A Managed Forex Account

These are forex accounts that are not traded by you, but by a money manager on your behalf.  This is a similar situation to employing an investment advisor to trade equities and bonds on your behalf.  It is suitable for use if you do not have sufficient knowledge or time to trade yourself.  Many traders do not want to learn the often complex and intricate mechanisms of this large financial market.  Individuals who prefer having a professional manage their funds would prefer this type of account.

The Advantages of a Managed Forex Account

One of the most important advantages of a managed forex account is that your money is held by your broker and not by your manager.  This gives the money manager the responsibility to do the trades for you, but he or she will not have the authority to withdraw money from your account.

The other advantages linked to this type of account are:

• Large brokerages offer you extensive experience in this market which you have access to.  Your money manager will inspect your portfolio on a regular basis and diversify your investments if necessary.

• You do not need to have experience in the forex market as your manager will be doing your trades.  This provides you with a knowledge base based on practical experience which is to your advantage.

• You will normally receive a daily report on all the positions you currently hold.

• The possibility of showing profits irrespective of the state of the market is increased by using this type of account.

• Through your money manager, you will have access to the market 24 hours of every day.  If you choose to trade personally, there is always the possibility that you may miss out on a profitable trade because you were not online at the time.

Disadvantages of a Managed Forex Account

Since you are not personally managing your account, you may face several risks.  The risk of being scammed is high as you may have chosen to use an untrustworthy broker.  You may be assigned a money manager who is incompetent and this could cause you to lose funds.

Scammers should be quite easy to recognize as they will constantly request deposits from you.  Their main aim is to get as much money out of you as possible.  To avoid this risk, obtain details from your broker as to the manner in which your account will be managed.

Check if you have been assigned a normal account as the account will then be a personal one and in your name.  This means that all the funding you put in will go to the broker.  If you are assigned to a pooled account, your funds are normally sent directly to the money manager who is responsible for pooling funds received from various clients into an account that he or she controls.

One of the scariest aspects of a managed forex account is that you could lose all your money through incompetence.  To avoid this, you should ensure that you read and understand your contract before you sign on the bottom line.  You must be aware of who will be handling your account and the methods they intend using.

By: Djelloul On 4:29 AM

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Why Forex Is The Best Market For New Traders

It is my belief that Forex is hands down the best market for new traders. When everyone thinks about trading, they automatically think about the Stock exchange. What they don't understand is that it cost a lot of money to actively day trade the stock market. By law, the SEC, requires a large minimum balance for day traders. In this article, I will give you several examples why new traders will find it easier to trade the Forex market as day traders and as other short time frame based currency traders in this market.

There are some inherent advantage to Forex. The first benefit is that you can fund an account with a broker with as little as $5 and as much as a million. Forex makes it so that any trader, no matter their account size has an opportunity to trade. Another advantage of Forex is the fact that you have a lot of leverage you can use, you can use up to 1:400 leverage with some Forex brokers. Leverage is the same as buying with margin. Stock brokerage accounts do not provide this amount of leverage. All short term traders need high leverage to make the most out of their small incremental wins.

More opportunities to trade equals more money that can be made. The stock market opens at around 8 in the morning and closes before 5 pm, that is a short window to trade and makes it so that anyone with a day job can't trade. Forex doesn't have this problems. Forex is a 24 hours market that you can trade anytime of day. It is a global market with participants from all around the globe trading  at every hour of the day, it never closes. You can trade before work and after work.

Open crossover is another reason why Forex is so great. Although, the Forex market is open 24 hours, it does have several opens. An open is when a countries banks start trading. For example, London's open is at 3 am EST and the US open is at 9 am EST. There are also opens for the Asian countries too. What this means that their is a ton of liquidity being pumped into the market through out the day. When these trading periods cross over you have a ton of people moving the market. For day traders and scalpers this is a goldmine.

As you can see, Forex is the best market for a new trader to trade. They will find greater success in Forex than in any market. It is also easier to open an account and get high leverage in Forex. One of the great benefits of Forex is that it is a 24 hour market that you can trade day or night. A new trader can go to work in the day and come home and trade during his or her leisure time. It is a market that gives the trader the advantage.

By: Djelloul On 4:22 AM

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Why Use A Foreign Exchange Calendar?

Foreign exchange trading is more often than not based on assumptions determined by a volume of data.  It is possible to predict the future by the use of historical forex information, however, care should be taken when this is done.  The volatility of this financial market makes it difficult to predict the future.  You should consider using a foreign exchange calendar to provide you with an edge when you predict trends.

