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Random article: Margin trading on the Forex market
Margin trading is a trading with borrowed funds. The idea of such a trading is to borrow money from a broker and trade with funds greatly exceeding trader’s own. This pledge is called margin. Margin funds are measured by the currency of deposit (for instance, US dollar). Margin depends on liquidity of a trading instrument (products). The essential part of the margin trading mechanism is to provide a leverage. To calculate margin-based leverage, divide the margin amount by the total value of a transaction. For example, the ratio 1:100 shows that in order you can trade, the balance of your trading account have to be 100 times less than the value of a transaction.
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Popular article: Knowing Foreign Currency (Forex) Best Business Ever
The foreign exchange market itself experienced a rapid growth in the early decades of the 70s. As for the cause of the foreign exchange market is growing rapidly, among others are: 1. Movements in foreign exchange rates that experienced significant movement so that it appeals to certain circles to engage in the foreign exchange market. 2. Businesses are getting more global. As business competition gets bigger, companies need to find new resources that are cheaper, and spread all over the world, causing demand for the currency of a particular country. 3. The rapid development of telecommunications in the presence of telephone, telex, fax, internet, has made it easier for market participants to communicate, making transactions easier. 4. Gains earned in the foreign exchange market tend to increase the desire of various parties trying to gain a gain (profit) from the movement of foreign exchange rates.
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Forex encyclopedia “Clever FX” is the unique service created by FreshForex to introduce world of Forex to traders. The main purpose is to share knowledge of experienced traders with novice traders in simple and convenient form. Every trader will be able to learn something new here. If you are a professional trader, we invite you to write an article for “Clever FX” and get reward. Let's write Forex history together!
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