Currency Options, Forex Options, Fx Options, Currency Options Trading
Currency options are derivatives contracts in which foreign currency is the underlying asset. Currency options are also known as forex options or Fx options. The contract is between a buyer and a seller and gives the buyer the right (but not the obligation) to buy or sell the underlyingforeign currency at a specified price on an agreed upon date in the future.
Currency options are of two types: call options and put options. The buyer of a call option has the right to buy the underlying currency at an agreed upon price at a future date. A put option provides the buyer the right to sell the underlying currency.
How are Currency Options Traded?
While currency options give the buyer the right to buy or sell the underlying currency, there is no obligation to do so. However, the seller of the currency options is obligated to buy or sell the underlying currency in case the buyer decides to exercise the option.
For exercising the right to trade the underlying asset, the seller of the option is paid a price, known as premium. The price that is specified for either buying or selling at the future date is known as the strike price.
When an investor believes that the US dollar will appreciate against the Euro, he purchases a currency call option on USD/EUR. If the value of the US dollar actually increases against the Euro, the buyer can exercise his right to earn a profit.
Benefits of Currency Options
The benefits of currency options are:
* Currency options are extremely useful for hedging against the adverse movements of exchange rates.
* Currency options are the only option contracts that are traded 24 hours a day.
Risks of Currency Options
The risks associated with currency options are:
* Currency options change in value very frequently, since they are tied to the volatile forex market.
* The small outlay that is paid as the initial margin may prevent an investor from estimating the actual losses that he may suffer due to adverse market conditions
Saturday 31 October 2009
Money Management Forex Books
While Forex trading is tightly connected with analysing the charts and the fundamental indicators, knowing where to enter and where to exit a position is not enough. Professional traders manage their risks and devote a lot of their time to learning the techniques of the proper money management. Here you can find some of the best Forex e-books about money management in the financial trading.Almost all Forex e-books are in .pdf format. You'll need Adobe Acrobat Reader to open these e-books. Some of the e-books (those that are in parts) are zipped.If you are the copyright owner of any of these e-books and don't want me to share them, please, contact me and I will gladly remove them.Risk Control and Money Management — by Gibbons Burke.Money Management — A chapter from The Mathematics of Gambling.Position-sizing Effects on Trader Performance: An experimental analysis — by Johan Ginyard.Fine-Tuning Your Money Management System — by Bennett A. McDowel.Trade Your Way to Financial Freedom — by Van K. Tharp.Money Management: Controlling Risk and Capturing Profits — by Dave Landry, a short but educative guide to money management for the financial traders.Money Management Strategies for Serious Traders — a book by David Stendahl that tries to explain the process by which the traders can develop, evaluate and improve the performance of their trading systems based on the money management strategies.The Truth About Money Management — an article by Murray A. Ruggiero Jr. from Futures Magazine explains the basic principles rules and advantages of the risk control and money management.
Friday 30 October 2009
What is Stock market ?
This video lays out the underlying reasons behind the market crash. very telling Also note this is not just a normal market correction, this is the begining of the co...
what is forex trading ? watch this Video !
How to make money in Foreign Currencies using Fibonacci Retracements and Fibonacci Profit Targets.
Forex Introduction
Forex is the world's largest and most liquid market for trading. Many think that the Forex the best home business you can ever be, despite the efforts of ordinary people have the opportunity to do to participate in trading foreign currencies for profit (in the same way banks and large companies) since 1998, only now to be cool , hip, new "thing" to talk about at parties, business events and other social events.
Despite some of the loosely guarded secret, it's every day more and more investors are switching to electronic currency trading worldwide revenue and profitability for a number of benefits and advantages over traditional trading vehicles, like stocks, bonds and commodities.
But still, every time something new or just seems to be a part of social conversation, news articles, and water cooler gossip, misconceptions must be overcome, the mind must be open and clear the slate, fresh with the right information.
So, in this article, it is my attempt to provide a solid, but not too much detail to give information about the "FX (Forex), ie, what is it and why they exist.
As said, a successful entrepreneur, forex trading is like taking money out of the ground. Forex trading is not abandoned, as it take for someone else. "The people in the industry also said that forex trading is like an ATM machine on your own computer.
