, one has to use specialized tutorials and articles. The tax issue alone is massive one, but as with all money and income related matters, one has to become a specialist in order to reach the real benefits. Tax planning is useful, as it helps minimize your tax liability and capital gains tax. In most countries it is possible to offset investment losses through CFDs and even take things further when one combines CFDs with the spot market. As far as CFD trading platforms go, one does not need to use a tutorial. Platforms can be used and set to custom settings by the trader themselves. One needs to get brainstorming ideas out of specialized tutorials, but once that has been done and the content has sunk in on their mind, it’s time to get creative. CFDs can be used in a million different ways. Such as for the purpose of hedging impossible adverse market conditions, minimizing tax liability and even saving a fortune on capital gains tax. Most traders don’t like paying capital gains tax because they feel the government is profiting out of their hard earned profits, as if taking a good portion of their profits. While the same government was not willing to take a share of their losses when these traders were losing money. Bear in mind, that some of the world’s top traders endured long, painful learning curves where they were losing money for years, before finally making millions. So the idea of capital gains tax does not appeal to these people, because they feel they are robed by their governments. Because they took all the risks on their own, to make those profits. A good tutorial on tax planning is a must in this case.

When a CFD Tutorial is Not Good

A CFD tutorial is about providing specialized guidance and great insights into using CFDs to improve your trading strategy and overall efficiency as an investor or trader. Generic tutorials that simply explain what is CFD trading, in a nutshell, are good for beginners. But they are not good for serious traders willing to pursue the trade above and beyond the minimum. Many poorly put together tutorials focus too much on the benefits of leverage and tax planning. And they mention nothing about the benefits of linear hedging and one way liquidity, which are actually extremely important! Generic tutorials are understood right away, as they are intended for amateur investors who are introduced into derivatives trading for the first time ever. So they are not good for those investors and traders seeking to gain that edge, which is only possible to learn through specialized tutorials and educational materials. Tutorials lasting less than 30 minutes, are unlikely to touch upon these issues.

Control Your Financial Fate With Online Trading In Digital Markets

In the present era of zero interest rates, the search for alternative investment channels is a subject of great popular interest ■ As an example, online trading empowers you to personally manage your investments and presents you with a means for economic independence

In recent years, trading in capital markets has undergone a significant change. Unlike previously, when to invest in the stock market investors had to use intermediaries such as investment advisers at banks, now all you need is an internet connection and an advanced platform for independent online trading. These two components, along with the professional support of a trading company through which you act, give you an opportunity for economic independence, and allow you to avoid the high trading fees charged by banks; Opening a world previously unknown to you.

Controlling Your Financial Fate

In the present era, with households desperately fleeing closed banking deposits, which cause them real losses, or at best give them a ludicrous annual yield of about 0.5%, many seek to invest their money in the capital market. One possibility is to contact the Bank’s investment advisor and ask him to invest a portion of your savings on the stock exchange. If you choose this option, you will find that within a short period the bank charged you various commissions regardless of whether your investments have borne fruit, or lead to losses. The alternative is to abandon the banks when it comes to investments in the capital market, to study the field and control your own financial destiny. “Through independent trading you can effectively manage your risks and decide at anytime of the amount you invest and whether you should get out of a specific transaction,” said Roi Dan, trading supervisor at Prime Broker.

Learn a new field

Capital markets are a world in and of themselves. In recent years, the public has grown increasingly interested in issues such as cost of living, pension, stock market, monetary policy, stocks etc. At the same time, and as previously mentioned, the low interest rates provided by banks almost everywhere, have pushed millions of people to the capital markets. The resulting demand for knowledge in the field is constantly increasing. And while many would prefer to invest their funds in the capital market but, out of fear, turn, as mentioned, to advisors and investment managers. Although the field does requires appropriate knowledge, but it certainly does not require the solving of sophisticated formulae available only to outstanding students of finance. In fact, anyone who has the desire can learn the basics of trading and become an independent trader. How to do it? Over the internet you can find plenty of information related to trading in the capital market: short guides, entire books, methods, and different strategies. In addition, independent trading investment houses, like prime broker, are always ready to assist their customers and provide them with a wide variety of educational materials.

Enough to pay commissions

Anyone who has ever managed an investment portfolio through the banks certainly has (or should be) certainly surprised to find the assorted fees collected each quarter. Banks assess the most exhorbitant commissions on periodic/management fees (on the basis of their “guarding” your securities). These fee range from 0.1% to 0.6% for all banks. In other words, the bank charges you a management fee percentage irrespective of whether you lose or profit. In addition, banks charge a commission for buying, selling, changing or cancelling orders in securities (transaction fees) at an average rate of between 0.3% to 0.5% on each transaction. In comparison, online trading companies, assess transaction fees, in the range from 0.01% to 0.2%. Also, most trading firms do not charge money for the non-execution or cancellation of orders, and trading fees for foreign securities are much lower than those charged by local banks. Domestic banks are estimated to generate commission income of some NIS3 billion annually [1].

“Trading firms’ commissions are almost non-existent in some assets,” says Dan. According to him, in certain instruments, such as forex trading, online trading fees that companies charge are negligible and their revenues are based essentially on the buy/sell trade spread.

Independent Trading – all the tools for succeed

Another advantage to independent traders are the tools and systems placed at your disposal by trading companies. For example, leading trading companies allow customers to use advanced systems which may be used to selectively employ a variety of contemporary market systems and strategies. In addition, trading firms allow their clients to execute “short” trades, which generate profits on price declines. These trading systems are easy to employ and allow for a variety of profit-maiximizing strategies. “Any self-respecting company now offers a seamless interface, regardless of platform: smartphone, tablet or desktop,” says Dan, “one of the world’s leading software is ‘MetaTrader 4’, with which we work at Prime Broker.

Personal professional support

While ostensibly trading alone, professional guidance and assistance is one of the most significant benefits online traders receive, says Dan. “In fact, traders have a whole team behind them which help them to get on track.” He said that established companies provide customers with personal and professional trading available almost anytime and helps the trader in understanding capital markets, trading systems, sites with important data for the various markets and so on. Additionally, a trading room, operating more than 12 hours a day, provides support for all the difficulties and questions of traders. So if you are tired of high bank fees, and are interested in a kind of economic self-sufficiency, consider becoming and independent trader. You do not have to turn online trading into your primary profession, but it certainly can provide you with a way to earn extra money from home or transfer your investment activities of banks.

*** Read the full company risk-disclosure, before contacting it for any service.