More About Monitoring the Forex Trade

By Mark Thomas

When it comes to forex trading, you need to follow the various aspects of the process very closely. It is not always easy to keep track of all the activities and procedures that are involved. There is a need to have a way to analyze and evaluate what you do. One of the tools that are important when it comes to forex trading is a trading log. This is because it assists you to have all the information about all the tasks and transactions that go on. With this approach, you will avoid getting overwhelmed by the activities especially when there is so much business.

A forex trading log may be in the form of an easy table of grids that has components like the date, price, number of lots opened, quantity, commodities, initial protective stop level, and exit price among others. There are now standard logs that have been designed specifically for this purpose; initially, traders used their personal dairies as a trading log. Trading logs can now be found in both digital and book forms. They both have the same format but the convenience and flexibility varies.

More and more entrepreneurs are opting for digital trading logs because of the fact that both book-keeping and accounting processes have gone digital. Spreadsheet programs that contain a host of computing and data management capabilities may be a valuable additional to your trading log system. They automatically update figures in the log which gives you a large scope of flexibility. Lotus 1-2-3 and Microsoft Excel are good examples of widely used spreadsheet programs that may be used to create simple trading logs.

There are many forex trading software in the market that can assist you in your forex trading tasks including log keeping. The available software includes tools that aid in market analysis, forecasting, order entry and management. This makes the package quite useful when you are trading.

One of the advantages of having a trading log is that you will be able to improve the weaknesses that you have in the business so that you get the maximum benefits from your investments. The first question you should ask yourself is why you are making the entries and exits in the log and the kind that you should include. This will be important in finding out the kind of mistakes that you are making and what is working well. Include a field for remarks on the log that will be entered after a fixed period of time. This is an important step that assists you when you are making strategies to have a profitable forex trading business. - 23218

About the Author:

Mark Thomas, a Professional Software Developer have been in Trading for several years and have developed a Forex Trading Software Tool which helps the Traders to keep track of all their Trades in a Disciplined Manner. Get complete details about Trade from Mark Thomas . Visit his website http://www.tradeontrack.com

Learn How To Manage Risks in Forex

By Mark Thomas

All businesses are exposed to some form of risk. The risks may be due to competition in prices, the exchange rates, prices of raw material, rates of interest to name a few. In a bid to ensure your business is not affected by the many risks which face such ventures, you have to put in place risk management strategies which are effective. Forex trading is exposed to many risks. Even though statistics indicate that up to 70% of forex trading succeeds, the remaining 30% causes worry.

Risk in a foreign exchange can be attributed to the profits or losses that may occur due to trade in forex market. So as to substantially reduce the risk that may occur, a trade has to incorporate the right forex risk management strategies. The exposure management strategies in questions must be fully understood and customized in order for them to work well in protecting you from the unnecessary risks and also ensure that you run profitable forex trading.

There are some approaches that you as a trader can adhere to minimize the chances of falling to risks. You need to be well acquainted with the effect of various currency climates to your business and to the market as well. For instance, currency exchange rates will directly have an impact in your trade. Therefore, it is important to understand the actual effects that has on the value of your assets, liabilities as well as capital.

Limit losses- Profits will not be inevitable in each and every trading. Having this in mind, ensure that your broker is aware of the exit point of your loss. It will assist you in dealing with risky conditions. This will also varnish you with advance knowledge on the amount of risk you will be exposed to just incase all does not go well.

Maximize the profit value- Like in every form of business, forex is bound to profit or loss. Therefore, it is good to have a way of exiting in case of loss. This can play an important role in controlling conditions that are risky to your trade. It will also give you a signal before-hand and as a trader you can be able to measure up the extent of therisk.

Place your stop and limit orders accurately - The stop trading order should not be placed too close to the market price because a little fluctuation of the prices may trigger the order. Limit orders should not overexpose you to the trade but should also not be too close to the market price. Understanding the intricacies of the forex market is the best forex trading tool that you can possess. Take time to establish rational profit and loss levels for your business. - 23218

About the Author:

Mark Thomas, a Professional Software Developer have been in Trading for several years and have developed a Forex Trading Software Tool which helps the Traders to keep track of all their Trades in a Disciplined Manner. Get complete details about Trade from Mark Thomas . Visit his website http://www.tradeontrack.com

Thinking of Mutual Funds? Think again.

