http://www.forextrademag.com Global Forex Trading News, Free forex charts & quotes, Forex Trading Developments And Currency Trading Resources. Mon, 01 Jun 2009 10:58:29 +0000 http://backend.userland.com/rss092 en A floating exchange rate or a flexible exchange rate is a type of exchange rate regime wherein a currency's value is allowed to fluctuate according to the foreign exchange market. A currency that uses a floating exchange rate is known as a floating currency. The opposite of a floating exchange ... http://www.forextrademag.com/floating-exchange-rate/ [caption id="attachment_40" align="aligncenter" width="300" caption="Currency transfers"][/caption] The exchange rate regime is the way a country manages its currency in respect to foreign currencies and the foreign exchange market. It is closely related to monetary policy and the two are generally dependent on many of the same factors. The basic types are a ... http://www.forextrademag.com/exchange-rate-regime/ Controversy about currency speculators and their effect on currency devaluations and national economies recurs regularly. Nevertheless, economists including Milton Friedman have argued that speculators ultimately are a stabilizing influence on the market and perform the important function of providing a market for hedgers and transferring risk from those people who ... http://www.forextrademag.com/forex-for-dummies-speculation/ [caption id="attachment_33" align="aligncenter" width="300" caption="ONLINE CURRENCY TRADING"][/caption] Spot A spot transaction is a two-day delivery transaction (except in the case of trades between the US Dollar, Canadian Dollar, Turkish Lira and Russian Ruble, which settle the next business day), as opposed to the futures contracts, which are usually three months. This trade ... http://www.forextrademag.com/forex-for-dummies-financial-instruments/ [caption id="attachment_29" align="aligncenter" width="300" caption="ONLINE CURRENCY TRADING"][/caption] Electronic trading is growing in the FX market, and algorithmic trading is becoming much more common. According to financial consultancy Celent estimates, by 2008 up to 25% of all trades by volume will be executed using algorithm, up from about 18% in 2005. An algorithmic ... http://www.forextrademag.com/forex-for-dummies-algorithmic-trading-in-foreign-exchange/ [caption id="attachment_26" align="aligncenter" width="300" caption="Online Currency Trading"][/caption] The following theories explain the fluctuations in FX rates in a floating exchange rate regime (In a fixed exchange rate regime, FX rates are decided by its government): (a) International parity conditions viz; purchasing power parity, interest rate parity, Domestic Fisher effect, International Fisher effect. ... http://www.forextrademag.com/forex-for-dummies-determinants-of-fx-rates/ [caption id="attachment_22" align="aligncenter" width="360" caption="Most traded currencies Currency distribution of reported FX market turnover"][/caption] There is no unified or centrally cleared market for the majority of FX trades, and there is very little cross-border regulation. Due to the over-the-counter (OTC) nature of currency markets, there are rather a number of interconnected ... http://www.forextrademag.com/forex-for-dummies-trading-characteristics/ [caption id="attachment_4" align="aligncenter" width="300" caption="Global Forex Trading - foreign exchange market"][/caption] Unlike a stock market, where all participants have access to the same prices, the foreign exchange market is divided into articular, since the early 2000s.” (2004) In addition, he notes, “Hedge funds have grown markedly over the 2001–2004 period in ... http://www.forextrademag.com/forex-for-dummies-market-participants/ The foreign exchange market is unique because of its trading volumes, the extreme liquidity of the market, its geographical dispersion, its long trading hours: 24 hours a day except on weekends (from 22:00 UTC on Sunday until 22:00 UTC Friday), the variety of factors that affect exchange rates. the low margins of profit compared with other ... http://www.forextrademag.com/forex-for-dummies-market-size-and-liquidity/ [caption id="attachment_4" align="aligncenter" width="300" caption="Global Forex Trading - foreign exchange market"][/caption] The foreign exchange market (currency, forex, or FX) is where currency trading takes place. It is where banks and other official institutions facilitate the buying and selling of foreign currencies. FX transactions typically involve one party purchasing a quantity of ... http://www.forextrademag.com/forex-for-dummies-foreign-exchange-market/