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FOREX KEY FACTS

Question: What is Forex?

Answer: Forex (FOReing Exchange Market) is a global international market where currencies are traded. Forex took its present-day shape in the 70-ies of XX century, when the major countries have moved from fixed exchange rates to floating ones. Nevertheless, US Dollar (USD) remains the main currency in Forex. Forex is not a stock exchange and, not being tied down to the time of opening and closing, it is open 24 hours a day, 5 days a week, because purchases and sales are made between banks all over the world at any time of the day or night (some banks are open on Saturdays and Sundays). However, as well as in any stock exchange, Forex trading takes place based on the supply and demand of a particular instrument, for example, there are "euro against the dollar" buyers and there are also sellers.

At the current moment of its development Forex is on the rise and the rapid development of society and technology is taking place, is will continue to evolve.

Question: Where geographically the Forex Market is located?

Answer: The Forex market has no specific site. Currency trading is conducted via the Internet or by phone 24 hours a day throughout the week. Forex trading sessions do not have a specific schedule. Different banks open at different times, so the time is indicated approximately in GMT, EET (Eastern European) and MSK (Moscow) formats.

Question: Who are the Forex Market Participants?

Answer: All the operations in Forex are carried out through the institutes system: central banks, commercial banks, dealers, brokers. Every Forex member has their own trade volume in the currency exchange market. For example, central banks have the largest trade turnover, the trading volume exceeds hundreds of millions of dollars a day. Commercial banks and dealers’ turnover is smaller. The daily brokers’ turnover is approximately 25-50 million US dollars, which is only 2% of the total Forex volume of trading.

Question: What currencies are traded in the Forex Market?

Answer: as a rule, traders use so-called liquid currencies (those of countries with stable governments, responsible central banks and low inflation). Nowadays about 85% of currencies traded are the US Dollar, Japanese Yen, Euro, British Pound, Swiss Franc, Canadian and Australian Dollar.

Question: How to make money trading in Forex?

Answer: Forex is an exchange currency market, where currencies serve as a commodity. Your job as a trader is to buy currency cheaper and sell it at a higher price, so the price difference will be your profit. Or you can play on the slide. Knowing that the price of the currency will fall, you sell it expensive, and then buy cheap. The difference in price is your earnings (your profit).

Question: How do I make deals?

Answer: All the deals are made via special software, the UTIP trading platform which is provided by a broker absolutely for free and that gives you an access to the Forex foreign exchange market. You can download the UTIP trading program from our website.

Question: Is it possible to make money on Forex during a crisis period?

Answer: Many Forex market participants during the crisis earn almost twice as much than usual. This is natural, because the changes, including the sharp fall in the value of various currencies, do not impede the process of making a profit in the Forex market. For those who are engaged in a long-time trade, fluctuations in the values of 100-150 are not worth worrying. For the participants of a trade conducted during the day, the failures from extreme differences are compensated by the significant amount of deals made.

Question: Do stock market and international Forex foreign exchange market work by the same rules?

Answer: No. In stock market gains can be obtained only when prices are rising (except for hedging mechanisms), whereas in the Forex market you earn not only when prices are rising, but also when they fall.

Question: Is it possible to learn how to trade in the Forex?

Answer: Yes, it is. First try yourself out on a demo account. Read charts, analyze, ask yourself why certain processes take place, watch for trends and their changings, and soon you will become a good trader. We can also recommend you to keep a diary, where you will keep a track of your actions and their causes. This will help you to analyze your actions. It will also be useful to study thematic literature, a wide selection of which is presented in the Internet.

Question: Are currency quotations similar on demo and real accounts?

Answer: Yes, because it is an important criteria that helps you to learn how to trade independently.

Question: Are there any taxes?

Answer: Our company is not a client’s tax agent, so all taxes and fees arising when the client profits from trading operations, the client pays for himself without any interfering from the company. This means that the client is responsible for tax liabilities.

FOREX CONSEPCT AND TERMS

Question: What does spread mean?

Answer: Forex spread is a difference between the ask and bid price. For example, in the EURUSD quotation of 1,4527/29 the ask price is 1,4527, the bid price is 1,4529, therefore this currency’s spread (the difference between the Ask and Bid) is 2 points.

Question: What is a margin?

