Forex Trading

kennethT · 31 May 2013 at 12:09

What is this? A friend of mine reckons he can make a lot of money by doing this, it just takes a while to get going apparently.
Had a look at this http://www.binaryoptionstrategy.eu and from what I can see you're basically betting on whether the exchange rate will go up or down.
Anyone done it??

Maccy · 31 May 2013 at 12:12

We did this for a bit at uni using BetOnMarkets; one guy paid for a tipster and we made a few hundred quid every now and then.

darubio · 31 May 2013 at 13:22

Best bet would be all on red.

Freddie1980 · 31 May 2013 at 13:57

darubio said:
Best bet would be all on red.

You've obviously never watched Passenger 57 then have you?

While you can make money on Forex trading it's more then likely you will lose it. Just how much money were you willing to place in a trading account and how much of it would you place in terms of a % on any one trade?

If you know someone who does this full time and makes a bob or two then you should shadow them and learn how it works otherwise as above you might as well just go down the bookies. The other option is to get Forex training but be prepared to cough up £1500-£2500 for the privilege, I went to a Forex seminar which was little more then a sales pitch, it looked interesting but I have a pretty decent career as an accountant and I wasn't really look for a change (the g/f took me just out of curiosity). They held in a fancy hotel to make you think that the person running it is making money hand over fist doing Forex trading. Although the guy talked like one of those demonstrators you see on shopping channel he made some very good points which are most people who go into this lose most of the capital within 6 months and secondly people trade on emotions rather then cold logic and common sense (I do some stock market trading from time to time and I know exactly what he is talking about).

If you are serious my advice is to go at hardheartedly but bear in mind your going to need about £5000 or ideal £10,000 to get you up and running.

arknor · 31 May 2013 at 13:59

You might want to keep it simple and learn matched betting

Russinating · 31 May 2013 at 14:02

arknor said:
You might want to keep it simple and learn matched betting

How is that in any way related to Forex? :confused:

arknor · 31 May 2013 at 14:17

Russinating said:
How is that in any way related to Forex?

It's all betting at the end of the day if anyone is going to do any form of betting they might as well start with one where it's only possible to gain

kennethT · 31 May 2013 at 16:02

Interesting stuff, thanks. My friend has a full time job but does this in his spare time, he gets up early in the morning to do it. Like I said, he says he 'can' make a lot of money from this, no sign of it yet though.
I can imagine people trading on emotions.
Thanks.

Ceryndrion · 31 May 2013 at 16:04

Is it bad, that my first thought when seeing this, was

"why would anybody want to trade in an Australian beer?"

Russinating · 31 May 2013 at 16:48

arknor said:
It's all betting at the end of the day if anyone is going to do any form of betting they might as well start with one where it's only possible to gain

Yes, but it's a bit like recommending someone doing a plumbing course if they want to become an accountant. They're both jobs.

Plus matched betting isn't even gambling.

Russinating · 31 May 2013 at 16:50

On topic, if you want to be a Forex trader then you need to be very intelligent and devote every waking hour to research in order to know what's going on in the world and how each country's economy works and how it reacts and effects everything else. Those at the top of their game I'm sure will have sources to know government issues before they break, too.

Catastrophic events can also send currencies tumbling and if you're working a day job then you'll lose thousands before you can excuse yourself from work and sell.

My advice, if you're interested in this general thing, is look at spread betting. I did it a year or so ago and made about 20% in a few months. I'd recommend these two books:

http://www.amazon.co.uk/The-Naked-Trader-Anyone-Trading/dp/0857191705
http://www.amazon.co.uk/Naked-Traders-Guide-Spread-Betting/dp/1906659230

I used Tradefair to trade, and I believe they have a play account too, otherwise you can just do that in Excel.

isonomicjedi · 31 May 2013 at 17:41

My advice would be to look at the recent Dollar/Yen swings as a result of the announcement of Abenomics and see how much you could have lost in minutes if you had bet the wrong way.

If it doesn't frighten you, you have money you won't miss if you lose, have an in-depth knowledge og the economies of 2 countries you would like to trade then go ahead.

Advice can go up as well as down

tntcoder · 31 May 2013 at 18:25

How volatile are stable currencies typically? Do you get many point changes over a minute/hour/day basis? Guess that would enable fairly quick scalping trades, does the 'broker' take a hefty cut of every trade as well?

isonomicjedi · 31 May 2013 at 18:41

tntcoder said:
How volatile are stable currencies typically? Do you get many point changes over a minute/hour/day basis? Guess that would enable fairly quick scalping trades, does the 'broker' take a hefty cut of every trade as well?

Nowadays everything is volatile.

It is widely agreed that Dollar/Yen will go to at least 1.10 fairly quickly though it keeps pulling back towards 100 when it should be going the other way.

Everyone agreed Abenomics was a great idea now half of them say it might not or will not work.
How can a mere mortal like you or me fathom that out.

The US have been printing money faster than Usain Bolt chasing commercial deals so why is the Dollar so strong?

The Turkish Lira now fluctuates between 2.50-2.90 to the pound (since government devalued it) without reason ( without understandable reason)

(I bought a load last year at 2.85, my sister just came back and she was getting 2.70 so I'm quids in)

Some platforms offer zero pip spreads on the major currencies

Anox · 31 May 2013 at 19:26

Seems like an interesting investment if you have the money to throw around with it.

dowie · 31 May 2013 at 20:38

Freddie1980 said:
The other option is to get Forex training but be prepared to cough up £1500-£2500 for the privilege, I went to a Forex seminar which was little more then a sales pitch, it looked interesting but I have a pretty decent career as an accountant and I wasn't really look for a change (the g/f took me just out of curiosity). They held in a fancy hotel to make you think that the person running it is making money hand over fist doing Forex trading.

Definitely don't pay for something like that - your suspicions re: a cheap sales pitch are likely correct.

arknor said:
You might want to keep it simple and learn matched betting

I don't think that will help him trade FX. Also what exactly is there to learn - if it isn't already abundantly obvious to someone that a bookie's sign up offers can be taken advantage of then once you've pointed out the fact to someone then they've 'learned' that.

CREATIVE!11 · 31 May 2013 at 20:43

All I know from my brief research is Forex seems a lot more like gambling than anything else.

dowie · 31 May 2013 at 20:45

kennethT said:
Interesting stuff, thanks. My friend has a full time job but does this in his spare time, he gets up early in the morning to do it. Like I said, he says he 'can' make a lot of money from this, no sign of it yet though.
I can imagine people trading on emotions.
Thanks.

You're probably best avoiding it tbh... its essentially a den of thieves - most 'brokers' are just bucket shops, lots of ECNs out there aren't quite ECNs... other ECNs will only show orders from counterparties your broker has a credit agreement with, some of these will have last look provisions in place for liquidity providers.

You're not going to be trading via EBS or Reuters any time soon... you could perhaps look at LMAX or FX futures on CME Globex