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Investing in Currencies?

Investing in Currencies?

Postby macbeth » Tue Apr 16, 2013 9:25 pm

1. Is this a good idea?
2. Is there a website to track the lowest currencies?
3. How do you know when the value of their money will eventually go up?
4. What is the best currency to invest in right now in your opinion?
macbeth
 
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Investing in Currencies?

Postby adolf2 » Tue Apr 16, 2013 9:36 pm

1. Probably not a good idea for a newbie right now. Things are incredibly chaotic and volatile.

2. I'm not sure what you mean by "lowest currencies?" They're not having a fire sale.

3. You don't, ever. Nobody does. We use technical analysis and indicators to give us a small edge, then use good money management and stops to protect against a huge loss if we're wrong.

4. There is no such thing as a "best" currency. What would you choose as the best stock or best art painter or "best" color? It depends on so many things, we can't list them all.

Open a demo account at any online forex brokerage and trade a simulator while you learn. I actually prefer trading forex futures and the NinjaTrader platform at Amp Futures, but I also trade the cash/spot market on a separate machine with FXCM. Both of these platforms have a demo mode.

http://www.ampfutures.com/index.php
http://www.fxcm.com/
http://www.ikonfx.com/accounts/demo-account
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Investing in Currencies?

Postby baran38 » Wed Apr 17, 2013 3:39 am

First off, you don't "invest" in currencies any more than saying that you are keeping your money in the bank in the US is investing. Why would converting your money to swiss francs and keeping it in a swiss bank constitute investing anymore than putting money in a US bank. People generally trade currencies.

Second, currencies just don't move that much and there is always a "mean reversion" in their movements because of purchasing power parity. The vol on a major currency is about 8%/year which is just not that great. Further, there is really no reason why a hamburger ought to cost a different amount in Yuan, USD, CHF, and Yen. That means that there are breaks to currency movement because if prices get way out of line in one currency then there are all manner of auto-correcting capital movements that happen to bring them back in line.

Third, if you invest in a currency, you generally change your currency into that currency and put it in the bank somewhere. There is this huge theory called uncovered interest rate parity that says you should expect your return including both interest rates and currency appreciation/depreciation to be the same no matter which currency you choose.

Fourth, you "invest" in currencies by using currency derivatives if you are at all smart about it. The daily volume of currency derivatives is more than the entire capitalizatio n of the NYSE. That means it's a really efficient market and your chances of beating it are infinitesimal.

So,

1. Nope.

2. There are all kinds of FX trading sites. You will just lose your money there.

3. Lots of study. It's a hard and competitive game.

4. USD for the near to intermediate term
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Investing in Currencies?

Postby hulbard » Wed Apr 17, 2013 4:39 am

horrible idea for a novice, forex accounts are dangerous even for seasoned pros
hulbard
 
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Investing in Currencies?

Postby bartolomeo » Wed Apr 17, 2013 6:32 am

I wish I have answer to these I am looking for one myself-goodluck
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Investing in Currencies?

Postby elvey » Wed Apr 17, 2013 6:39 am

Joey, has hit right on the head. Who is your advisor anyway? Please don't waist your money this way.
elvey
 
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Re: Investing in Currencies?

Postby setkewi » Fri Apr 19, 2013 12:22 pm

It's good to invest in forex trading. Forex trading is good for those who have good knowledge and experience. Forex trading depends on knowledge, skills and strategies used by traders.
setkewi
 
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They go back to school to get more

Postby denig » Mon Feb 24, 2014 4:41 am

They go back to school to get more specialized skills so they can earn more money
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