Important economic factors that govern the Forex markets

Beginners seldom understand the importance of learning what makes the Forex markets function - the underlying economic factors! Foreign exchange, a financial market valued in trillions today, allows traders to profit through the exchange of currencies. And this exchange is possible only because currency prices go up and down. Without their fluctuation, prices would be stagnant and exchanging currencies would be impossible. 

There are number of similar factors that cause the Forex markets to move erratically, making it both risky and lucrative. As an adept trader, having knowledge of these factors will help you place profitable trades. 

Forex Trading Strategies

Here are some important factors that influence the Forex markets: 

1) Interest Rates: 

Every trader has to look out for interest rates. They are essentially set by a country's central bank to control investors' affinity towards their markets. If interest rates are high, the chances of investors favoring their currency go up. Similarly, if the banks feel that they need to bring down the number of exchanges, they lower the rates. 

2) Inflation: 

A global phenomenon, inflation governs a lot in Forex. When a country has products that are constantly getting hiked in value, foreign investors are less likely to invest in it. If inflation is constant, a country's currency is bound to get devalued. 

3) GDP: 

A country's GDP is used to measure the value of its goods and services. This includes government expenditure, business spending, private expenses and the overall expenses laid out by a country as a whole. A healthy GDP indicates that a country's economic value is stable and its currency will play out well in the markets. 

4) Economic Events: 

Economic events can range from elections to changes in fiscal policies - and all of them influence the Forex markets. You will have to devise your Forex Trading Strategies keeping these events in mind at all times. Novices often enter trades without any knowledge of a country's economy and end up losing big money.

5) Retail Sales: 

The strength of an economy can also be measured by retail sales. When a country's economy is healthy, customer expenditure will be consistent and even incremental at times. A constant study of this will help traders decide if a country's currency is worth investing in. 

Open a Forex Demo Account in Malaysia and gain gradual mastery over currency trading. Difficult, but far from impossible, profiting in the Forex markets will happen swiftly with our experts by your side! Reach out to WesternFX today and equip yourself with our stellar strategies and trading platforms. See your Forex trading career take to the skies - call us! 

6 Things To Keep In Mind While Hedging In Forex

Hedging is one of the most incredible Forex trading strategies. Implemented well, you will be able to cut your losses and balance them out with profits seamlessly. However, the catch here is that hedging requires a lot of research and adept implementation. 

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Even knowledgeable traders struggle with understanding the nuances of this approach. With a good amount of time invested in learning, mastering this method won't take too long! Once you know how to hedge trades, loss management will become immensely easy and you will able to see a stellar increase in profits.

Here are 6 tips to hedge better in Forex:

1) Novices Shouldn't Try It: 

Hedging isn't a method that you can master simply by seeing someone else do it or by understanding it theoretically. A lot of practice is required to hedge successfully. To start off, try hedging trades on a Forex demo account. Once you are comfortable with demoing this approach, you can begin employing it on live trades.

2) Finding A Compatible Broker Is Important: 

Not all brokers offer the option to hedge. And not all brokers are equipped with the experience to help you hedge properly. Before you start trading, find a reliable broker.  

3) Employ Trading Robots: 

Hedging is something that happens very quickly and to manually carry it out will be risky. However, technology has developed incredibly, allowing traders today to automate their exchanges. With trading robots, also known as expert advisors, you can automate your trades and hedge safely.

4) Time Your Hedges: 

If hedging worked on all timeframes, every trader would be able to cut losses and boost profits. The catch with hedging a trade is that it has to be done across the right timeframe. If you employ this strategy without proper timeframe analysis, you will only end up losing more money than usual! 

5) Patience Is The Key: 

Hedging is the simple art of placing a trade opposite to the one you're losing. While this might sound easy to do, implementing it is very tricky and risky. You will have to wait for the right opportunity to surface, and impatience will only serve as an impediment.

6) Evaluate Your Methods Continuously: 

Everyone makes mistakes, more so when they trade Forex. This is why evaluating your methods is necessary. To perfect hedging will take time and a lot of continuous improvement. 

Open a Forex Demo Account in Malaysia today and start mastering the hedging approach. Our experts at WesternFX will equip you with a top-tier platform that augments your trading skills. Work with us today and see unrivaled success in your Forex ventures!

