ForexGen | Educational Market

The new Forex Gen Academy will feature the educational marketed and distributed by Forex Gen Broker world-wide technology license from Forex International Investments, Forex Gen Academy was developed by Forex Gen Broker for investors interested in the foreign currency exchange (forex) market, teaches the history of forex and the interbank market, gives the user trading tools, charting and technical analysis, and includes demo account trading tied to the Trading Platform, which is the most powerful, simple to use online forex trading platform in use today in the forex spot market.

So that… you will notice Why ForexGen? Also you can Download our platform

ForexGen Introducing Broker Program

ForexGen main focus is on our client’s profitability and satisfaction which increase their online forex trading life time. At ForexGen the trader has the ability to spend most of the time controlling and performing their business rather than troubleshooting. The most competitive trading conditions:
2 pips spread on six currency pairs.

Leverage of 200:1 leverage for accounts.

Without maintenance margin, our services offer margin call and automatic closing of positions below the initial margin on weekdays for accounts with initial equity of up to $1 million US.

The minimum account size with a 250 US has the ability to execute a lot of trading lots.

Qualified and familiar multilingual platform!

Streamline dealing with no request for quote for up to 20 million.

The ForexGen online Trading platform offers traders to do currency trading in pairs. We also allow trading Gold and Silver with the ‘one click trading’ mechanism.

Introduced broker’s client’s account can be activated with the agreement of their clients.
For full Information and online application, please click here

Proprietary Trader with ForexGen

ForexGen is currently offering a unique opportunity to traders worldwide to trade bank funds under direct supervision and guidance of successful traders. Candidates must have a strong educational background.

Individuals must be highly motivated with strong interests in financial markets and trading.This is a great learning experience and advancement opportunities are excellent.This trading opportunity allows active professional traders to earn money without using their capital.

If you consistently trade on an intraday basis and achieve profitable or breakeven results this is your chance to become a professional trader with our money.In addition, candidates must be able to show a sound trading strategy and risk management.

Traders are strongly encouraged to apply and take advantage of our unique offer.Candidates must show:A track record, which must be a verifiable statement from a registered brokerage firm. Track records must be from a live account; demo account statements will not be accepted.A brief description of your trading methodology and trading experience.

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Forex Vs. Stocks:

Forex	Stocks
24 hour market	Open only a few hours a day
Most liquid market in the world	Limited liquidy especially in the smaller capitilzation stocks
High leverage 100:1 leverage on standard-sized accounts	50% leverage at most 2:1 leverage to the average stock investor
Slippage is usually very limited	There is usually slippage on every order
No commissions	Commissions on every trade
Can go long or short easily	Harder to go short with uptick rule and possiblity of borrowed shares being called
Can make as many trades you want	Daytrading limitations on how many trades you can do in a period of time
Limited risk, most forex brokers will automatically close your positions when your account balance goes to zero	It is possible to have a negative balance after an adverse move in the market
Minimum slippage and order errors	More room for slippage and error
Can short-sell anytime	Need to obey uptick rule in order to short-sell
Minimum slippage and order error	More room for slippage and error

Pip

Every trader in the Foreign Exchange ‘FOREX’ hopes to make a profit from something called ‘PIP’. It may sound silly, but gains in pips can potentially make you over wealthy .Take your time with this information, as it is required knowledge for all Forex traders. Don’t even think about trading until you are comfortable with pip values and calculating profit and loss.

What is a pip ?

Pips stands for ‘PERCENTAGE IN PIONTS’. In the Forex trading, a ‘PIP’ is a unit of measurement which represents the smallest change in the price of currency or a currency pair. In the stock markets this is a classified as a ‘POINT’. As a result, some folks refer to pips as points. Pips are the last decimal point in an exchange rate or currency pair. For the majority of currencies a ‘PIP’ is equal to 0.0001. This means that if you purchased USD/CHF at 1.2310 and sold at 1.2330, you made 20 pips .On the other hand, there are some currency pair exceptions. FOR EXAMPLE: The USD/JPY pair has only two decimal places making a pip equal 0.01. Therefore,

USD/JPY: 110.78
.01 divided by exchange rate = pip value
.01 / 110.78= 0.0090269This looks like a very long number but later we will discuss lot size.

