Key Takeaways Futures contracts have a minimum price fluctuation, or tick, established by an exchange For equity index futures, tick sizes, or tick values, are different than they are for individual stocks Understanding tick sizes is critical for tracking how much a futures position gains or loses each day Like a scorecard at a baseball […]
Key Takeaways The use of leverage in forex trading can help amplify potential gains, but it can also magnify losses For actively traded forex “pairs,” such as the euro and the U.S. dollar (EUR/USD), margin rates typically range from 2% to 5% Margin trading in forex differs in some ways from margin use in other […]
Many traders find they are able to spot the top of the market or a bearish trend in equities, but are not willing to pull the trigger on the bearish trade. For one reason or another, most people are wired to look for bullish opportunities, and quite frankly, they can miss the forest for the […]
According to the Bureau of Economic Analysis (BEA), consumer consumption accounts for 65 % or more of the U.S. Gross Domestic Product (GDP). This means that nearly two-thirds of our entire economy depends on consumers spending money. When Jane Public stops buying because loss of employment, lower wages, decline of confidence, or simply lower the […]
You might not trade currencies, but you should know what they’re up to. Why? Because the dollar, the yen and others tell the story of our global economy in real time. There are many “big” markets all around us, in terms of money changing hands, shares traded, or whatever. The U.S. stock market is big. […]
While stock traders generally focus on price/earnings ratios, new product lines, revenue streams, and more, foreign exchange (forex) traders tend to drill down on economic growth and interest rate differentials to rate and rank the strength of global currencies. Sophisticated traders who are willing to dip their toes beyond the arena of stock trading will find […]
The U.S. dollar index (/DX) is strong. Since early May, the /DX has climbed 5.30%. Potential catalysts for this rally include Brexit and the ensuing global uncertainty, and demand for safe-haven investments. Additionally, last week’s June labor report renewed talk that the Federal Reserve might sneak in a rate hike in 2016 after all. “Uncertainty […]
The Republican sweep of the White House and Congress in November unleashed a wave of U.S. dollar bullish sentiment as expectations of infrastructure spending and tighter monetary policy set up a perfect storm for U.S. dollar bulls. In just 12 trading sessions—from November 9 to November 24—the U.S. dollar index stormed a whopping 6.4% higher. […]
Here’s a riddle: What asset class averages about $5.1 trillion in trading each day, is available virtually 24 hours a day, 6 days a week, affects each of us pretty much whenever we open the wallet or purse and swipe that card, yet most retail investors don’t participate directly? If you answered “foreign exchange,” congratulations. […]
Suppose you’ve decided to venture into retail forex investing. You buy a foreign currency and hold the position for about a week. After a few days, you begin to notice something: your “open” position seems to be accruing credits (or debits) at the end of each business day. Later in the week, on a Wednesday, […]