Events

One of the economic events that is currently affecting forex rates is the rate of unemployment.  News releases on this and other economic factors that affect financial markets are constantly being made available.  Some of the other events that you should be aware of for effective trading are non-farm payrolls, interest rates and consumer price indices.

Be Aware When Trading

Your trading method is an important factor, but it is also important that you keep up to date with current events and future events that will have an effect on your trading options.  If you are not aware of the latest economic trends, you may be unaware of adjustments that may be necessary to improve your strategy.  The use of technical analysis methods is highly dependent upon the current trends and global events.

Although you may be making consistent profits with your current strategy, if you ignore potential risky events, you could be putting your money at risk.  The use of a calendar will allow you the opportunity to access readily available information which you can prepare for.  This will help you avoid any sudden changes that could potentially turn the tide against you.

The calendar is used to keep up to date about major announcements released by different countries across the globe.  If you are aware that an announcement is pending, it is best not to trade.  The best method is to abstain from trading for at least two or three hours before you expect an economic data release for your trading currency pairs.  For example, if you are trading GBP/USD and you are aware of an impending event such as interest rate announcements, you should refrain from trading before it is released.  This will aid you in avoiding the major slides that often take place when the announcement is finally released.

Currencies generally experience a huge swing just before these major announcements.  Once the market settles down, the trend will be reversed.  You do not want to get caught up in these fake signals as it might cause panic.  It is advisable to check the signals once the market has had time to settle which should be about half an hour after the event.

When you use a foreign exchange calendar, you will be able to mark the events that you feel are relevant to your trading pattern.  You will have the opportunity to highlight the main announcements linked to your trading pairs.  Many of the websites where you are able to access the calendar have tutorials on how to effectively use the calendar.  They also indicate when you should make your trades and explain how the economic announcements may affect your trades.

By: Djelloul On 3:45 AM

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The Most Important Stock Indicator

Overall the most important stock indicator is Volume. Candlesticks are an important price indicator, however candlesticks do not complete the chart analysis which is a crucial aspect of successful trading. There are three data that come from the market which are Price, Time, and Quantity. Price is represented on the chart by the candlesticks, Time is represented by the chart timeframe, and Quantity is represented by volume bars.

Quantity the data stream, has two primary types. The total number of shares traded at that time whether it is a millisecond or a year, and this is the total number of shares represented by volume bars. Quantity can also refer to the number of shares per transaction, but that is not discussed in this article.

Volume bars should be represented on your charting software with green bars for up days and red bars for down days, because this provides exceptional analysis easily and quickly. If you use a solid color such as blue and do not differentiate up or down days, your analysis will be impaired and will take much longer. Each volume bar on a daily chart represents the total number of shares that traded hands that day, therefore one side of the trade and not both are represented in the volume bar.

Use daily charts and analyze end of day volume, because then you are analyzing the "consolidated" tape volume. This volume differs from intraday because it includes all volume from every trading platform and venue, not just the exchange volumes. ATS Dark Pools, Electronic Communication Networks for Electronic Trading aka Day Trading, and Regional exchanges all must report their data. All of this data is called the consolidated tape, which includes the total volume from all sources.

The total consolidated volume is an important part of making sure your stock chart analysis for selecting stocks is correct. With the consolidated volume provided at the end of the day from your charting software, you can quickly go through stocks using the basic criteria of at least 100,000 shares traded per day average. Always make sure that you check the volume for any stock you trade.

Avoid trading stocks that are illiquid. This means is there are so few shares traded per day that buying the stock can be very risky. Without sufficient volume, there is a lack of interest by the market participants and this can lead to weak picks, poor trading profits, or even losses. Illiquidity also skews any indicator you might apply to the stock, and lack of volume makes price action extremely volatile and unreliable. To determine if the stock has sufficient liquidity always study volume bars first before checking any other indicators.

By: Samory Borry On 10:54 AM

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How To Trade A Penny Stock

Do you know how to buy and sell a penny stock? Chances are, you do. If you know how to buy MSFT or GOOG then you're set - because the actual process is the same. You fire up your broker's website, like E*Trade or Scottrade, look up the symbol and execute the trade. Selling is the same too. Open the broker's site, find the stock in your portfolio and execute a trade to sell the stock.

So, if it really is that easy, what's this article all about?

There are a few differences between buying and selling a penny stock compared to a traditional stock.

