Foreign Exchange
The simultaneous transaction of one currency for another.
Foreign Exchange Market
An informal network of trading relationships between the world's major banks and other market participants, sometimes referred to as the interbank market. The foreign exchange market has no central clearinghouse or exchange, and is considered an over-the-counter (OTC) market.
Spot Markete
The market for buying and selling currencies at the current market rate.
Rollovere
A spot transaction is generally due for settlement within two business days (the value date). If you open a position on Monday, the value date is Wednesday, but if you hold it past rollover on Monday, the new value date is Thursday. Every margin transaction involves borrowing one currency to purchase another, so you pay interest on the currency borrowed, and earn it on the one purchased. For example, if you buy the NZD (7.5% interest rate) and sell the JPY (0.5% interest rate), you would earn interest on the NZD and pay it on the JPY. The amount you pay or receive is based on the interest rate differential between the two currencies. Most brokers automatically roll over your open positions (usually 5PM New York time/10PM GMT) allowing you to hold your position for an indefinite period of time.
Current central bank interest rates
How to calculate rollover interest
Rollovers in Forex
Exchange Ratee
The value of one currency expressed in terms of another. For example, if EUR/USD is 1.3200, 1 Euro is worth US$1.3200.
Currency Paire
The two currencies that make up an exchange rate. When one is bought, the other is sold, and vice versa.
Base Currencye
The first currency in the pair. Also the currency your account is denominated in.
Counter Currencye
The second currency in the pair. Also known as the terms currency.
ISO Currency Codese
USD = US Dollar
EUR = Euro
JPY = Japanese Yen
GBP = British Pound
CHF = Swiss Franc
CAD = Canadian Dollar
AUD = Australian Dollar
NZD = New Zealand Dollar
For a full list, see ISO Currency Codes
Currency Pair Terminologye
EUR/USD = "Euro"
USD/JPY = "Dollar Yen"
GBP/USD = "Cable" or "Sterling"
USD/CHF = "Swissy"
USD/CAD = "Dollar Canada" (CAD referred to as the "Loonie")
AUD/USD = "Aussie Dollar"
NZD/USD = "Kiwi"
Market Makere
A market maker provides liquidity for a particular financial instrument and stands ready to buy or sell that instrument by displaying a two-way price quote. In most cases, a market maker's commission is built into the spread.
# Another Market Maker Definition
Forex ECN Broker
Electronic Communications Network. A Forex ECN brings together multiple market makers and traders to trade together between themselves, matching buyer and seller together for a small fee. It allows traders to act like market makers by being able to enter in their own bids and offers into the platform. A forex ECN displays all the available bids and offers from all market makers and traders on the platform, and matches your order to the best available price.
Jumat, 07 Maret 2008
tips marketiva forex
Counterpartye
One of the participants in a transaction.
Sell Quotee
The sell quote is displayed on the left and is the price at which you can sell the base currency. It is also referred to as the bid price. For example, if the EUR/USD quotes 1.3200/03, you can sell 1 Euro for US$1.3200.
Buy Quotee
The buy quote is displayed on the right and is the price at which you can buy the base currency. It is also referred to as the ask or offer price. For example, if the EUR/USD quotes 1.3200/03, you can buy 1 Euro for US$1.3203.
Pipe
The smallest price increment a currency can make. Also known as points. For example, 1 pip = 0.0001 for EUR/USD, or 0.01 for USD/JPY.
Pip Valuee
The value of a pip. Pip value can be fixed or variable. To calculate the pip value, divide 1 pip by the exchange rate, and multiply it by the lot size.
e.g. 1 pip EUR/USD = 0.0001 / exchange rate (1.2900) * 100,000 = 7.75 EUR. To convert back to USD, simply multiply it by the EUR/USD exchange rate. 7.75 * 1.2900 = $10 per pip.
1 pip USD/JPY = 0.01 / exchange rate (118.00) * 100,000 = $8.47 per pip.
Lote
The standard unit size of a transaction. Typically, one "standard" lot is equal to 100,000 units of the base currency, or 10,000 units if it's a "mini" lot, and even 1,000 units if it's a "micro" lot. Some dealers offer the ability to trade in any unit size, down to as little as 1 unit!
Spreade
The difference between the sell quote and the buy quote or the bid and offer price. For example, if EUR/USD quotes read 1.3200/03, the spread is the difference between 1.3200 and 1.3203, or 3 pips. In order to break even on a trade, a position must move in the direction of the trade by an amount equal to the spread.
Standard Accounte
Trading with standard lot sizes
Mini Accounte
Trading with mini lot sizes
Margine
The deposit required to open or maintain a position. A 1% margin requirement allows you to control a $100,000 position with a $1,000 margin deposit.
