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Forex trading
- Thread starter NJTrader
- Start date
a couple of facts RE the spot interbank foreign exchange (fx) market, the by far most liquid and 24h market in the world, and where roughly 95%, according to greenwich associates, of the usd 1,2 trillion a day volume, according to the bank of international settlements, is purely speculative, breakdown of participants is roughly, speculative positions by banks, multinational corporations, financial cartels, global money managers and hedge funds, registered dealers, international money-brokers, right the way down to private individuals:
the remaining five percent of fx trades are genuine transactions for physical exchange and delivery of currency for non-speculative purposes and hedging. this category of participants includes governments, import/export companies, international travelers, buyers of international money orders, and commercial enterprises that use currencies in their day to day operations.
first, depending on how big/capitalised you are, you'll be able to go to either a multibank portal like currenex, owned by, amongst others, credite suisse first boston and royal dutch shell, fxall, owned by a consortium of 15 banks, with the largest shareholders being goldman sachs, bnp paribas and credit agricole indosuez, etc.
with these, spreads will typically be as narrow as one or two pips in the four main currencies, and eur/usd and usd/jpy comprise around 50% of of fx market trading volume, a full 75% of volume is transacted in the four majors, eur/usd, usd/jpy, usd/chf, gbp/usd.
the ten largest participating banks are:
1. Citibank 2. NatWest
3. Merrill Lynch 4. Deutsche Morgan Greenfell
5. Chase Manhattan 6. SEC Warburg
7. JP Morgan 8. Goldman Sachs
9. HSBC Markets/Midland 10. BZW
as far as roll-overs go, the truth of the matter is that you are either credited OR debited interest rate payments on open positions depending on whether you are long or short the currency with higher interest rates vs it's pair - meaning it's irrelevant over time, you'll pay some and you'll earn some.
if your funds / credit lines do not allow for participation in a multibank portal, you have the nonbank retail sites.
depending on whom you choose you'll obviously have varying spreads and other arrangements.
re www.oanda.com, accts can be opened from usd 1 upwards, and the minimum deal size is also from 1 usd upwards. interestingly, they
continuously credit or debit interest rates on open positions on a second by second basis, meaning no more roll-overs, and spreads are between 2 and 4 pips, depending on the currency pair, and eur/usd & eur/gbp sometimes as low as 1 pip, also price is tradeable immediately without having to indicate long/short or size, and also no requotes. plus a demo platform identical in all respects to the trading platform itself that you can test strategies etc on for as long as you desire.
other above board competitors would be saxo bank, gain, cmc, and ifx.
here's a very good article about the interbank market and the various players, although atriax has since folded, notwithstanding that it was set up by some of the largest participating banks in the interbank market like city, deutsche etc, there simply isn't enough place for too many multibank portals, and we are currently in a phase of consolidation. it also has to be remembered that in the interbank market, to date roughly over two thirds of all transactions are still being done over the phone, and the idea of doing business electronically is still relatively nouveau:
http://www.erivativesreview.com/con...7B3670A833F669C
and here is a free fx chart provider:
http://www.saxobank.com/ibsite/fore...ts.asp?Charts=1
the remaining five percent of fx trades are genuine transactions for physical exchange and delivery of currency for non-speculative purposes and hedging. this category of participants includes governments, import/export companies, international travelers, buyers of international money orders, and commercial enterprises that use currencies in their day to day operations.
first, depending on how big/capitalised you are, you'll be able to go to either a multibank portal like currenex, owned by, amongst others, credite suisse first boston and royal dutch shell, fxall, owned by a consortium of 15 banks, with the largest shareholders being goldman sachs, bnp paribas and credit agricole indosuez, etc.
with these, spreads will typically be as narrow as one or two pips in the four main currencies, and eur/usd and usd/jpy comprise around 50% of of fx market trading volume, a full 75% of volume is transacted in the four majors, eur/usd, usd/jpy, usd/chf, gbp/usd.
the ten largest participating banks are:
1. Citibank 2. NatWest
3. Merrill Lynch 4. Deutsche Morgan Greenfell
5. Chase Manhattan 6. SEC Warburg
7. JP Morgan 8. Goldman Sachs
9. HSBC Markets/Midland 10. BZW
as far as roll-overs go, the truth of the matter is that you are either credited OR debited interest rate payments on open positions depending on whether you are long or short the currency with higher interest rates vs it's pair - meaning it's irrelevant over time, you'll pay some and you'll earn some.
if your funds / credit lines do not allow for participation in a multibank portal, you have the nonbank retail sites.
depending on whom you choose you'll obviously have varying spreads and other arrangements.
re www.oanda.com, accts can be opened from usd 1 upwards, and the minimum deal size is also from 1 usd upwards. interestingly, they
continuously credit or debit interest rates on open positions on a second by second basis, meaning no more roll-overs, and spreads are between 2 and 4 pips, depending on the currency pair, and eur/usd & eur/gbp sometimes as low as 1 pip, also price is tradeable immediately without having to indicate long/short or size, and also no requotes. plus a demo platform identical in all respects to the trading platform itself that you can test strategies etc on for as long as you desire.
other above board competitors would be saxo bank, gain, cmc, and ifx.
here's a very good article about the interbank market and the various players, although atriax has since folded, notwithstanding that it was set up by some of the largest participating banks in the interbank market like city, deutsche etc, there simply isn't enough place for too many multibank portals, and we are currently in a phase of consolidation. it also has to be remembered that in the interbank market, to date roughly over two thirds of all transactions are still being done over the phone, and the idea of doing business electronically is still relatively nouveau:
http://www.erivativesreview.com/con...7B3670A833F669C
and here is a free fx chart provider:
http://www.saxobank.com/ibsite/fore...ts.asp?Charts=1
Here are some stats (I posted this before)
http://www.bis.org/publ/rpfx02.htm
In fact, the spot currency market has only a 387 billion USD daily volume (the rest are forwards, swaps, ..)
EUR/USD now at parity!
http://www.bis.org/publ/rpfx02.htm
In fact, the spot currency market has only a 387 billion USD daily volume (the rest are forwards, swaps, ..)
EUR/USD now at parity!
Originally posted by SethArb
the management of GAIN Capital
at an investment Expo in NYC
they seem to be honest chaps
good website ...
have not traded with them , but they would be
my first choice if I were to start trading Spot FX again
good luck
I agree. These guys are great, very professional. Talk to Kevin Mallon. Try the live Demo, they will load your account with 25,000 and then tell me you can't make $$$. The spreads are actually tighter than the currency futures market, because you are paying no commission and you are getting 100 to one leverage rather than 15/1 leverage in the futures market.
Account minimum is $5000.00 Try the DEMO it will give you a great feel for the market..it is hooked up to a live price feed, not a simulation enviroment.
Originally posted by Nemsy
Here are some stats (I posted this before)
In fact, the spot currency market has only a 387 billion USD daily volume (the rest are forwards, swaps, ..)
EUR/USD now at parity!
yeah, although one mustn't forget that all these figures are basically estimates, and that forwards etc are normal instruments that are used normally in the line of doing fx business, thus the 1,2 billion usd / day figure.
for all relevant and realistic purposes, there is no "real" size limit for initiating / exiting positions, no matter if you are a hedge fund, GE, or whoever.
and parity, yup, that was a long nice ride.
cheers
Agreed. Beginners must spend quality time on learning before they start live trading, else they end up in never ending losses.Forex is a great way to make money and you can get profit if you have a good strategy and risk management, Always learn it and then apply your experience and get results as profit.