Global stock of foreign currency:
The word "forex" means the foreign exchange market or the global stock of foreign exchange in short the corresponding word "Foreign Exchange" in the English language. And is speculating in this market by buying and selling major currencies which have the basic share from operations in the forex market is the U.S. dollar USD)) the base currency and the euro (EUR) and Sterling (GBP) and Swiss franc (CHF) and Japanese Yen (JPY) .
Buying and selling those currencies and the U.S. dollar or other currencies among themselves, which defines pairs of currencies and against the U.S. dollar or any currency against another currency value. And considered speculative currency earn some kind of trade in the stock exchanges, and also the most risky, because of rapid fluctuations in the currencies of the upward trend to trend downward, or vice versa. In addition to the currency market there are other types of stock exchanges are: gold, silver, oil stocks, shares and bonds, agricultural and energy. The stock exchange characterized by various indicators and technical analysis, news analysis and rapid access to the profits.
Daily volume of currency trading in the forex market to reach $ 3 trillion. And for the sake of comparison, the volume of the activities of the New York Stock Exchange does not exceed $ 300 billion per day, it needed half a year for the New York Stock Exchange to reach the volume of the currency market.
And I have a bond market and sell future Future (FUTURE) and lack of a fundamental difference compared to the forex market: they stop working at the end of the day and resume work with the next morning. It is normal that if you are trading in the markets of Germany, for example, and the events occurred in America with a significant impact on the market, you may find the market at the beginning of work is significantly different than expected.
The forex market is not a market in the literal sense of the word, since it has no center, no place has a certain exercise a trade. The trading exercised by contacting the telephone and Internet computer at one time among hundreds of banks around the world. Hundreds of millions of dollars are sold and purchased every few seconds, and this is what is called currency trading.
Forex market combining four regional markets: Australian and Asian, European and American. And continue operations where all trading days of work, and the market operates around the clock 24 hours a day. And the relative calm from 20:00 pm until 01:00 GMT, and was due to the closure of the New York Stock eighth in the evening and start work on the Tokyo Stock Exchange at one o'clock in the morning.
It is known that decreases the influence over the financial markets, which could lead to the collapse of stock or bonds. The forex market decline in the dollar (for example) means the price rise of the second currency and there is no such mention the collapse of the stock or bonds. . .
It was established forex market (FOREX) for the financial transactions between banks in 1971 when it turned transactions in global trade from using fixed values of the currencies of the values of the floatation. The total output of the financial transactions carried out by agents of the financial markets to divert a certain amount of money in the currency of one country to another country's currency value agreed in advance to a specific date. And identifies specific currency conversion rate for other currency simply: supply and demand for convertible approved by the parties.
The volume of transactions in the international money market in steady growth. This development is significant in world trade and lifting the ban on currencies in many countries. The 80% of all transactions is a speculation in the currency market aimed at obtaining profits from currency differences. This speculation and attract many participants, both financial organizations or individual investors.
As a result of the tremendous development in communications technology in the last two decades has changed the market in itself to a large degree. That the profession currency trader, which was surrounded by an aura of secrecy has become almost unanimous. The trafficking in currency, which was until recently limited to major banks monopolistic become accessible to all as a result of electronic commerce. Even the largest banks in favor of trading as well as personal electronic transactions between two parties.
Objective of the forex market as a potential person for the use of financial, mental and psychological blow is not luck. Some may succeed in this, but not for long. The basic advantage of the currency market is that the success of using intellectual potential.
One interesting feature of the currency market is characteristic balance despite the fact that this seems strange. Everyone knows that the fundamental characteristic of the financial market is the sudden nosedive. But the forex market is different from the stock market in that it does not fall. When stocks lose value this collapse. If the dollar falls, for example, that only means that other currency has become stronger - an example of the Japanese yen, which has become in a few months of 1998 the strongest quarter for almost the dollar. This has reached a decline of the dollar for some days in that period of tens of per cent. Although this did not happen down the market and the transactions continued as usual. In this limited stability of the currency market and the associated work. The currency is fully liquidity goods can be purchased or sold at all times.
