Forex Trading News

Negative carry is a situation where holding an investment or trade costs you more than the income it generates. This concept is important for investors and traders to understand as it can hugely impact their overall returns and portfolio performance. It’s especially relevant in futures and margin trading, but has various other applications as well. […]

Academic papers can be a great way to not only learn, but also derive trading ideas. For example, in this article, we’ll consider the following paper and how we can derive insights and trade ideas from what’s written: The Term Structure of Covered Interest Rate Parity Violations   Key Takeaways – How to Turn Academic […]

Trading is largely a process of making mistakes and learning from them to get better. Unfortunately, of course, these mistakes can be very costly. As such, trading can be risky. But risky things are not inherently risky if they’re understood and controlled for. For example, flying an airplane is very risky if you don’t know […]

Foreign exchange (FX) trading is not an easy game, with various factors influencing the movements of global currencies. One such factor is the economic status of a country, specifically, whether it is a creditor surplus country or a debtor deficit country. This article looks at the characteristics of these countries and how their respective statuses […]

Many traders rely on support and resistance levels to chart price movements and predict buy or sell signals. However, the effectiveness of this technical analysis strategy is a subject of debate. We’ll explore the broader question of whether support and resistance levels work.   Key Takeaways – Do Support & Resistance Levels Work? Limitations of […]

Designing an algorithm for predicting exchange rates involves a series of steps that integrates knowledge in finance, economics, math, programming, and machine learning.   Key Takeaways – How to Design an Algorithm for Predicting Exchange Rates Incorporate Relevant Variables: Include key macroeconomic indicators like interest rates, inflation, GDP, and political stability, as they all influence […]

Currency risk premium refers to the additional return a trader or investor demands for holding a currency that may depreciate against their home currency. This concept is important in international finance and investing. The risk premium is influenced by various factors:   Key Takeaways – Currency Risk Premia Currency risk premia reflect the potential return […]

Currency overlay is an investment strategy employed by institutional investors to protect their portfolios from currency fluctuations. The currency overlay manager first identifies the currency risk exposure of the portfolio, and then enters into currency hedging transactions to offset that risk. Currency overlay can be used to hedge both: currency risk arising from investments denominated […]

Forex broker, Skilling, has introduced around-the-clock trading on popular currency pairs, providing weekend trading opportunities. Key Takeaways 7 currency pairs can now be traded over the weekend: AUD/USD, EUR/USD, GBP/USD, NZD/USD, USD/CAD, USD/CHF, USD/JPY. Weekend forex trading is available on the Skilling Trader, MetaTrader 4 and cTrader platforms. Forex spreads are competitive, starting from 0.1 […]

There are many options pricing models with complex mathematical foundations and variables that go into determining what an option is worth. But in terms of the big-picture intuitive understanding of an option’s value is, it really boils down to two main factors: the probability that an option will be in the money (ITM) by expiration […]