Leveragee
The extent to which you are using borrowed funds. To calculate leverage, divide your total open positions by your account equity to get the leverage ratio. e.g. If a trader has $1,000 in his account and opens a $100,000 position, he is using 100:1 leverage. If he opens a $200,000 position with $1,000 in his account, he is using 200:1 leverage.
Manual Executione
An order which is executed by dealer intervention.
Automatic Executione
The order is executed by computer software without human intervention or involvement.
Slippagee
The difference between the order price and the executed price.
Long Positione
A position in which the trader profits from an increase in price. Buy low, sell high.
Short Positione
A position in which the trader profits from a decrease in price. Sell high, buy low.
Drawdowne
The extent to which equity is lost in a trading account from a trade or series of trades, measured from peak to subsequent trough, most commonly in percentage terms.
Common Order Types
Market Ordere
An order to buy or sell at the current market price.
Limit Ordere
An order to buy or sell at a specified level.
Stop-Loss Ordere
An order to restrict losses at a specified level.
Limit Entry Ordere
An order to buy below the market or sell above the market at a specified level, believing that the price will reverse direction from that point.
Stop-Entry Ordere
An order to buy above the market or sell below the market at a specified level, believing that the price will continue in the same direction.
Trading Styles
Scalpinge
A style of trading that involves frequent trading seeking small gains over a very period of time. Trades can last from seconds to minutes.
Day Tradinge
A style of trading that involves multiple trades on an intra-day basis. Trades can last from minutes to hours.
Swing Tradinge
A style of trading that involves seeking to profit from short to medium term swings in trend. Trades can last from hours to days.
Position Tradinge
A style of trading that involves taking a longer term position that reflects a longer term outlook. Trades can last from weeks to months.
Discretionary Tradinge
A style of trading that involves the human decision making process for every trade.
Automated Tradinge
A style of trading that involves neither human decision making or involvement, whereby a pre-programmed trading strategy is automatically executed by computer software.
Example Transactione
Assume you have a trading account of $25,000 and you are trading with a 1% margin requirement. The current quote for EUR/USD is 1.3225/28 and you place a market order to buy 1 standard lot of 100,000 Euros at 1.3228, expecting the euro to strengthen against the dollar. At the same time you place a limit order at 1.3278, 50 pips above your order price.
The notional value of this transaction is $132,280 (100,000 units * $1.3228). Your required margin deposit is 1% of the total, which means you need $1322.80 account equity for this trade.
As you expected, the Euro strengthens against the dollar and your limit order is reached at 1.3278. The position is closed. Your total profit for this trade is $500 (each pip being worth $10).
One of the participants in a transaction.
Sell Quotee
The sell quote is displayed on the left and is the price at which you can sell the base currency. It is also referred to as the bid price. For example, if the EUR/USD quotes 1.3200/03, you can sell 1 Euro for US$1.3200.
Buy Quotee
The buy quote is displayed on the right and is the price at which you can buy the base currency. It is also referred to as the ask or offer price. For example, if the EUR/USD quotes 1.3200/03, you can buy 1 Euro for US$1.3203.
Pipe
The smallest price increment a currency can make. Also known as points. For example, 1 pip = 0.0001 for EUR/USD, or 0.01 for USD/JPY.
Pip Valuee
The value of a pip. Pip value can be fixed or variable. To calculate the pip value, divide 1 pip by the exchange rate, and multiply it by the lot size.
e.g. 1 pip EUR/USD = 0.0001 / exchange rate (1.2900) * 100,000 = 7.75 EUR. To convert back to USD, simply multiply it by the EUR/USD exchange rate. 7.75 * 1.2900 = $10 per pip.
1 pip USD/JPY = 0.01 / exchange rate (118.00) * 100,000 = $8.47 per pip.
Lote
The standard unit size of a transaction. Typically, one "standard" lot is equal to 100,000 units of the base currency, or 10,000 units if it's a "mini" lot, and even 1,000 units if it's a "micro" lot. Some dealers offer the ability to trade in any unit size, down to as little as 1 unit!
Spreade
The difference between the sell quote and the buy quote or the bid and offer price. For example, if EUR/USD quotes read 1.3200/03, the spread is the difference between 1.3200 and 1.3203, or 3 pips. In order to break even on a trade, a position must move in the direction of the trade by an amount equal to the spread.
Standard Accounte
Trading with standard lot sizes
Mini Accounte
Trading with mini lot sizes
Margine
The deposit required to open or maintain a position. A 1% margin requirement allows you to control a $100,000 position with a $1,000 margin deposit.
Leveragee
The extent to which you are using borrowed funds. To calculate leverage, divide your total open positions by your account equity to get the leverage ratio. e.g. If a trader has $1,000 in his account and opens a $100,000 position, he is using 100:1 leverage. If he opens a $200,000 position with $1,000 in his account, he is using 200:1 leverage.