Currency market works all the time-stop is not linked to hours of work designated for Exchange, the transactions between banks located in different parts of the globe. The changes in currency rates are significantly and several times be sufficient to carry out several operations each day. If you have a proven trading technology and secured area you can make work not compare the effectiveness of its effectiveness in any other area. Therefore, we find the major banks acquire the most expensive equipment used dozens of specialist trading in the various sections of the currency market.
Expenditures to engage in this work is not great. In fact, the work requirements in this area of study and primary acquisition and the purchase of computer information service and does not exceed the value of insurance together a few thousand dollars and this amount can be invested seriously in any other area. With a huge supply of services in this area easy to find an experienced agent in the currency market. What is left after that depends on the stores. Draw from this is that success in this area depends on you personally more than any other act.
The basic thing for success in this market is not the size of the money entering the market as it is to focus Permanent study the market, and understand Mikhanykyate and wishes of the participants. This results in the continuous improvement of the way you work and organize your trading. This did not happen that someone has succeeded in the currency market was adopted on the capital only.
Advantages of Trading in the stock market for global currency:
• Liquidity: based on money market funds are not limited to able to open and close any specific transaction prices of currencies at the moment. I have a high degree of liquidity huge attraction for any investor as it gives him the freedom to open and close any deal, any size.
• Effectiveness: the proportion of the work of the market around the time it is not the traffickers in the market waiting to interact with a specific event, as the case may be on the stock market and other markets.
• Flexibility transactions: trading system is characterized by flexibility in the market as it can make the deal for a limited time by former investor desire thing that can be planned in advance of his coming.
• Cost: not for the forex market is traditionally no commission expenses, or any other expenses except for expenses - or profits - the difference between the bid and ask price (BID / ASK).
• standard rates: the proportion of the high degree of liquidity in the market, we find that the vast majority of sales operations can be implemented flat rate, which avoids the problem of investor volatility in the market, which offset future sale or stock exchanges and other exchange markets where they are sold at a particular time and a specified price only a limited amount of currency.
• directional market: that the movement of any of the currency market a particular direction can be followed by a period of time. And give each a specific currency price change with time special only thing that gives the investor the possibility of dealing in the market with tact.
Size of the margin:
Located in the Forex market the size of the loan called the margin or shoulder only agreement between the dealer and that the bank or brokerage firm which gives the director of the market and is usually 1:100 any customer to pay a deposit of $ 1000 can make a deal worth 100 thousand dollars. That the use of this margin with the large currency fluctuations make this profitable market, but also great risks.
Key elements in the foreign exchange market:
1 - global banks:
It is no secret to anyone that the banks are the largest and most important players in the arena of global trade currencies. They are conducting thousands of transactions daily around the clock, they exchange among themselves, or with Albrookr and ordinary investors, through their Permanent Representatives in this area. It is no secret that the greatest influence in moving the market and identify and exclusively in the hands of senior international banks, as the daily transactions amounting to billions of dollars.
2 - Central Banks:
Central banks are deals in this market commissioned by the government, a move often to influence the course of the direction taken by their own currencies, according to the interest that is consistent with financial policies, and therefore protect their economic interests.
3 - Investment funds:
It was due mostly to institutional investors or pension funds or insurance companies, intervene in the market, according to the dictates of their interests. Most famous of these funds remember "Tom Kwan," a fund, which is owned by renowned investor George Soros, who wrote a history in this area and still is one of the largest investors unable to extend influence in the course of the market.
4 - clients trade currencies:
These are the important link between the buyers and sellers. In other words, they move one hand as intermediaries between the various banks, on the other hand between the banks and private investors. In return for this work are they reckoned commission or the so-called Brokerage.
5 - Persons independents:
These are ordinary people who make a daily turnover of massive currency to finance their trips planned, or to secure access to their salaries, or at retirement, etc..
