Trading Courses: The Importance of Eliminating Emotions

Forex trading courses are intended for teaching beginners how to trade in currencies. Generally, such courses provide an introduction to currency trading and information about how to read quotes, factors that influence exchange rates, risks and benefits and trading strategies for risk management.

Despite being all inclusive, trading courses somehow lack the most elementary feature of the learning process. This relates to the actual trading experience because no matter serious and sincere you are, the actual trading experience cannot be simulated; neither in a traditional classroom setting nor through Power Point presentations. Trading in financial markets can send the adrenalin rushing to the brain leading to rash and often illogical trading decisions. It is thus extremely important to learn how not to let emotions rule over sound trading decisions.

Education imparted in trading courses through series of lessons or meetings is great for learning forex basics, terminology and trading strategies. However, for deriving full benefit of what you have learned you must try your hand at the actual thing. It is for this reason that good trading courses insist on taking the learning process to the final and most important level. Advanced trading courses accomplish to complete this process with the aid of actual trading on a trading platform.

If you think that you have taken one of the best trading courses available, you can complete the process on your own as well. Most forex dealers allow new clients to start with a demo account. You are provided with live rates as if you were trading for real. The only difference is that real money is not involved; you trade with virtual money. Try your hand and see how long it takes you to learn how to stick to a trading system and keep emotions out.

Characteristics of a CFD Tracker that Ensure Success

A CFD trader is someone who trades in the CFD markets. The CFD markets have been seeing a surge in the number of people who intend to take it on and try their hand in CFD trading. However, there are some things that you need to check about yourself, your personality and your abilities to see if you are likely to become a great CFD trader or not. These traits are signs of a great CFD trader.

A successful CFD trader needs to have a mind that is analytical with regards to numbers. He is one who can look at numbers, create trends and understand the import of the data. Being able to make decisions quickly based on the numbers that you have seen is another important characteristic of a good CFD trader.

Confidence against all odds is another aspect of a CFD trader that can lead to ultimate success. This means that you need to have the confidence about the decisions that you have made with regards to CFD and stick with them. Giving up and calling for stop loss too early is the biggest mistake that a CFD trader can make.

However, it is also an important aspect that the CFD trader understands when he has made a mistake. Calling stop loss at the right time and reducing losses is important because a CFD trader knows that he needs to live to fight another day.

The keen balance of knowing when to hold on and when to quit is of utmost importance for a CFD trader.

Trading Strategies for Pleasant Trading Experiences

Trading in markets is full of risk regardless of whether you are trading in currencies, stocks or commodities. Venture into financial markets without proper understanding of trading strategies and you run the risk of losing all the money in your trading account.

Trading strategies are basically market analysis that traders use for determining whether to buy or sell at a given point of time. Regardless of whether it is forex or stock trading, trading strategies may be based on technical analysis such as charting tools or fundamental analysis or study of news-based events.

It is necessary for day traders to have trading strategies suited for various market conditions. During the course of a single trading session, while playing out the broader trend and range, one may notice new trends emerging and fading only to reappear again. In times like this, traders need to choose whether to make a profit only at the time that suits a single strategy or use different strategies that suit an array of market conditions.

While using strategies it must be kept in mind that markets have a mind of their own. No matter how skilled a trader is, one can only hope to minimise losses as they cannot be eliminated totally.

On the face of it, trading strategies appear to be difficult to internalise and use. They actually are but if you can take care of one single aspect of human nature, you can use them to minimise losses. For effective use of trading strategies, it is extremely necessary that you control greed and keep emotions out. It is because of this that many experts recommend automated computer based trading systems.

Forex Risks and Benefits

Only recently, trading in forex, short for foreign exchange, was in the domain of large institutions and retail participation was not possible. However, the Internet and emergence of online trading platforms has changed all that. It is now possible for retail traders to trade in currencies through online brokerage accounts.

Forex is a highly fast-paced market where prices change every minute. However, daily currency fluctuations are very small, usually less than one percent in a day. To increase the value of small price movements, currency traders rely on the availability of enormous leverage that can be as much as 250:1. The fact that the forex market is highly liquid has made it possible for brokerages to offer high leverage as it addresses the issue of risk associated with it. The availability of leverage also makes it more volatile than it appears on paper.

Trading in currencies, just like trading in other financial markets, is a risky proposition. The very same leverage that increases the potential for profit for traders is responsible for huge gains turning into losses that can sometimes wipe out the major part of your account with the forex broker.

The forex market is also the largest financial market in the world involving large number of players dealing in larger amounts of money. Moreover, the currency market is open round the clock. It is thus important for beginners to understand that traders’ reaction to information released into the market is almost instant, which leads to constant movements in exchange rates of currency pairs. Although currencies do not move as sharply as stocks, the availability of leverage and the large size of individual contracts, makes forex trading as risky.

