New to Forex

[bullboy8]

For example, i trade on fxcm, i buy euro and sell GBP. Do i really own the euro (as in fxcm really execute the transaction to get euros for me), or is it just virtually? How come i cannot hold the euros for years then sell?

Also, where do fxcm get their prices/quotes.....its different from buying shares because a stockbroker obtains the price of a share from the Stock exchange. thanks

 

[bullboy8]

any good uk based forex company? where can i obtain real time interbank market rates?

 

[Rhody Trader]

For example, i trade on fxcm, i buy euro and sell GBP. Do i really own the euro (as in fxcm really execute the transaction to get euros for me), or is it just virtually? How come i cannot hold the euros for years then sell?

Also, where do fxcm get their prices/quotes.....its different from buying shares because a stockbroker obtains the price of a share from the Stock exchange. thanks

The actual process you go through when trading forex is to borrow one currency, convert it in to another, and deposit it. In your EUR/GBP example, you would borrow the GBP (for which you pay the overnight UK interest rate), convert it into EUR at the going rate and deposit it (for which you receive the overnight Eurozone interest rate). For most brokers/dealers who handle individual accounts, this is done virtually. The margin you post to do the trade is the surety against the position going against you.

If you actually want to hold the currency, you would have to go to the interbank market and deal on a much larger scale (generally 1 million lots), or go to your local bank and get raped by the exchange rates, just as you do if you exchange money in the airport (I've seen 5% variation from the actual market rate).

FXCM and others get their prices from the interbank market.

 

[bullboy8]

thanks for you reply....very informative. But, how can i ensure the posted prices by the dealer/broker are exactly the same as those provided by the interbank, i mean what stops them from manipulating the prices/quotes. thanks

 

[neil]

Bucket shops

thanks for you reply....very informative. But, how can i ensure the posted prices by the dealer/broker are exactly the same as those provided by the interbank, i mean what stops them from manipulating the prices/quotes. thanks

Search under FXCM on this site and at www.Elitetrader.com
These bucket shops trade against you. Suggest you read all you can here and at Elitetrader before you even practice forex trading.

Some reading to start you off:

http://www.elitetrader.com/vb/showthread.php?s=&threadid=72816&highlight=fxcm

http://www.elitetrader.com/vb/searc...=1302972&sortby=lastpost&sortorder=descending

 

[neil]

And one on dealing desks etc.

http://nondealingdesk.blogspot.com/

 

[bullboy8]

wow...neil...the nonetradingdesk site is brilliant...loads of info...cheers, but the site doesn't provide any non trading desk companies

 

[Rhody Trader]

thanks for you reply....very informative. But, how can i ensure the posted prices by the dealer/broker are exactly the same as those provided by the interbank, i mean what stops them from manipulating the prices/quotes. thanks

Competition - the fact that you can take your business to another broker/dealer and/or run multiple accounts and arbitrage price discrepencies.

 

[neil]

Try Www>oanda>com And Use Their Fx Game Account To Practice

 

[bullboy8]

is oanda a none trading desk? thanks

 

[FOREXHUSKY]

Brokers are like Casinos they will carry your wins util you will get bigger then they credit in bank or they assets.
If someone here believe that you trade real money thru brokers like fxcm..and couple others you are in HUGE misteake.
There is no money.
But to get full info how it works you need to do your own home work and that cost time and MONEY.

Yes go to non desk brokers like coesfx or some others,unless they will not hunt your stops and you will avoid running 10charts to check spikes generated to take your cash for they new years partys lol.

good Luck

 

[gus]

Husky, when are you going to learn how to converse in English and spell the words correctly?

Gus

Brokers are like Casinos they will carry your wins util you will get bigger then they credit in bank or they assets.
If someone here believe that you trade real money thru brokers like fxcm..and couple others you are in HUGE misteake.
There is no money.
But to get full info how it works you need to do your own home work and that cost time and MONEY.

Yes go to non desk brokers like coesfx or some others,unless they will not hunt your stops and you will avoid running 10charts to check spikes generated to take your cash for they new years partys lol.

good Luck

 

[FOREXHUSKY]

Dear GUS

Same day when you will made your first $ 1miln.

Regards

 

[forexprincess]

Ha! You make me laugh! over to you Gus.....!