The following is a statement (which I feel appreciate to know) what and how the Forex is a group of traders who profit from it:
The Foreign Exchange Market, also known as "forex" or "FX" market, is the (cash) market for currency.
But do not buy false FX trading as a futures market where you buy a contract with a specific currency at a price that will come with the time.
What FX traders is much more risky than trading currencies on the futures market, much more profitable and much easier than trading shares.
You might be wondering where it was in ... or ... such as the FX market access?
The answer is: FX Trading is not bound to a floor and not centralized on an exchange like stocks and futures markets. FX market is "market as over-the-counter (OTC) or 'interbank, due to the fact that the entire market will be executed electronically, continuously within the bank network for 24 hours.
Yes, if the first time you heard of an electronic market of all, I know this may sound a little interesting for you.
Here is what you are actually traded, you) to the Foreign Exchange (Forex market:
In principle, such as large banks, the foreign exchange market to itself from fluctuations in exchange rates to protect the various currencies, as investors, what the FX traders exchanged and one other foreign currencies. So, in fact, their electronic trading partner currencies and the price that we are given the exchange rate between two currencies.
In other words, only the listed price, how much of the same coin, worth 1 of the other currencies.
Example:
EUR / USD last trade 1.2850 - One Euro is worth U.S. $ 1.2850 first dollars.The currency (in this example, the EURO) called the base currency and the second one (/ USD) as the counter or quote currency.
Forex has a daily trading volume of approximately U.S. $ 1.5 trillion - 30 times greater than the total volume of all U.S. equity markets. This means that 1498574 qualified traders could ever take 1 million U.S. dollars from the forex market and forex every day more and more money than to have to leave the New York Stock Exchange every day!
Forex plays an important role in the global economy and it is always a great demand for foreign exchange. International trade increases the technology and communications increased. As long as it is the international trade, it will be a Forex market. FX market, it should be such that a country like Japan can sell products in the United States and in a position to Japanese yen in exchange for U.S. Dollar.
There are a lot of money by using the Forex for many dealers who have the right trading techniques / tactics that they should be using the opportunity created. And with only 5% of daily sales volume from banks, governments and large enterprises to hedge, which is 95% of speculation and the profit necessary.
Despite some of the loosely guarded secret, it's every day more and more investors are switching to electronic currency trading worldwide revenue and profitability for a number of benefits and advantages over traditional trading vehicles, like stocks, bonds and commodities.
But still, every time something new or just seems to be a part of social conversation, news articles, and water cooler gossip, misconceptions must be overcome, the mind must be open and clear the slate, fresh with the right information.
So, in this article, it is my attempt to provide a solid, but not too much detail to give information about the "FX (Forex), ie, what is it and why they exist.
As said, a successful entrepreneur, forex trading is like taking money out of the ground. Forex trading is not abandoned, as it take for someone else. "The people in the industry also said that forex trading is like an ATM machine on your own computer.
The following is a statement (which I feel appreciate to know) what and how the Forex is a group of traders who profit from it:
The Foreign Exchange Market, also known as "forex" or "FX" market, is the (cash) market for currency.
But do not buy false FX trading as a futures market where you buy a contract with a specific currency at a price that will come with the time.
What FX traders is much more risky than trading currencies on the futures market, much more profitable and much easier than trading shares.
You might be wondering where it was in ... or ... such as the FX market access?
The answer is: FX Trading is not bound to a floor and not centralized on an exchange like stocks and futures markets. FX market is "market as over-the-counter (OTC) or 'interbank, due to the fact that the entire market will be executed electronically, continuously within the bank network for 24 hours.
Yes, if the first time you heard of an electronic market of all, I know this may sound a little interesting for you.
Here is what you are actually traded, you) to the Foreign Exchange (Forex market:
In principle, such as large banks, the foreign exchange market to itself from fluctuations in exchange rates to protect the various currencies, as investors, what the FX traders exchanged and one other foreign currencies. So, in fact, their electronic trading partner currencies and the price that we are given the exchange rate between two currencies.
In other words, only the listed price, how much of the same coin, worth 1 of the other currencies.
Example:
EUR / USD last trade 1.2850 - One Euro is worth U.S. $ 1.2850 first dollars.The currency (in this example, the EURO) called the base currency and the second one (/ USD) as the counter or quote currency.