Trading Platform: Features You Cannot Afford To Ignore

A trading platform is proprietary software, usually offered free on maintaining a funded account with stock brokers or forex dealers. It provides traders the ability to initiate buy and sell trades and manage their positions. Most platforms also include market analysis software that allows traders to chart the markets. Software associated with trading platforms is easy to operate and extremely user friendly. Most of the times, the broker or the dealer will guide beginners how to use its various features. This is often accomplished by offering traders to try their hands on a demo account before opening a funded account.

Regardless of whether it is a trading platform for forex or stock trading, primarily it is a channel for communicating and exchanging information between you and your broker. It may either be an online trading platform or it may be installed or made available for download on your computer. In either case, an internet connection is necessary for getting live feed required for placing orders and monitoring accounts. A web-based trading platform has a distinct advantage as it allows traders access to markets from anywhere through any computer connected with the Internet.

However, there are certain features that need to be checked. Availability of real time and historical data is a absolutely necessary. Another feature is the ability of placing all types of orders that you need for managing risks associated with trading in financial markets. If you are one of those who trade in the forex market during your spare time, the trading platform you need should allow strategy automation. This allows you to create an automated trading system so as to execute trades at precise entry and exit points and adhere to time tested money management rules.

FX Singapore: Different Types of Orders

There are two ways that you can trade. One is simple buying and selling of currency pairs that the FX Singapore dealer offers. You go long (buy) one currency and short (sell) in the other currency in the pair. The second way is to trade in derivatives that have a specific currency pair as the underlying asset. Both these techniques are similar to what stock traders use on daily basis in stock markets.

However, the simple buying and selling of currency pairs is more common; most new traders are relatively unfamiliar with the way derivatives are traded in FX Singapore. One buys or sells a currency pair in the hope that the exchange rate of the currencies in the pair will move favourably to the position taken in the trade. For example, a long position in AUD/USD pairs yields profits when the exchange rate of the Australian dollar goes up in relation to the US dollar and a loss if it goes down. The exchange rate will rise when the value of the AUD dollar increases against the US dollar, which means that the bet is on the Australian dollar.

Here again, while initiating a trade in a FX Singapore account a trader may place a market order or a limit order. A market order is executed at the current prevailing price quoted on the FX Singapore trading platform. A limit order on the other hand signifies a specific price at which the order should be executed.

You also have the option of placing a take-profit order with the FX Singapore dealer. This means that your open position will be automatically closed once the price moves up to the specified level. Similarly, you can place a stop loss order to protect yourself against sharp downward movement in price.

The Uniqueness of FX Trading

In the FX market you are not really buying or selling anything even if on the face of it appears that you are buying one currency and selling another. It is basically a speculative market and there is no transfer of ownership of any currency in any case. Trades are simply accounting entries and profit or loss is netted or calculated on the basis of market price. A trader’s account is credited or debited in the currency in which it has been denominated. For example, even if the exchange rate of EUR/USD is quoted in US dollars, an Australian dollar denominated FX account will be credited in AUD.

The existence of FX market is basically for the purpose of facilitating exchange of currencies for exporters, importers and other trade related international transactions including payroll and mergers and acquisitions. However, trade related needs for foreign currencies amounts to only about 20-25 percent of the daily turnover in the FX market. Such transactions are in the domain of large banks that buy or sell foreign currencies on behalf of their clients. The rest is all speculative trades initiated by multinational banks, large financial institutions, hedge funds and even high net worth individuals. In fact, the FX market opened for the small individual investor only recently, thanks to the Internet.

In essence, when a trader initiates a trade, he is actually buying one currency and selling another because currencies are traded in pairs. If a trader buys a standard lot (equivalent to a hundred thousand units) of AUD/USD, he is essentially exchanging USD for AUD. It is almost similar to exchanging cash for, say, a laptop except that no transfer of ownership is involved in FX trading. However, the transactions may only be accounting entries the effects are as real as any other trading activity.

Using Tools for Predicting Foreign Exchange Rates

Traders in futures and options are familiar with concepts like implied volatility and open interest. The same tools can be used for placing profitable trades in foreign exchange markets as well.

In foreign exchange trading, implied volatility is used to measure the expected price change in a currency’s price over a given period of time. Calculation of implied volatility is based on the study of historical fluctuations and annual standard deviation of daily changes in foreign exchange rates. This is slightly different from option volatility that is a measure of the rate and extent of changes in the price of a currency. For effective prediction of future movement in the foreign exchange rates, a comparison of implied and actual volatility has to be made.

