What is a currency converter and how do I use one?

June 30, 2024 No Comments

A: A currency converter is a calculator that converts the value or quantity of one currency into the relative values or quantities of other currencies. For example, if you had $1 that needed to be exchanged into the local currency of a country you are

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

What is an overnight position in the forex market?

June 30, 2024 No Comments

A: Overnight positions represent all open long and short positions that a forex trader possesses as of 5:00pm EST, which is consider the end of the forex trading day. The new trading day is considered to occur right after 5:00pm EST. At that point in

Is there a buy-and-hold strategy in forex, or is the only way to make money by trading?

June 30, 2024 No Comments

A: Typically there are different ways to trade in most markets. Traders have been classified into three groups, primarily based on the time frame they prefer to trade. For simplicity, we can label these three groups as day traders, swing traders and position traders. Some

What is arbitrage?

June 30, 2024 No Comments

A: Arbitrage is basically buying a security in one market and simultaneously selling it in another market at a higher price, profiting from the temporary difference in prices. This is considered risk-free profit for the investor/trader. In the context of the stock market, traders often try

Is there a world currency? If so, what is it?

June 30, 2024 No Comments

A: T here is no such thing as a world currency. However, since World War II, the dominant or reserve currency of the world has been the U.S. dollar. At one time, all currencies were backed by gold, meaning that every country had to hold

What is foreign exchange?

June 30, 2024 No Comments

A: Foreign exchange, or forex, is the conversion of one country’s currency into another. In a free economy, a country’s currency is valued according to the laws of supply and demand. In other words, a currency’s value can be pegged to another country’s currency, such

Keynesian and Monetarist economics: How do they differ?

June 30, 2024 No Comments

A: Monetarist economics is Milton Friedman’s direct criticism of Keynesian economics theory, formulated by John Maynard Keynes. Simply put, the difference between these theories is that monetarist economics involves the control of money in the economy, while Keynesian economics involves government expenditures. Monetarists believe in

What are the advantages of using a mini forex account for trading?

June 30, 2024 No Comments

A: A mini forex trading account involves using a trading lot that is one-tenth the size of the standard lot of 100,000 units. In a mini lot, one pip of a currency pair based in U.S. dollars is equal to $1, compared to $10 for

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