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Easy Forex

Thursday, November 12, 2009, Ashok Niroula

Should I use a Easy Forex ?

The Forex market is not, most people would agree, the place to cut your teeth as a trader. Novices can very quickly get their fingers badly burnt. But inexperience is not the only easy reason to consider using a Forex broker to trade in the high risk international currencies market.

Equally as important is having the right temperament for a high pressure market where swings are commonly pendulum-like and fast moving. Not only are Forex traders required to readjust mentally to juggling twin-faceted currency transactions, they also need to keep a calm easy head. Fear and greed are, without a doubt, the enemies of the successful Forex trader.

Before entering the Forex market for the first time, whether or not you have experience in trading stocks and shares, you should carefully consider whether the Forex is for you. Not all investors are suited to Forex trading, and finding out too late can result in heavy losses. If you have doubts about your investment objectives, experience and risk exposure, then you should seek the advice of a Easy Forex broker or risk having your initial investment rapidly wiped out.

So what should you look for when selecting a Forex broker ?

Experience and reputation are two good starting places for the selection process. Do as much research as possible about the broker and ask in online forums for anyone with first hand knowledge of the company.

Because of the global nature of the Easy Forex there is a diverse range of financial regulatory environments depending on where the broker is based. One of the most unregulated countries is the US, so in the absence of independent verification of a company's continuing financial stability doing your homework thoroughly is imperative.

It should be emphasized, of course, that there are very many top quality Forex brokers around who provide excellent customer service and value for money. The message here is that selecting the right broker for you takes time and effort. In the end, it may well save you a lot of dollars and heartache.

Be skeptical. Examine any claims made about high returns and low margins, especially if the company is vague about the risk involved and are unwilling or unable to disclose financial information on the strength of their company. Low margins may sound competitive, but in reality this is because the broker is speculating against you and relying on the low margin to stop out your gains.

Small minimum investments should also sound alarm bells. To make serious investment strategies work small sub-$10,000 sums are unlikely to cut it in the Forex. Moreover, the brokers offering small minimum investments are also likely to be those offering low margins as well. And all for the same reason.

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Learn Forex

Wednesday, November 4, 2009, Ashok Niroula

How do I begin? Please give it to me SIMPLY.

1. The best advice on how to learn to trade profitably is to learn from experts with proven track records. Many learning styles are available to beginners at all levels: books, CDs, online courses, group seminars, even one-on-one mentors who will come right your home for a few days. We outline our Forex-Trader picks in Learning Forex Trading. Learning to trade from experts is worth every penny and has saved us untold thousands in mistakes.We would not recommend starting forex trading without any training. It is not hard to learn, nor difficult to trade successfully, but you must first provide yourself with a basic functioning knowledge of 'the game you're in'.

2. While you are learning you will need charting software to practice reading the Market. Charting is an indispensable tool that shows you in real-time data what the market is doing moment by moment and also what the market has done in the past. As you learn to analyze these charts you can determine what trades to enter and exit, where to set your stop losses, limits etc. There are several good charting software services that you can subscribe to online monthly. See our Forex-Trader tested Charting Software picks in Tools of The Trade.

3. Then, to perform your actual trades online you need a real-time 'trading platform' to execute your 'buys' and 'sells' directly in the Foreign Currency Market. You obtain a trading platform from a Forex Clearinghouse that is connected real-time to the interbank market. There are many good Clearinghouses (also confusingly called Brokerage Firms, Market Makers, etc.) that provide you with the trading platform to trade the funds in the account you have opened with them. Before you begin trading your 'real' money, while you are learning, you will practice on your own 'demo account' with play-money in it, which will be provided to you by the clearinghouse you plan to trade through. The contractual relationship you enter into with your Clearinghouse is a very important one because the Clearinghouse you choose determines many trading features and financial advantages to you both as a trader and as an investor. Forex-Trader tested Clearinghouses are reviewed in Tools of The Trade.

We have outlined a Getting Started path with uncomplicated steps. This is the path that we would take if we were beginning trading over again today with 'what we know now'. The products and services we mention in these steps are all ones that we have personally used for some time with consistent success. As always you are free to forge your own path, and if you do, happy hiking. There is a mountain of products and services try out, and if you find ones you like better we would love to compare notes with you.

Explain More About Charting Services

To trade successfully you also must have good charting software and instantaneous data feeds critical to helping you analysis and interpret the movement of currencies moment to moment so you know when/why to buy or sell — this you subscribe to monthly. You can get a 2 week or more demo to familiarize yourself with one that has the features you like. The costs also vary, and some companies require a year commitment. There are some free charting services offered through the clearinghouses, but they tend to lack the tools to be truly useful. There are also some costly proprietary Specialty Software charting 'hybrids' which are market forecasters tools that look more like video games than charts.

Explain More About How Clearinghouses Work

A good clearinghouse (i.e.. your computer access/link to the live Forex Exchange Market) is the partner with which you trade the money you have deposited with them in your trading account. After trying and demo-ing many we have found a small handful that are truly excellent for the beginner (and continue to be excellent as you grow) — meaning user friendly, legally accountable to regulatory bodies, and offering fair costs (spreads) for their services/trading software platforms. There still are many worrisome ones practicing in this closing era of unregulated forex trading (new Commodities laws are imminent).

The topic of matching the right clearinghouse for your needs is discussed more in Tools of the Trade, because it depends on a number of factors — how much you can open an account with, how much the clearinghouse profit spread, what your liquidity needs are, your minimum/maximum stop loss and margin requirements, even where you live and how much time you have to give to trading in a 24 hr. day.

How Much Does it Cost to Begin to Trade?

Learning to trade will entail the cost of books and whatever traiining method you choose. It will also include a reliable computer with a minimum 128 Mb of memory to run the charting software and trading platform. Ongoing 'costs of operation' include the monthly costs of high-speed internet, charting software, the email forecasting subscriptions — plan on spending $150./mo. up for ongoing costs.

What about Pooled Clearinghouse Accounts to Trade with More Leverage?

We strongly do not recommend pooled accounts in any circumstance. Perhaps you are considering self-trading a pooled- together family account because it would give you a perceived advantage of more leveraged funds to trade (50:1 up to 100:1 leverage) — any risks of loss represent a potential risk to family relationships, and for this reason alone we do not recommend aggregating with family or friends.

However much worse are the too-numerous negative experiences of people allowing their investment funds to leave their control to become part of a 'managed' pooled account. Not only is it a very risky investment idea, it is illegal for anyone to 'pool' accounts without compliance with SEC (a USA Securities Exchange Commission) or international equivalent license. Never relinquish direct control over your money/trading account to anyone (i.e.. the ability to make withdrawals, deposits etc. directly by your own authority into your own account).

A good fund manager, if you do choose to go the (legitimate) Managed Account route rather than the Self-Trader route, will make certain you have your own 'segregated account' in your own name in a bank or brokerage firm. These individual segregated accounts can still be traded together as though they were in a single account by a designated trader as long as the clearing house uses a trading platform that allows it. You, as the investor/account holder, have direct access online to your account activity at all times, and direct control over your own account in your own name (just like a bank account). The importance of this, for the safety of your funds, cannot be over emphasized.

source:.forex-articles.net/article-17.html

Collected by bank4money.blogspot.com


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