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Since there are different types of orders in the Forex market that would permit you to be more specific on how you want your traders to carry out your trades like whether you should place a stop or a limit order, you are entitled to command your broker about your prerogative to refuse the market price and instead you want to move your stock price in a particular direction before you execute your order.
In a stop order, your trade will be carried out once the security you want to buy or sell reaches a specified price (stop price). If this happens, a stop order essentially becomes a market order and is packed. And once the order is turned on, the investor is guaranteed an execution, but execution prices do not. This order is used by investors to control the loss that they might have or to lock in a profit on a stock. They may issue this order to their stock broker to automatically sell the stock if the price of stock would fall down to a particular price.
There are also instances that these stop orders are not always executed at the stop price. If an incident happens that the stock falls down suddenly by a huge amount, the stop order may be triggered and the stock could be sold. On the other hand, since stocks are always sold at a market price, the price might be below the stop price. This type of order is usually entered into a computer trading system and is automatically carried out whenever the price is at or below the stop price.
The use of this order is more common for stocks that trade on an exchange than the over the counter (OTC) market. Moreover, your broker-dealer would not permit you to lay this order on some securities nor accept a stop order for OTC stocks. Before entering into this type or order, consult first your broker or financial advisor about how this order works.
It is advantageous to investors to use the stop order because they can monitor their stocks for a period of time or on a daily basis and brokers may even position this order for no charge. Since investors commonly use this type of order, this allows them to have a quick and automatic response to stock price movements.
Buy and hold investors are doubtful to use this type of investment strategy. One disadvantage of this order is that the stop price could be activated by a short term variation in a stock’s price. Once your stop price is attained, this order becomes a market order and the price you had may be different from the stop price primarily in a fast moving market where stock prices vary swiftly.
The price of an order could be lower than the specified price by this order. In addition, investors must be careful about where they set a stop order for it may be harsh if it is turned on by a short term fluctuation in the stock’s price.
If you want to know why the Forex trading market is superiors to other investor options such as Equities or the futures market, then you can rest assure that you'll find the answer in this page.
The best way to clarify the advantages of the Forex market is through a real example. In 1929, the stock market collapsed, causing many people and businesses from around the world to go broke. This also happened when the high tech bubble burst. The fear of a market crash is a concern that constantly dwells in the minds of investors, both professional and beginner ones.
In the online Forex trading market, There is no way for the market to crash. If you have read about what is the Forex trading market, then you know that when you buy a certain currency, you are at the same time selling another currency. When some currencies' price false, others' price rise.
So this is the most important advantage of Forex day trading. Unlike other markets, where in some cases all traders lose money, with Forex trading there are always traders that make a profit, at any given time.
Here are some other advantages of the Forex trading market:
No commissions. Only in the Forex trading market are there no government fees, brokerage commissions, exchange fees and other unnecessary losses of cash. There are also low transaction costs between the bid and ask price.
No middlemen. In this market there are no investors that take a percentage of the investment or the profit, and you transact directly with the pricing market agent.
You can choose the size of your investment. The Forex trading lot is dynamic, and is set according to your preference. This lot can vary between large lots worth $10,000 to mini lots worth $25.
High liquidity. In the Forex trading market you can buy and sell your currency at any time and place, regardless of the currency position, when the trade itself is done almost instantaneously.
Trading in the margin. Forex trading consists of margin investments that increase your chances for higher profits by increasing your money's worth.
Opened 24 hours a day. Because it's worldwide and operates in several time zones, the Forex trading market is the only market that you can trade in 24 hours a day.
With all of these wonderful advantages, there is no wonder more and more investors choose Forex trading as there main fund for investment. Because all transactions can be done online, you don't even have to leave your house!
The modern online Forex history begins in 1973. Even though currency trading has been around since the times of ancient Egypt, which at that time the market was extremely primitive, and there were no advance trading tools as today's fundamental analysis, for example.
The first currency coins were used at the times of the pharos, and the first paper notes were then introduced by the Babylonians. Later on, the roman coin called aureus was used, which was followed by the denarius. Both coins had worldwide use, making them the first global foreign currency coins.
The Bretton Woods System (1944-1973), came after the great instability of World War II. England and other European countries were left in ruins, after the war ended, while the US's economy was left relatively stable and strong.
The USD became the prominent currency after WWII, mainly because of the war. The Dollar also became the new global reserve currency, and remained so throughout the rest of the Forex history. This was agreed upon in the Bretton Woods conference, when all of the other foreign currencies were pegged to the USD, and a new international financial network was formed.
In 1971, the Smithsonian Agreement was signed by ten of the major financial powers, but it's attempt to improve stability to the current Forex history failed.
Free Floating exchange rates came into use when the Bretton Woods agreement ended. This occurred after this international financial system was in operation for three decades in the Forex history.
During 1973, the UK, facing financial problems, floated it's currency. Other currencies began to lose value, and this led the European economies to also float their currencies.
1994 saw the first online currency trading introduced to Forex history. This had a large impact on the development of the Euro currency, and introduced a new major contender to the control of the USD in the Forex history. By 2002 the Euro became the official currency for 12 European nations, and in the past few years more nations have joined this agreement. The modern online forex history offered new options for the online trader, such as the use of margin account to leverage investments, and this is all thanks to the contribution of the internet to the forex history.