Forex has a daily trading volume of approximately U.S. $ 1.5 trillion - 30 times greater than the total volume of all U.S. equity markets. This means that 1498574 qualified traders could ever take 1 million U.S. dollars from the forex market and forex every day more and more money than to have to leave the New York Stock Exchange every day!
Forex plays an important role in the global economy and it is always a great demand for foreign exchange. International trade increases the technology and communications increased. As long as it is the international trade, it will be a Forex market. FX market, it should be such that a country like Japan can sell products in the United States and in a position to Japanese yen in exchange for U.S. Dollar.
There are a lot of money by using the Forex for many dealers who have the right trading techniques / tactics that they should be using the opportunity created. And with only 5% of daily sales volume from banks, governments and large enterprises to hedge, which is 95% of speculation and the profit necessary.
Monday 26 October 2009
The growth section
The growth section in the FOMC statement saw little changes, mentioning the same growth re-straints, ie, softening labour markets, financial markets under considerable stress, tight credit conditions, housing correction and energy prices. Note that energy prices, despite their recent decline, are not (yet) cited as a positive growth factor.
There were few changes in the inflation assessment. The FOMC still sees upsides to inflation. Interestingly, the statement refers to energy prices in the past tense. This might be interpreted as a very cautious ac-knowledgement of the recent retrenchment in commodity prices, which, in turn, would be a dovish twist.
Again this time, the committee did not state an explicit balance of risk. Importantly, the phrase 'diminished downside risks' to growth was replaced by 'downside risks'. Upside risks to inflation were not described as having 'increased' but were instead emphasised as being 'also of significant concern'. Generally, the state-ment put growth and inflation risk on a slightly more equal footing than last time. Also, the fact that there was only one dissenter revealed that disagreement within the committee did not widen, although it probably re-mains unusually widespread.
There were few changes in the inflation assessment. The FOMC still sees upsides to inflation. Interestingly, the statement refers to energy prices in the past tense. This might be interpreted as a very cautious ac-knowledgement of the recent retrenchment in commodity prices, which, in turn, would be a dovish twist.
Again this time, the committee did not state an explicit balance of risk. Importantly, the phrase 'diminished downside risks' to growth was replaced by 'downside risks'. Upside risks to inflation were not described as having 'increased' but were instead emphasised as being 'also of significant concern'. Generally, the state-ment put growth and inflation risk on a slightly more equal footing than last time. Also, the fact that there was only one dissenter revealed that disagreement within the committee did not widen, although it probably re-mains unusually widespread.
Saturday 24 October 2009
Friday 23 October 2009
The foreign exchange market
The foreign exchange market (currency, forex, or FX) trades currencies. It lets banks and other institutions easily buy and sell currencies.
The purpose of the foreign exchange market is to help international trade and investment. A foreign exchange market helps businesses convert one currency to another. For example, it permits a U.S. business to import European goods and pay Euros, even though the business's income is in U.S. dollars.
In a typical foreign exchange transaction a party purchases a quantity of one currency by paying a quantity of another currency. The modern foreign exchange market started forming during the 1970s when countries gradually switched to floating exchange rates from the previous exchange rate regime, which remained fixed as per the Bretton Woods system.
The foreign exchange market is unique because of
its trading volumes,
the extreme liquidity of the market,
its geographical dispersion,
its long trading hours: 24 hours a day except on weekends (from 22:00 UTC on Sunday until 22:00 UTC Friday),
the variety of factors that affect exchange rates.
the low margins of profit compared with other markets of fixed income (but profits can be high due to very large trading volumes)
the use of leverage
As such, it has been referred to as the market closest to the ideal perfect competition, notwithstanding market manipulation by central banks. According to the Bank for International Settlements, average daily turnover in global foreign exchange markets is estimated at $3.98 trillion. Trading in the world's main financial markets accounted for $3.21 trillion of this. This approximately $3.21 trillion in main foreign exchange market turnover was broken down as follows:
$1.005 trillion in spot transactions
$362 billion in outright forwards
$1.714 trillion in foreign exchange swaps
$129 billion estimated gaps in reporting
The purpose of the foreign exchange market is to help international trade and investment. A foreign exchange market helps businesses convert one currency to another. For example, it permits a U.S. business to import European goods and pay Euros, even though the business's income is in U.S. dollars.