USD/CHF: 1.1227
.0001 divided by exchange rate = pip value
.0001 /1.1227 = 0.0089070

USD/CAD: 1.2780
.0001 divided by exchange rate = pip value
.0001 / 1.2780 = 0.0078247

In the case where the US Dollar is not quoted first and we want to get the US Dollar value, we have to add one more step.

GBP/USD: 1.9799

.0001 divided by exchange rate = pip value
So .0001 / 1.9799 = GBP 0.0050507

But we need to get back to US dollars so we add another calculation which is

GBP x Exchange rate

So
0.00505076 x 1.9799 =0.0099998 When rounded up it would be 0.0001

Don’t worry, you don’t have to do that, but it’s really important for you to know how the Forex brokers will work this out.

What is a lot ?

The value of a pip changes based upon the size of your account, because the size of your account affects how much currency you can leverage. A standard full size account is 100,000 units of the base currency. If you are trading in USD, The Value of the ‘LOT’ in the standard account is $100.000.A mini ‘LOT’ is 10,000 units of the base currency. If you are trading mini ‘LOTS’, you can leverage $10,000.This is why a pip in a mini account is worth less than a pip in a standard account. Let’s assume we will be using a $10,000 lot size. We will now recalculate some examples to see how it affects the pip value.

USD/JPY at an exchange rate of 110.78
(.01 / 110.78) x $10,000 = $0.092 per pipUSD/CHF at an exchange rate of 1.1227
(.0001 / 1.1227) x $10,000 = $0.98 per pip.

In cases where the US Dollar is not quoted first, the formula is slightly different.

GBP/USD at an exchange rate of 1.9799
(.0001 / 1.9799) x GBP 10,000 = 0.50 x 1.9799 = $1 per pip

How do I calculate profits and losses?

When you close out a trade, you can calculate your profits and losses using the following formula:

Price (exchange rate) when selling the base currency - price when buying the base currency X transaction size = profit or loss Assume you buy Euros (EUR/USD) at 1.2178 and sell Euros at 1.2188. If the transaction size is 100,000 Euros, you will have a $100 profit.

($1.2188 - $1.2178) X 100,000 = $.001 X 100,000 = $100

Similarly, if you sell Euros (EUR/USD) at 1.2170 and buy Euros at 1.2180, you will have a $100 loss.

($1.2170 - $1.2180) X 100,000 = - $.001 X 100,000 = - $100

You can also calculate your unrealized profits and losses on open positions. Just substitute the current bid or ask rate for the action you will take when closing out the position. For example, if you bought Euros at 1.2178 and the current bid rate is 1.2173, you have an unrealized loss of $50.

($1.2173 - $1.2178) X 100,000 = - $.0005 X 100,000 = - $50

Similarly, if you sold Euros at 1.2170 and the current ask rate is 1.2165, you have an unrealized profit of $50.

($1.2170 - $1.2165) X 100,000 = $.0005 X 100,000 = $50

If the quote currency is not in US dollars, you will have to con- vert the profit or loss to US dollars at the dealer's rate. Further, if the dealer charges commissions or other fees, you must subtract those commissions and fees from your profits and add them to your losses to determine your true profits and losses.

What is Leverage ?

This is the one characteristic that makes ‘FOREX’ trading so appealing trading more money than you have in your account. It’s of course a double sword and creates risk. The bulk traders fail at ‘FOREX’ trading because the over leverage their positions. For example, for every $1,000 you have, you can trade 1 lot of $100,000. So if you have $7,000 they may allow you to trade up to $700,000 of forex. Leverage to deal with it you need to enter & exit at optimum risk reward.

What is a margin call ?

