The Difference Between Currency Futures and the Forex Market by Justin Stewart
Well, you already know that the word "currency" refers to the monetary unit used in countries to buy goods and services (or pay taxes like in the USA). And we are also aware of the fact that "trading" refers to the purchasing and selling of these currencies. To say that there are nearly as many currencies in the world as there are countries is a fairly safe assumption. But when it comes to discussing currency futures versus the Forex market, the most targeted currencies for investment purposes are:
* United States dollar
* British Pound (sterling)
* The Euro
* Japanese Yen
Since the currency markets have become extremely popular with investors, and since they are predominantly a day-trade oriented market, they exhibit an extremely high volume of trading (contracts) and equally high amount of liquidity. The factors of high volume and liquidity entice the participation of all types of traders such as:
* Banks
* Financial and non-financial companies
* Governments
* Individual day traders
There are a number of ways in which to trade currencies but even non-traders are familiar with the most obvious one, namely trading your currency for that of the country that you are vacationing in. Usually, travelers will use a currency broker, in this case one of the country's banks, to exchange their currency. When the transaction is done, it is considered to be part of the currency exchange market. Where the serious investor or professional trader is concerned, this form of currency exchange is not acceptable.
Forex (FOReign EXchange)
The Forex Exchange is one of the most popular and highly trafficked venues of trading the actual exchange rates of two currencies in the industry, and the Euro to United States dollar gets a lot of attention in the Forex market. The exchange is usually listed as EUR/USD, which means trading the value of one Euro in US dollars. The five other most popular currency trades are:
* AUD/USD - The Australian Dollar to US Dollar
* CAD/USD - The Canadian Dollar to US Dollar
* EUR/CHF - The Euro to Swiss Franc
* EUR/GBP - The Euro to British Pound
* GBP/USD - The British Pound (Sterling) to US Dollar
In the Forex market, currencies are traded directly rather than in contracts. "Lot" is the terminology that is used to describe the minimum amount that can be traded, which is characteristically $25,000 USD.
Currency Futures
The currency futures market is based on the currency exchange market. Trades use futures contracts that are a reflection of the exchange rates of two different currencies. The Euro futures market is currently the most popular market of the bunch and is based upon the EUR/USD exchange rate. The Chicago Mercantile Exchange, or CME, provides the most popular currency futures.
An exchange provides the currency futures since it is a futures market, meaning that it employs centralized pricing, as well as clearing, and therefore ensures that market prices remain constant regardless of which brokerage is being used. Contract specifications include the value of the contract, the "tick size" (minimum price change), and the "tick value" (price change value).
Justin Stewart has used software to automatically trade the forex market allowing him to earn a living without lifting a finger, even while he sleeps. You can use the same forex software to get the same results.
Thursday, September 10, 2009
Tuesday, September 8, 2009
Futures trading:win or lose its how you play the game
Futures Trading: Win or Lose, It's How You Play The Game by Bill McCready
You've heard the maxim: "A win is not always a win and a loss is not always a loss." It's true in many aspects of life and particularly in futures trading. Making a profit does not always indicate a textbook perfect trade. Likewise, losing money does not always indicate a wrong trade.
What is essential for futures traders to realize is that the inherent rightness or wrongness of your trading method cannot be determined by the outcome of any one single trade. Those who incessantly tinker around with their system, trying to fine tune it to perfection after every trade, are setting themselves up for failure. Those who jump from system to system, searching for that elusive perfect system, are doomed.
Patterns, Not Single Results, Are Important
The perfect system is a myth. Even the most carefully planned and flawlessly executed trade can lose. And there will be times when you actually win with what you know was a faulty approach. While winning and losing are important, they cannot be the driving force behind your trading approach. You cannot base your trading tactics on a single win or loss. Tactics are best based on patterns, such as the results of 50 to 100 wins or losses.
Don’t get me wrong. It is important to learn from your trades. That's why I recommend keeping a detailed trading log and taking a snapshot of each trade for future study and reference. You may need to make some adjustments to your system as you develop it. But traders who second guess every trade don't have faith in themselves or their system and are headed for disaster. Futures trading is not for the timid and unsure. If you are going to succeed as a futures trader, you must first and foremost have faith in yourself and your system.
The analogy I often use with my students is that learning futures trading is a lot like learning to drive a car. You spend time in the classroom and in the simulator, but eventually you have to get behind the wheel of a real car, turn the key, step on the gas, and take that baby out for a spin. Preparation and practice can (usually!) keep you from crashing, but you're bound to pick up a few dents and scratches along the way--and you don't give up when that happens, do you? No, you trust your ability to apply the skills you've learned, and with time and experience, you're soon cruising confidently down the highway.
Professionals know that winning is in the details. If you concentrate on proper execution of the individual components of the trade -- timing, entry, money management, exit, etc. -- winning will take care of itself.
Bill McCready is a futures trader. His trading course, Futures Trading Secrets, has helped students all over the world improve their trading. To get 11 FREE futures trading lessons, a video, and free ebook, "The Truth About Day Trading”, visit ==>> Futures Trading Secrets.
Article Source: http://www.articlealley.com/article_788012_19.html
You've heard the maxim: "A win is not always a win and a loss is not always a loss." It's true in many aspects of life and particularly in futures trading. Making a profit does not always indicate a textbook perfect trade. Likewise, losing money does not always indicate a wrong trade.
What is essential for futures traders to realize is that the inherent rightness or wrongness of your trading method cannot be determined by the outcome of any one single trade. Those who incessantly tinker around with their system, trying to fine tune it to perfection after every trade, are setting themselves up for failure. Those who jump from system to system, searching for that elusive perfect system, are doomed.
