Forex Trading Leverage and Costs

Many people would like to trade for a living, but the biggest problem they face is a lack of capital. In order to make a living trading in the stock market, traders really need to plan on having an initial balance of at least $100,000. That’s possible for mid-career professionals and retirees, but an unlikely … Read more

Investing in the Chinese Yuan: Appreciation Imminent?

With the impressive economic growth in China, many investors are getting interested in owning Chinese currency, aka the Yuan (which translates as round coin) or Renminbi. The distinction between the two is that the Yuan is the actual unit of currency while the Renminbi is name of the Chinese currency. A good comparison would be … Read more

Inflation Fighting Investment? Try Currency ETF’s

By Brian O’Connell Former President Ronald Reagan once defined inflation as “violent as a mugger, as frightening as a mugger, and as deadly as a hit man.” Our 40th president wasn’t exaggerating. Inflation is nature’s financial way of eating your income without you knowing it – or at least not right away. That’s the case … Read more

Why there are no commissions in Forex Trading?

When trading stocks, futures or options an investor will use a broker who executes the trade and charge a commission for the service. Forex trading, however does not involve commissions. Forex trading firms are dealers not brokers – they assume market risk by acting as a counterparty to the trade. Forex dealers make money through … Read more

Forex Market Participants

The main participants in the forex market are central banks, commercial and investment banks, hedge funds, pension funds, corporations and private speculators. An estimated 95% of the daily trading volume in the is done by speculators and investors – ranging from the individual trader to the leading banks of the world. The remaining 5% is … Read more

Chosing a Forex Broker – What to Look For

Tight Spreads: Look for competitive spreads. This is the difference between the bid and offer and is measured in pips. This is what it will costs to enter a trade, since it is not possible to buy on the bid or sell on the offer in the Forex market. Forex brokers are usually tied to … Read more

Currencies Traded in Foreign Exchange

Virtually any currency can be traded through a broker – providing it is backed by an existing nation. Currencies are defined by three letter symbols, where the first two letters stand for the name of the country and the third stands for the name of the currency. The major currencies are: the US Dollar (USD), … Read more

The Major Trading Sessions in the Forex Market

The FX market is active 24 hours a day – it is important for the active forex trader to identify the times where there is the most volatility and largest trading ranges. 1. Asian Session (Tokyo) 7PM-4AM EST Tokyo is one of the principle dealing centers in Asia and is the first major Asian market … Read more

What is a Pip?

A pip is the smallest price increment in forex trading – pip stands for percentage in point. Prices are quoted to the fourth decimal point in the forex market – for example EUR/USD might be bid at 1.1914 and offered at 1.1917. In this example we can see that the spread is 3 pips wide. … Read more