Month: October 2017

If you are familiar with forex trading, then you would know about its classifications “Market Maker” and “ECN”. ECN or Electronic Communications Network provides a marketplace where banks, market makers, and individual traders buy and sell to each other by sending competing bids and offers into the system. All parties interact with each other in the network and they are given the best offers for their trades at any given time, and the orders are matched against other participants in real time. All services are provided for a small fee.

ECN is relatively new and IMMFX has recently started offering this service for its customers, particularly because of the many advantages it has. For instance, ECN does not have a fixed spread, and this means that spreads will mostly be based on the buying and selling rates in the market.

However, this is not the only advantage of ECN trading. Here are some additional benefits that will help you reach a verdict on ECN trading systems:

ECN is Flexible

If you have traded with a forex broker, chances are that you were offered a fixed spread. Of course, this is perfectly all right if the buying and selling rates are good. However, these rates remain the same despite any fluctuations in the market.

As an ECN broker, IMMFX can guarantee success to a great degree to investors because of the system’s flexibility. ECN adapts to rates in the market in a way that makes traders confident about their investment.

Straight Through Processing

In the ECN system, traders do not have to go through dealing desks. Your money will go straight to the interbank market without any interruptions. This is known as straight-through processing (STP) and it makes the life of traders easy as they do not have to go through dealing desks.

Access to Information

While traders on ECN remain anonymous (which is a benefit in itself), you can view the orders that have been made and sold without any difficulty. This will help you analyze market depth, which in turn enables you to make better buying or selling decisions.

Even with the anonymity factor, all the orders in the market and their rates can easily be viewed. This also increases transparency as the status and ratio of demand and supply is open for all to see.

Final Thoughts

Many times people confuse STP brokers with ECN brokers. ECN brokers provide you with direct trading on the real market, whereas STP brokers are a mix between ECN brokers and market makers. Other benefits of ECN forex trading include the fact that in this system, the deals of the traders are not carried out against the broker, which is not the case with market makers. To get started with ECN, you need to open a forex trading account with IMMFX.

OPEN YOUR ECN TRADING ACCOUNT

Over the years the financial trading industry has evolved dramatically. Today thanks to the Internet, investors can participate in trading from anywhere and anytime they want even when they are on the go. The impressive technological advancements have brought the world of trading to your fingertips. Traders can now make quick buy and sell trading decisions immediately and benefit from outstanding trading opportunities right away.

In addition to this, investors now have a large variety of trading markets to choose from. Trading today has surpassed the traditional stocks and bonds trading market and expanded to commodity, futures, CFD and forex trading.

With so many trading markets at hand, novice investors often face the challenge of selecting a market that is right for them.

Presently, forex and CFDs are two of the hottest trading arenas. There are approximately 120 currencies traded in the forex market every day, which combines to transactions worth trillions of dollars. Both the CFD and forex markets are highly liquid and offer great money making opportunities for traders.

However, to get started with forex or CFD trading, first you must learn the similarities and differences between the two to make a better choice!

Forex Trading

The trading instruments in the forex market are currency pairs. Traders select a currency pair and speculate the strength of the base currency (the first currency in a currency pair) against the quote currency (the second currency in a currency pair).

CFD Trading

CFD stands for Contract for Difference. It is a contract between two parties (the buyer and seller) where the buyer speculates the price difference of the trading instrument. It is an over the counter trading instrument that involves trading of indices, commodities and currencies. It is also known as the equity derivative.

Before we start defining the major difference between trading forex and CFDs, let us first give you an overview of the similarities between the two.

Similarities

Both trading markets have:

• Identical trading execution process.
• No directional trading, which means traders can earn profits whether the market spikes or plunges provided that traders have an accurate directional prediction.
• The cost of trading in both markets is the spread; it can be fixed or floating depending on the financial services broker.

Differences

Trading Instrument Types

The major difference between CFD and forex trading is that CFD trading can include different contract types covering a variety of financial instruments like indices, currencies and commodities, whereas the forex market is purely based on trading currency pairs.

Size

In CFD trading a trader can choose different contracts that vary in currency type and increment value. However, in forex you trade one currency against another in standardized lot sizes.

Market Driving Forces

The contract value in CFD trading is influenced by the demand and supply factor of the underlying asset whereas in forex, the value of trading currency pairs is affected by economic, political and global factors.

CFD Offers Currency Trading But Forex Does Not Offer CFD Trading

Through CFD trading you can enter into a contract for trading currencies but through forex trading you cannot create a CFD contract to trade a variety of trading instruments.

A Contract for Difference (CFD) is a contract between two parties that settle the difference between the opening and closing price of the underlying instrument at the close of contract. As a derivative product, a CFD allows trading on the world commodity markets at live price movements without requiring traders to actually own the underlying instrument.

The biggest advantage of CFDs is that one can speculate regardless of market movement by going short in order to profit from falling prices, allowing you to hedge your portfolio against any losses of value for your physical investments. CFDs are powerful financial instruments providing progressive access to the commodity markets.