Why Being Patient Is Better Than Trading Relentlessly In Forex?

No trader gains a complete understanding of Forex right off the bat. A market valued at trillions of dollars doesn't reach such heights overnight! To get a piece of this pie, traders need to put in long hours of research and practice, and even after learning Forex trading thoroughly, exchanging currencies on volatile markets isn't an easy job. Several well-learned traders have lost huge sums to erratic market shifts! One can never be careful enough in the Forex markets. 

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As a Forex trader, you will have to develop many skills, and the most important of them is patience. Critical to winning trades and climbing the Forex trading ladder, patience alone can help you avoid a number of expensive losses. When you start off trading currencies, the hunger to win and profit will be intense, and how you channel this drive is what will make all the difference. 

The profitable few are able to draw a line between passion and greed; they exercise incredible patience and only take trades that are wholly viable. An inexperienced trader on the other hand, will trade without preparation, take exchanges impulsively and employ impatiently-devised Forex trading strategies.    

Why You Need Patience To Trade In The Forex Markets?

Being patient always pays off. In a domain as intensive as Forex trading, you will be tempted to take the many trades that come your way, but none of these will return what you invest! While it remains true that when an opportunity presents itself, you should capitalize on it, said opportunity should be viable. And patience helps you land exchanges that are amply profitable! Running behind quick money, traders partake in exchanges without any sort of preparation. 

Economic shifts, political events and social happenings all play a vital role in determining how currency markets behave. This is why traders need to have patience; patience to analyze said factors, measure the viability of a trade, prepare for if and when things to south, and have the backing of solid Forex Trading Strategies! As a Forex trader, there are a number of things between you and profits, all of which will have to be mastered through skill and patience. 

While overnight victories are every trader's desire, the markets aren't lenient enough to let traders profit that soon. To master indicators, charting, trade analysis and the many other elements of Forex trading, practice and research is of paramount importance. Haste makes waste, and in the Forex markets, you always stand a chance of losing big money. So settle down and prepare for a long ride! Patience will take you a long way in Forex, towards unparalleled profits.

Open a Forex Demo Account in Malaysia today and start honing your patience! Sign up with WesternFX today and avail our world-class demo trading solutions. We will provide you with a stellar demo trading platform and give you excellent guidance. Get started today, call us!

CFD Trading Vs Options Trading - Which Field is Better & Why?

One of the most flexible trading markets in the world today, Contracts for Difference (CFD) is a domain ready to disrupt the trading society. What makes CFD trading unique and so sought after is that firstly, you don't have to own an asset to trade it, you merely speculate on the change in its value, and secondly, you can do this for currencies, options, indices, stocks and a variety of such financial commodities! 

There are rewards in plenty, and risks plenty more, which is what makes trading any asset, be it stocks, currencies or contracts, a very risky endeavor.
 

What is CFD Trading?
 

Choose the Best Among CFD Trading vs Options Trading

 

Put simply, contracts trading are the exchange of a financial commodity between a broker and a trader did across a pre-established timeframe decided by the opening and closing time of a trade. In essence, a CFD is an agreement between the broker and the trader, one that requires no actual owning of said asset. Any profit or loss made is a result of the commodity's movement.
 

This nature of CFD, which lets you profit from simply speculating is one of its biggest advantages. Let's see an example of its beneficial nature - assume that you want to buy 20 shares of an asset valued at $10 per share, doing this on stock trading grounds would lead to you purchasing the 20 shares for $200. However, with a CFD agreement, you need only pay a percentage of the actual share value. 

So with 5% charged, you will only be paying $0.5 per share and be able to buy the 20 shares at just $10! This is one of the many benefits surrounding CFDs.
 

Why Trade CFDs?
 

Trade on Falling and Rising Markets: The biggest advantage CFD online trading in Malaysia has, is that it allows traders to profit from markets that are rising as well as the ones that are falling. This means that you are immune to erratic economic shifts that disrupt growing trends and push them downwards. So long as you analyze the markets properly, falling trades will be a friend just like the ones going up are.
Flexible Contracts: There is no trading cap you are supposed to obey. As a CFD trader, the contracts are flexible and lot sizes are provided in varying sizes. 