By Jordan J. Weir

It has been consistently demonstrated that your investment returns aren't so much a function of what stocks your invested in, but what sectors/asset classes your invested in. In the dot com boom, it didn't matter what dot com stock you invested in, if you were invested in dot com companies, you probably did alright. During the dot com bust, it wasn't just a couple select companies that went down, it was just about all of them. Because of this tendency for similar stocks to move together, it is much more productive to be able to simply buy " or short - a type of stock, then try and nail the exact right company. But how can you gain exposure to a sector without taking unnecessary risk based on the company?

Exchange Traded Funds are the answer. Exchange traded funds (ETFs) allow you to invest in a group of companies all at once, similar to a mutual fund. The difference is that ETFs are traded directly on a stock exchange just like a stock, they can be bought and sold any time during the day without penalty, and they are both shortable, and optionable allowing you to take advantage of both up, and down moves in the market.

Each ETF is designed to mimic an investment in a certain industry, region, or type of stock. Some examples of ETFs are the XLI, XLU, and EWC. These ETFs grant an investor exposure to the industrial sector of the S&P 500, the utilities sector of the S&P 500, and the entire Canadian stock market, respectively. Similarly, one who simply wanted to match the S&P 500 indexs returns could just invest in the SPY.

Yet if ETFs are so similar to mutual funds, why not just use a mutual fund. There really are a couple reasons to do so. First off, mutual funds have a history of underperforming the stock market as a whole after fees are included. This makes simple index investing, through an ETF representing a large basket of stocks, such as the SPY, an extremely effective way of matching the markets returns with nearly no cost. There are also slight tax advantages with ETFs compared to mutual funds. Mutual funds have to pay capital gains tax whenever they sell one of their holdings, and whenever they have a large wave of redemptions, they have to sell their positions to come up with the money. This leads to excess fees, some of which get passed on to the remaining investors.

Another advantage held by ETFs is their great convenience over their mutual counterparts. Many mutual funds have redemptions fees if you exit within 30 days, whereas ETFs aren't plagued by this problem. Also, unlike mutual funds, you can go short an ETF, benefiting from a fall in a sector instead of a rise. ETFs can also be bought and sold any time during the trading day, using limit orders, stop losses, and all the other tools you can use for buying stock.

Furthermore, ETFs are often optionable, so risk can be minimized with covered calls and protective puts, or " if your so inclined " much larger returns can be sought through buying calls and puts on the ETF. Experienced stock option experts may even use advanced stock option strategies, like iron condors and vertical spreads to increase investment returns.

There are some disadvantages to ETFs as well. Some ETFs have complex structures that can lead them to deviate from what they are supposed to be tracking. A similar instrument, ETNs, can also easily be mistaken for an ETF, leading to some general confusion about what exactly you are investing in. Yet for those willing to put in the work to learn, ETFs can be a highly profitable venture for the modern day portfolio.

The only reason not to use ETFs is a lack of understanding, for they really are one of the most revolutionary investment tools of the 21st century. Their ability to reduce risk through diversification across an asset class, while still effectively giving an investor exposure to an entire sector, should be taken advantage of by everybody, for both long and short plays. ETFs are an invaluable asset for everyone invested in any stock market, and their advantages should be used to the fullest. - 23218

About the Author:

You must learn the ways of the market before you can truly succeed there, so visit my website and become a market virtuoso! Learn about hidden techniques such as ETF Investing, stock option strategies, sector rotation, and shorting stock! Unleash the true power of ETFs in your portfolio, and allow your portfolio to be the best it can be

How To Achieve Profitable Forex Trading

By Mark Thomas

You have probably come across much information concerning running a profitable forex trade in the internet, business books, business journals or magazines. While the information contained in these sources may be accurate, there is no particular get-through to a profitable business; leave alone forex trading. Any profitable establishment requires a set of suitable and working approaches; there is no particular formula to the success.