In a typical foreign exchange transaction a party purchases a quantity of one currency by paying a quantity of another currency. The modern foreign exchange market started forming during the 1970s when countries gradually switched to floating exchange rates from the previous exchange rate regime, which remained fixed as per the Bretton Woods system.
The foreign exchange market is unique because of
its trading volumes,
the extreme liquidity of the market,
its geographical dispersion,
its long trading hours: 24 hours a day except on weekends (from 22:00 UTC on Sunday until 22:00 UTC Friday),
the variety of factors that affect exchange rates.
the low margins of profit compared with other markets of fixed income (but profits can be high due to very large trading volumes)
the use of leverage
As such, it has been referred to as the market closest to the ideal perfect competition, notwithstanding market manipulation by central banks. According to the Bank for International Settlements, average daily turnover in global foreign exchange markets is estimated at $3.98 trillion. Trading in the world's main financial markets accounted for $3.21 trillion of this. This approximately $3.21 trillion in main foreign exchange market turnover was broken down as follows:
$1.005 trillion in spot transactions
$362 billion in outright forwards
$1.714 trillion in foreign exchange swaps
$129 billion estimated gaps in reporting
By wiki ...
Forex Trade
Forex Candlesticks are one of the most popular technical indicators in the forex market. I am a big fan of candlesticks.
When used correctly, candles can help you precisely understand what can happen next so you can decide whether you want to open a trade or you want to exit an open trade.
I have seen a lot of trades that I should have closed early, but I just ignored the warning signs given by the candle.
So, learning forex candlesticks can really be beneficial and an asset for a forex trader. There are lot of formations that are associated with the candlestick patterns that can help in analysing if the trend is about to end or is it going to continue or what is the strength?
The candles work great with a lot of other technical indicators.
When used correctly, candles can help you precisely understand what can happen next so you can decide whether you want to open a trade or you want to exit an open trade.
I have seen a lot of trades that I should have closed early, but I just ignored the warning signs given by the candle.
So, learning forex candlesticks can really be beneficial and an asset for a forex trader. There are lot of formations that are associated with the candlestick patterns that can help in analysing if the trend is about to end or is it going to continue or what is the strength?
The candles work great with a lot of other technical indicators.
Motor trade insurance
We are now living in a modern world where everything has to be online. We can purchase anything online, from gifts, bags, pens, computers, and even insurance.
Many motor trade insurance companies have their own website where people can sign up and look for any given information. Their website provides all the necessary information needed by clients in purchasing a motor insurance.
Signing online is the fastest and the easiest way to get insurance. All you need is the internet and you're good to go. You can also be confident signing up online as you receive in the mail your complete policy in detail.
There are several benefits in signing up online for motor trade insurance.
You can easily compare different motor trade insurance policies, and get the best deal that you can. Searching online is the best thing to do when you want to find insurance that is suitable for your budget. There are many companies that offer better packages online. You can compare them easily and efficiently rather, than signing up over the phone or going directly at the insurance site.
Many discounts are offered on the internet. There are several companies that offer discount on the internet and some may not be available to other companies. Searching for discounts online will enable you to minimise your expenses.
You can save more time and money searching for online insurance. This applies to all companies that offer insurance. Many people can save time because they won't be going to the insurance site to get insurance. If you don't have much time and want to purchase motor insurance, then getting online is the best thing to do. It could also save you more money since you won't be paying for any traveling expenses to get insurance. Some insurance companies may be too far from your house and you may find it hard to go there.
Buying motor trade insurance online is safe and reliable. When you go to an insurance comparison website to buy motor trade insurance, you know that these companies have already passed the ratings tests. This means that you will get quotes from companies that are responsible, reliable, and financially sound.
It is the easiest way to purchase insurance. All you need to do is to buy motor trade insurance online and go to an insurance comparison website, and type in some basic information about yourself, your insurance needs and the type of vehicle that you have. After doing it, you can sit back and wait for quotes from multiple insurance companies to arrive. Once you have received those quotes, you can review them and choose the best company that offers the best price and policy for you.
Many insurance comparison websites make the process even easier by having insurance agents on hand to talk with you online or by phone. This means that you can get quick answers to your motor trade insurance questions.
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