The Forex market exists wherever one currency is traded for another, and was established between and when various central banks throughout the globe introduced a free exchange rate regime, letting the individual currencies fluctuate driven by the market. The Forex trades over the counter OTC , and thus does not have a physical location, and trades are executed through telecommunications and trading platforms.
To choose the correct contract type, it will help you to know the value of 1 pip in each contract size. The value of 1 pip for a standard contract 1. For the mini contract 0. With a leverage of only A Forex contract is the result of a simultaneous purchase of one currency and the sale of another. A contract is always done in pairs, and is basically buying and selling money in the same time. The Forex contract is also very special as it has no centralized trade location and trades are done around the clock.
All contracts are bought by telephone and over computer networks between traders in different parts of the world. Not exactly, the Forex just comes through different cost doors. The broker collects the difference between the bid and ask price. The bid price is 2. If the trader had been selling the GBP, the price would have been 2. More contracts would be a multiple of the 3 Pips. The spread will vary from currency pair to currency pair, and from broker to broker, with the bottom line being: If the base primary currency has a higher interest rate than the secondary currency, you will receive interest.
EST will eliminate any possibility of either earning or having to pay this interest. Of course keep in mind that increased leverage also increases your risk. When you trade, you can use the appropriate contract type for the size of your trading account.
What Is A Forex Contract A Forex contract is the result of a simultaneous purchase of one currency and the sale of another. So you may ask yourself, does that mean that I have no costs associated with trading the Forex? A lthough the Rollover is a relatively small amount of money, closing your positions before 5 p. About the Author Brian Keith.More...