A Comprehensive Guide to Forex Trading

Understanding the world of investments and trading can be daunting, especially with various options like stocks, bonds, and real estate. But one type of investing stands out from the rest, which is Forex trading. Known as foreign exchange, Forex is the world’s largest financial market.

Before diving into the depths of Forex trading, it is essential for any potential trader to grasp the basic understanding of what Forex or foreign exchange is. Forex refers to the global marketplace for trading the world’s currencies. Unlike the stock market, which has a centralized exchange, Forex trading takes place over the counter (OTC), meaning trades are conducted via a network of computers, rather than on a centralized exchange.

One of the main characteristics of Forex trading is its immense size. The daily trading volume of this global market typically exceeds 5 trillion dollars, making it the largest and most liquid market in the world.

There’s a wide variety of participants in the Forex market, from central banks and multinationals to independent individual traders. Various factors such as macroeconomic data, geopolitical events, and market sentiment can lead to currency fluctuations, hence potential trading opportunities.

What is trading in Forex like? A typical Forex trade involves the buying of one currency and selling of another. These currencies are traded in pairs, like the Euro versus the US dollar (EUR/USD), the British pound versus the US dollar (GBP/USD), or the US dollar versus the Japanese yen (USD/JPY).

Traders participate in Forex trading with an aim to profit from the changes in currency prices. The goal is to predict how the price of one currency will move against the other.

One remarkable aspect of Forex trading is its accessibility. With an internet connection and a computer or mobile device, anyone can enter the Forex market. This has opened up a world of opportunities for individuals around the globe to participate in the financial markets.

Moreover, the Forex market operates 24 hours a day five days a week. This means that an individual can trade any time that suits them, regardless of their time zone. This flexibility is one of the main reasons why Forex trading has gained popularity among individual traders.

However, despite the potential for earning profits, trading in the Forex market should not be treated lightly. Without a proper understanding of the market, trading strategies, and risk management, a trader could suffer substantial losses. The Forex market is not only known for its high liquidity and 24/7 operation, but also for its high risk.

Therefore, it’s essential for beginners to use demo accounts to practice trading and to acquire the necessary knowledge before risking real money. Proper education, careful planning, patience, and discipline are the keys to success in Forex trading.

In conclusion, Forex or foreign exchange trading is about buying and selling currencies to extract profits from fluctuations in their values. With the right preparation and mindset, any individual can potentially take advantage of this vast and dynamic market.

The rise of a digital technologies requirement in the post-Covid-19 world implicates that most industries are either already affected or will be affected by the technological revolution. Talking about the finance industry, investors, brokers, etc. have already adopted technology to stay relevant in the changing world. This shift has triggered stock trading app development, with apps likeE*TRADEandRobinhoodleading the fintech market space.

As per a report by Statista, stock trading apps have an awe-inspiring penetration rate. In 2019, Android finance apps penetration stood at 25.75%.

What are Stock Trading Apps?

In general, the purpose of websites and mobile apps is to make a product or service delivery convenient for digital-savvy customers. Like many other industries, the finance industry has also decided to reap the benefits of mobile technology. Among other digital transformation activities, the brokerage companies figured a way to automate their traditional trading system via Stock Trading Apps.

The brokerage companies and startups like E*TRADE were right about their desire to democratise the stock trading market. Stock trading apps allow traders and investors (including individuals) to conduct all sorts of transactions in the stock market whenever they want. These apps allow users to manage their portfolio without having to pay a commission to a broker. This eased-out opportunity to invest has built people’s interest in stock trading.

The year 2020 has seen record demand for digital trading mobile apps. While the United States saw massive unemployment, the stock market, on the other hand, wasexperiencing growthbecause people saw trading as a way to make money. In June 2020,Robinhood realised its highest trading volumeever. Not only Robinhood, but even TD Ameritrade alsoreported record tradesduring the second quarter of 2020.

Best Stock Trading Apps

Robinhood is a stock trading platform that allows users to invest in stocks and ETF funds without charging any commission. The app caters to both beginners and seasoned trading pros. The platform provides users with the ability to compile personal lists of financial credit documents and security papers and know real-time information about quotations. The company’s monetisation strategy includes accumulating interest from the user accounts.

E*TRADE is a subsidiary of Morgan Stanley. The E*TRADE mobile app is an electronic trading platform that allows users to trade financial assets, including preferred stocks, common stocks, exchange-traded funds, futures contracts, mutual funds, and fixed-income investments. The users won’t have to pay any charges for US-listed stocks, ETF, and options contracts. However, some services are chargeable. You can find thepricing details here.

eTorois a social trading platform that allows users to not only invest but also communicate with renowned traders. The app is considered to be the original idea for stock market app development. The eToro application is beneficial to people who want to learn about stock market trading while earning at the same time. eToro users can do Stock and ETFs trading, CFD trading, and invest in cryptocurrencies.

