Sunday, November 22, 2009
FOREX (Foreign Exchange market)
Forex is an inter-bank market that took shape in 1971 when global trade shifted from fixed exchange rates to floating ones. This is a set of transactions among forex market agents involving exchange of specified sums of money in a currency unit of any given nation for currency of another nation at an agreed rate as of any specified date. During exchange, the exchange rate of one currency to another currency is determined simply: by supply and demand – exchange to which both parties agree.The scope of transactions in the global currency market is constantly growing, which is due to development of international trade and abolition of currency restrictions in many nations. Global daily conversion transactions came to $1,982 billion in mid-1998 (the London market accounted for some 32% of daily turnover; the New York market exchanged approx. 18%, and the German market, 10%). Not only the scope of transactions but also the rates that mark the market development are impressive: in 1977, the daily turnover stood at five billion U.S. dollars; it grew to 600 billion U.S. dollars over ten years – to one trillion in 1992. Speculative transactions intended to derive profit from jobbing on the exchange rate differences make up nearly 80% of total transactions. Jobbing attracts numerous participants – both financial institutions and individual investors.With the highest rates of information technology development in the last two decades, the market itself changed beyond recognition. Once surrounded with a halo of caste mystique, the foreign exchange dealer’s profession became almost grasroots. Forex transactions that used to be the privilege of the biggest monopolist banks not so long ago are now publicly accessible thanks to e-commerce systems. And the foremost banks themselves also often prefer trade in electronic systems over individual bilateral transactions. E-brokers now account for 11% of the forex market turnover. The daily scope of transactions of the biggest banks (Deutsche Bank, Barclays Bank, Union Bank of Switzerland, Citibank, Chase Manhattan Bank, Standard Chartered Bank) reaches billions of dollars.The FOREX market as a place where to apply one’s personal financial, intellectual and psychic power is not designed for attempts at catching a bluebird there. Sometimes someone manages to do so but for a short time only. The key advantage of a forex market is that one can succeed there just by the strength of one’s intelligence.Another essential feature of the FOREX market, no matter how strange it might seem, is its stability. Everybody knows that sudden falls are very typical of the financial market. However, unlike the stock market, the FOREX market never falls. If shares devalue it means a collapse. But if the dollar slumps, that only means that another currency gets stronger. For instance, the yen strengthened by a quarter against the dollar late in 1998. On some days dollar fell by dozens percentage points. However, the market did not collapse anywhere; trading continued in the usual manner. It is here that the market and the related business stability lie - currency is an absolutely liquid commodity and will be always traded in.The FOREX market is a 24-hour market that does not depend on certain business hours of foreign exchanges; trade takes place among banks located in different corners of the globe. Exchange rates a`re so flexible that significant changes happen quite frequently, which enables to make several transactions every day. If we have an elaborate and reliable trade technology we can make a business, which no other business can match by efficiency. It is not without reason that the pivotal banks buy expensive electronic equipment and maintain the staffs of hundreds of traders operating in different sectors of the FOREX market.The starting costs of joining this business are very low now. Actually, it costs several thousands of dollars to take a course of initial training, to buy a computer, to purchase an information service and to create a deposit; no real business can be established with this money. With excessive offers of services, finding a reliable broker is also quite a real thing. The rest depends on the trader himself or herself. Everything depends on you personally, as in no other area of business now.The main thing the market will require for successful operations is not the quantity of money you will enter it with – the main thing is the ability to constantly focus on studying the market, understanding its mechanisms and participants’ interests; this is constant improvement of one’s trade approaches and their disciplined implementation. Nobody has achieved success in that market by forcing one’s way with one’s capital atilt. The market is stronger than anything else; it is even stronger than central banks with their huge foreign exchange reserves. George Soros, a national hero of the FOREX market, did not win the Bank of England at all, as many of us believe – he made the right guess that, with existing contradictions inherent in the European financial system, there were plenty of problems and interests that would not allow to hold the pound. That’s exactly what happened. The Bank of England, having spent nearly $20 billion to maintain the pound rate, jacked it up, by giving it in to the market. The market settled this problem, and Soros got his billion.The global monetary system has gone a long way during thousands of years of the human history, but it is surely experiencing the most exciting and earlier unthinkable changes. The two main changes determine a new image of the global monetary system:
Forex Markets Worldwide Tips & Information
Forex is also considered by the name foreign market exchange or FX. Those concerned in the foreign exchange markets are usually the biggest, most wealthy business organizations and banks from around the world. They trade in multiple currencies from many countries to create that balance between those who will profit and others who might in all probability suffer fantastic losses. The fundamental principles of forex are similar to that of the stock market found in any country, only much bigger and complex. Forex dealing involves individuals, monies and transactions from all across the globe between every last country.