Since availability actual data is limited, a comparison of historical implied volatility (usually one-month and three-month) is considered to be a reasonably effective comparison for prediction of future of movements in currency prices. In general, implied volatility increases when the foreign exchange market is in a bearish phase and decreases in a bullish market.

Open interest, on the other hand is the total number of pending futures and options contracts or the number of buy orders before the market opens. This is different from traded volumes because open interest refers only to the number of contracts that have not been closed on a particular day. Monitoring of open interest in foreign exchange pairs at the end of each day helps in drawing conclusions of market behaviour. For example, increase in open interest indicates flow of new money in the market. Similarly, levelling of open interest after a sustained upward movement indicates the end of the upward trend.

How to Increase the Number of Profitable Trades While Trading CFDs

Irrespective of the instrument, trading in financial markets is associated with a high level of risk. Trading in CFDs is no exception. A trader’s skill lies in increasing the number of profitable trades and restricting losing trades. Besides skill, it involves discipline and patience.

CFDs refer to contracts for difference, a system of trading in financial instruments without actually owning them. A buyer and seller enter into an agreement to settle on the basis of difference between the opening and closing prices. Like any other financial instrument, it is imperative that traders in CFDs employ the same strategic tools for managing risks associated with the markets.

Regardless of the profit potential in CFDs, you need to have a system based on stop loss and trailing stop loss orders to restrict losses. Markets have a mind of their own and no matter how experienced a trader may be, there is no way one can predict market movements and be correct all the time.

A stop loss order is a pre-defined level at which you must exit the trade. Once the price reaches that stop loss price, the broker’s trading platform automatically triggers closure of the trade. If the markets are moving favourable to your position, you need to place a trailing stop loss. It is basically about increasing (or decreasing if you are in a short position) the stop loss price. This prevents profitable trades in CFDs to turn into losing trades. It is a method of locking the profit and remaining in the trade as long as the market keeps moving favourably.

While trading CFDs it is essential that a stop loss is placed in every trade if you want to increase the number of profitable trades and limit losing ones.

CFD trading Singapore: Three Essential Features of Trading Systems

As CFD trading in Singapore gains popularity many people want to know about the best CFD trading system.

However, before we get into CFD trading Singapore, it is necessary to understand what it actually means. CFD trading Singapore basically refers to a derivative product based on an underlying asset where a buyer and seller agree to pay or receive on the basis of difference between the closing and the opening price. No physical ownership is involved and a trader may sell or go short without prior ownership.

Just like any other trading system, a system for CFD trading Singapore is basically a set of criteria for determining entry and exit levels. It may be a mechanical process or discretionary or both. A fully mechanical CFD trading Singapore system means that you adhere to pre-defined rules and you are relieved of having to take decisions.

A discretionary system means that you have to spend a lot of time to learn how to trade and practice trading. You could do that under the tutelage of an experienced trader who can teach you how to use the system’s rules for increasing the number of profitable trades.

Regardless, any CFD trading Singapore system must include the three essential features.

- Stop loss feature. This allows you to exit a trade the as soon as the market starts going against you.
- Trailing stop loss feature. This allows you to lock in the profit when the market goes your way and lets you remain in a profitable position as long as the market keeps moving favourably.
- Acceptable risk-to-reward ratio. This refers to the ratio between how much you stand to gain if the market moves favourable and lose if it moves adverse to your position.

Why a CFD Singapore Broker Allows Trades on Margins without Checking Credit Scores

CFDs can be traded on margin money, which means that a CFD Singapore broker will allow you to place trades of a much larger value than the amount in your account. The balance amount is financed by your CFD Singapore broker.

The question to be asked here is do you need to have a good credit score for margin trading. The simple answer is no. However, a CFD Singapore broker would be more than eager to give you the required margin for trading. The question that crops up to mind is why a broker would lend you money. The answer to this is not that simple and needs to be understood.

A loan means taking a risk. Even a fully secured home loan has an element of risk as it is not easy for the loan provider to sell the mortgaged property. In the case of a margin trading loan there is no collateral but still there is not risk attached to it. It works like this.

Suppose you have 100 dollars in your account with the CFD Singapore broker and you buy a CFD of the value of 4,000 dollar. On the face of it, the broker has loaned you a sum of 3,900 dollars. The reality however is that the loan is at risk only if you happen to lose more than 100 dollars in the trade.

It is this aspect of margin trading that the CFD Singapore is worried about. The moment the loss amount reaches 90 dollars, the automated trading software alerts the broker and you will be asked to deposit more money in the account or the trade will be automatically closed. It is because of this that a CFD Singapore broker has bigger margins for CFDs based on highly volatile assets.