CFDs can be traded on equities, indices, and futures. These are instruments of investments which provide online access to price movements of stocks, indices and commodity futures without requiring actual possession of them by a trader. CFDs on equities, indices, and futures are a brilliant hedging method, protecting the value of assets, as well as allowing for speculative trading at high leverages.

Although there is an array of index CFDs available for trading, investors need only trade on a few, major indices, which include:

• Dow Jones Industrial Average
• Nasdaq Composite
• FTSE
• S&P 500 Index
• Aussie 200 Index

CFDs on equities, indices, and futures are an increasingly popular trading practice these days as they provide speculative profits on both rising and falling markets while allowing traders to hedge their portfolios against bad investments in a highly effective way. CFDs have the additional benefit of being traded instantly, avoiding the hassles of time-consuming transfers, and they are a margin product, traded in a similar fashion to the Forex markets.

There are various and considerable advantages to CFD trading on equities, indices, and futures, which make them incredibly popular today in the world of finance.

• Leverage: The leverage on CFDs can be 10 times higher as compared to ordinary investments. The risks of trading are directionally proportional to leverage, therefore, traders must be careful and be aware of the differences between ordinary stock trading and CFD investments. The higher leverage, however, does make CFDs a particularly attractive option for high-risk taking investors.
• Margin: The margins on CFD trading are extremely low which allow for greater control on the value of the contract. The greatest benefit of these margins is that traders can invest in precious commodities such as gold and oil even with capital value as low as $500.
• Positions: Trading positions can be entered both short and long, allowing for speculative profits on both rising and falling markets and traders are not required to pay any financial charges when the borrow stocks.
• Execution: The execution of CFD trades is extremely straightforward, very reliable and can be carried out almost instantly. The price and order executions are also very simple and fast which is a major attraction for serious investors.
• Hedging: When expecting a decline in prices, traders can enter a short position to hedge their investments if they are not keen on selling to compensate for the losses that occur on basic positions through the profits made on the CFDs.

 

For those who want to be successful players in the Forex trading market, it is very important to keep an eye on the global macroeconomic factors. While not necessary, they play a very important part in helping you stand amongst the top Forex traders in the global market. Whether it is the financial reports of other countries or their political scenario, all factors are vital and should be observed with a keen interest in order to stay ahead in the Forex trade sector.

Why Understanding Global Macroeconomics Is Important

While some people do not agree that it is important to understand macroeconomics to become a Forex trader, which is true to some extent, there is something additional you have to do in order to win big. That something, in case of the Forex trade market, is having a clear understanding of how potential happenings in the global macroeconomic scenario can affect your area of trade in the future. It can give you time to make plans to safeguard yourself from any losses that these changes might bring your way.

Which Global Macroeconomic Factors Should Be Considered

The key global macroeconomic factors that need to be understood before you enter the Forex trade market include the inflation rates, GDP, unemployment rates, and the interest rates of various countries, as well as their standing in the international trade market, the recent performance trends in their capital markets, and the stability of their political scenario. Understanding all these things about a country can be extremely helpful in determining where their currency is headed in the future.

However, while all these global macroeconomic factors may sound simple enough, they are not so, especially in case of currencies that are used more widely. Understanding these factors to predict the trends of the US Dollar and the Euro can be quite tricky since all of these factors are interdependent and interrelated. For currencies that are widely used, all these factors for many different countries need to be considered.

Understanding the Right Approach to Macroeconomics

Another thing that can slightly complicate matters is the approach to understanding these key global macroeconomic factors. In order to understand the idea of macroeconomics, you can take help of several different theories that apply to the field. There are 7 main concepts that are used to define macroeconomic factors and the first thing a Forex trader needs to do is to understand which concept he thinks is the best for him. Once you have determined the way you want to go, it can be easier for you to understand the basics of macroeconomics.

Is Global Macroeconomics Absolutely Necessary to Succeed in Forex Trading?

While it is true that you can enter the Forex trade market without any knowledge of macroeconomics and still gain profits, it is also true that this success will be short-term. In order to stay successful in the Forex trading market for a long time, proper planning, with an eye to detail regarding every aspect of the market is very important.

Understanding what risks stand ahead of you in the Forex trading market and taking measures to avoid them as much as possible is the right way to make big profits in the global Forex trade market.

If I have to choose between them, I would definitely go with the Cryptocurrencies trading. That’s not because Forex trading is less profitable, but forex trading is pretty constant and skill based trading where Cryptocurrencies are easy to trade. Forex takes a long time and primary knowledge about financial trading but sadly less profitable than Cryptocurrencies trading.

Because of the market volatility, you can make a very good and fast profit with Cryptocurrencies. You do not need to have much experience or knowledge about the market. Your skill to predict the markets is sufficient to start.

IMMFX now offers Bitcoin – should you trade it?

