Frequently Asked Questions
Here you can find answers to general questions about our company.
What is “FOREX”?
The international currency market of “FOREX” (Forex, Foreign Exchange Market) — is a set of operations on foreign currencies purchase and sale.
Where is the international currency market of “FOREX”?
“FOREX” has no concrete location for tendering. Transactions between bidders are carried out by means of the Internet, thus one party can be in Europe, and another in Asia.
Who are the main participants of the currency market?
Key participants of the currency market are the central and commercial banks, investment funds, broker companies, dealing centres, and also individual traders.
Who is a Market maker?
Market makers (from English market maker, the founder of the market) on the currency market — it is the companies which accept risks. They own a certain quantity of currency for trade maintenance on it, even when the market is illiquid.
Who is a broker?
The broker (from English broker, the intermediary at the conclusion contract) — is the company or the legal entity, the professional participant of the market, who has the right to make trade operations at the request of the client and at his expense or on his own behalf and at client expense on the basis of onerous contracts with the client.
Who is a trader?
The trader (from English trade, trade) — is a person committing operations on the currency market. He earns on the rate fluctuations of world currencies. The essence of the market participant activity consists of the information analysis, forecasts creation and transaction at the necessary moment. The key to success of the trader — the knowledge of bases of the fundamental and technical analysis, rules of capital management, the main aspects of exchange trade psychology.
At the expense of what a trader earns?
The principle of the trader's work on the currency market is simple. To earn, it is necessary to buy currency cheaper, and to sell more expensive or vice-versa. The advantage of the FOREX market before other financial markets is — here it is possible to earn both on the market growth, and on its falling.
What are the most commonly traded currencies on “FOREX”?
The main currencies on the currency market are US dollar (USD), euro (EUR), Japanese yen (JPY), British pound (GBP), Canadian dollar (CAD), Australian dollar (AUD) and Swiss franc (CHF).
How much can a trader earn on currency fluctuations?
Everything depends on the desire of a trader and how much time and effort he is ready to devote to work on the currency market. As many professionals' experience shows, it is real to earn 100% a year and even more on the “FOREX” market.
“FOREX” — is it something like a lottery?
The international currency market is not a lottery where it is worth relying only on an occasion. For success achievement it is necessary the knowledge which can be gathered from books, subject magazines, Internet resources, and also at webinars, seminars and courses which are held by experts. For successful trade on “FOREX” it is necessary to study the principles of work and bases of the currency market analysis. The insufficient level of knowledge and qualification of the trader can lead to losses.
What is better to begin with?
Begin with the examination of schedules, analyze, and carefully follow trend changes. Constantly be engaged in self-improvement — study subject literature. To trade it is better to begin with a demo account. However many professionals hold to the opinion that work on a demo account doesn’t give a complete image of real trade on the FOREX market and therefore it is better to begin with small, but the real sum on the real trading account. So it is up for.
What education should a trader have?
On the FOREX market your diploma isn’t important. As practice shows, the one who really aspires to achieve success only. The main thing is your desire to master currency trade, and you will be able quickly to learn all necessary things, because today a trader has an opportunity to use the mass of free educational resources to gain necessary knowledge and skills for trade on “FOREX”.
What is the hedging?
Hedging (from English hedge, an insurance, a guarantee) — this insurance of risks of the price changes. It is carried out by the conclusion contracts on the forward markets. The first operations with futures were put into Chicago with the purpose to protect goods from sharp situation changes on the currency market. The mechanism of hedging consists of obligations balancing, i.e. opening of counter positions on currencies purchase and sale.
What is the spread?
The spread (from English spread, a difference) — is a difference between the offer on currencies purchase and sale. The spread — it is that broker’s earnings on the transactions of clients.
What is the warrant?
The warrant — is the order, arriving to the broker from the trader on the currency sale or purchase at a determined price. The warrant works till the execution or cancellation, so the trader at any actions with warrants needs to wait for the confirmation of such actions from the broker. Important elements of trade on “FOREX” — warrants “take-profit” and “stop loss”
What is the “stop loss” and “take-profit”?
The “Stop loss» warrant (English stop loss) — is the order under which the position is liquidated at the specified price automatically. This warrant is the tool limiting losses in situations when the market goes against the trader.
The “Take-profit» warrant (English take profit) is an order which is intended for profit fixing on an open position at the determined price achieved by a financial instrument. This warrant is the tool for timely fixing of the profit — until the moment that the market will develop in the adverse direction for the investor.
What is the leverage?
Leverage is the ratio between the mortgage sum and volume of the carried-out transaction. For example, the leverage 1:100 means that for carrying out the trade operation it is necessary to have on the trading account the sum 100 times smaller than an amount of transaction.
What is the quotation?
The quotation is the cost of one currency in terms of another on a certain time point. It is the most concrete dimension, unlike the exchange rate.
Are the quotations identical on demo and on the real account?
The EXO Trading company adheres to all rules and values the clients therefore on any type of the accounts. All quotations are identical, which guarantees our success.
Where are quotations taken from and what the concept “quotes flow” means?
Market quotations are formed on the basis of supply and demand. Bidders for obtaining necessary data use news agencies Bloomberg, Electronic Broking Services (EBS) and etc.
What is the Bid (Bid) and Ask (Ask)?
The Bid is the demand price that is the price at which the client is ready to buy a certain currency. In the quotation it is always specified on the left.
The Ask is the offer price that is the price at which the client is ready to sell a certain currency. In the quotation it is always specified on the right.