What is the correlation between U.S. stock prices and the value of the U.S. dollar?

June 30, 2024 No Comments

A: The correlation between any two variables (or sets of variables) summarizes a relationship, whether or not there is any real-world connection between the two variables. The correlation coefficient will always be between -1 and +1, which signify two opposite extremes of perfect correlations. A

What is the difference between extensive margin and intensive margin in economics?

June 30, 2024 No Comments

A: Trading on margin is not commonly done in stock trading except by professional investors and institutional traders. However, trading on margin is standard practice in the futures markets and forex trading. The ability to trade on relatively low margin, with high leverage, is part

What is the difference between inflation and stagflation?

June 30, 2024 No Comments

A: Inflation is a term used by economists to define broad increases in prices. Inflation is the rate at which the price of goods and services in an economy increases. Inflation also can be defined as the rate at which purchasing power declines. For example,

What is the difference between LIBID and LIBOR?

June 30, 2024 No Comments

A: Both LIBID and LIBOR are reference rates set by banks in the London interbank market. The London interbank market is a wholesale money market in London where banks exchange currencies either directly or through electronic trading platforms. The acronym LIBID stands for London Interbank

What is the difference between pips, points, and ticks?

June 30, 2024 No Comments

A: Point, tick and pip are terms used to describe price changes in the financial markets. While traders and analysts use all three terms in a similar manner, each is unique in the degree of change it signifies and how it is used in the markets.

What is the name of the currency in New Zealand?

June 30, 2024 No Comments

A: The New Zealand currency is known as the New Zealand dollar. The currency was decimalized in 1967, and divided into 100 parts or cents. Before 1967, the currency was called the New Zealand pound. But since its decimalization, it has been called the New

What is the value of one pip, and why are pips different between currency pairs?

June 30, 2024 No Comments

A: In forex markets, currency trading is conducted most frequently among the U.S. dollar, the Japanese yen, the euro, the British pound and the Canadian dollar. A currency pair such as EUR/USD, for example, represents the relationship between the euro and U.S. dollar. The first

What should I look for when choosing a forex trading platform?

June 30, 2024 No Comments

A: A trading platform is a piece of software that acts as a conduit for information between a trader and a broker. A trading platform provides information such as quotes and charts, and includes an interface for entering orders to be executed by the broker.

What is a pip and what does it represent?

June 30, 2024 No Comments

A: A pip, short for point in percentage, is a very small measure of change in a currency pair in the forex market. It can be measured in terms of the quote or in terms of the underlying currency. A pip is a standardized unit

Is scalping a viable forex trading strategy?

June 30, 2024 No Comments

A: One way that investors borrow funds from brokerages is through margin accounts; it is these interest charges that allow them to charge such low commission rates. How do we calculate the interest charges? Well, each brokerage has a different method of calculation, so you

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