The most heavily traded currencies are those that include (in no particular order) the British pound, Australian dollar, the Swiss frank, the United States dollar, the Eurozone euro and the Japanese yen. You can cross-trade currencies as well as mixing the trades between currencies to acquire extra money and daily interest.
The times when forex exchange will start at one hour and then close while other markets are opening. This is seen also in the stock exchanges from around the world, as transactions are starting in one time zone while making other transactions during various times. The conditions of forex trades in one region might create various results in another forex exchange as the countries take turns opening and closing with the time zones. Rates of exchange will be different from a forex exchange to another, and if you are a broker, or if you are learning about the forex markets you want to know what the rates are on a given day before making any trades.
The nature of the stock exchange is dependent on various products and their value as well as other financial factors that will change the price of stocks. When people find out a business event is going to happen before public disclosure, it is called insider trading, the use of illegal business intelligence to buy stocks and make money - which by the way is illegal. There is not so much inside trading in the forex trading markets. Financial trading is a basic part of the forex exchange but very little is based on business secrets, but more on the value of the economy, the currency and such of a country at that time.
A three letter code is attached to every currency on the forex exchange so no confusion exists when knowing which currency one is trading from or into. The euro is the EUR and USD stands for the US dollar. The British pound is the GBP and JPY stands for the Japanese yen. If you are interested in contacting a broker and becoming involved in the forex markets you can locate several brokers online where you can check out the company’s profile and type of forex transactions ahead of throwing your money down the drain.
What is your working schedule?
You can trade on Forex 5 days a week from Sunday 23:00 GMT till Friday 21:00 GMT. To trade CFDs on stocks is allowed only during the trading hours for specific instrument. For more information go to page "Contract Details" In case of any problems with Internet connection you can apply to our operators to make a deal by phone. Technical support works 24 hours a day and always ready to answer your questions.
What is your working schedule?
You can trade on Forex 5 days a week from Sunday 23:00 GMT till Friday 21:00 GMT. To trade CFDs on stocks is allowed only during the trading hours for specific instrument. For more information go to page "Contract Details" In case of any problems with Internet connection you can apply to our operators to make a deal by phone. Technical support works 24 hours a day and always ready to answer your questions.
Internet Trading Risks
In addition, there are risks associated with utilizing an Internet-based deal execution trading system including, but not limited to, the failure of hardware, software, and Internet connection. Since PFG Inc. does not control signal power, its reception or routing via Internet, configuration of your equipment or reliability of its connection, we cannot be responsible for communication failures, distortions or delays when trading via the Internet. PFG Inc. employs back up systems and contingency plans to minimize the possibility of system failure, and trading via telephone is always available.
Market Opinions PFG Inc.
Any opinions expressed by representatives of PFG Inc. as to the future direction of prices of specific currencies are purely opinions, do not necessarily represent the opinion of PFG Inc., and are not guaranteed in any way. In no event shall PFG Inc. have any liability for any losses incurred in connection with any decision made, action or inaction taken by any party in reliance upon the information provided verbally or via the Internet, or any delays, inaccuracies, errors in, or omissions of information.