Definition of CFD and It Compares With Trading In Futures

Financial markets have traditionally been associated with buying and selling of shares, a trading activity carried on in stock exchanges. However, the advent of the Internet and online trading platforms has been instrumental in the emergence of new products in the financial markets. The most recent trading instrument to make an appearance in the Australian financial market is CFD.

CFD is short for contract for difference. It is a contract wherein two parties agree to pay or receive on the basis of the difference between the opening and closing values of the contract. For example, let us suppose that a trader were to go long (buy) in the benchmark index of the Australian Securities Exchange, the S&P/ASX 200 at 4,335 and the trade at 4,348. The trader stands to receive 13 AUD from the trader who made the opposite short trade or sold the index.

It is an unlisted market, which means that trades are not routed through an exchange. Instead, CFD is an over-the-counter market just like the retail forex market. All trades are directly between the traders involved rather than being processed by a central clearing agency or an exchange. Just like the forex and futures markets, trading in CFD market is done using leverages. This allows traders to place trade of much higher value than the money in their trading account.

The margin requirements in CFD trading are often lower than the futures market of the underlying asset. For example, the margin requirement in ASX 200 in the futures market is AUD 430 as compared to AUD 13,750 in the futures market. Even after allowing for the difference in tick size and value of both, margin in CFD is still lower by AUD 3,000.

Advantages of an Automated Trading Platform

There are various advantages of choosing a good trading platform. The ones that have been developed of late are the ones that are automated. While some people fret about the efficacy of automated trading platforms, these can be immensely convenient.

The first thing that you can accomplish by using an automated trading platform is to reduce the level of emotion involved in trading. Once you have decided on a plan, the automated trading platform carried out the instructions without human emotion. Sometimes you may be a bit hesitant to pull the trigger even when you have thought through various decisions. An automated system allows these decisions to be carried out easily.

The backtest feature that most of the automated trading platforms offer ensure that historical data can be applied to determine whether an order is likely to be successful or not. Such an automated trading platform helps in maintaining discipline too; something that is extremely helpful in volatile markets.

Sticking to the trading plan is not something everyone can do. Various thoughts and opinions tend to shade them; something that is not a great idea especially when you have a thought out plan. You can maintain consistency by using an automated trading platform.

The ease of use and convenience outweighs every other benefit. Automated trading systems can carry out orders and trades based on specific instructions about the price of a specific share or stock. You may not need to monitor the stocks that you are looking to buy every day and you can be sure that they will be picked up once they reach the desired rate.

Choosing from the Various Trading Courses Available

There are various kinds of trading courses that are available and the more you research the larger the options seem to get. However, the whole idea is not to jump and choose from the trading courses that you see online without really understanding what each one has to offer. Here are some pointers about how you can go about evaluating trading courses and choose the one that is most apt for you.

The first thing that you need to remember is that there are various kinds of options in trading. You can try your hand at traditional trading, binary options and futures, forex markets or CFD. It is best to first get a preliminary understanding of the specific aspects of what each of these involve before starting to research trading courses.

Make a decision about the trading niche that you want to participate in and then commence your research on trading courses available in that niche. Make sure that the ones that you shortlist are the trading courses that are meant specifically for that niche alone.

If you choose trading courses that are not specific you are likely to get an overview of all the kinds of trading methods without really getting a complete workable understanding of how to go about the process. The basic information that you get is something that you can obtain without paying a penny on many of the trading websites. So do make sure that you choose something specific that gives you the knowledge and the expertise to trade.

CFD Trading in Singapore: Short Selling

The increasing popularity of CFD trading in Singapore can be attributed to the ability to sell in financial markets without prior ownership.

It is like selling something you borrow from a friend and then buy at a lower price and return it. Open an account for CFD trading in Singapore and you will be able to the same with any financial instrument. In financial markets this is known as short selling.

CFD Trading in Singapore: What Does Short Selling Mean

Short selling means selling without prior ownership. CFD trading Singapore is a system of trading in financial instruments involving settlement of positions on the basis of price difference. There is no physical ownership involved. The contract is between the trader and the CFD provider which stipulates that the seller will pay the buyer the difference between the opening and closing values of the contract. If the outcome is negative, the buyer pays the sellers.

Each CFD has an underlying asset, which may be a share or currency pair or a commodity or a market index. CFD trading does not imply trading in the underlying asset. It is trading in a financial derivative product, which you can sell without buying it first.

CFD Trading in Singapore: Why Go Short

When you sell a CFD, you are actually betting on the price of the underlying asset going down. In traditional trading, traders have no choice when they see that markets are falling. If the downturn continues over a long period, it is like a long holiday. Traders can either refrain from trading or sell whatever they have in their portfolio. CFD trading Singapore offers an opportunity for benefiting from a falling market as well. The idea is to sell now and hope to buy later at a lower price.

