Advantages of forex on the purchase and sale of shares
Investing in forex offers significant advantages over the purchase and sale of shares and futures. Here are the advantages of the forex market:
Running 24 hours a day
The Forex market is a steady market available 24 hours a day, open on Sundays at 14:00 hours from New York until Friday at 16:00 hours from New York. By having the capability to operate during the hours of the U.S. market, Asia and Europe, operators have the advantage of immediately reacting to news of the market and determine their own hours of operation.
Increased liquidity
With a daily trading volume 50 times greater than the volume traded on the New York Stock Exchange, there are brokers and dealers (agents) to buy or sell currencies in the forex markets. The liquidity of foreign exchange market, especially the market for major currencies, helps ensure price stability. Traders can almost always open or close a position at a fair market price. This represents a major advantage of the Forex market.
100:1 leverage in the forex market
The online forex market dealers offer a 100 to 1 leverage, which far exceeds typical 2:1 margin offered by brokers and beyond 15:1 futures market. With a leverage of 100:1, the operators a margin deposit of $ 1000 for a position of $ 100.0000, or 1%.
Transaction costs low
It is much more efficient in operating costs based on the foreign exchange market in terms of commissions and operating expenses in the purchase and sale of currencies.
Equal potential for profits in both bull markets and falling
In all open forex position, an investor has a long position in one currency and short another. A short position is one in which the trader sells currency before it will depreciate. In this case, the investor benefits from a fall in market price.
The ability to sell currencies without any restrictions is another distinct advantage over the stock market.
Basic Principles on the Purchase and Sale of Foreign Currency
Any purchase involves the sale of foreign currency to buy one currency and sell another simultaneously. Currency quotes are presented as rates, ie, the value of a currency relative to another. Supply and relative demand for both currencies will determine the value of the exchange rate.
When an operator conducts a foreign exchange transaction, you want the value of the purchased currency appreciates in value against the currency sold. Its ability to determine how an exchange rate change, determine its gain or loss in an operation. Let’s make an example with a currency trading system obtained by the purchase and sale of foreign exchange (forex).
Taking an example of tender price and the current demand for EUR / USD is 1.0126, ie you can buy 1 euro for 1.0126 U.S. dollars.
Imagine that you think is the euro depreciated against the dollar. To realize this strategy, you buy Euros (simultaneously sold dollars) and then waits until the exchange rate rise.
Then performs the operation: 100.000 EUROS purchase (1 lot) and sell $ 101,260.
As you expected, EUR / USD 1.0236 climbs. How to buy Euros and sell dollars in its previous operation, must now sell Euros for Dollars for gain. Now you can sell 1 euro for 1.0236 U.S. dollars. When you sell 100,000 Euros at the current rate of EUR / USD 1.0236, will receive U.S. $ 102.360.
As you originally sold (paid) 101.260 U.S. $, your gain is $ 1100.
Total profit = U.S. $ 1100.00
Which currency pair should I start trading?
The brokers offer us the possibility to operate with a lot of currency pairs, the range is often so broad that sometimes we doubt what is the best pair to start operating.
The pair you choose will depend on your model of investment and expertise.
The most widely used currency pairs are known in English “The Majors” Pairs EUR / USD, USD / JPY, USD / CHF and GBP / USD
To choose a currency pair to operate to take into account the following requirements:
What is the currency with which it has more information?
Currencies like the dollar, Euro, Pound or the Yen will have more information than others.
There is some opportunity in the market?
Follow the market in search of opportunities in this.
The pair I am going to operate is related to gold or oil?
Some currencies like the dollar affected the price of oil and vice versa so often have a strong correlation.
Operate events?
Many operators want to operate at times close to the events which at times which tends to increase the volatility of the market, but offer many possibilities.
Volatility that I am willing to take?
Some currency pairs offered in their prices more volatile than others.
Spread it has the pair?
The commission charged by the broker that we often vary the torque to operate
That moves the markets? forex.
The relative prices of currencies, as in any market, fluctuate according to the laws of supply and demand. They also are exposed to a number of macroeconomic variables, and especially monetary policies of the countries involved.
Among the major variables affecting the market are interest rates, defined as those that yield more value than money on his (or anyone compares). The balance of trade of countries and their corresponding cash flow. Your tax situation, productivity, employment levels etc..
Entries (RSS)
Il faudra attendre que la corrélation dégage un gain, parfois un jour ou plus …, si j’interviens pour pyramider la sortie pourrait être plus rapide ??