Margin in Forex Trading Explained

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What is Margin? Margin trading in forex is trading with a loan borrowed (short-term loan) from a broker to control large positions on a currency pair. A margin is the amount of money a broker will put aside to keep investor’s trading position(s) open. However, it simply magnifies the amount […]

Forex Hedge Explained

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What is Forex Hedge? Hedging is when a trade is placed by a forex trader to protect an existing or losing trade. It is carried out in forex trading to protect one’s position from a sudden currency price move in the forex market. Hedging involves, placing both long and short […]

Leverage in Forex Trading Explained

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What is Leverage? Leverage is when a trader has the ability to use a small capital to execute a large volume of trades in the forex market. Leverage is the ratio of the trade size compared to the capital invested. For example, a leverage of ratio 50:1 means $200 of […]

Choosing the right lot size for Forex Trading

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Lot Size in Forex Many amateur traders are unable to manage their risk properly especially when they select the wrong lot size for their Forex trades. One of the reasons why a new trader will lose a great percentage of the trading capital is because of the wrong choice of […]

Fundamental Analysis in Forex Trading

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Fundamental Analysis Fundamental Analysis is a very important tool that professional traders use in Forex trading. It is the careful study of the economic, political, fiscal and social factors that affect the value of the currency of a country. However, the general economic outlook of the country related to the currency […]

The Bull and the Bear Markets: Market Sentiments

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Bull and Bear Markets The bull market is a market where traders buy a currency against another while the bear market is where traders sell a currency against another currency. A market price that is going up can be described as a bullish market while the price that is falling […]

The Market Price: Forex Currency Price

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The Market Never Stops The market price is dynamic. It never stops (except when the market is closed). Price quote for currency pairs display in the form of a two-way quote. We have the bid price and the ask price. However, the bid price is the amount that traders will […]

Do’s and Don’ts of Forex Trading

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Rules that Guide Traders There are rules to forex trading that must be strictly adhered to if one is to be a successful trader and these are; -View Forex trading as a business: Don’t see forex trading as a game, betting or gamble. See it as a skilled business that […]

Money Management in Forex Trading

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Money Management Money Management is a major problem for new traders. It is an important factor that separates a professional trader from an amateur. However, in Forex trading, Money Management is the process of assessing the level of exposure to risk and it also helps to quantify risk. In Forex […]

Risk Management in Forex Trading

On By beanfxtrader

Risk Exist Everywhere There is a level of risk in any business. Level of risk differs from one business to another. You should understand that there is risk involved in Forex trading. It is advisable that you acquire enough experience before you start to trade with real money. Engaging in […]