Tips for Trading in FX in Singapore

Singapore is one of the leading exchanges where FX trading is very popular. FX in Singapore has become extremely popular due to the value of the currency and the time zone specifics too. When you are looking at FX in Singapore, there are a few things that you should keep in mind.

Research and analysis is the one thing that you cannot do without if you are trading in FX in Singapore. It is necessary that you learn to use the proper technical analysis to be able to make better predictions in FX in Singapore.

There are also various kinds of tools and plans that are available when you trade in FX in Singapore. These tools can be found on the various trading platforms that are available. These trading platforms have charts and analysis data that can be created easily at the click of a button. Some of the features that you may get include indicators, customizable charts and price alerts.

The other thing that is extremely important for FX in Singapore is to be able to manage risk and stop loss when you have to. Discipline and planning is the best way to ensure that you do not make decisions that are based on emotions; something that leads to maximum mistakes made in FX in Singapore.

Following the news is also very essential if you want to be able to understand fundamental analysis and create some of your own as you go along. This is the kind of analysis that will help you in making great long term investment plans too.

Setting up a Forex Singapore Account

Forex trading involves buying and selling currencies. The forex market is among the most liquid markets in the world and offers great opportunities for making good profits with little investment. If you want to join the bandwagon, the first step is to open a forex Singapore account.

There are three types of accounts that you can choose to open with a forex Singapore broker – mini, standard and managed. The factors that can influence you decision are:

- Risk appetite.
- Initial investment.
- The amount of time that you can afford to devote on daily basis.

When we talk of standard and mini accounts, the reference is to lot size. Lot size in turn refers to units of currency. A standard lot is worth $100,000. However, that does not mean that you have to deposit SGD100, 000 in your account to be able to trade. Forex trading is done on the basis of leverage and margin. A typical forex Singapore broker offers 100:1 leverage, which means that your initial investment in the margin account is only SGD1, 000 for trading one standard lot.

A stand account with forex Singapore broker gets you better service and perks and also increases the profit potential. Each pip is worth 10 dollars and if the position moves up by 100 pips, you stand to gain SGD1, 000, something that is not possible in other accounts unless you trade more than one lot.

A mini lot is worth is worth 10, 000. It is one-tenth of a standard lot and so is the gain potential. In a managed forex Singapore account you simply put up the money and the trading is done by the broker on your behalf.

Useful Tips for Choosing the Right Forex Broker

You can never be too careful while selecting a forex broker. There have been a number of scams in the forex market and there is an express need of separating fact from fiction. It is all the more important to choose the right broker because the forex market is not regulated the way stock markets are. There is also no centralised exchange system.

While selecting a forex broker it is important to check whether the broker is registered with the local broker’s association. Avoid getting carried away by a flashy and well designed website, if the broker is registered there should be a prominent message displayed on the landing page.

Absence of a central exchange system means that accounts vary with each forex broker. The most important things that you need to check and compare are the level of leverage and margins. Brokers are known to offer leverage up to 200:1. Leverage refers to a loan extended by the forex broker to a margin account holder. A 200:1 leverage means that with $1,000 in the account, the account holder can hold positions up to $200,000.

Check the commission that the broker charges. Most brokers do not charge any commission but make money with spreads. Spread is the difference between ask and bid prices. A forex broker will sell a currency pair at a price higher than the price at which he will buy the same pair. A spread could be fixed or it may vary depending up market volatility. The difference reflects that when you buy a currency pair, it immediately falls in value as the broker will buy it at a lower (bid) price. Wider spreads translate into higher profit for the forex broker.

Foreign Exchange Market: An Introduction

The foreign exchange market is the biggest market in the world, where daily turnover in spot trading exceeds 4 trillion US dollars. While the US dollar is the most widely traded currency the biggest foreign exchange market is London. 

Trading in foreign exchange refers to currency trading. While the basic principles are the same, trading in currencies is a little different from other markets. While in other markets you trade a specific share, commodity or index, in currency market you trade currency pairs.

Trading involves buying or selling but how does one buy a currency? There has to be a different currency in which one can pay for the currency one buys. It is because of this that currencies are traded in pairs. It is also the reason why the currency market is known as foreign exchange market; the rates reflected are exchange rates. An exchange rate is the rate at which one currency can be exchanged for another. 

In the foreign exchange market, the big banks are the ultimate market makers. In fact, not very long ago, currency trading was only in the domain of large banks that bought and sold currencies for themselves and for their clients. The bid and ask prices of currency pairs are also set by banks after considering the demand and supply situation. However, brokers in the retail market have varying rates as there is no centralised exchange. 