First, not all penny stocks are listed, or supported, by your online broker. Because there is significantly more risk carrying penny stocks, some online brokers do not list them all. You might find a good penny stock you want to invest in, only to find it isn't listed by your broker.

To compensate for the risk, some online brokers charge more fees on top of the trading fee. This is typically a percentage of the trade's worth, or fixed amount per share. For example, to trade the micro stock ABCD, which is valued at $0.01, a broker may charge you 0.5% of the total trade value in addition to the $9.99 trading fee. If you bought 10,000 shares, it would cost you $110.49 ($100 for the stock, $9.99 for the trading fee, and $0.50 as a surcharge). These costs can add up as you add to your portfolio - especially if you trade in larger volumes.

Each broker has their own rules, but many surcharge on stocks valued at less than a dollar.

Also, you have to understand that sometimes selling (and even buying) a position in a penny stock can be much more difficult than a traditional stock. To buy a stock, there must be outstanding shares available. To sell the stock, someone must be willing to buy. Sometimes, depending on the stock, it may be hard for either condition to be true.

To protect themselves (and presumably you) most online brokers require you to put penny stock orders in as limit orders instead of a traditional market order. In a limit order, you specify a price (a cap) you want the stock to be at before the order executes. Because prices can fluctuate rapidly, chances are the price you see isn't necessarily the price the stock is at currently. For example, let's say ABCD is at $0.01 and you want to buy it but spend no more than $0.03 per share. You would enter a limit order of $0.03 and the trade would execute as long as the price was equal to or less than three cents.

A limit order to sell works the same way. When the price reaches let's say $.10, if you enter a limit order to sell at $.10, the trade would execute. Some brokers also allow you to specify the "low" point to sell at (limit loss or stop loss). For example, if ABCD falls below $0.02, sell the stock to cut your losses.

These are different from market orders which execute at the current market price. Again since prices rise and fall rather dramatically, these measures are in place to protect you.

I hope you have learned more about trading penny stocks - happy investing and good luck.

DISCLAIMER: I am not a licensed financial advisor, investment broker or analyst. I am just an amateur trader giving his amateur unbiased opinion and sharing with the community what works for me. Always use prudent investing, and never invest more than you can afford to lose - in other words, be prepared to potentially lose whatever you invest.

By: Samory Borry On 10:49 AM

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Growth And Value What S The Difference

While the majority of American investors understand the importance of diversifying across growth and value investments, few are able to achieve a passing grade on a test of their knowledge of the differences between the two, according to a new American Century Investments survey.

Test your knowledge with the Growth & Value IQ quiz below:

1. Which best describes a growth stock?

a) Stock that offers guaranteed rate of growth tied to consumer price index.

b) Stock in a company specializing in agriculture, lumber, landscaping, and other organic products.

c) A stock in a company demonstrating better than average profit and earnings gains.

d) All of the above.

2. Which best describes a value stock?

a) Stock in fast-growing company specializing in high-value, low-cost products, like a discount retailer.

b) Stock in a company specializing in valuable goods, like precious metals and jewelry.

c) Stock that has a low price-to-book ratio.

d) All of the above.

3. Which statement is true?

a) Value stocks outperformed growth stocks between 1927 and 2001.

b) Smaller company value stocks outperformed larger company value stocks between 1927 and 2001.

c) Maintaining a portfolio with a combination of growth and value stocks generally is considered a prudent investment approach.

d) All of the above.

4. During periods of strong economic expansion, which fund generally performs better?

a) Growth.

b) Value.

c) Neither.

d) Both.

5. Generally speaking, value funds outpaced growth funds in 2000 and 2001.

a) True.

b) False.

6. Generally speaking, growth funds outpaced value funds during the 1990s.

a) True.

b) False.

7. Which type of fund is more likely to invest in stocks paying a significant dividend?

a) Growth.

b) Value.

c) Neither.

d) Both.

8. Higher price-to-earnings ratios normally would be associated with stocks in which type of mutual fund?

a) Growth.

b) Value.

c) Neither.

d) Both.

9. What kind of stock is described in this example: “Established baked-goods company with strong balance sheet and good cash flow experiencing temporary drop in reaction to changes in senior management.”

a) Growth.

b) Value.

c) Neither.

10. What kind of stock is described in this example: “Software company, enjoying steady sales increases, is in the process of rolling out an eagerly anticipated update to a popular software application.”

a) Growth.

b) Value.



