XM - What's now?
XM has updated the maximum leverage to 1:1000 in June 2022.
Leverage 1:1000 does not apply to client registered under the EU regulated entity of the Group. The maximum leverage for Trading Point of Financial Instruments is 30:1.
How to start trading Forex with XM Trading?
To start trading Forex and CFDs with XM, you need to open a trading account with XM from this page first.
By opening a trading account with XM, you can start trading Forex and CFDs through XM’s trading software, MT4 and MT5…
Forex Trading Software is an online trading platform provided to each customer of XM Trading, which allows you to browse, analyze and trade trading currencies and other investment products.
In other words, each XMTrading customer is given access to the trading platform (software), which is directly linked to the pricing of the global market and allows them to execute transactions without the intervention of a third party.
What is Forex trading?
Forex trading, also known as Forex Margin Trading or Currency Trading, means selling one currency and buying another currency instead. In currency transactions, one currency is always exchanged for another.
There are various purposes, and one of the following is the main purpose, but is not limited to:
- Exchange currency A (eg USD) for currency B (eg EUR) for travel.
- Exchange currency A (eg USD) for currency B (eg EUR) for trading purposes.
- Exchange currency A (eg USD) for currency B (eg EUR) for speculative purposes aimed at making a profit.
For the above reasons, the Forex trading market is the most liquid and volatile market in the world today, with daily trading volumes of over $ 5 trillion.
How does Forex trading work on XM?
Forex trading is simply exchanging one currency for another. Therefore, XMTrading customers sell another currency at the current market rate in order to buy one currency.
In order to trade, you need to open an account, hold currency A, and then exchange currency A for currency B for long-term or short-term trading with a final goal according to it.
Since FX transactions are performed on currency pairs (transactions that pay the relative amount of one currency to another), the first currency is the so-called key currency and the second currency is the settlement currency. Is called.
For example, the market value of EUR / USD 1.2345 is the price of the euro denominated in US dollars, which means that 1 euro is 1.2345 US dollars.
Currency transactions are from 22:00 GMT on Sunday (7:00 GMT) to 22: Friday when currency transactions take place in the major financial cities of London, New York, Tokyo, Zurich, Frankfurt, Paris, Sydney, Singapore and Hong Kong. It is possible to do 24 hours a day until 00GMT (7:00 Japan time Saturday).
What affects the price of Forex trading?
There are innumerable factors that contribute to and influence the daily price (exchange rate) of Forex trading, but it can be said that there are six that have the most influence on the price fluctuation of Forex trading and are the driving force to some extent. ..
- Inflation inequality
- Interest rate difference
- Current balance deficit
- Public debt
- Trading Conditions
- Political and economic stability
To best understand the above six factors, it is important to keep in mind that currencies are trading with each other. Currency units are always represented by other currencies, so if one currency depreciates, the other currency will rise.
Who are the participants in the Forex trading market?
Forex trading market participants can be divided into the following categories:
- Travelers who exchange money to travel abroad or consumers who purchase goods from abroad.
- A company that needs to exchange its own currency into the currency of the seller’s country in order to purchase raw materials and goods from overseas.
- Investors who need foreign currencies to trade stocks and other investment products from abroad, or who exchange currencies to trade currencies for the purpose of profiting from market fluctuations Speculator.
- A financial institution that exchanges money or lends money to overseas customers as part of customer service.
- Governments and central banks that buy and sell currencies to correct fiscal imbalances and adjust economic conditions.
As an individual Forex trader, the most important factors that influence your trading are the quality, speed and spread of your trading. These affect each other.
Spread refers to the price difference between the Bid price and Ask price (Bid price and Ask price) of a currency pair, which is simply the price at which a broker or bank sells or buys a transaction order submitted by a customer. However, the premise for considering spreads is accurate contract power.
In the FX trading market, forex trading power means the speed at which forex trading traders can actually buy and sell prices that are visible on the screen or quoted as Bid / Ask prices over the phone. A good price doesn’t make sense unless the broker or bank can execute the Bid / Ask price fast enough.
Trade Major, Minor and Exotic currency pairs
In Forex trading, some currency pairs are called major currencies (major currency pairs). This category includes the most traded currency pairs, one of which is always USD.
Examples of major currency pairs: EUR / USD, USD / JPY, GBP / USD, USD / CHF, USD / CAD, AUD / USD, NZD / USD
In Forex trading, a minor currency pair or a cross currency pair is one of which is not USD.
In Forex trading, an exotic currency is a currency pair with a small trading volume, and a major currency and a currency of a small economic country or an emerging country are paired. These pairs usually have low volatility and low liquidity, so they do not show the active price movements of major and cross currency pairs.