Forex trading is a very lucrative business that needs a great deal of commitment. You will have to adopt smart principles to get ahead. Once you do this, you are guaranteed of doing well whether you are new in the business or have been around for some time. The chances of making massive losses in trade are many if you do not pay attention to this.

So you have decided to get into forex business? That is right and one thing you have to know is to make your mind to settle on the business and have a clear focus on what you are about to do. You have to focus on developing a business mind rather than allowing emotions to be part of the trade. The reason here is that forex trade is a challenging business which may frustrate you if you handle it with a divided mind. You must be prepared to work any time of the day as the trade usually has odd working schedules requiring you to make some adjustments where necessary.

To succeed in forex, you need to learn how the market runs. You need to understand various aspects that have effect on the profitability of the business. For instance, you need to know the effect that a country's GPD has on the trade and what you are supposed to do in case one of this misfortunes strikes. Just like any other business, some skills and experience are vital ingredients to the success of the forex business. Therefore, if you are new to the trade, you can consider taking some lessons online or offline so as to have a smooth running in the business.

Good money management skills are one of the important practices that are required in forex business. You have to mobilize your capital properly without freezing the budget of the business. Be sure to use the demo accounts as you don't lose any money at the long run. - 23218

About the Author:

Mark Thomas, a Professional Software Developer have been in Trading for several years and have developed a Forex Trading Software Tool which helps the Traders to keep track of all their Trades in a Disciplined Manner. Get complete details about Trade from Mark Thomas . Visit his website http://www.tradeontrack.com

Forex Trading Basics

By John Eather

Day-after-day, much more than 2 trillion dollars is traded in the Foreign Exchange market. Without doubt the biggest trading in the globe. Forex is open 24/5, including public vacations. The world financial centres start out trading in Sydney, and then to Tokyo, and lastly London and New York.

There are always active buyers and sellers at any given time anywhere in the world. This allows the FX market the most fluidity the world has ever had or known. Currency in the Forex market is traded only in pairs, for example, EUR/USD, GBP/USD or UDS/JPY. All trades coinside with the selling of one and the purchase of another. The basis for the buy or sell is the base currency. Consider the currency as an object to be bought or sold and the first of the pair is the base currency.

The main currency of the Forex market and generally the base for quotes is the United States dollar and includes USD/JPY, USD/CHF and USD/CAD. There are exceptions and they are EUR/USD and GBP/USD. These and other numerous currencies quotes express in units of one dollar ($1) USD per the other half of the pair. For example, quote of USD/CAD. 1.1302 simply means one US ($1) equals 1.130 Canadian. You'll often find when trading Forex, a double sided quote. It will be a bid' and ask' price quote. Bid' is the price to sell the base currency while, at the same time, buying the other currency. Ask' price is the buy cost of base currency while, at the same time, selling the other currency from broker.

The differences between bid' and ask' prices is the spread and is paid to the Forex broker as commission. Commission-free trading is offered by majority of brokers, and they instead profit from trades' spread. On major currency pairs the spread is usually 3-5 pips. Rollovers, what are they? The process by which the completion of a deal is rolled to another value date. The cost is based on the differential rate of the pair of currencies. Almost all brokers will roll your open positions thus allowing the position to be held over indefinitely.

Trading on leverage or the margin and trading, in truth, lets Forex brokers take the advantage of not having to bear the whole payout on the total cost of the positions value. Forex trading brokers, in any case, just about all of them, allow for more leverage than stocks or futures. The absolute sum of leverage access in Forex trading may be up to 5 hundred times higher in value than your forex trading account. Leverage availableness in Forex trading is amidst the 1st interests of a lot of traders in the Forex marketplace.

Take advantage of the leverage for brokers allow for greater, a good deal greater profits and because this can occasionally be a double edge sword and they are also able to incur very big losses. Nevertheless, with a deliberate, affordable and well prepared plan and tenaciousness this might not be a matter at all. A decently assembled investment strategy will assist you in your successful trading. I'll give you an important word of caution.The same as gambling, you had better not ever invest more than you are able to easily afford to lose and when you do turn a profit, start utilising the profit for investment. Get on the internet and open a demo account, practice for fun and once you're ready to trade for real, then good luck. - 23218

About the Author:

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