Since there are different types of orders in the Forex market that would permit you to be more specific on how you want your traders to carry out your trades like whether you should place a stop or a limit order, you are entitled to command your broker about your prerogative to refuse the market price and instead you want to move your stock price in a particular direction before you execute your order.
In a stop order, your trade will be carried out once the security you want to buy or sell reaches a specified price (stop price). If this happens, a stop order essentially becomes a market order and is packed. And once the order is turned on, the investor is guaranteed an execution, but execution prices do not. This order is used by investors to control the loss that they might have or to lock in a profit on a stock. They may issue this order to their stock broker to automatically sell the stock if the price of stock would fall down to a particular price.
There are also instances that these stop orders are not always executed at the stop price. If an incident happens that the stock falls down suddenly by a huge amount, the stop order may be triggered and the stock could be sold. On the other hand, since stocks are always sold at a market price, the price might be below the stop price. This type of order is usually entered into a computer trading system and is automatically carried out whenever the price is at or below the stop price.
The use of this order is more common for stocks that trade on an exchange than the over the counter (OTC) market. Moreover, your broker-dealer would not permit you to lay this order on some securities nor accept a stop order for OTC stocks. Before entering into this type or order, consult first your broker or financial advisor about how this order works.
It is advantageous to investors to use the stop order because they can monitor their stocks for a period of time or on a daily basis and brokers may even position this order for no charge. Since investors commonly use this type of order, this allows them to have a quick and automatic response to stock price movements.
Buy and hold investors are doubtful to use this type of investment strategy. One disadvantage of this order is that the stop price could be activated by a short term variation in a stock’s price. Once your stop price is attained, this order becomes a market order and the price you had may be different from the stop price primarily in a fast moving market where stock prices vary swiftly.
The price of an order could be lower than the specified price by this order. In addition, investors must be careful about where they set a stop order for it may be harsh if it is turned on by a short term fluctuation in the stock’s price.
If you want to know why the Forex trading market is superiors to other investor options such as Equities or the futures market, then you can rest assure that you'll find the answer in this page.
The best way to clarify the advantages of the Forex market is through a real example. In 1929, the stock market collapsed, causing many people and businesses from around the world to go broke. This also happened when the high tech bubble burst. The fear of a market crash is a concern that constantly dwells in the minds of investors, both professional and beginner ones.
In the online Forex trading market, There is no way for the market to crash. If you have read about what is the Forex trading market, then you know that when you buy a certain currency, you are at the same time selling another currency. When some currencies' price false, others' price rise.
So this is the most important advantage of Forex day trading. Unlike other markets, where in some cases all traders lose money, with Forex trading there are always traders that make a profit, at any given time.
Here are some other advantages of the Forex trading market:
No commissions. Only in the Forex trading market are there no government fees, brokerage commissions, exchange fees and other unnecessary losses of cash. There are also low transaction costs between the bid and ask price.
No middlemen. In this market there are no investors that take a percentage of the investment or the profit, and you transact directly with the pricing market agent.
You can choose the size of your investment. The Forex trading lot is dynamic, and is set according to your preference. This lot can vary between large lots worth $10,000 to mini lots worth $25.
High liquidity. In the Forex trading market you can buy and sell your currency at any time and place, regardless of the currency position, when the trade itself is done almost instantaneously.
Trading in the margin. Forex trading consists of margin investments that increase your chances for higher profits by increasing your money's worth.
Opened 24 hours a day. Because it's worldwide and operates in several time zones, the Forex trading market is the only market that you can trade in 24 hours a day.
With all of these wonderful advantages, there is no wonder more and more investors choose Forex trading as there main fund for investment. Because all transactions can be done online, you don't even have to leave your house!
The modern online Forex history begins in 1973. Even though currency trading has been around since the times of ancient Egypt, which at that time the market was extremely primitive, and there were no advance trading tools as today's fundamental analysis, for example.
The first currency coins were used at the times of the pharos, and the first paper notes were then introduced by the Babylonians. Later on, the roman coin called aureus was used, which was followed by the denarius. Both coins had worldwide use, making them the first global foreign currency coins.
The Bretton Woods System (1944-1973), came after the great instability of World War II. England and other European countries were left in ruins, after the war ended, while the US's economy was left relatively stable and strong.
The USD became the prominent currency after WWII, mainly because of the war. The Dollar also became the new global reserve currency, and remained so throughout the rest of the Forex history. This was agreed upon in the Bretton Woods conference, when all of the other foreign currencies were pegged to the USD, and a new international financial network was formed.
In 1971, the Smithsonian Agreement was signed by ten of the major financial powers, but it's attempt to improve stability to the current Forex history failed.
Free Floating exchange rates came into use when the Bretton Woods agreement ended. This occurred after this international financial system was in operation for three decades in the Forex history.
During 1973, the UK, facing financial problems, floated it's currency. Other currencies began to lose value, and this led the European economies to also float their currencies.
1994 saw the first online currency trading introduced to Forex history. This had a large impact on the development of the Euro currency, and introduced a new major contender to the control of the USD in the Forex history. By 2002 the Euro became the official currency for 12 European nations, and in the past few years more nations have joined this agreement. The modern online forex history offered new options for the online trader, such as the use of margin account to leverage investments, and this is all thanks to the contribution of the internet to the forex history.
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