Key: 1(c); 2(c); 3(d); 4(a); 5(a); 6(a); 7(b); 8(a); 9(b); 10(a). – NU

By: Samory Borry On 3:15 PM

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Stock Market Window Dressing The Art Of Looking Smart

As investors, and we all are investors these days, it is important that we understand the idiosyncrasies of the Stock Market pricing data we use to help us in our decision making efforts. On Wall Street, investing can be a minefield for those who don’t take the time to appreciate why securities prices are at the levels that appear on quarterly account statements. At least four times per year, security prices are more a function of institutional marketing practices than they are a reflection of the economic forces that we would like to think are their primary determining factors. Not even close… Around the end of every calendar quarter, we hear the financial media matter-of-factly report that Institutional Window Dressing Activities” are in full swing. But that is as far, and as deep, as it ever goes. What are they talking about, and just what does it mean to you as an investor?

There are at least three forms of Window Dressing, none of which should make you particularly happy and all of which should make you question the integrity of organizations that either authorize, implement, or condone their use. The better-known variety involves the culling from portfolios of stocks with significant losses and replacing them with shares of companies whose shares have been the most popular during recent months. Not only does this practice make the managers look smarter on reports sent to major clients, it also makes Mutual Fund performance numbers appear significantly more attractive to prospective “fund switchers”. On the sell side of the ledger, prices of the weakest performing stocks are pushed down even further. Obviously, all fund managements will take part in the ritual if they choose to survive. This form of window dressing is, by most definitions, neither investing nor speculating. But no one seems to care about the ethics, the legality, or the fact that this “Buy High, Sell Low” picture is being painted with your Mutual Fund palette.

A more subtle form of Window Dressing takes place throughout the calendar quarter, but is “unwound” before the portfolio’s Quarterly Reports reach the glossies. In this less prevalent (but even more fraudulent) variety, the managers invest in securities that are clearly out of sync with the fund’s published investment policy during a period when their particular specialty has fallen from grace with the gurus. For example, adding commodity ETFs, or popular emerging country issues to a Large Cap Value Fund, etc. Profits are taken before the Quarter Ends so that the fund’s holdings report remains uncompromised, but with enhanced quarterly results. A third form of Window Dressing is referred to as “survivorship”, but it impacts Mutual Fund investors alone while the others undermine the information used by (and the market performance of) individual security investors. You may want to research it.

I cannot understand why the media reports so superficially on these “business as usual” practices. Perhaps ninety percent of the price movement in the equity markets is the result of institutional trading, and institutional money managers seem to be more concerned with politics and marketing than they are with investing. They are trying to impress their major clients with their brilliance by reporting ownership of all the hot tickets and none of the major losers. At the same time, they are manipulating the performance statistics contained in their promotional materials. They have made “Buy High, Sell Low” the accepted investment strategy of the Mutual Fund industry. Meanwhile, individual security investors receive inaccurate signals and incur collateral losses by moving in the wrong direction.

From an analytical point of view, this quarterly market value reality (artificially created demand for some stocks and unwarranted weakness in others) throws almost any individual security or market sector statistic totally out of wack with the underlying company fundamentals. But it gets even more fuzzy, and not in the lovable sense. Just for the fun of it, think about the “demand pull” impact of an ever-growing list of ETFs. I don’t think that I’m alone in thinking that the real meaning of security prices has less and less to do with corporate economics than it does with the morning betting line on ETF ponies… the dot-coms of the new millennium. [Do you remember the "Circle of Gold" from the seventies? Isn't GLD, or IAU, about the same thing?]

As if all of these institutional forces weren’t enough, you need also consider the impact of tax code motivated transactions during the always-entertaining final quarter of the year. One would never suspect (after watching millions of CPA directed taxpayers gleefully lose billions of dollars) that the purpose of investing is to make money! The net impact of these (euphemistically labeled) “year end tax saving strategies” is pretty much the same as that of the Type One Window Dressing described above. But here’s an off-quarter buying opportunity that you really shouldn’t pass up. Simply put, get out there and buy the November 52-week lows, wait for the periodic and mysterious “January Effect” to be reported by the media with eyes wide shut amazement, and pocket some easy profits.

There just may not be a method to actually decipher the true value of a share of common stock. Is market price a function of company fundamentals, artificial demand for “derivative” securities, or various forms of Institutional Window Dressing? But this is a condition that can be used to great financial advantage. With security prices less closely related to those old fashioned fundamental issues such as dividends, projected profits, and unfunded pension liabilities and perhaps more closely related to artificial demand factors, the only operational alternative appears to be trading! Buy the downtrodden (but still fundamentally investment grade) issues and take your profits on those that have risen to inappropriately high levels based on basic measures of quality… and try to get it done before the big players do. To over simplify, a recipe for success would involve shopping for investment grade stocks at bargain prices, allowing them to simmer until a reasonable, pre-defined, profit target is reached, and seasoning the portfolio brew with the discipline to actually implement the profit taking plan.