Today, after the revolution, which introduced the Internet operations of global communications, and after successive collapses in the stock markets, and under the influence of the foggy atmosphere witnessed by global markets, Treasury bonds, slowly growing role of independent dealers who have modest amounts of money in selling and buying the daily fast, "Dai Trader ". Growing influence and grow in the foreign exchange market, so that many of them are engaged in this work, and spend their days in front of computers, sell and buy each according to his vision of the course of today's events.
Trading Around the Clock:
As mentioned above, the work on the currency markets over the past 24 hours. In the calendar today and most obviously, start first in the Far East, in New Zealand, then moved to the role of Sydney in Australia, then to Tokyo, and on to Hong Kong, Singapore, and Moscow, Frankfurt, London, and finally New York, Floss Angeles.
Work begins foreign exchange dealer in Western Europe, for example, at half past seven in the morning. In the eighth work in the draw. Need to dedicate the first half hour each day to analyze market conditions, and study the developments of the day both the main substantive, technical art, after access to the new daily newspapers, or the exchange of information and leaks to the market and that would influence the course of the market. Thus, a clear idea, a program today which must be applied is changed if the need arises to be the work of the day.
Definitions in the global stock of currency:
Definition of the market:
The old definition, or common: it is a place where people go to buy their needs of various goods and services.
Economic definition: It is a group of buyers and a group of vendors want to buy and sell a commodity or service.
A historical perspective on the stock exchange:
The origin of the word to the Stock Exchange last name Van der Borsn Belgian who was working in the field of banking, which was her hotel the city of Bruges meeting place for local traders in the fifteenth century, where he became a symbol of the capital market and commodities exchange. The publication of what looks like a list of stock prices over the trading period for the first time in 1592 the city Anffers. In France, have stabilized the exchange in Paris at the Palais des Bronyar proportion to the engineer who drew the charts in 1808. In the United States stock exchange has started Street Wall Street in New York City mid-fourth century century.
What is the stock market?
Stock Exchange is the undisputed place of exchange, which can be shared everything. In it is the sale and purchase of food (such as coffee, rice, corn ...), and raw materials (such as oil, cotton, copper ...), and securities (such as bonds, equities and obligations ...), and currencies (such as the dollar and the yen and the euro ...) , everything is subject to the exchange.
How does the stock market?
DME is working on the convergence of two people or two parties: the seller and the buyer. These parties do not know each other and can not identify each other. And so can not share a vendor to know the person who buys this stock. Buyer may be a professional or skilled contributor simple. Anything is possible. Affected the market in the stock market directly the number of buyers (demand) and the number of sellers (supply). Faced between supply and demand results in equilibrium price. In the stock market equilibrium price changes several times per minute. When the number of exhibitors (vendors) is higher than the number of applicants (buyers) the price is down, and vice versa.
Outline of the financial markets:
Financial markets has become a subject of great concern in developed countries and developing countries alike, as these markets play an important role in mobilizing national savings and direct investment in the channels of work to support the national economy and increase the rates of well-being of its members.
Knows that the financial market is a system whereby a combination of buyers and sellers of a particular type of investment tools, where unable to do so investors buying and selling financial instruments within the market, either through brokers or companies working in this area. But with the growth of networks and communications, has led to minimize the importance of presence at the market, and thus allowed to deal from outside the market through brokerage firms are available in various countries
And elements of financial markets made up of three elements
Money market, which is the banking system in which the primary role.
The capital market, which consists of investment banks and insurance companies.
Securities market in which transactions are the financial instruments of securities stocks and bonds issued by companies and banks or governments or other institutions, public bodies and they are negotiable.
Types of global capital markets:
Real-time market
The process of payment and receipt immediately, buyer has the financial instrument purchased directly.
Futures
The process of payment and receipt dimension of a period of time are identified and agreed upon between the seller and the buyer.