High Risk Investment
Margined Currency Trading is one of the riskiest forms of investment available in the financial markets and is only suitable for sophisticated individuals and institutions. An account with PFG Inc. permits you to trade foreign currencies on a highly leveraged basis (up to approximately 100 times your account equity). An initial deposit of $1,000 will enable the account holder to take a maximum position with $100,000 market value (please note that the minimum required to open an account is $2000.00). The funds in an account trading at maximum leverage can be completely lost, if the position(s) held in the account has a one percent swing in value. Theoretically, an account could lose more than the equity it contains, if the account is trading at maximum leverage and positions held in the account swing more than one percent in value. Given the possibility of losing one's entire investment, speculation in the foreign exchange market should only be conducted with risk capital funds that if lost will not significantly effect one's personal or institution's financial well being.
Rollovers
In the spot Forex market, trades must be settled in two business days. It means that counter transactions encompassing the same currency pair, for the same amounts, settled on a spot basis, are needed where one transaction closes the position for the "old" value date, and simultaneously opens the position for the new value date. In this case the dealer may charge or pay interest to the client for these position rollovers. As a result funds are subtracted or added to the client's account with open positions. Whether a fee will be charged or a payment made depends upon the short-term interest rates in the countries of the currencies in the pair. For example, you sold 100,000 EUR/USD. It means that you effectively borrowed 100,000 Euro from the dealer against the current interest rate on Euro. You sold Euros and earned a corresponding amount in US dollars, which the dealer is now "holding" for you. The dealer pays you for the US dollars you placed with him at the current interest rate on US dollars. You pay the interest rate that currently can be earned on EUR investments. The difference between these payments is recorded in points on your account. A model schedule can be represented as follows:
Order quotation and fulfillment in a highly volatile market
Rapid changes normally occur in the market after release of important macroeconomic parameters, economic or political news of in case of force majeure events. In this case, spread may be slightly widened, and a dealer has the right to change the price and to suggest that a transaction should be entered into at a new price but orders are fulfilled in strict conformity with stated prices.
Order quotation and fulfillment in a quiet market
In a quiet market, quotations received from a dealer conform to or are slightly different from those in the Market Watch window of the MetaTrader trading platform. Spread on the major currencies and main crosses is 3-5 pips. Orders are fulfilled in strict conformity with the price stated in the order, irrespective of the order type.
Making profit on Forex market. Examples.
Let your deposit equal 3000 USD. Leverage 1:100 on Forex Market allows to operate the sum equal 300 000 units of base currency.You expect increasing of US currency cost against general world currencies on Forex Market. And decide to sell GBP against USD on September, 22, 2005. At the same time you realize the risk of trading the maximum sum, and sell only 30 000 GBP against USD at 1.8000.12 days later, on October, 3, 2005 you decide to close your short position and buy GBP at 1.7540.
Asset management
Asset Management company "Pro Finance Group" is a young and perspective company on the financial market. Our relationship with the clients is based on five main principles: an individual approach, reliability, convenient reporting system, high professionalism of our employees and measured decisions
Brokerace company
Brokerage company "Pro Finance Group" offers brokerage services to companies and private persons. Our brokerage department is more than twenty brokers on stock and non stock markets, who will select for you the most profitable stocks, bonds, futures etc. and will help to hedge the risks.
Financial company
Financial company "Pro Finance Group" was founded in 2000. The company originally focused on alerting investor clients to long-term price trends in commodities and financial markets, and opportunities for trading in futures and derivative markets. The efficiency of the company's operation is defined by professionals and business diversification in the world.
Central Banks
Speeches, publications, press releases and analysis by the leading central banks. You can also find out the interest rates along with historical data from every bank on the list.
Forex News
In this section you will find all the latest financial news, top stories, currency news, and more on topics like commodities, equties, interest rates and economic indicators.
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