Patterns, Not Single Results, Are Important
The perfect system is a myth. Even the most carefully planned and flawlessly executed trade can lose. And there will be times when you actually win with what you know was a faulty approach. While winning and losing are important, they cannot be the driving force behind your trading approach. You cannot base your trading tactics on a single win or loss. Tactics are best based on patterns, such as the results of 50 to 100 wins or losses.
Don’t get me wrong. It is important to learn from your trades. That's why I recommend keeping a detailed trading log and taking a snapshot of each trade for future study and reference. You may need to make some adjustments to your system as you develop it. But traders who second guess every trade don't have faith in themselves or their system and are headed for disaster. Futures trading is not for the timid and unsure. If you are going to succeed as a futures trader, you must first and foremost have faith in yourself and your system.
The analogy I often use with my students is that learning futures trading is a lot like learning to drive a car. You spend time in the classroom and in the simulator, but eventually you have to get behind the wheel of a real car, turn the key, step on the gas, and take that baby out for a spin. Preparation and practice can (usually!) keep you from crashing, but you're bound to pick up a few dents and scratches along the way--and you don't give up when that happens, do you? No, you trust your ability to apply the skills you've learned, and with time and experience, you're soon cruising confidently down the highway.
Professionals know that winning is in the details. If you concentrate on proper execution of the individual components of the trade -- timing, entry, money management, exit, etc. -- winning will take care of itself.
Bill McCready is a futures trader. His trading course, Futures Trading Secrets, has helped students all over the world improve their trading. To get 11 FREE futures trading lessons, a video, and free ebook, "The Truth About Day Trading”, visit ==>> Futures Trading Secrets.
Article Source: http://www.articlealley.com/article_788012_19.html
Sunday, September 6, 2009
Trading future forex market
Trading Future Forex Market by Anna Cove
Trading Future: Forex future trading is a non stop market for generating cash where the currencies pertaining to different countries around the world are traded. The trading is done with the help of online traders or the brokers. The foreign currencies are sold and bought simultaneously to earn the profit. You purchase a currency of a certain country at a low rate and sell it at a higher rate to make profit.
Forex future trading is also a great way of making money online. If you have enough time to track the change in the rate of currencies of different countries you can easily make a fruitful investment and earn a noticeable profit from it. Today looking at the present situation of the economy you will find it very difficult to predict the rates of the currencies. There ahs been a great downfall in the currency rate of USA. Dye to the down fall in the stock market the country has seen a great loss in the economy as well.
The conditions prevailing in the foreign exchange can change anytime and you have to keep a strict eye on all the changes so as that you can make a good profit according to your investments.
You can trade 24x7 and 5 days a week in Forex future trading. Also the liquid market is so enormous that you can easily trade with most currencies. The market conditions are so volatile that they offer you so many opportunities to grow in it and you will be glad to take the use of the standard instruments to control the risk exposure associated with Forex trading.
The Forex trading is done in the currency pairs. For example the exchange rate of a particular pair of currieries lets say EUR/USD on 26th august was 1.0857. The number is referred as Forex rate or rate. If your investor bought 1000 Euros at this rate that means you will be paying a total sum of 1085.70 UD dollars and if after some time say one year the rate f the dollars changed and became 1.2083 that means the value of the numerator ahs increased ad you can actually sell your purchased currency at 1208.30 now. The trading is done in this way in Forex future trading. You can also do intra day trading but if you invest in the Forex market for a long time you will find it easy to earn big profit in this way.
The best part about the Forex future trading is that the rates keep on fluctuating on the daily basis and you can keep and eye on the changing rates to make a good investment n the currency you find to be at the top an will help you make good profit.
You can read details and information about the future Forex market on the internet to brush up your memory and get to know what kind of situation will prevail in the future so that you can make wise investments and make thing simple and profitable for you.
Trading Future: Forex future trading is a non stop market for generating cash where the currencies pertaining to different countries around the world are traded. The trading is done with the help of online traders or the brokers. The foreign currencies are sold and bought simultaneously to earn the profit. You purchase a currency of a certain country at a low rate and sell it at a higher rate to make profit.
Forex future trading is also a great way of making money online. If you have enough time to track the change in the rate of currencies of different countries you can easily make a fruitful investment and earn a noticeable profit from it. Today looking at the present situation of the economy you will find it very difficult to predict the rates of the currencies. There ahs been a great downfall in the currency rate of USA. Dye to the down fall in the stock market the country has seen a great loss in the economy as well.
The conditions prevailing in the foreign exchange can change anytime and you have to keep a strict eye on all the changes so as that you can make a good profit according to your investments.
You can trade 24x7 and 5 days a week in Forex future trading. Also the liquid market is so enormous that you can easily trade with most currencies. The market conditions are so volatile that they offer you so many opportunities to grow in it and you will be glad to take the use of the standard instruments to control the risk exposure associated with Forex trading.
The Forex trading is done in the currency pairs. For example the exchange rate of a particular pair of currieries lets say EUR/USD on 26th august was 1.0857. The number is referred as Forex rate or rate. If your investor bought 1000 Euros at this rate that means you will be paying a total sum of 1085.70 UD dollars and if after some time say one year the rate f the dollars changed and became 1.2083 that means the value of the numerator ahs increased ad you can actually sell your purchased currency at 1208.30 now. The trading is done in this way in Forex future trading. You can also do intra day trading but if you invest in the Forex market for a long time you will find it easy to earn big profit in this way.
The best part about the Forex future trading is that the rates keep on fluctuating on the daily basis and you can keep and eye on the changing rates to make a good investment n the currency you find to be at the top an will help you make good profit.
You can read details and information about the future Forex market on the internet to brush up your memory and get to know what kind of situation will prevail in the future so that you can make wise investments and make thing simple and profitable for you.
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