Money Management & Risk

This may surprise some people but a trader needs to be correct on his trades about 50% of the time (Win/Loss Ratio) consistently to be a profitable trader, if his Risk/Reward Ratio on each trade is higher than 1:1, i.e. 1:2, which is a common recommended rule to follow. So in other words, by simply […]

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Rollover & Interest Rate

In the Spot Forex Market, a Rollover simply means a contract which has reached it’s daily expiration point (set by the Broker, normally 5 pm EST). What happens then is that if the trader’s position is still open at that point, the contract automatically rolls over into the next contract period. For example, if a […]

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Pips & Money Conversion and Contracts

Let’s pretend an U.S. based guy wants a break and is planning a trip to Europe. He is on a low budget and has only $1000 available to spend. He decide to exchange Dollars for Euro and is checking the current EURUSD market rate which is 1.3000. So he divides $1000 by 1.3000 to see […]

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About Leverage and Margin

A part of Forex trading which often can be difficult to understand is Leverage and Margin requirement. But because these terms are connected to the Risk involved in Forex trading, it’s important to try getting an understanding of what they mean, so the trader is able to control risk better. Those traders who are able […]

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These Forces Drive the Forex Currency Market

So what factors drive the Forex market? Although there is more to it, basically it’s Fear and Greed, a constant flow of money into/out of assets/currencies. When traders are fearful, a flight to safety can be seen, i.e. into the USD and other safe havens. When greed takes over, traders are ready to move into […]

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