Answer: Margin is a deposit required to maintain your open positions. This is not a commission or transaction costs, but simply part of the funds in your account, deferred and used as a security deposit. If the amount of money in your account falls below margin requirements, some or all open positions will be closed. This scheme allows you to protect your account from losses means even in a high-volatile fast-moving market.

Question: How is the deal’s volume measured in Forex?

Answer: Basic unit of volume in the Forex market is called a Lot. Buying 1 lot is equal to the purchase of US $ 100.000, which is a standard contract size. For example, a purchase of 5 lots of USD / JPY equals to the  purchase of 500,000 US dollars.

Question: What does “long” or “short” position mean?

Answer: Long position, or simply long, is a position when trader buys the currency at one price planning to sell it later at a higher price. In this case an investor gets the profit from a growing market.

Short position, or short, is when a trader sells the currency waiting for it to fall. In this case an investor gets profit from the falling market. However, it is important to remember that each position in the Forex market requires the investor to open a long position on one currency and short on the other.

Question: How currency quotations are formed?

Answer: Foreign exchange quotes are influenced by various economic and political conditions, but perhaps the most important of them are interest rates, inflation and political stability. Sometimes governments act as participants in the Forex market, affecting exchange rates by legislative means. They can also fill the market with their currency in an attempt to lower its price or, conversely, to buy, meaning to increase the price. This behavior is known as Central Bank’s intervention. Any of these factors, as well as a large number of market transactions, may cause increased volatility in prices. However, the size and volume of the market do not allow anyone to operate it for a long time.

Question: How do “Margin Call” and “Stop out” work?

Answer: Margin Call is a broker’s or dealer’s requirement to deposit additional cash or other assets to ensure fulfillment of the obligations on a loss position of the client. In our company it is 30%. «Stop out» (10%) is an instruction to close the position without the client's consent or any prior notice in the event of lack of funds to maintain an open position.

Question: Is it possible to lower loss risks?

Answer: The most useful instruments while managing the risks are the limit order and stop loss order. Limit order limits the maximum price to be paid or the minimum price to be received in the deal. Stop loss order ensures the automatic elimination of a certain position when the price reaches a predetermined level in order to limit potential losses if the market moves against the position of the investor. The liquidity of the Forex market increases the chance of the limit order and stop loss order’s work.

Question: What trading strategies can I use?

Answer: Currency traders make decisions using technical and fundamental analysis. Traders who use technical analysis to identify trading trends use charts, trend lines, support and resistance levels, a variety of templates and mathematical schemes, while traders who use fundamental analysis predict price movements by interpreting a variety of economic information, including news, manufactured Government statistics and even rumors.

However, quotations get the most powerful movement at the unexpected events that can come from the Central Bank’s raising interest rates as a result of policy choices or even war. Nevertheless, more often the influence comes from the expectation of an event rather than the event itself.

Question: What is the credit leverage and why do I need it?

Answer: Leverage is a ratio between the volume of the position (in currency terms) and collateral for its opening. The greater the leverage is, the less money is required for the opening of a deal. In other words, leverage allows you to trade a much larger amount of money compared to the amount that you credited to the trading account. For example, 1:100 leverage means that for opening a position, in your account you must have the sum that is 100 times less than the contract’s sum.

INVESTING IN INTELLECTUAL FINANCIAL MANAGEMENT (IFM)

Question: What is the IFM investment program?

Answer: This is a successful and proven private investments management model. Previously, in order to earn in the Forex market, it was necessary to have a solid start-up capital from $ 10,000 or more. At the same time, not having skills of independent trade increased the risk of funds loss. Under such conditions, not everyone could be in the international Forex market. Nowadays, with only $500  you have the opportunity to earn much more.

Question: What guarantees are given by the IFM investment program?

Answer: Forex is a market with a high potential of a risk, so there is always a possibility of losing money. However, in the Intellectual financial management program the risk is minimal. Firstly, your funds are managed by highly professional experienced professionals, and secondly, your account is not tied to a specific person. Because of these factors the risk is minimal.  

Question: What profit do I get if I invest in the IFM?

Answer: You can count on the consistent profit no less than 4%. Remember that the Forex market is very dynamic, therefore, the results in the past do not guarantee the same results in the future.

Question: What is the minimum payment?

Answer: In our company you can start working with only $500.

Question: Who do I entrust my funds to?

Answer: Your funds are allocated among the investors' accounts of best managing traders.

Question: How safe is it to invest to the IFM program?