The difference between bid and ask prices is known as a spread, which represents the profit of the broker. Historically, the narrowest spread is reserved for participants in the interbank foreign exchange market. In the retail market, brokers do not charge a commission on trades but derive their profit from the spread. 

CFD Forex: Exploit Full Profit Potential by Managing Risks

CFD Forex is a highly leveraged system of trading in currency pairs that has the potential for huge profits. CFD is short for contract for difference, a contract between two parties; a buyer and seller, where both agree to pay or receive (as the case may be) the difference between the current exchange rate of the underlying currency pair and the rate at the time of the contract.

Being a leveraged derivative product that is traded using margins, traders can get the benefits of the full value of the contract by investing only a fraction of contract value. However, CFD Forex is double-edged sword that cuts both ways. It is thus extremely important that traders understand the risks involved and exercise care while initiating trades.

The two most common factors why new and inexperienced traders make losses while trading in financial markets are greed and fear. A successful CFD Forex trader determines entry and exit level before initiating a trade. After that it should be a matter of waiting only. Regardless of whether the markets move favourably or against your prediction, you should exit the trade at predetermined levels.

This is possible only if the CFD Forex trading platform offers the facility of guaranteed stop losses. If the stop loss is triggered, the system automatically closes the trade. This way a trader knows beforehand the maximum amount that can be lost in a particular trade.

Placing stop losses is just a simple method of minimizing risk in CFD Forex trading. There are also other trading strategies that can be used to mitigate risks.

Characteristics of a CFD Tracker that Ensure Success

A CFD trader is someone who trades in the CFD markets. The CFD markets have been seeing a surge in the number of people who intend to take it on and try their hand in CFD trading. However, there are some things that you need to check about yourself, your personality and your abilities to see if you are likely to become a great CFD trader or not. These traits are signs of a great CFD trader.

A successful CFD trader needs to have a mind that is analytical with regards to numbers. He is one who can look at numbers, create trends and understand the import of the data. Being able to make decisions quickly based on the numbers that you have seen is another important characteristic of a good CFD trader.

Confidence against all odds is another aspect of a CFD trader that can lead to ultimate success. This means that you need to have the confidence about the decisions that you have made with regards to CFD and stick with them. Giving up and calling for stop loss too early is the biggest mistake that a CFD trader can make.

However, it is also an important aspect that the CFD trader understands when he has made a mistake. Calling stop loss at the right time and reducing losses is important because a CFD trader knows that he needs to live to fight another day.

The keen balance of knowing when to hold on and when to quit is of utmost importance for a CFD trader.

Forex Singapore Trading Account

If you are in Singapore and want to earn some money on the side, you may try and open an account with a forex Singapore broker. This however does not mean that you do not need any prior knowledge before you start trading. The fact is that the forex market is one of the most difficult markets to understand. It is also very popular because of the high potential of profit.

Opening an account with a forex Singapore broker will help in more than one way. For one, it will give you access to a demo account. A demo account with the forex Singapore broker will allow you to place virtual trades in the market at real-time currency rates without putting up any cash. The best way for an adult to learn is through participation. You can try your hand for as long as the broker allows you to. On expiry of the trial period you may be asked to deposit the minimum required amount in to your account.

Once there is money in your account the forex Singapore broker will probably not allow you to trade in the demo account. However, if you think you still do not have enough confidence, you can continue the learning process by creating small positions. You will see that your confidence increases with every profitable trade.

There will also be losing trades but that is part and parcel of trading in financial markets. A good forex Singapore broker will also provide the necessary resources that you may require for learning how to manage the risks associated with forex markets.

Forex Course for Beginners

The forex market is not only the largest but also the most complex of all markets. Most beginners find it difficult to internalise the basics and understand what makes the market move the way it moves. What adds to the complexity is that it is also one of the most fluctuating markets in the financial world. If you are a beginner, you could consider taking a forex course to understand these complexities and learn how to maximise your profit.

The reality is that the forex market is so large that despite its recent popularity there are no signs of reduction in its unpredictability and the associated risks. The fact that it is an over-the-counter market makes matters even worse for a beginner. Beginners get easily carried away by the enormous gains that they may make early in their trading career forgetting that there is a similar potential of loss. A forex course can prove to be of great help in knowing the factors that influence market movements.

A good forex course will also teach risk management strategies. Like other financial markets, there are risks in forex trading as well. There will be profitable as well as losing trades. Your success depends upon maximising the number of profitable trades and minimising losing trades. The forex course you choose should cover proven trading strategies that have 60-70% winning chances.

The best forex course is the one that teaches you by allowing you to participate. Participation in trading activities makes it easier for adults to develop the kind of emotionless mindset required for the success of a forex trading career.