Manual Executione
An order which is executed by dealer intervention.
Automatic Executione
The order is executed by computer software without human intervention or involvement.
Slippagee
The difference between the order price and the executed price.
Long Positione
A position in which the trader profits from an increase in price. Buy low, sell high.
Short Positione
A position in which the trader profits from a decrease in price. Sell high, buy low.
Drawdowne
The extent to which equity is lost in a trading account from a trade or series of trades, measured from peak to subsequent trough, most commonly in percentage terms.
Common Order Types
Market Ordere
An order to buy or sell at the current market price.
Limit Ordere
An order to buy or sell at a specified level.
Stop-Loss Ordere
An order to restrict losses at a specified level.
Limit Entry Ordere
An order to buy below the market or sell above the market at a specified level, believing that the price will reverse direction from that point.
Stop-Entry Ordere
An order to buy above the market or sell below the market at a specified level, believing that the price will continue in the same direction.
Trading Styles
Scalpinge
A style of trading that involves frequent trading seeking small gains over a very period of time. Trades can last from seconds to minutes.
Day Tradinge
A style of trading that involves multiple trades on an intra-day basis. Trades can last from minutes to hours.
Swing Tradinge
A style of trading that involves seeking to profit from short to medium term swings in trend. Trades can last from hours to days.
Position Tradinge
A style of trading that involves taking a longer term position that reflects a longer term outlook. Trades can last from weeks to months.
Discretionary Tradinge
A style of trading that involves the human decision making process for every trade.
Automated Tradinge
A style of trading that involves neither human decision making or involvement, whereby a pre-programmed trading strategy is automatically executed by computer software.
Example Transactione
Assume you have a trading account of $25,000 and you are trading with a 1% margin requirement. The current quote for EUR/USD is 1.3225/28 and you place a market order to buy 1 standard lot of 100,000 Euros at 1.3228, expecting the euro to strengthen against the dollar. At the same time you place a limit order at 1.3278, 50 pips above your order price.
The notional value of this transaction is $132,280 (100,000 units * $1.3228). Your required margin deposit is 1% of the total, which means you need $1322.80 account equity for this trade.
As you expected, the Euro strengthens against the dollar and your limit order is reached at 1.3278. The position is closed. Your total profit for this trade is $500 (each pip being worth $10).
What is Marketiva?
Marketiva is one of the most popular online Forex brokers:
* Buy and sell major currency pairs and cross rates with one mouse click
* You can start trading with as little as $1!
* Open your account for free and get $5 cash reward so you can start trading right away!
* Spreads between bid and offer prices are among the tightest in the forex market
* Trading on margin (1%) allows you to trade $10,000 with only $100 deposit (collateral) in your account
* You don't need to start on live market right away - practice with your virtual money first
* No commissions or exchange fees on your trades - you can trade as much as you like!
* No interest charged on your open positions
* Read real-time economic news and forecasts about global economy and forex markets
* Get alerts narrated aloud prior to major scheduled market events
* Chat with other forex traders about market events, exchange trading ideas and learn
* Get help from our support professionals available 24h on support channels
* The most sophisticated and easy-to-use forex charting tool with built-in advanced technical indicators
* You can trade, view and modify open positions - directly on your charts
* Modify parameters of technical indicators in real-time and see how they appear immediately
* Build your chart collection by adding your saved chart configurations
* Easy to use and understand even if you are a beginner
* Streamster trading software gives you the best forex trading experience available!
* Arrange trading windows according to your preference, set charting options, use auto-pilot, and much more...
* You only need 5 minutes to open your account - and it's free!
* Buy and sell major currency pairs and cross rates with one mouse click
* You can start trading with as little as $1!
* Open your account for free and get $5 cash reward so you can start trading right away!
* Spreads between bid and offer prices are among the tightest in the forex market
* Trading on margin (1%) allows you to trade $10,000 with only $100 deposit (collateral) in your account
* You don't need to start on live market right away - practice with your virtual money first
* No commissions or exchange fees on your trades - you can trade as much as you like!
* No interest charged on your open positions
* Read real-time economic news and forecasts about global economy and forex markets
* Get alerts narrated aloud prior to major scheduled market events
* Chat with other forex traders about market events, exchange trading ideas and learn
* Get help from our support professionals available 24h on support channels
* The most sophisticated and easy-to-use forex charting tool with built-in advanced technical indicators
* You can trade, view and modify open positions - directly on your charts
* Modify parameters of technical indicators in real-time and see how they appear immediately
* Build your chart collection by adding your saved chart configurations
* Easy to use and understand even if you are a beginner
* Streamster trading software gives you the best forex trading experience available!
* Arrange trading windows according to your preference, set charting options, use auto-pilot, and much more...
* You only need 5 minutes to open your account - and it's free!
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