If you are new, you can begin with smaller lots; as you progress the size can be incremented and you can start making bigger trades.
 

Hedge Trades: Hedging can help you greatly when you place risky trades and are on the verge of losing a big chunk of your capital. Since CFD trading in Malaysia can be done both ways, you can hedge your losing trades by opening another position in the opposite direction! This guarantees that either one of the trades will win or the one that's lost will be compensated for by the other. 
 

Trade on Margin: Margin trading makes CFDs so very lucrative! To put margins simply, opening a trade contract for a particular asset will only cost you a margin of the original value said asset carries. This makes CFD trading lighter on the pocket but doesn't reduce its profitability! 
 

What is Options Trading?
 

A derivative security, options get their value from parent assets. Options trading are the buying or selling of an asset for a fixed price before a specified date and this is done through an options contract. Options are of two types, call (buy) and put (sell) options. A call option lets you buy an asset at the price agreed upon, and a put allows you to sell the same. Once either of these options has been bought, your job as an options trader is to go long or short depending on your market speculations.
 

Benefits of Options Trading:
 

Cost-effective: Options trading can be very cost effective when compared to its cousin trading fields. Buying 100 shares of a $50 stock will cost you $5000 through normal means; with an options contract, however, you can purchase two $10 call options, wherein each call represents 50 shares, and the total would only add up to $2000! 
 

Relatively Less Risky: The margin and leverage provisions make options less risky when traded properly; keep in mind that this very leverage can backfire and lead you to losses! As a hedge and on nominal margins, however, options are times less risky than shares.
 

Healthy Profit Opportunities: When the investments are lesser than the returns, it is a clear case of evident profits. Options trading markets have a stellar profit potential in the hands of the right trader.
 

So if you are trying to decide between options trading and CFD trading in Malaysia, it ultimately comes down to preference! Both markets have a good trading value with ample profits for the taking. Still confused? Talk with an expert at WesternFX and know more! We house trading veterans, battle-hardened and ready to help you out with your queries. Call us today to get in touch!

4 Easy Steps to Improve Your CFD Trading in Malaysia 2019

Typical financial commodities require that you own them and then trade, but not CFDs! A contract for difference is a derivative that allows you to trade a commodity without owning the underlying asset. From currencies to indices, you can speculate on the various financial commodities in the markets with a CFD. It is an incredibly fascinating and lucrative field for the curious trader in you! 

Unlike many other fields, getting started won't take you too long. With a few basic steps done, you can become a CFD trader in a short span!
 

Here are 4 simple steps to get started trading contracts:
 

Tips to Improve CFD Trading in Malaysia 2019

1) Pick Your Trading Instrument: As a CFD trader, you have a variety of commodities and markets to choose from. This is advantageous and disadvantageous all the same! Too much variety only brews confusion and leads to hasty decisions. Do your homework before choosing an asset to trade on. Find out the most profitable market for your methods and how viable it is in the long run! 

Research is always the key to succeeding, especially so in CFD trading or anything like Forex trading as well.
 

2) Select a Safe Leverage Ratio: CFD trading is leveraged, meaning you hold more value than your actual investments give you. Leveraging is a huge benefit since you get to trade higher positions with investments half the value! However, there's always a catch. When you leverage and lose, you lose both the borrowed money and your invested sum. 

To avoid these disastrous happenings, it is best to leverage with care and nominally.
 

3) Learn Stop Usage: Losses are inevitable and can't be avoided, especially on markets like CFD trading in Malaysia. While you can't dodge them, you can definitely minimize the repercussions! A stop order is something that when placed in a trade will automatically remove you from it upon a certain amount of money being lost, or when a bad trade trend is spotted. 

Once again, these have to be placed precisely to notice the best effect; random stops will only be a hassle and remove you from trades before you make any profit!
 

4) Keep Trades Under Control: Contract trades have enough destructive potential to go from steady to erratic in seconds! When you don't exercise caution, your trade can effortlessly throw you into losses. Always have proper indicators and tools in place to keep your trades in check.
 

Note these down and you can embark on a profitable, adventurous journey of CFD trading in Malaysia! While difficulties do exist, you can overcome them and rise to the top of the charts with an established broker like WesternFX by your side. We house professionals with years of experience and the burning desire to help traders fly high! Sign up with us today, and see the magic for yourself.