What You Need To Be Aware Of While Choosing a Forex Broker

Just as it is in other businesses it is not uncommon to hear about forex broker scams. The fact of the matter is that even a well reputed forex broker can cheat you because there is no formal regulatory central agency the way there are stock exchanges for the stock market. This is also the reason why it is extremely crucial to know how you choose your forex broker and understand how s/he can cheat you.

One of the most common ways that a forex broker can cheat you is to provide you with fake rates of currency pairs. Keep in mind that brokers have access to better technology and can choose to show whatever price they want to. The fact is that every broker offers a different spread on currency pairs and this will always differ from the actual quotes in the interbank market. This gives brokers a chance to change rates whenever they want to. The best part is that they are on the right side of the law as they are covered by the terms and conditions of the contract you sign with them.

Fraudulent brokers can easily programme cheating schemes into their trading platforms. For example, they could fraudulently run your stop losses to make more money out of you. However, at the same time it must also be said to their credit that good brokers do not normally indulge in such fraudulent practices and do not change their spreads simply to cheat their clients.

To protect yourself from forex broker scams it is necessary that you check the rates offered by your broker with other sources, preferably with interbank rates.

Trading In Foreign Exchange Explained In Simple Terms

The ability to trade with margins is one of the reasons of the immense popularity of trading in foreign exchange. Margin trading or leverage means that a trader can take a large position with a small capital outlay, which increases the profit potential manifold. However, it works both ways as it increases the potential for loss as well.

Trade in foreign exchange is basically done in currency pairs. The quoted rate reflects the value of one currency as compared to the other in the pair. For example, if EUR/AUD is being quoted at 1.23, it means that one euro is equal to 1.23 Australian dollars. The base currency is always the one that is listed first in the pair. What is interesting in the foreign exchange market is that both bull and bear market are always present at any given pointy in time. This is because you are primarily betting on which currency will increase in value as compared to the other. If you are bullish on one, you are bearish on the other.

Traders in foreign exchange can take advantage no matter which way they think the market will move in future as they have the option of going long or short in a currency pair. The minimum movement in foreign exchange rates is known as a pip. In case of AUD against the US dollar this would be the fourth decimal place. Suppose AUD/USD is quoting at 1.70 and you were to buy 10,000 units. If the price moves up by 0.01, it would mean that you make a profit of $1.

Which is Better: Forex CFDs or Conventional Forex Trading

Ever since trading in foreign currencies was opened to the general public it has become increasingly popular with the investing community. Its popularity has also been instrumental in the introduction of trading in forex with CFDs.

With the introduction of forex CFDs, traders not only have another option they are also faced with a dilemma of choosing between the two. While there are many similarities between spot trading and CFD trading in forex, there are also differences that may influence your decision.

In forex, both spot trade and CFD trading offer an enormous amount of leverage. Leverage allows an investor to place trades of a much larger value than the amount deposited with the broker. While leverage increases the profit potential, it is a double edged sword that can cut both ways.

Another similarity is that both allow traders to make a profit regardless of whether the market is going up or down. Just as traders can buy or sell a currency pair, they can also buy and sell forex CFDs. In fact, CFDs can be bought or sold regardless of whether you are trading in shares, commodities, indices or forex.

However, one of the major differences is that most CFD dealers offer a guaranteed stop loss, a feature not available in spot trading. While a lot depends upon whether you are dealing with a market maker or have direct market access, availability of a guaranteed stop loss has a fair advantage over normal stop loss. Moreover, forex CFDs are more flexible in terms of size of your trades and are simpler; your profit or loss is simply the difference between the current value and the value on expiry of the contract.

CFD Trading Singapore: Disciplined Trading

Regardless of the financial product you are trading you need to work out a plan before placing your trades. No matter how simple and easy to execute a CFD trading Singapore plan is, it requires a fair amount of discipline. Trading without discipline is a sure invitation to trouble. Strict discipline, on the other hand can yield handsome profits.

Firstly, enter a CFD trading Singapore trade only after you are sure of the point at which you will exit and stick to it regardless of market behaviour. Indirectly, it means that you need to avoid greed and not be afraid to book a loss. Remember that you placed the trade after due diligence and you should stick to it. Unnecessary greed can have dire consequences and so can your refusal to book a loss. 

Secondly, never get lured by promises that CFD trading Singapore provides fast and easy profits. Markets tend to spring surprises and no matter how experienced you are, you can never be always correct. The most you can do in CFD trading Singapore is to identify a target enter and exit price. Your job is over. Keep your gambling instincts out of it. Whether you make a profit or loss depends upon how the market behaves. 

