Questoin about FOREX? How long can you hold your orders for?
I don’t know too much about the FOREX system but do work in an industry with foreign currencies so I watch rates Daily and notice trends in currencies going up and down so figrued I may try to get into FOREX< thinking about learning more about it.
My question is this, when I place an order I’m betting on a currency going up or down. How long can I hold an order for? Is it like shorting a stock where you have til day end or maybe 3 days or can you hold it for as long as you want. If you can hold as long as you want I dont see how you could possibly not make money as every currency is going to go down adn bcak up and then back down.
Also, why do they let you leverage youself 100%?
If your allowed to hold a position as long as you want it makes it seem to easy, even if you take a hit eventually the currency will come back to at least what you paid if not higher to make a profit. WIth stocks the broker can call back meaning you have to sell back reguardless of what the price is, can this happen with FOREX?
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Tagged with: adn • currency • daily • foreign currencies • Forex Questions • forex system • leverage • shorting a stock • system • til
Filed under: Forex Software
First, you can hold a short position in stock as long as you want.
Second, you can hold a forex position as long as you want.
They let you leverage 100:1 because they feel it’s safe for them to let you do this. It doesn’t mean it’s a good idea and I never run my positions with that much leverage.
You can hold a position as long as you want and you will receive a rollover credit/debit depending on the interest rate of the currency you bought. if you bought a currency with a higher interest rate and you will receive a credit if you sold it you will be debited. If you hold a position that is moving against and you use up your margin the broker will automatically unwind the position.
You can hold a position for any amount of time. At 5pm ET each day, your open positions will automatically be rolled over, and you’ll either gain or lose a little bit in interest. There are no short calls in Forex. You only have to worry about margin calls, and stop losses.
Here’s why it’s a challenge to make money. Say you decide that a currency is going to rise in the long run, and say that you’re right. But before it rises, it drops. If you’re highly leveraged, that drop can easily wipe you out.
Now if you’re not leveraged, you’re right, most currencies will tend to fluctuate in the long run. But that might mean 5 or 10 years, and even then there’s no guarantee that a large enough fluctuation will ever happen.
TED has it correct. In fact… most of your answers are "right on"………………
In addition;
"Shorting" a curency pair is simply taking the opposite "side" of a buy.
ie, the EUR/USD as a "short" is USD/EUR. S tock going down is always a bad thing. A currency pair moving down could be good or bad… but it’s going down is not an indication of either.
Leverage of 1000% (100:1) is from the brokers point of view… no big deal. They are set up to liquadate your account as soon as you get close to a margin call. In other words… the brokers always win. There are quite a few brokers offering 400:1 margin…. it’s bad for the client… but great for the broker because it gets more accounts.
You show a poor understanding of the stock market yet you’re exploring currency trading… which is 100 times more dangerous. I’d stay clear of both until your understanding of these markets is vastly better.