CFD Trading in Malaysia | Everything You Need To Know - Guide

A contract for differences is a deal between two parties that grants access to the value of an underlying asset. The contract can be purchased and sold; this difference is the profit CFD trading offers. CFDs reign superior because to trade them, you need only invest in contracts rather than buying the entire asset. However, don't let this mirage of ease carry you away; trading CFDs needs honed skills and thorough planning. Contracts have a leveraged ecosystem, meaning, if you lose a trade, you lose much more money than the capital invested!
 

Currencies, stocks, indices, and commodities can be trades through contracts and are the predominantly trades elements. Let's take an example of trading crude oil shares. Say, one share of crude oil sells at $100, to purchase 10 shares you will need $1000 in your account. This is your investment capital. CFD brokers provide leverage to give you better grip over the market. So once you've bought 10 shares of crude oil, your broker will allow borrowing, let’s say 50% of the share value - $500; with this, you can buy 10 more shares of said commodity, instead of investing $1000 again. This is the leveraged environment of CFDs.

 

CFD Trading in Malaysia

 

Throughout this dealing, how does your broker earn? Through margins? Though the parameters to derive these might differ, standard calculations go as follows - maximum loss amounts you might incur times number of CFDs owned. Profits or losses are calculated in a similar manner. This is the difference between the price at which you sold a contract and the price at which you bought it.
 

Leverages in CFD Trading:
 

These are the primary factors of CFD trading. With leverages, you borrow a certain amount from your broker and invest it on a commodity, when you profit, the returns derived are substantial; however, losing a leveraged trade is equally massive. Typically in contracts trading, leverages range from 2:1 to 400:1. A ratio of 10:1 means, for every $10 owned, you control $100 of share value.
 

Keeping in mind the earlier crude oil example - with a leverage of 10:1, you can purchase one share of crude oil at $10 instead of $100. This elevated environment of CFDs allows you to yield huge profits with minimal investment capital and at the same time, a bad trade can lead to you losing the initial amounts along with the leveraged capital, which will add up to a scary sum.
 

Advantages and Disadvantages of CFD Trading:

 

CFDs have made the process of trading immensely convenient by providing leverages and numerous commodities to profit from. From currencies to indices, you can delve into any field! With minimal investments, you can make substantial profits. However, the chances of risks are equally high and losses can be devastatingly huge!
 

Advantages of CFD:

 

1) You can trade without having to own the underlying asset. Since CFD trading only agreements between two parties, only commodity values are speculated.
2) With broker provided leverages, you can invest generously without spending a single dime from your pocket.
3) With a single CFD account, you can participate in multiple fields of trading like currencies, oil, silver, commodities etc., without the hassle of multiple accounts.
4) You can profit from both rising and falling trends, that's the beauty of CFDs. Typically a trend on the downside might result in losses; however with contracts, as long as you can speculate accurately, you can profit both ways.
 

Disadvantages of CFD:

 

1) Being careless around leverages can result in devastating losses. Along with your investment capital, you'll lose even the borrowed amount.
2) Holding a position overnight can result in costs mounting up very quickly.
3) Unlike other genre, contracts have a strict boundary set by the broker, in terms of margin requirements. This can feel slightly suffocating for conventional traders.
 

The Importance of a CFD Broker:

 

CFDs are profitable to brokers as much as they are to traders. Several brokers will give you healthy leverage capital and keep hoping the market moves against your favor! Finding a neutral broker is substantial if you want to thrive. Without a Forex trading account, no deal can be facilitated.  These accounts connect you to the markets; having a well-leveraged trading account is a must when it comes to contracts. It is advisable to get a demo account before trading live. A broker that can equip you with a good trading platform and be transparent will be the perfect choice. A bonus would be if you can avail a mobile trading platform; this will allow you to trade on-the-go! Know how to find a reliable forex brokers in Malaysia here.

Utilize the lucrative markets of CFD, partner up with a world-class broker and see consistent success! Hire WesternFX! Our brokers are experienced and will provide a stellar trading account for you to work with, and keep assisting with timely strategies. Want to master CFD trading in Malaysia? Call us today!