Yeah, I do miss the days when there were just stocks and bonds, but maybe I’m just a bit too old fashioned. Interesting place Wall Street…

By: Samory Borry On 3:13 PM

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Profitable Trading System

After you have found a profitable trading system that you already back-tested, how can you be sure that this system will produce the same gains in future?

Nobody can predict the future, your system can easily make losses in next years or can be no tradable.

There are some tests you must do before accepting a trading system, these tests swill show the robustness of your system and when passing these tests, it will be more likely to show gain in future.

Test 1 : Make sure that you put liquidity rule, that your entry and exit prices are realizable.

Test 2: Examine again your trading systems and your rules (This is very important).

I made dozen of trading systems that showed great results but after more examination, it showed that i cannot follow them in real life.

Check if there is one stock that made very big gain, the system will maybe become no profitable without this stock.

Test 3: Change twice or 3 times the date of begin for the simulation, if it still show good results then it has passed the test 3.

Test 4: Change values of some parameters or variables you have in your trading system rules, you must change one value and then back-test, change another and then back-test…

If the results are not affected very badly then it passed the test 4.

Test 5: Try to restrict the system from buying 20% or more of stocks you previously bought when doing the back-test. Then re-run the back-test. To pass this test, system must show pretty the same results as before.

Test 6: Equity chart must have a good look, check some statistic values like sharpe ratio, sortino ratio, standard deviation, maximum drawdown, average day for gains recovery…

It depends on the risk you are willing to take but choose only systems that have : higher sharpe ratio, higher sortino ratio, lower standard deviation, lower maximum drawdown…

Exclude systems that have very big max drawdown, standard deviation and average day for gains recovery.

The must important factor i think is average day for gains recovery.

Its the average number of day that you must wait until your equity value will goes back to the same level before the drawdown happen.

Big values will let you wait for long times before recovering gains and for sure many traders will abandon their trading system, and that’s the worse thing that can happen to a trader because just after that, the system will show excellent results. (That’s always happen)

Theses tests are very restrictive and you will reject maybe all your trading systems, but when trading you will put your money, real money, so i think you must be very selective to make all chance in your side.

By: Samory Borry On 3:11 PM

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How the Stock Market Saved My Life

Most people know the stock market to be a rough and challenging world but in reality it is a savior. For many people the only experience they have with the stock market is staying away from it but I guarantee you that you can make money as long as you put in a little bit of effort. What most people don't understand about the stock market is that it isn't the most experienced that are making the most money, it is the people who take the time to do the proper research.

Why the stock market saved my life

A while back I went making a lot of money every month to making nothing because of the changes in the internet and my local businesses but the stock market was the only thing that was still there I could adjust quickly enough to make money that very day. What I learned from the stock market is to trade when others are trading and take a firm position.

What did this mean for me

What this meant was while so many people where looking at the casino business from afar I wanted to get up close and dive right into my favorite stocks. I chose to buy 2 different casino stocks that own more than 6 hotels and casinos in Las Vegas because I knew that the Las Vegas tourists would be flocking the city very soon.

What happened next

The next thing I knew I was sitting on more than $5,000 of pure profit from my 2 stocks and that was only within 4 weeks of buying them. The thing about this money was that I traded the stocks over and over again until I got as much money as I could out and now I am just holding the stocks as a long term gain.

The stock market is more than just a way to make money, it is my savior because I know there is nothing else out there that can make me that much money that fast without doing anything. Do you know of anything that will make you $5,000 in less than 1 month without doing anything? Probably not and that is why the stock market should be there in case you need it too.

By: Samory Borry On 11:41 AM

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Real Forex Traders Learn To Like Losses

As a forex trader you have to learn how to take losses. Period. Don’t be a crybaby. Learn how to take losses.

Learning how to take losses is one of the most important lessons you must learn if you want to survive as a trader. Nobody is 100% right all the time.

Losses are inevitable. Even Michael Jordan and Tiger Woods lose sometimes and they’re considered the best in their field.

There will be trading streaks where you’ll have a number of successful consecutive trades, but that will eventually come to an end you will take a loss.

As that point it’s very important not to lose your head, you must remain in control of yourself. Don’t have a cow man.

