Forex Trade
Main menu:
 |
|||||
 |
|
|
|
New To Forex |
|
|
|
|||||
|
|
|||||
|
|
|||||
|
|
|||||
ACM offers online forex trading services for traders wanting to make speculative transactions on the exchange rate between two currencies. These rates may be influenced by world economic and political events, currency rate differentials, as well as many other factors including extreme weather conditions (hurricanes), acts of terror etc. The Foreign Exchange Market is the largest marketplace in the world with than 1.8 trillion dollars changing hands daily and so making it one of the most attractive and lucrative markets.
www.etoro.com.pl
FX market allows you to buy and sell currencies against each other and speculate on the differences in exchange rates. Making a transaction on the Foreign Exchange Market is simple: the procedures are identical to that of any other market so switching to trading currencies is straightforward for most traders.
 |
Buying/Selling - B/S
If you want to open a position (i.e.: place
an order to sell – to make a profit if the exchange rate falls)
you have to choose the amount (i.e.: 100.000 EURUSD) from the
drop down menu on the platform and then click the mouse on the
sell currency button: SELL (if you want to place an order to buy,
you should act in reverse). This will open a position in the
market and you will receive an immediate notification of it on
your trading station. To close an open position, you have to do
the opposite of the initial operation – in our case buy the
100.000 EURUSD back. |
 |
How does the B/S system work?
As with any market, for each currency pair, there are 2 prices. The difference between them is called the spread. The spread is measured in points or pips – lowest decimal figure in a currency rate. For a EURUSD a pip equals 0.0001 (or 10 dollars on 100.000), for EURJPY a pip equals 0.01 (or 1000 yen on 100.000). More information on P/L calculation on the following page: (Choose whether to buy or sell.) |
Currencies are quoted in pairs, for example – EUR/USD or
USD/JPY. The first currency in the pair is called the base currency and the
second is called the counter currency. The base currency is the ‘basis’ for
purchases and sales. For example, if you buy EUR/USD, then you acquire Euros
and sell Dollars. You do this if you expect the Euro to grow against the
Dollar. It is also possible for a currency pair to be quoted as USD/EUR, but
this method is used extremely rarely.
Each transaction must have 2 sides – a buy and a sell (or a sell and a buy).
By this we mean that it is impossible to buy 100.000 EUR/USD and then
exchange it for another currency pair (i.e.: EUR/JPY) without closing the
first position.
Also please note that no physical currency delivery will be made. For these
purposes banks and exchange companies, which specialize in low-rate currency
conversions are available.
The Foreign Exchange Market, based on ‘spot’ transactions, is
unique in comparison with all other global markets. This is because trading
takes place 24 hours a day, 5 days a week (ACM platform works from Monday 00:00
to Friday 23:00 CET). Financial centers are open for work, and banks and other
organizations exchange currencies in different parts of the world for different
purposes. Therefore, trading never stops apart from a short break during the
weekend.
Early closings are possible depending on calendar arrangement such as, for
example, Christmas or new year’s eve.
A margin deposit is not, as many traditional traders suggest, the payment in cash for purchasing market shares. A margin is in fact a guarantee or a trust deposit, providing protection from losses during a deal? It allows traders to open positions on amounts that greatly exceed their account limits and so increase their buying power. ACM offers a 1% margin (or 1:100 leverage), which means you can control 100 times your deposit in the real market.
If the funds in the account, in the course of trading, fall below the prescribed margin, your positions will be closed automatically without prior notice. Using this system, the client’s account cannot go overdrawn even under volatile, fast-changing market conditions.
The formula for calculating margins is as follows:
(account balance + profit/loss) : open position = the margin
For the sake of transparency and unlike any other online broker we actually have a complete explanation of applied interest rates and the very tight interest rate spreads we apply. The exact calculation is based on 1 day interbank deposit rates and is as follows:
1) (1 day interbank dep. rate for base ccy.) - (1 day
interbank dep. rate for counter ccy.) = interest rate differential.
2) Interest rate differential / 365 = daily differential.
3) (Daily differential x total open position in currency
pair) / 100.
How to start trading
1. Define how long you can trade for.
2. Define the currency pair you feel most comfortable with.
3. Choose the tradable amount.
4. Before opening a position, you have to consider how much
profit you wish to make or how much loss you are eventually prepared to take.
Depending on this analysis, place stop and/or limit orders.
5. Open your position or place an entry order.
6. Follow significant news events and technical indicators
which you can consult inside your trading station or from third party sources
|