what is forex margin?
Thursday, March 6, 2014
, Posted by Ryanita at 12:57 PM
kumar
Explain with a numerical example.
Answer
Forex Margin is the amount of money required by a forex broker from a forex trader to open a trade or position in the foreign exchange market. Trading on margin is nothing but taking a short term loan from your forex broker. Before you can start trading on margin youâll have to set up a forex trading account with a forex broker, and deposit money in this account.
Generally, for margin trading of 1% the broker will ask you to deposit only $1000 in your account. Basically, you are providing just 1% of your trading capital, the remaining 99% is provided by your forex broker. You now have the possibility to buy up to $ 100,000 worth of currencies with only $ 1,000 or put technically you have leveraged your account by 100 times.
Numerical Example:
You must calculate the margin required as a percentage of the lot value.If your account is denominated in USD the margin required per transaction is calculated in USD. For example, retail forex brokers always quote currency pair such as EUR/USD (i.e. EUR in terms of USD). If the EUR/USD is trading at 1.2500, that is one Euro is worth 1.2500 US Dollars, and you want to buy 10,000 Euros or 10 K, you would sell 12,500 USD to get those 10,000 Euros. Basically your margin required will be 1% of $12,500 which equals $125.00.
FOR MORE INFO CHECK OUT THIS SITE: http://www.forex-margin.net
Forex Margin is the amount of money required by a forex broker from a forex trader to open a trade or position in the foreign exchange market. Trading on margin is nothing but taking a short term loan from your forex broker. Before you can start trading on margin youâll have to set up a forex trading account with a forex broker, and deposit money in this account.
Generally, for margin trading of 1% the broker will ask you to deposit only $1000 in your account. Basically, you are providing just 1% of your trading capital, the remaining 99% is provided by your forex broker. You now have the possibility to buy up to $ 100,000 worth of currencies with only $ 1,000 or put technically you have leveraged your account by 100 times.
Numerical Example:
You must calculate the margin required as a percentage of the lot value.If your account is denominated in USD the margin required per transaction is calculated in USD. For example, retail forex brokers always quote currency pair such as EUR/USD (i.e. EUR in terms of USD). If the EUR/USD is trading at 1.2500, that is one Euro is worth 1.2500 US Dollars, and you want to buy 10,000 Euros or 10 K, you would sell 12,500 USD to get those 10,000 Euros. Basically your margin required will be 1% of $12,500 which equals $125.00.
FOR MORE INFO CHECK OUT THIS SITE: http://www.forex-margin.net
Forex profits on margin?
Clic
Hi guys, im 14 years old already trading on the forex market with the mt5 paltform using technical analysis. I would like to know what do you think of my results i started with $10k on demo account and in 3 days reached 14k not trading full day with a 1:100 leverage is that good ? I would like to compare myself to others am i average ? good ? very good ? thanks for your future answers
I'm not trying to show off just need some feedback
Answer
Demo trading of forex is a joke, nothing like real life.
You can't open a live money account until age 18, the legal age for signing a contract.
Retail forex is full of scams. Please read the warning link below from CFTC, the US regulator for forex.
Study stocks instead. Far greater chance of success. Two excellent books that should be in any library, both suitable for an ambitious 14 year old:
One Up On Wall Street - Peter Lynch
A Random Walk Down Wall Street - Burton Malkiel
Demo trading of forex is a joke, nothing like real life.
You can't open a live money account until age 18, the legal age for signing a contract.
Retail forex is full of scams. Please read the warning link below from CFTC, the US regulator for forex.
Study stocks instead. Far greater chance of success. Two excellent books that should be in any library, both suitable for an ambitious 14 year old:
One Up On Wall Street - Peter Lynch
A Random Walk Down Wall Street - Burton Malkiel
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