Take a break. Calm down and relax. Take a chill pill dude.

Until you’ve regained a clear mind and an ability to think logically again, stay out of the market.

Don’t whine about your loss and never carry a prejudice against a loss.

The key to manage losses is to cut them quickly before a small loss becomes a large one.

I repeat. The key to manage losses is to cut them quickly before a small loss becomes a large one.

Never ever think that you will never lose. That’s just ludicrous. Losses are just like profits, it’s all part of the trader’s universe.

Losses are unavoidable. Get over the loss and move on to the next trade.

By: Samory Borry On 12:33 AM

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Forex Currency Trading

You can develop into a better and more profitable trader by applying some of the more imperative forex currency trading rules consistently with an appropriate amount of discipline. There are few principles that can help to perk up your chances of success if they are understood, practiced, and implemented in your trading on a regular basis and these rules have been learned in the trenches, mostly through testing and scrutinizing the common mistakes nearly every trader makes when starting out in the forex currency trading business. The first step is to set up and apply specific goals and objectives.

The majority of forex traders who often find themselves on the losing end of a trade make the same common and recurring mistakes. Most forex traders don’t have a clear direction, never take the time to develop a sound business plan and lack a formal written strategy for putting a well thought out plan in place. In forex currency trading, the primary goal is clearly to make money, but it’s important to have goals that are not strictly money related as well. Your personal objectives and ambitions should be very specific and measurable to you, but they should include the characteristics that are needed for the trading.

Having a clear-cut idea of what you want to accomplish in your trading and the precise time frame you want to achieve it, make your efforts more focused. In order to establish a track record of winning trades, you need to develop discipline and a personal forex currency trading system that makes sense for you. The spread generally referred to as the bid/ask spread is what brokers charge instead commission fees. Forex brokers are typically linked with large banks due to the large amount of capital that is required to operate in the forex market. Leverage is a ratio of total capital available to actual capital which is the amount of money a broker will lend you for trading. Finally you should select a trading account that fits your budget.

Basic Forex trading strategy begins with fundamental and technical analysis. Fundamental analysis is mainly used to anticipate and better understand long-term trends in the currency market. Technical analysis is widely used to examine the forex because it identifies and measures sustained trends. Successful traders use a combination to make more accurate predictions. Once you have the knowledge of how the forex currency trading works open a demo account and paper trade to practice until you have what it takes to make a consistent profit. It’s important to take the time to build, test and implement a sound trading plan before you put capital at risk.

By: Samory Borry On 12:30 AM

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Currency Rates You Have To Know The Trends If You Expect To Earn On Forex

Currency rates and the differential between countries and over time is the meat of the foreign exchange game. They are constantly changing and the better your ability to predict these changes the more money you are going to make over time in this market. So naturally a few tips in this area are worth their weight in gold.

So what are some of the things that should be learned when attempting to understand the changes in currency rates? What affects currency and the perception of their value up against the currency of any number of other countries? I make no guarantees in this article but hope to point you in a few worthwhile directions so that you can understand and therefore profit in this goldmine of a market.

Before I start I want to mention the potential for profit if you understand and are willing to put some time into mastering the factors involved in the changing currency rates. Perhaps the most important thing to understand is that thought this market has been around for a long time relatively few people are taking advantage of it. The market is not saturated and therefore there is a lot more room to compete and be at the top of the game. Why is this? For one thing it just has never been as flashy as the stock market. Part of this is how things have played out in the media and in our economy. Industry is for some reason valued more than the overall economy and the public’s perception of striking it rich is stronger in the stock market. It is true that the potential to strike instant riches is greater in the stock market with new companies forming and old ones failing far faster than countries are forming and failing. However the potential for constant and predictable gain is more in forex.

Why? Well for several reasons. One the currency rates, or in other words the value of a currency is dependent on something that is far easier to evaluate and predict. The chief operator in this game is the overall economy of that country, which is far more stable and predictable than the ability of a company to earn a profit in the cutthroat world of business. You can judge with far more accuracy how a current event or change in leadership is going to affect an economy globally than you can how a company will perform.

The main reason for this is the information differential that there is more information available on current events and the lives and values of governmental leaders than there are on private companies. This is due to the concentration of the media in this area and the fact that it is more important for a company to be private in order to not give an advantage to their competition.

So in order to be good in the currency rates game you have to read your newspaper and have a general idea of the public and global perception of an event and a government and how these things will affect the economy of a country. Something that we do almost every day anyway.

By: Samory Borry On 12:25 AM

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