The most comprehensive educational resources for finance

Do Day Traders Really Make Money?

The question is, do day traders whether in stock market or in forex really make money? Research suggests that most of the day traders do not make money. Probably only 20% of day traders will make money. Surprisingly, studies also suggest that those traders who placed the most trades made maximum money, probably because they

Get Foreign Exchange Rates in Excel

This spreadsheet is designed to help you import the historical foreign exchange rates for any currency pair in the excel sheet. The spreadsheet makes use of the historical rates from oanda.com This is how it works: Enter a Currency pair. For example, if you want the quotes for EUR/USD, then EUR will be the first

Fibonacci Sequence and the Forex Market

In this article, we are going to discuss the basic mathematical notion behind Fibonacci theory, and we are going to discuss a basic Fib Strategy that works.

Foreign Exchange Market Participants

Market participants are categorized on the basis of their role and the nature of their dealings in the marketplace. These will influence their risk appetite, policies and controls in managing risk with each participant in the market. Market participants should, in addition to clearly understanding their own role in the market, know the role in

Currency Devaluations – A Forex Trader’s Guide

In the past few years we have seen many currency devaluations, for example Thai government devaluing their currency, and fall of Philippine Peso. We will consider a few key pointers concerning the business of currency devaluations and how to play them. Devaluations are perfectly obvious with the benefit of hindsight. Experience is, therefore, really the

Common Practices in Foreign Exchange Markets

In this post, we will discuss some of the common market practices in foreign exchange markets. Choice Prices A choice price is one where the market marker quotes a single rate at which the market user can choose to buy or sell. This is sometimes done where the amount is small, but the counterparty relationship

Cross Rates and Different Base Currencies

If we look at two sets of currency pairs with different base currencies you can still adopt the same procedure to find a cross currency quote, provided that you remember the basics. For example, suppose cable (GBP/USD) is 1.6175 and USD/CAD 1.3639/42. We can now find the GBP/CAD cross rate as follows. – – GBP

Forex Rates: Understanding Cross Rates

Cross rates are rates between two currencies where neither is the US dollar. A cross rate can be calculated from the respective rate for each of the currencies against the dollar. Example Consider the following rates: USD/SEK   6.6270-6.6275 USD/SGD   1.4143-1.4148 From these rates for the Swedish krona and Singapore dollar against the US dollar, we

Bid-Offer Spreads and the Market Position

The spread (also called dealers spread or the bid-offer spread) is the difference between the bid price and offer price. This represents the market markers margin. In the case of prices from brokers, it is the difference between the highest bid and the cheapest offer. Most currencies are quoted with spreads of 3 to 5

Forex: Bid and Offer Rates

Exchange rates are commonly expressed as two rates, the bid price and the offer price, for example: USD/AUD 1.1240-1.1245 or USD/AUD 1.1240-45 or USD/AUD 1.1240/45 Rates shown in the financial press are the average (mid-point) of the bid and offer rates. The bid price is the rate at which the bank quoting the price, the