What is Managed Forex Trading?
Foreign exchange trading is traded in the over the counter interbank market and is not traded on recognized exchanges, therefore it is treated as off-exchange retail trading of currency pairs. Clients trading do not participate directly in the interbank market but deal through registered Forex Dealer Members (FDM) or Forex Commission Merchants (FCM) and not directly in the interbank market, The registered FDM or FCM may or may not be the counterparty to your trades depending if they have STP (Straight Through Processing) with a bank or liquidity provider or not.
Let us control your managed forex trading or let us teach you to trade. Here are some basics on managed forex trading.
Forex refers to the Foreign Currency Exchange Market in which more than 7,000 international banks and thousands of small and large speculators participate. Foreign Exchange Trading, Forex, is the off exchange trading of retail foreign currency contracts not necessarily with a bank but most times through a registered Forex Dealer Member. The managed Forex trading market is by far the largest market in the world. This exciting and rapidly growing financial market provides the entrepreneur an opportunity to trade in a short period of time; however you should be aware of the risks associated with managed forex trading.
Prior to the recent international growth of managed forex trading, the industry was limited to master traders who positioned themselves with million dollar accounts and were connected direct to the inter-bank currency exchange. Today, the exchange of currency has expanded from master traders, banks and now includes home computers. The simplest definition of the Foreign Exchange is the exchange of one currency for another and unlike the traditional exchange of the stock market, one may trade whether buying or selling within the Currency Exchange. Banks are offered a buy or sell twenty-four hours a day from the inter-bank currency exchange float. As a result, with proper broker relationships and trader agreements through margin establishment, leveraged accounts are established and individual traders are allowed to enter the market with home-based computers with the same leveraged guarantees that worldwide banks have enjoyed over the years.*
How Does Managed Forex Trading Work?
It is quite simple. Currencies are traded in pairs. A spot trade is "opened" when you simultaneously buy a block of one currency while selling another. A trade is "closed" when the reverse is done. Managed forex trading can be done by us in your behalf or you can choose to learn this and trade your account yourself.
To earn a profit, you try to buy low then sell high, or, vice-versa, sell high then buy low. Risk can be set as low as 1% to 5% per trade. Please be advised that under certain market conditions the use of protective orders such as stops, limits, stop loss, may or may not be able to be executed at the desired price or at all. Trades are performed online. Managed forex trading is not for everyone since price swings can be fast at times. Trading currencies on a leveraged basis can create substantial losses if not managed properly.
Risk Warning