A broker’s demand on an investor using margin to deposit additional money or securities so that the margin account in brought up to the minimum maintenance margin. This is sometimes called ‘fed call’ or ‘ maintenance call.You would receive a ‘MARGIN CALL’ from a broker if one or more of the securities you had bought (with borrowed money) decreased in value past a certain point. You would be forced either to deposit more money in the account or to sell some of your assets.

Example #1
Let’s say you open a regular Forex account with $3,000 (not a smart idea). You open 1 lot of the EUR/USD, with a margin requirement of $1000. Usable Margin is the money available to open new positions or sustain trading losses. Since you started with $3,000, your usable margin is $3,000. But when you opened 1 lot, which requires a margin requirement of $1,000, your usable margin is now $2,000.

If your losses exceed your usable margin of $1,000 you will get a margin call.

Example #2
Let’s say you open a regular Forex account with $15,000. You open 1 lot of the EUR/USD, with a margin requirement is $1000. Remember, usable margin is the money you have available to open new positions or sustain trading losses. So prior to opening 1 lot, you have a usable margin of $15,000. After you open the trade, you now have $14,000 usable margin and $1,000 of used margin.

If your losses exceed your usable margin of $14,000, you will get a margin call.

Remember: there's a difference between ‘USABLE MARGIN’ & ‘USED MARGIN’

The term "order" refers to how you will enter or exit a trade. Here we discuss the different types of orders that can be placed into the foreign exchange market. Be sure that you know which types of orders your broker accepts. Different brokers accept different types of orders.

Order Types

Basic Order Types

There are some basic order types that all brokers provide and some others that sound weird. The basic ones are:

• Market order
  A market order is an order to buy or sell at the current market price. For example, EUR/USD is currently trading at 1.2140. If you wanted to buy at this exact price, you would click buy and your trading platform would instantly execute a buy order at that exact price. If you ever shop on Amazon.com, it's (kinda) like using their 1-Click ordering. You like the current price, you click once and it's yours! The only difference is you are buying or selling one currency against another currency instead of buying Britney Spears CDs.
• Limit order
  A limit order is an order placed to buy or sell at a certain price. The order essentially contains two variables, price and duration. For example, EUR/USD is currently trading at 1.2050. You want to go long if the price reaches 1.2070. You can either sit in front of your monitor and wait for it to hit 1.2070 (at which point you would click a buy market order), or you can set a buy limit order at 1.2070 (then you could walk away from your computer to attend your ballroom dancing class). If the price goes up to 1.2070, your trading platform will automatically execute a buy order at that exact price. You specify the price at which you wish to buy/sell a certain currency pair and also specify how long you want the order to remain active (GTC or GFD).
• Stop-loss order
  A stop-loss order is a limit order linked to an open trade for the purpose of preventing additional losses if price goes against you. A stop-loss order remains in effect until the position is liquidated or you cancel the stop-loss order. For example, you went long (buy) EUR/USD at 1.2230. To limit your maximum loss, you set a stop-loss order at 1.2200. This means if you were dead wrong and EUR/USD drops to 1.2200 instead of moving up, your trading platform would automatically execute a sell order at 1.2200 and close out your position for a 30 pip loss (eww!). Stop-losses are extremely useful if you don't want to sit in front of your monitor all day worried that you will lose all your money. You can simply set a stop-loss order on any open positions so you won't miss your basket weaving class.

