Foreign Exchange Trading: Making Money With Cash

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Foreign Currency Trading Software: Shop Around For Best Results

There is a wide choice of foreign currency trading software for the forex market. When you are just getting started with forex trading you will need to shop around to find the platform that will suit you best. But what types of program are available and what features should you look for?

Online brokerage accounts are always run through forex software. Your broker may either give you access to a platform that runs on their server or you may have something that runs on your own computer.

Brokers may have their own custom forex trading platform or they may use a generic platform which they can have tailored to their company. This should provide you with many features including a wide variety of charts, tools and analytical capabilities that can indicate changing patterns and trends in the price movements. There may also be a forex alert feature or a running commentary on the financial news.

In some cases you can customize your desktop view of the software. This is more useful than you may realize at first. It can save a lot of time to have your preferred settings or combination of tools and charts load automatically when you log in.

If you choose to use automated foreign currency trading software, otherwise known as a forex robot, this will need to connect to your brokerage account to make the trades. Most robots use the platform Metatrader 4.

If you are running a program yourself, be aware that this usually means that your computer must be switched on and connected to the internet at all times while you have open trades, stop losses or orders to open a trade at a certain point. If your internet connection is often broken by storms or other factors, or if your internet provider automatically cuts the connection any time there is no activity from your machine for more than a certain time, you will not be able to trade effectively unless your instructions have already been passed to your brokerage account and are stored there.

The software should be simple to access and use. Clear instructions plus an FAQ page or manual that you can go to for reference are essential. Beyond that there should be some kind of support, either live or by email, when you need more detailed help or cannot find the answer to your question in the documentation.

Forex trading is risky and you can make losses as well as gains. In this very fast moving market it is vital to have all of the information that you need at your fingertips, plus the power to make your selected trades fast. Automated foreign currency trading software can help you massively and you need the best that you can get your hands on.

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Tuesday, June 30th, 2009 fx trading software No Comments

Why Start Trading Currencies?

Trading currencies has been attracting more and more retail investors in recent times. Foreign exchange or forex is an OTC (over the counter) market where anybody can get involved. All you need is an internet connection, a good system or the time to learn and develop your own system, and some money to invest.

You do not necessarily need very much money. Brokers now offer mini forex trading accounts and even micro forex trading accounts which you can open with just a couple hundred dollars. However, it is better to have a little more, even if you do not put it all into the account in the beginning. Forex trading is risky and if you only have a couple hundred dollars to spare, you probably should be doing something safer with it.

But assuming that you have the funds and you have decided that you want to make money with some kind of financial trading, let’s look at why this could be a better option for you than stock or commodity trading methods.

1. No commissions and no fees.

If you have experience of the stock market you know how your profits can be eaten away by brokerage, exchange and even government fees. The free world nature of the forex market means that you do not have to pay any of these. There are no middle men. Brokers make their money through the spread, which is the difference between the bid and ask prices of a currency.

2. No fixed lot size.

In commodity futures markets, the size of a lot or contract is set by the exchange and you cannot buy or sell less than one lot. But in spot forex trading you can theoretically set your own lot size. Brokers tend to use their own standard sizes but if you know that you will want to trade small amounts you can look for a broker who offers small or fractional lots.

3. It’s a 24 hour market, five days a week.

From the beginning to the end of the global business week, the forex market never sleeps. This is great for people who need to trade outside of normal business hours. You can go work for the boss from 9 to 5, come home and start trading currencies in the evenings. Or you can start whatever time you wake in the morning, even if it is 5 a.m.

4. High leverage.

Forex brokers will offer up to 200 times your margin deposit in leverage. This means that you have the chance to make a lot of money from only a small deposited fund. You only need $50 to control $10,000 dollars in a trade. Provided you have good risk management and always remember that high leverage also means high risk, this can be a very attractive option.

5. A huge market with high liquidity.

The forex market is huge, so there is no chance of any single institution getting control of it. Even the banks, big as they are, have limited influence. Insider trading is not the issue that it can be in stock trading. And high liquidity means that you can always make the trade at the moment or the price that you want. You are never stuck unable to close a trade, and you can even set an automated trading system to close your position for you at a certain level of loss or profit.

6. Free tools and information.

Brokers are going all out to attract more retail traders and the competition between them is great for you as an investor. It is easy to find a good broker who will offer you a demo account where you can practice your trading, hone your skills and learn the basics before you start using real money. They will also give you the charts that you need to identify trends, and access to breaking forex news, all for free.

7. Low start up costs.

A computer with a high-speed Internet connection is all that is needed to begin trading currencies. If you want to use a robot for your trading you can find one for $100 to $200. A lot of information on trading currencies including advice on systems is available for free online.

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Thursday, June 18th, 2009 Introduction No Comments