Rights market option
The buyer the right to perform the operation or lack thereof, after the agreed period for the implementation process.
CFD CFD:
Conventions which the sale or purchase. Gives traders vulnerability to trade in various financial instruments (stocks, currencies, stock indices, energy contracts, goods, and other financial instruments, global) and take advantage of the volatility in prices for these tools, without the need to acquire them effectively, relying on a system CFD Margin ( Margin) directly.
The trading operations on contracts for differences (CFD) is one of the most used strategies in global financial markets, characterized by doubling the quantities sold and purchased many times as much capital available, giving full opportunity for investors to double their profits when you trade the expectations of private investment for each financial instrument.
The introduction of margin "margin":
The work system margin of strategies and widespread in the world of finance and investment, this system is working to increase the purchasing power of the investor and reduces the financial burden required to engage in trading operations in the global market.
The system margin (margin) depends directly on the leverage of the investor's account, and in the following example will clarify the general idea of the margin system, God willing,
For example, if an investor has to open an account margin of $ 5000 and the leverage to 1:100 this account, it means that the purchasing power of the investor will double to reach $ 500,000 which bears only the $ 5000 in the account will not bear any additional financial burden .
And the sense more clearly, if an investor is willing to sell or buy 100,000 € For example, it will need only $ 1000 Kmarzin to be able to trade at $ 100,000.
Trading in the third market:
The technology revolution in the limitless field of communications and computer networks has made the world more closely, and has affected many aspects of contemporary life
And, of course, was in the area of financial investments the largest share of this technological revolution, in terms of flexibility and speed
Today, can any investor in any geographical area in this world that performs purchase and sale of any investment vehicle you have selected, through regular phone or mobile phone or via the World Wide Web (Internet), what it only to contact one of financial intermediaries to implement the orders the investor directly, without having to go personally to the global stock markets is well known. Financial middlemen have diversified investment portfolios and comprehensive covering all the wishes of the investors.
The trading through the market or the third investment is the most popular and common in the world. The process of buying and selling of contracts (P-C-D) is between the financial intermediary and the investor are directly without having to go through the complexities and transactions associated with such operations
The largest global computer networks for trading on the third market since 1998, is a network of NASDAQ, there are plenty of companies that met the requirements for inclusion in the primary and secondary markets, still prefer to be traded in the third market because of its high flexibility.
Study of various market data:
So as to enable the investor to reduce the risks surrounding the trading and investment in the global market, he must he read, and is studying the economic data carefully and cautiously
The economic data are usually in two forms, basic information specialized news expected, and the change results from the expectations of each story affects the global investment market. As well as technical information, which studies and analyzes available to the graphs.
Define the access point in the process of trading:
The determination of price points, or enter into an investment, is one of the elements of successful trading in the global market, and to determine this point, the investor should be familiar with a broad and adequate to all the background reports and technical information, before making the decision to take the investment to enter the market at some point. When the price reaches the point required, the investor can enter into the process of trading through the trading system directly, as well as using various trading orders.
Determine the exit point of the process of trading:
Of course, as is the case in determining the entry price point, or in a particular investment, the determination of the point of exit from the investment have the same importance, the investor should be familiar with a broad and adequate to all the background reports and technical information, before making the decision to take investment out of the market when Fix
The result of the process of emerging from a particular investment, profit or loss, in both cases, the investor should be committed to the point that he had identified out of the process.
Stop loss orders:
Stop loss orders are the most important mechanisms for risk management of trading in global markets. Where can an investor through these commands that the stop loss for a specific position when the price reaches the world market to point out that he had identified in advance.
Orders to take profits:
Take-profit orders are effective mechanisms in the management of investment success. Where can an investor through these commands that is take the profit of the Center for the arrival of a certain price in the global market to the point of exit that he had identified in advance.
Capital User:
The process of using Margin trading is a risky exercise, where the use of capital times the original. It is advisable to always using a ratio of not more than 30% of the capital in the trading operations using the Margin