Newbie - Forex trading

[Gibblin]

I’m new to all this and am very interested in trading on the forex. I’ve spend a fair while looking through the site and there as some basic things I need to get to grips with! Being a beginner I want to start small and obviously practice and form my own strategies/systems.

Firstly, are there only 2 types of company to trade with, a Market Maker and a Broker? Are the spreadbetting companies such as D4F and finspreads merely brokers, and places like fxcm & dailyfx market makers? Don’t tear me to shreds if I’m wrong!

There’s been lots of arguments on here regarding the pros and cons of certain companies, but no-one has really stated who they’re using at the moment and why.

Also, can anyone provide information about the margins and account values required, who offers the minimum etc and how these compare between market makers/brokers.

Sorry to sound dumb, I’m getting to grips with the technical aspect of trading, but it’s the ways and means of placing the trades (i.e. who with!) that I need to figure out.

Lastly, if I can be pointed in the direction of a good site that offers a virtual account with live feeds to practice, I’d be grateful.

 

[Dave1971]

Spreadbetting is a completely seperate proposition to trading through a broker. You do not buy or sell anything, but bet on whether the price of you chosen instrument will be above or below a given range (the spread) over a given time frame.

The advantages are flexibility and low stake size. Most of the main SB companies offer a virtual account for you to practice, and they have fairly clear guides as to what spreadbetting is and how a trade is executed.

Most SB's are fairly alike in terms of service and price, so have a look at a few and see which you are most comfortable with.

Dave

 

[Gibblin]

thanks for your reply. so brokers are simply a go-between? why would anyone bother using a broker when they can go direct?
also, i'd love to find a definative list of online companies , something like a who's who's guide and what they offer (in terms of margins etc). any ideas?

 

[starspacer]

Brokers/SB Companies

Gibblin

You might want to try http://www.finspreads.com They allow very small trades (1p per bet upwards, I believe). This will allow you to trade small, but still have real money at stake.

Once you feel comfortable with your trading style, you might want to take a look at http://www.capitalspreads.com or http://www.dealforfree.com for possibly tighter spreads.

The above companies are spread betters. This offers you tax free profits.

If you want to try direct trading, take a look at the boards on T2W as these have plenty of information to help you make the best choice.

Good luck

 

[fx globe trotter]

I just found out that GFT also has smaller trading lots. See thier press release they sent out Friday...

Press Releases
GLOBAL FOREX TRADING INTRODUCES BASE 10 TRADING™

August 26, 2004 - ADA, Michigan - Global Forex Trading has introduced Base 10 Trading™, a new forex trading product that offers traders an alternative to forex mini accounts that are typically 1/10th the size of the standard trading lot size of 100,000 units.

"Base 10 Trading™ is perfect for people looking to trade forex in smaller amounts without having to worry about the inherent problems associated with minis," said Gary L. Tilkin, president and CEO, Global Forex Trading.

Base 10 Trading™ allows traders to structure trades according to their risk–tolerance levels by having the ability to adjust the size of their trading lot to any multiple of 10. Variable lot sizes significantly reduce the margin requirement freeing up more trading capital for drastic market moves, taking additional positions or holding positions longer.

With Base 10 Trading™, each lot can be set to any multiple of 10—from 10, 1,000, 15,010…100,220, 110,030, 150,010, 225,050 and 62,090. For example, a trader may wish to buy EUR/USD in a volume of 15,010 instead of the standard lot size of 100,000 units.

The minimum amount to open a GFT account remains the same ($2,500 to open) so traders are capable of utilizing a larger equity to maintain a position in the forex market. A forex mini account, on the other hand, typically requires little equity to enter the market while increasing the likelihood of liquidation when a position goes against a trader and reducing the amount of trading capital.

Base 10 Trading™ is an additional product from GFT that delivers the flexibility and serious control forex traders need and is only available from GFT.

To learn more about Base 10 Trading™, visit http://www.gftforex.com/products/base10.