Your broker IMMFX has recently managed to offer trading with a variety of Cryptocurrencies that includes BTCUSD (Bitcoin v USD), LTCUSD (LightCoin v USD), or ETHUSD (Ethereum V USD).

It is known that trading in Cryptocurrencies depends on an inconstant news conditions, and the price movements determines exclusively supply and demand, excluding the aptitude of central banks and other regulatory organizations from the side of the Cryptocurrency.

When working with any Cryptocurrency pairs, technical strategies are more possible to win through, while the news conditions are more effective in higher timeframes.

There are some intraday traders trading on Cryptocurrencies on the market, however there are much more long-term traders and position investors.

Switching to Cryptocurrency

Trading Cryptocurrencies is easier than forex trading. Now we may already are familiar with forex, but because of the huge profit making opportunity we can switch to Cryptocurrency trading.

Trading Cryptocurrencies like a Pro

You can easily and quickly identify the price movements of Bitcoin in the financial markets. An additional advantage of Bitcoin trading is that you can begin to trade with a small investment that is pretty low compared to what you will need in forex.

You may require having a balance of at least a few hundred dollars and most likely more than that; however in Cryptocurrencies you can start trading with a tiny investment amount. Cryptocurrencies mostly offer you a way to begin trading on pretty small positions without any big risk.

Forex trading is the premier attraction for investors worldwide today, providing an easy access, a host of advantages and high chances of profitability. As such, a vast number of traders want to invest their spare money in the hopes of garnering even more. But to turn that hope into reality, and make any real profits, traders need to open a Forex live account to be able to buy and sell Forex.

With currency trading being so popular, traders have the option of choosing from a large variety of Forex trading brokers. However, it presents a problem.

1. The Broker

The vast array of choices available when it comes to deciding on which Forex trading broker can choose makes it a mind-boggling and risky endeavor. Forex scams have made it increasingly important to open a Forex trading account with a reliable broker like IMMFX.

2. The Process

A Forex live account can usually be opened within three days and is a simple enough process. Traders have to fill out an application form, and then choose their trading platform and their preferred language.

3. The Account

Before a trader can open a trading account though, the most obvious factor to consider is the type of account they want, of course. Traders can normally choose from a standard account, managed account or a mini account, depending on which functions and requirements are most suitable to them.

4. The Platform

There are several different Forex trading platforms provided to traders by different brokers. Some of them are faster, some allow for higher leverage and yet others provide more options with currency pairs. A trader has to consider which one suits them best before they open a Forex live account.

5. The Deposit

Different minimum deposits are required to set up different trading platforms, even if they are provided by the same broker. This needs to be considered keeping in mind the trader’s experience with Trade Forex Live and the funds available.

6. The Forex

It might seem like the most obvious things, but it is critically important to understand how Forex trading works before one jump in with both feet. A trader needs to the process, the terminologies, the patterns and the customs of the market.

7. The Pair

Currencies at Forex are always traded in pairs. A trader buys one currency while simultaneously selling the other. As such, he needs to be aware of the most active currency pairs. Majority of the trades occur between the major currencies, such as U.S. Dollar, British Pound, Euro, Japanese Yen etc.

8. The Package

Charting packages can be used by traders to analyze market trends, study and deal in equities, futures or Forex through hundreds of brokerages around the world, and offer various trading solutions to help them trade more effectively and profitably.

9. The News

Any trader who aspires to be successful in the market has to make the Forex news feeds a part of their lives. Opening an account, and understanding the processes and the tools of the trade is just not enough. A Forex trader has to be aware of all the current happenings to make the best decisions.

10. The Risks

In any business, be it Forex trading or any other in the world, profit-making carries an inherent risk. A risk that is directly proportional to the profit potential. It is best to use speculative capital only when opening a Forex trading account as it is traded in the cash market rather than on an exchange.

Cryptocurrency is a type of digital currency that is made to be protected and, mostly, secret. It is a digital money connected with the internet technology that relies on cryptography, the method of converting readable information into a practically illegible code, which is hard to decipher, to track transactions and online purchases.

Cryptography was created in need of private and secured contact during the Second World War. It has later developed in the digital period combining computer science with the mathematical theory to make an approach to safe and secure communications, online currency exchange and information sharing.

The first and best-known Cryptocurrency was Bitcoin that was designed in 2009. There has been a rapid increase in numbers of Cryptocurrencies in the last decade and there are now over 950 available Cryptocurrency on the internet.

Is Cryptocurrency Real Money?

Of course, Yes.

In view of the fact that this is a new concept to the majority people, it will surely take some time to become broadly accepted. This is where Bitcoin, as the first and widely accepted Cryptocurrency, has been helpful in paving the way for recognition of this new technology. Online payment processors, Stripe as an example, also let their merchants accept payments from Bitcoin.

Note that other Cryptocurrencies like Ether or Litecoin are not widely accepted. However, they will surely make a position among people’s mind towards the acceptance of other Cryptocurrencies as like Bitcoin.

Follow our blog for the latest articles to find everything you need to know about cryptocurrencies.