How to become a savvy Forex Trader
When
trading in the exciting and lucrative FX markets, what should one look
for? Which are the factors that make all the difference between a smart
trader and a novice trader?
- Spreads-the lower the better!
The
spread is the difference between the buying price and the selling price
of a foreign currency. Traders everywhere are looking for low spreads
as this guarantees double the profit when trading volume.
- ECN/ STP-trading environment
This
involves no intervention of a third party, thus no Dealing Desk,
allowing for transparency of live prices, all orders and rates can be
seen by the client, reflecting market depth and allowing the client to
make better buying and selling decisions.
- Flexible Leverage-the higher the leverage the more risk involved!!
Leverage allows a trader to trade more money than he /she actually deposited
into the account. So a client who deposits $100 and selects a leverage
of 200:1 allows him/her to trade with an equity of $20,000. The higher
the leverage the more risk involved as more funds can be lost.
- Choice of Advanced Online Trading Platforms
Trading
has never been so easy as it is nowadays with the use of user-friendly
software. All trading platforms are easily downloadable and managed,
with self-explanatory advanced features, widgets and other applications
making the art of trading attractive. The ability to see all financial
instruments, and different currency pairs or sessions on multiple
screens, to generate historical reports of all trading activity, to
integrate all EAs needed ,
to create graphics, follow technical analysis, to add other plug-ins,
all these factors are essential in facilitating FX trading, not to
mention the fact that most platforms are nowadays available in many
languages too.
- Fast execution- the speed at which trades are executed is always a star attraction for any trader!
The
currency markets evolve rapidly and it’s important that orders are
executed at lightning speed so the trader makes no losses on his bid,
and the broker fills him in the best possible price, or the price
nearest to the market price at the time he clicks the ‘buy’ or ‘sell’ button. It is a fact that a few pips difference in price can make that much harder to win a trade.
- Forex Economic Calendar-master news trading!
Learn
how to use the real-time Economic Calendar which covers all important
events and releases that affect the FX market. Learn about Forex Trading
News ND Market analysis etc.
Approximately
7 pieces of data are released daily from the 8 major currencies
(EUR/USD/GBP/JPY/CHF/CAD/AUD/NZD) and their countries. A savvy trader
will learn to master the time at which the economic news are released and select the most relevant information for FX trading and how he can take advantage of this data.
Data such as :
interest rates, unemployment, inflation, trade balance, retail sales,
industrial production etc. The importance of each of these key features
will differ each month.
- Funding Methods
Clients
should be allowed to deposit and withdraw their funds and profits
whenever they wish and without any hassle. After some experience in
trading with different brokers, a client will understand which are the
best funding and withdrawal options available.
- Security of the Broker – do not touch a non-regulated broker!
Who wants to hand-over
their hard-earned cash to a broker which is not regulated or
authorized? None. It is therefore important to check the legal status
and credibility of the broker you are dealing with and nowadays this is
information which is readily available from the regulatory agencies in
each country.
- Customer Care-should be available 24/5!
A
savvy trader will make use of the support and advice of the
professionalism of the customer care. The competence of the customer
care department of any broker is just as important as its performance on
executing trades.
Once all the above
factors are well and truly mastered, you are now a savvy trader and
will enjoy all the benefits and profitability of FX trading!!!
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