Forex - Spot v's Futures

dorf

Newbie
6 0
Forex futures

Anyone found a good web site giving live central bank currency interest rates? I've been searching for one, but info seems thin on the ground. Perhaps this info is available by subscription only?
 

Buk

Established member
615 6
Trader term for the British Pound (Sterling) referring to the Sterling/US Dollar exchange rate....originated due to the fact that the rate was originally transmitted via a transatlantic cable starting in the mid 1800's.
 

spgslege

Newbie
8 0
Buk said:
Trader term for the British Pound (Sterling) referring to the Sterling/US Dollar exchange rate....originated due to the fact that the rate was originally transmitted via a transatlantic cable starting in the mid 1800's.

Thanks Buk
For the history lesson

Cheers
SG
 

dorf

Newbie
6 0
Forex futures

BBB said:

Thanks BBB, a useful site. However, perhaps it is me but I can find practically everything on this site except "central bank interest rates for each currency". This seems to be the case for all these types of sites which I have found. I have found one or two which list them for a few major currencies only, but not for most of the significant currencies. Perhaps I just don't know where to look?

Is the data really on Oanda? If so can you point me in the right direction please? Thanks.
 

BBB

Experienced member
1,071 3
dorf - Sorry, didn't read your post properly, I assumed you ment Central Bank FX rates which I assumed to be the same as Interbank FX rates - DOH!

You mean LIBOR & LIBID I take it?

Try Google on Libor?
 

Noche

Junior member
11 0
futures vs spot

:?: :?: :?: :?: I know that futures is in a large period of time, not like spot that could be even in seconds... but what if some one gets a future, and the market never goes to the price one is looking for, or expecting to get? :rolleyes:
 

dorf

Newbie
6 0
CB interest rates

BBB said:
dorf - Sorry, didn't read your post properly, I assumed you ment Central Bank FX rates which I assumed to be the same as Interbank FX rates - DOH!

You mean LIBOR & LIBID I take it?

Try Google on Libor?

Thanks BBB

Dorf
 

TRADERguy

Active member
122 3
Noche said:
:?: :?: :?: :?: I know that futures is in a large period of time, not like spot that could be even in seconds... but what if some one gets a future, and the market never goes to the price one is looking for, or expecting to get? :rolleyes:

Noche,

The spot price is the price deliverable in 2 days (1 day for CAD/USD). It is considered the immediate price. Futures are a form of forward contract that trades on an exchange, has a specified contract size, and has a set expiration date (usually in March, June, September, and December). Futures are a contract to buy or sell one currency for another at the specified date for the price that you agree to now. No money actually changes hands now except that you have to keep money with your broker to cover any losses that you incur; this is called margin but is a different concept than margin in stocks. For forex speculators (traders) who do not actually take delivery, your broker will automatically roll your spot position if you hold it more than 2 days and pay or take from you interest that is based on the interest rates in both countries. Retail forex brokers can do what they like because they take the other side of your trades: most pay/charge interest the usual way but some pay/charge intra-day and others only charge and never pay. There is no interest in futures: the "interest" is already reflected in the price of the future based on the interest rates in the two countries and the amount of time until the contract expires. As the futures contract gets closer to expiration, the price will get closer to the spot price until they converge at the end. You should also understand that the futures price can vary slightly from the current spread to the cash in the short term based on short term factors of supply and demand and the liquidity present. When trading either the futures or forex outright (not spreading or going for the carry trade, etc.) you simply buy or sell (the first one of the pair) based on which direction you think the currencies are going to move. If you are right you profit the number of pips that it moves your way times the tic/pip value, and if you are wrong you lose the amount that it goes against you. For both spot and futures you close a position by taking the opposite trade to your opening trade (buying or selling).
 

jpwone

Well-known member
254 3
Noche,

the description provided by TRADERguy of the difference between the spot market and the futures market is one of the best I have read. Don't take this the wrong way but until you understand all that TRADERguy has written then don't even think about trading Forex. The Spot Forex market is one of the most liquid in the world and attracts some of the best traders, they will be queuing up to take your money.
 
 
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