Foreign Currency Exchange Trading Index

The idea behind the carry is quite straightforward. The trader goes long the currency with a high interest rate and finances that purchase with a currency with a low interest rate. In 2005, one of the best pairings was the NZD/JPY cross. The New Zealand economy, spurred by huge commodity demand from China and a hot housing market, has seen its rates rise to 7.25% and stay there (at the time of writing), while Japanese rates have remained at 0%. A trader going long the NZD/JPY could have harvested 725 basis points in yield alone!

Category Foreign Currency Exchange Trading


 
 


Forex Trading, meaning Currency Trading, is a world wide, little known market, which will become the most popular source of income for investors in the very near future. It is open for banks, rich investors and small ones alike and, depending on the sum of money they are willing to risk, the earnings demonstrate this is the best way to start getting rich. Why choose currency trading over stock, real estate or futures trading? The currency trading advantages are speed, liquidity, commission-free transactions, increased safety, short-term trading and great earnings. Let's study each of these advantages in other trading systems: - Speed:
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