Answer: Managing traders who trade the customers’ funds are all professionals who have proved their right to be in our rankings in practice. Our company employs only those traders who have shown the best results in trading in actual accounts. In addition, managers can not withdraw money from the accounts of investors, as passwords from their personal accounts are only for customers. Managers can only use the funds to trade for profit.

Question: Can I, having invested into the funds in the IFM, watch the trading process and learn the trading strategies?

Answer: Given the uniqueness of the trader’s proprietary strategies and specially designed security system of the company’s intellectual property, the  monitoring of trade in BBG- IFM is strictly prohibited.

Question: how to deposit money to the account and to withdraw it?

Answer: the funds’ input\output is performed according to the terms set by the payment system chosen by the investor. Internal order to input and output of funds is executed immediately. Each subsequent application for withdrawal may be applied not earlier than 14 calendar days.

Question: I still have unanswered questions.

Answer: You can use the feedback form and order a free call. Also, in the "Contacts" all the ways to reach our experts are mentioned. They will answer all your questions.

Forex Self-Trading

Question: What accounts do you offer for a self-trading?

Answer: For experienced trader who have done self-trading already out company offers to open a BBG-REAL trading account. For those who try themselves out we recommend to practice on the BBG-DEMO account.

Question: What credit leverage do you offer for trading?

Answer: We offer favorable terms of trade with a leverage of 1:50 to 1: 500

Question: Where can I learn your trading conditions in detail?

Answer: You can get the information on the company’s trading conditions in the “Trading conditions” tab.

Question: Are there any additional taxes?

Answer: There are no additional taxes whatsoever. All the reward is included in conventional financial markets spreads.

To learn more, click the “Trading Conditions” tab.

Question: are your spreads fixed or floating?

Answer: At the present time, the company is committed to providing the most favorable trading conditions and therefore provides floating spreads for currency instruments in the accounts of BBG-REAL. Floating Spread means a time-varying (dynamic) value between the financial instrument’s bid and ask price. The company provides floating spreads for all the instruments on the BBG-REAL accounts.

Question: what is the difference between demo account and a real one?

Answer: Training demo account allows you to make transactions in real market conditions, but with virtual money. Thus, you can gain some experience, create and test your own trading strategy in the real market, but without the risk of losing money. Once you are ready to make real money, not virtual, open a real account.

Question: What is a point or a Pips? What is the minimal price change in the market?

Answer: A point or a pips is a minimal step of the currency rate’s change. Thus, for the EUR/USD currency pair changing a quotation by one point equals to a change the last fourth digit after the decimal point by one.

For example, changing from 1.2438 to 1.2439, or from 1.2405  to 1.2406, etc. Changing a quotation by 100 points is called a big figure. Traditionally for almost all of the currency pairs ((EUR/USD, GBP/USD, USD/CHF, etc.) one point equals a ten-thousandth of quotes (0.001), and for the USD/JPY and cross-rates involving the yen it is a hundredth (0.01)

Note that nowadays more précised quoting up to 5 or 3 figures after a decimal point are common, for instance, when the quotes are 1.24595 for EUR/USD or 89.986 for USD/JPY.  It is obvious that in this case on point equals 0.00001 and 0.001 of the quotation.

Question: if my deal became unprofitable, will a spread be charged?

Answer: Spread is a part of trading and in fact is paid immediately after the opening of a position or a deal. Therefore despite the deal is profitable or not, the spread is charged.

Question: What is the minimal deposit?

Answer: for our clients we offer a minimal deposit from $500.

Question: Do you open cent accounts?

Answer: no, our company does not provide such accounts for trade.

Question: what is the minimal lot in the company?

Answer: The minimal lot is 1.

Question: Can I trade using the scalping/pipsing strategy?

Answer: Yes, this is one of the trading styles that you can follow using the UTIP trading platform.

Question: What is the difference between scalping and pipsing?

Answer: Scalping and pipsing are different in the essence of trade and profit’s amount (in points). Clearly the difference between 5 and 50 points is substantial. Pipsing means trading the increased lots while carefully watching for all the micro-movements of the market. In pipsing no more than 5-10 points of profit do matter. Scalping is a way of intraday trading, the essence of which is to make a profit from all the small price fluctuations. Unlike pipsing, scalping has a vast range of 15 to 30 points. As a rule,  scalper’s range is 15-20 points.

 

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