Forex FAQ

Forex (Forex, sometimes FX, from the English. FOReign EXchange - currency exchange) - the interbank foreign exchange market at free market prices (the quote is formed without any restrictions or fixed value). Usually, a combination of "Forex" (born Forex market, FX-market). The term Forex is commonly used to refer to mutual exchange, rather than the totality of foreign exchange transactions.

In English-speaking environment commonly referred to as Forex currency market, currency and trade (English trades currencies).

In Russian, the term Forex is generally used in a narrower sense - I mean extremely speculative currency trading by commercial banks and dealing centers that is maintained with the use of leverage, ie margin trading currency.

Scalping - a method of excess short-term trading in financial markets, currencies, equities and derivatives.

The essence of scalping is that profits are a small price fluctuations, instantly capturing even a small profit or loss. At the same time a sufficient amount of profit is achieved by a large number of transactions.
Scalping as a method of trading requires a fairly substantial experience in the financial markets, because the risk is very high due to lack of time on the scalper thorough financial and technical analysis. In this fundamental analysis of macroeconomic processes for the scalper is not particularly interesting.

Pipsovanie - large lots is trading at a minimal change in the course.

This trading system has many deficiencies, does not, but it also is one of the most profitable. Everyone knows that the rate of change literally every minute - is the price swings to a few points - even for small intratreydinga, but pipsovaniya scalping or even from such a small price change can make a profit.
The fact that many traders do not have enough money for a serious trafficking, such as ekstratrend. With this trading strategy, traders are "preparing" your deposit , to trade at a higher level.

Margin (the margin in the professional slang) - a pledge that allows to obtain the temporary use of loan money or goods that are used to commit the speculative exchange transactions with margin trading. From simple credit margin is characterized in that the amount of money received (or the value of goods produced) usually exceeds the amount of collateral (margin). Usually margin (margin requirement) can be expressed as a percentage (%) as the ratio of collateral to the amount of the transaction (for example, 25%) or as the ratio of shares (eg, 1:4). In a spread-betting margin can be 3-5%, thus increasing the gain and loss.

Margin trading (born Margin trading) - the holding of speculative trading with money and / or goods provided by the trader in the loan secured by a specified amount - the margin. From simple credit margin is characterized in that the amount of money received (or the value of the resulting product) is usually several times the size of collateral (margin). For example, for the right to contract for the purchase or sale of 100,000 euros for U.S. dollars, generally requires a broker to pledge no more than two thousand dollars. This allows the trader to increase the volume of transactions for the same capital. In addition, when margin trading is usually allowed to sell the goods taken on credit subsequent to the alleged purchase of similar goods and repayment in kind (product) form. This operation is called a short position or selling without a coating (not covered by sales). This mechanism provides the technical ability to make a profit when prices fall.

Lot - in stock trading unit of transactions on the exchange, consignment, a certain amount of goods of one kind.

There are three types of lots (depending on size):

Standard lot = 100,000 units;
Mini lot = 10,000 units;
Micro lot = 1000 units.

Mini and micro lots are available to traders who open up a mini deposits (an average of $ 200 to $ 1,000). Standard lots can trade the trader, deposits are much larger (the size of deposit requirements differ depending on the broker).

Carry trade - one of the strategies, actions of investors in the stock and currency market (forex). The term literally translates as "buy and hold."

Strategy is based on the fact that different states have different deposit interest rates relative to funds in their national currencies.

Carry trade strategy is to borrow in domestic currency of the State created the low interest rates, currency conversion and investing them in the national currency of the States that have established high interest rates.

Advisors (experts) in the terminal program, developed in a programming language MetaQuotes Language 4 (MQL 4) to help automate analytical and trading processes. They allow you to quickly perform technical analysis of price data and on the basis of the received signals to control trading activities. On the advisers could be given all the routine work of technical analysis and execution of all transactions. An expert can perform analytical and trading operations of any financial instruments and periods, regardless of whether the corresponding graph is open or not.

Script is a program written in MetaQuotes Language 4 (MQL 4) and is designed for single execution of any action. The script can perform both analytical and trading functions. In contrast to the councilors, the scripts are executed on demand, rather than ticks. In other words, if the adviser works almost always, the script, having worked once, on their own exits.

Custom indicator is a program developed independently by the user in MetaQuotes Language 4 and provides a technical indicator. The technical indicator is a mathematical conversion price and / or volumes in order to predict future price changes. The use of indicators allows you to answer questions about whether the current trend will continue and where will the trend reversal. The indicators are intended to make the complicated process of making trading decisions on a simple and understandable. Based on algorithms indicators are trading tactics and develop councilors.

To participate in the auction in the Forex market there are various accounts, but the most interesting of them all stands Swap-free accounts. In another way it is called the Islamic account. Why he was just such an abbreviation, and what its popularity? A pretty simple.
As has become clear from the title - these accounts were originally developed for the Islamic countries, which by their laws and beliefs, there are certain limitations. Namely, they are not allowed to pay themselves or receive from a third party interest on transactions. Therefore, this account was called - Swap-free.
These accounts allow you to perform any transaction with any currency, but for the perfect deal does not bear interest and are not charged any fee, regardless of the value of open positions.
Because these conditions are given to owners to keep the account open position indefinitely. Given all this, the outcome of the transaction may have an impact only on the currency exchange rate fluctuations.
It is for such features, these accounts became widespread not only in Islamic countries, but also for traders from all over the world. In addition, many brokers offer these accounts are absolutely free, which further contributes to their wide dissemination.