Weird Sounding Order Types

GTC (Good ‘til canceled) A GTC order remains active in the market until you decide to cancel it. Your broker will not cancel the order at any time. Therefore it's your responsibility to remember that you have the order scheduled. GFD (Good for the day) A GFD order remains active in the market until the end of the trading day. Because foreign exchange is a 24-hour market, this usually means 5pm EST since that that's U.S. markets close, but I’d recommend you double check with your broker. OCO (Order cancels other) An OCO order is a mixture of two limit and/or stop-loss orders. Two orders with price and duration variables are placed above and below the current price. When one of the orders is executed the other order is canceled. Example: The price of EUR/USD is 1.2040. You want to either buy at 1.2095 over the resistance level in anticipation of a breakout or initiate a selling position if the price falls below 1.1985. The understanding is that if 1.2095 is reached, you will buy order will be triggered and the 1.1985 sell order will be automatically canceled. Always check with your broker for specific order information and to see if any rollover fees will be applied if a position is held longer than one day. Keeping your ordering rules simple is the best strategy. Summary The basic order types (market, stop loss, and limit) are usually all that most traders ever need. Unless you are a veteran trader (yeah right), don’t get fancy and design a system of trading requiring a large number of orders sandwiched in the market at all times – stick with the basic stuff first. Make sure you fully understand and are comfortable with your broker’s order entry system before executing a trade. DO NOT make a trade with real money until you have an extremely high comfort level with the trading platform and order entry system.

With the information we have covered so far, let's show a few examples of how much money can be made (or lost!) daily by trading currencies (please note that these are just examples for educational purposes).

Example 1:

A trader thinks the euro will gain value versus the dollar (EUR/USD is at 1.2150)
Let's say that the price of the euro-dollar pair is 1.2150 and a day trader, based on his strategy, gets a signal that the euro is going to continue to go up. The trader buys 100,000 EUR (1 lot) at 1.2155 (121,550 USD). If the trader's margin requirement is 2%, his margin deposit would be 2,000 euros or 2,431 dollars. The trader automatically sets a stop loss of 25 pips based on his technical trading strategy. As the trader expected, the EUR/USD goes up to 1.2225 (on paper, everything works!). Assuming this meets the profit requirements of his day trading system, the trader sells the 100,000 euros. He receives 100,000 x 1.2225 = 122,250 USD. Since the trader originally sold (paid) 121,550 USD for the euros, his profit is 122,250 - 121,550 = 700 USD.

Please note: Using leverage magnifies both profits and losses.

Example 2:

A trader thinks the yen will appreciate in value versus the dollar (USD/JPY is at 108.65)
The price of the dollar-yen is dropping and is currently at 108.65. A day trader gets a sell signal based on his trading strategy. He sells 100,000 USD (1 lot) at 108.60 and receives 10,860,000 Japanese yen. Assuming a 2% margin requirement, the deposit would be 2,000 dollars. Right after placing his trade, the trader places a stop loss of 30 pips based on his day trading strategy. The trader was right and the yen appreciates versus the dollar (dollar loses value relative to the yen), pushing the exchange rate down to 107.50. Satisfied with his profit, the trader sells the 10,860,000 yen at 107.50. He receives, 10,860,000 / 107.50 = 101,023 USD. Since he had originally paid (sold) 100,000 USD for the yen, his profit is 101,023 - 100,000 = 1,023.

Please note: Using leverage magnifies both profits and losses.

Example3:

Trader x has an account of USD 50'000.

He buys EUR/USD 500'000 @ 1.1500 at the market and places a stop loss order at 1.1460.

At this point his maximum risk is USD 2'000 and his margin utilization is 10%, well above the minimum.

During the day the forex market fluctuates and initially moves down to 1.1480.

At this point trader x has an unrealized loss of USD 1'000 and his margin utilization has fallen to 9.60% reflecting the effect of the downward move on his margin capacity.

Later still the price moves back up to 1.1550 and trader x decides to take profit. He sells at 1.1550 making a USD 2'500 profit which represents a 5% return on his account value. Note that trader x took only a risk of USD 2'000 and made a return of USD 2'500 this equates to a risk/reward ratio of 1.25. A high risk reward ratio is what every trader should be aiming for.

Please note that in this example no mention was made of the exact day trading strategy that the trader used to place his trades and set his stop losses. A trading strategy or system is extremely important and it has to be specifically defined, even if it was not discussed in these examples. Also, proper money management (how much should the trader have risked on the trades) was not discussed either. This was done for simplicity's sake. Generally speaking, a trader should never risk more than a certain amount of his trading capital on any given trade. Read my article about adhering to a specific day trading strategy.

Familiarize yourself with forex trading with our free forex demo account.