Thirdly, identify a handful of markets and watch them closely. After that, no matter what you hear or see about astronomical profit potential in other CFD trading Singapore markets, stick to the ones that you have been watching. Trade in a new market only after you have studied it for quite some time.

Basic CFD Trading Advice

While it cannot be denied that there is a huge profit potential in CFD trading, it is also correct that it requires you to hone your trading skills. The fact is that trading CFDs is simple but not easy. 

The first thing that you need to know is that there are the similarities as well as differences between CFD trading and trading in the cash market for the underlying asset. Some differences offer a distinct advantage over direct trading while others can result in huge losses if you do not take due care. It is thus extremely important that you first understand the fine details of CFD trading you open an account. 

It is your hard earned money that is at stake and it does not pay to trade on hunches. Create a position only after you have done your research properly. Trust only your own judgment and not anyone else’s.

The best CFD trading advice you will ever get is to keep emotions out and develop a good CFD trading system. You will feel more comfortable and relaxed if once you are able to adopt that mindset. A good trader has a set of rules or a programme before initiating trades. Create a position only if you are sure of the point at which you will close it. 

Markets have an uncanny habit of throwing surprises. You need to know how to place covering orders and protect yourself from sharp adverse movements. At the same time, a trader should always be adaptive and have the ability switch quickly from bullish to bearish trends.

Trading CFD Singapore: Is It Good Only For the Short Term

It is generally believed that CFDs are suitable only for those with a very short time horizons or day traders. One of the reasons given for that is that you pay interest if you carry the position overnight. The longer the period you keep the position open with the CFD Singapore broker the higher the interest amount. 

It is commonsense that if you want to hold a position for long you would rather buy in the cash market where you do not have to pay a regular maintenance charge. But there is another side to it also. If you are paying hard cash for the full investment amount, you are foregoing the interest that you would otherwise get if the money were to remain in a bank deposit. You need to view the interest that you pay to CFD Singapore the same way. It is just like the way a landlord makes it worthwhile by figuring in the expense of constant maintenance of rental property into his profit calculation. 

It should be kept in mind that the CFD Singapore will typically charge an interest rate that is roughly two to three points above the base rate. However, if you go short in a contract with the CFD Singapore, you are paid an interest rate that is 2-3 points lower than the base rate.

The second point to be made in favour is that CFD Singapore is a leveraged product. If have done your research properly and your instinct proves correct, you stand to get a handsome profit on the full value of the contract with an initial outlay of 10% of the contract value.

Trade in CFD Forex

If at any given point of time you have ever shown an interest in trading, there is a strong possibility that you have got e-mails from CFD forex brokers. Most traders are fascinated by the fact that the forex market is highly liquid and open all through the day. Both these factors are extremely attractive to online traders who can only log in after office hours. 

Another reason why traders find CFD forex trading attractive is the reason that it allows them to buy or sell without actually owning the currencies they trade in. They can go long (buy) or short (sell) and take advantage of all price movements regardless of whether prices of currency pairs are moving up or down. 

When you trade on a CFD forex platform, you need to be clear of the situation. The base price is the price at which you buy a currency pair, which is available in convenient lots or sizes. Like other CFDS, a forex CFD is also a leveraged product that is traded on margins, which means that you can create a position by paying just a fraction of the total value of the contract size. A typical CFD forex trade can be secured by paying just 1% of the contract value; the rest is a margin loan. 

A typical CFD forex broker will offer a very tight spread, the difference between the buy and sell price, which is also the only charge that you need to pay for trading in forex CFDs. Leveraged trading allows exceptional profit potential with a small initial outlay but you need to be aware that adverse movements can wipe off the entire margin and land you in trouble.

CFD Pricing

CFD refers to contract for difference, a system of trading without actual physical ownership. The parties to the contract agree to exchange the difference between the current value of the contract and its value on its expiry. The asset may be a share, commodity, currency or index. The seller pays the difference to the buyer if the difference is positive. On the other hand, if the difference is negative, the buyer stands to lose money.

It is a derivative product that allows traders to speculate on price movements without having to own the underlying asset. It is a leveraged product, which means that traders have to put up only a small margin amount of the total value of the contract. 

A CFD provider works on the same lines as a traditional broker who acts on behalf of an account holder. Providers do not carry any risk and hedge their positions in relation to their clients in the cash market. For example, if a client were to buy 10,000 CFDs of EUR/AUD, it means that the CFD provider has created a short position in the currency pair. He will simultaneously create a long position in the cash market to hedge the risk.

Since the CFD provider is hedging his bets, he is in a position to pass on any price movement to the client. This allows the CFD provider to offer the best cash market price. Transparent pricing that tracks the price movement of cash market without delay assures traders that there is no conflict of interest despite the fact that they and the provider are counterparties in the contract.