Forex from scratch --a helping hand from pipshower...
- Thread starter pipshower
- Start date
- Status
Re: Staying away from trap..
Open Spot Forex positions held at the end of a Trading Day will be rolled over to a new Value Date on a Next basis immediately after the change of trading day.
As part of the Next rollover operation, FX positions are subject to a swap charge or credit. The calculated swap charge or credit are referred to as Swap Point and are added to/deducted from each FX positions original traded rate.
The Swap Points are calculated as follows:
A swap rate is calculated based on a number of factors (including the interest rate differential between the traded currencies)
Or in other words--
Overnight traders will not have positions closed and will therefore remain in the market .During the Rollover, a swap calculation will be performed on their trades. Swaps are calculations performed on continued lots maintained in the market, beyond the EOD of the market. The ability to hold a position in the market without actually taking delivery of the underlying currency, is managed by a process of swaps. Swaps involve estimating the future value of money, based upon the difference of interest rates from currency to currency. Normally, Prime banks will use one of a few similar methods to predict swap values early on, then commit those values to actual transactions at EOD.
This swap is added or subtracted from your position value based on currency bought and sold interest rate difference.
This gave rise to carry trades , where the trade holder with higher interest rate currency that the sold one will profit even if the currency does not move from the original position due to swap gain on the trade . This was the reason if you see chart of GBP/JPY before 2008 from 2002 you could see uptrend only since GBP had higher interets rate where as JPY had zero interest rate policy . So most carry traders used to hold GBP/JPY long position giving rise to raised GBP/JPY value and also adding to there positions the swap helping them gain more.
For better understanding try holding a position on demo acct for more than 24 hrs and you will see in the swap added or deducted from your position profits or loss.
Try out as trying out is better method to understand..and thats what demo accounts are for..
Hope i have explained to you in the words understandable to you.
Regards
Pipshower
Open Spot Forex positions held at the end of a Trading Day will be rolled over to a new Value Date on a Next basis immediately after the change of trading day.
As part of the Next rollover operation, FX positions are subject to a swap charge or credit. The calculated swap charge or credit are referred to as Swap Point and are added to/deducted from each FX positions original traded rate.
The Swap Points are calculated as follows:
A swap rate is calculated based on a number of factors (including the interest rate differential between the traded currencies)
Or in other words--
Overnight traders will not have positions closed and will therefore remain in the market .During the Rollover, a swap calculation will be performed on their trades. Swaps are calculations performed on continued lots maintained in the market, beyond the EOD of the market. The ability to hold a position in the market without actually taking delivery of the underlying currency, is managed by a process of swaps. Swaps involve estimating the future value of money, based upon the difference of interest rates from currency to currency. Normally, Prime banks will use one of a few similar methods to predict swap values early on, then commit those values to actual transactions at EOD.
This swap is added or subtracted from your position value based on currency bought and sold interest rate difference.
This gave rise to carry trades , where the trade holder with higher interest rate currency that the sold one will profit even if the currency does not move from the original position due to swap gain on the trade . This was the reason if you see chart of GBP/JPY before 2008 from 2002 you could see uptrend only since GBP had higher interets rate where as JPY had zero interest rate policy . So most carry traders used to hold GBP/JPY long position giving rise to raised GBP/JPY value and also adding to there positions the swap helping them gain more.
For better understanding try holding a position on demo acct for more than 24 hrs and you will see in the swap added or deducted from your position profits or loss.
Try out as trying out is better method to understand..and thats what demo accounts are for..
Hope i have explained to you in the words understandable to you.
Regards
Pipshower
hello
pipshower,we have only started learning ABC of forex and still in nursery std. how can one trade ?
please post your lessons and help us graduate.
conversation between you and hari are interesting/intelligent but newbies need to start understading from basics please move up the ladder step by step only.
thanks
shekhar
hello pipshower,
we have only started learning ABC of forex and still in nursery std. how can one trade ?
please post your lessons and help us graduate.
conversation between you and hari are interesting/intelligent but newbies need to start understading from basics please move up the ladder step by step only.
thanks
shekhar
pipshower,we have only started learning ABC of forex and still in nursery std. how can one trade ?
please post your lessons and help us graduate.
conversation between you and hari are interesting/intelligent but newbies need to start understading from basics please move up the ladder step by step only.
thanks
shekhar
YES i do understand that i need to post step by step and i am and will be doing that as i still remember days when i was just starting out as newbie searching a place to learn from scratch . I will be going step by step keep on reading from start and try to get on demo acct and learn how to use it side by side. Never give up ..You will struck a gold mine sonner or later.!
Regards
Pipshower
hi pip
i have just got interested in trading in forex, i have just got a call from iforex.com
how credible is this website, according them i can start trading in forex with 100$
and there commission is @5pips for a deal size of 10000 usd.
they will be demo software & real account after i pay them 100$
should i go for this
plz suggest
i have just got interested in trading in forex, i have just got a call from iforex.com
how credible is this website, according them i can start trading in forex with 100$
and there commission is @5pips for a deal size of 10000 usd.
they will be demo software & real account after i pay them 100$
should i go for this
plz suggest
Last edited:
Hello Friend,
Have you practiced forex on demo account before? If yes, then have you been successful for atleast 4 months on demo acct? If the answer to all these questions is yes then i will suggest choose a broker which gives you power to choose the quanity to be traded.
Do you think $100 will help you earn $1000 in a month on consistent basis?
My answer is NO.
Start saving money each month to build and fund your account . Remember if you plan to make good money trading forex you will need an account of big size .
Dont go for funding account without being successful on demo first .
Instead while you practice on demo save money enough to fund the account with suitable amount where you can apply money management rightly and with that to make profits that will help you add consistent income to your bank account!
Get free demo here
http://www.metaquotes.net/terminal
If you have any questions feel free to ask questions!
Hope this helps
Regards
Pipshower
Have you practiced forex on demo account before? If yes, then have you been successful for atleast 4 months on demo acct? If the answer to all these questions is yes then i will suggest choose a broker which gives you power to choose the quanity to be traded.
Do you think $100 will help you earn $1000 in a month on consistent basis?
My answer is NO.
Start saving money each month to build and fund your account . Remember if you plan to make good money trading forex you will need an account of big size .
Dont go for funding account without being successful on demo first .
Instead while you practice on demo save money enough to fund the account with suitable amount where you can apply money management rightly and with that to make profits that will help you add consistent income to your bank account!
Get free demo here
http://www.metaquotes.net/terminal
If you have any questions feel free to ask questions!
Hope this helps
Regards
Pipshower
thank you very much for you kind advice.
i am a full time trader in Indian stocks.
initially i had thought to open account with 100$ and work on it on demo account with iforex before achieving the efficiency, since u have been kind enough to share the link from which i can download a demo
i will surely follow as u have suggested.
thank you
i am a full time trader in Indian stocks.
initially i had thought to open account with 100$ and work on it on demo account with iforex before achieving the efficiency, since u have been kind enough to share the link from which i can download a demo
i will surely follow as u have suggested.
thank you
- Status
| Thread starter | Similar threads | Forum | Replies | Date |
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| O | Forex market is an unpredictable | Forex | 1 | |
| R | How to save trading capital in forex? | General Trading & Investing Chat | 2 |
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