StockTwitsis a social media platform where investors, entrepreneurs, and traders can share their views or ideas. The company was founded in 2009 by Soren Macbeth and Howard Lindzon. Though the company started with a simple app built on the Twitter platform, it is the first to organise conversations using cashtags (i.e., $AAPL). Since then, it has grown its social network of professionals from the investment domain. Currently, StockTwits has more than 3 million registered users and audience.

Stock Trading App Monetisation

In early 2018, E*TRADE had over 3.7 million accounts, and Robinhood had 4 million. Both of these fintech institutions have been trying to prove that the conventional methods of fintech app monetization, such as collecting interest on customer deposits, are not the only way to make money from stock market apps.

An online stock trading app can also make money by offering premium memberships to the customers. The idea behind this is that some of the several million users will be ready to pay a premium to get access to the premium features that the software has to offer. The premium memberships unlock the advanced potential of the online trading platform for the users.

To help you understand the premium membership model for monetising the stock market app, we can take the example ofRobinhood Gold. Robinhood Gold is the premium way of interacting with the stock market. It opens up the possibilities of the platform to allow users who have a minimum balance of USD 2k to access extended-hours trading, trade on margin, and many other features.

Must Have Features For Your Stock Trading App Development

1. Simplistic Customer Onboarding.It is problematic for many stock market app developers to keep the customer onboarding experience simple yet secure and compliant. The KYC, data privacy, AML, and other regulatory compliances make it necessary for the fintech companies to follow norms. The customer sign-in process can be made simplistic via the phone number, email, and social sign-in options such as Facebook, Google, etc. However, there will be a need for ID verification for KYC, which can be done after sign-in. The app must support Touch ID for authentication; it will keep the user-experience simple & secure while making authentication less-frustrating.
2. User Profile Page.It is crucial to provide the user with the ability to modify necessary information about them. The information user profile page often contains personal data.
3. Trading.This is the key feature for your stock trading app development process, and therefore, you should give this feature your most attention.
4. Payment and Transactions.This feature enables users to make payments and monitor their flow of funds.
5. Newsfeed.You would be surprised to know that a newsfeed is a crucial part of the stock trading app development. The stock market is very prone to both local and global economic and political environments. For example, if a famous food chain brand has been alleged of doing something wrong, their stocks are very likely to fall. The investors make buying decisions based on such information. The feature should import news from multiple reliable sources such as news agencies, and also, the user should have an option to pick the type of news they want to be notified about.
6. Portfolio Management.The user should be able to track their portfolios in real-time within your stock trading app. The feature should be equipped with filter options to make the search and analysis easy for the users. Also, you should include total investment, capital gains, etc. within this feature.
7. Quote Monitoring.It is essential to provide the users with an ability to see and control the quotes in real-time.
8. Flexible Search.Every app has a search option but having a flexible search feature is a stand-out feature for your stock trading app development. It makes sure that users get relevant information, even if their search term is wrong or not available.
9. Advanced Analytics.Data is not easily understandable when it is just listed in text format. Users will appreciate it if they get an opportunity to observe the statistics in charts and graphs. Hence, it becomes crucial to include advanced analytics in your stock trading app development process.
10. Sort and Filter.While accessing your app, users get a list of stock options that they can trade-in. It will help the users if your app provides them with a sorting and filtering system, by which they can quickly go through their favorite stock options.
11. Personalised Notifications.And last but not least, a must-have feature for every app: personalised notifications. Yes, notifications that are personalised as per the user’s behaviour and preferences. Look, people stay with their mobile devices all day, but it doesn’t mean that they’ll open every notification that you push to them. Sometimes, sending too many irrelevant notifications causes app abandonment, which I’m sure you won’t want. Hence, to improve user retention and satisfaction, you should personalise the notifications using customisable preferences orAI & ML technologies.

How To Develop A Stock Trading App?

Here, I won’t be talking about the general mobile app development process; I will take you through what needs to be done for stock trading app development. If you’re interested in knowing the general mobile app development process, you can read out my recent blog post here –Understanding The Mobile App Development LifeCycle

Know the difference between a Mobile Site and Mobile App

If you’ve already decided to create a mobile app, you don’t need to read this and can skip to the second step. However, people need to understand the difference between a mobile app and a mobile site before getting started on the stock trading app development process. Going mobile will leave you with two options:

A Mobile Site.If you already have a website and are short on budget, you can consider going for a mobile site. Building the mobile version of your site will eliminate the need to create a new Android and iOS version, since mobile sites will work on all mobile devices. However there are downsides with this option. Due to a lack of push notifications, sites do not have the same level of user engagement as mobile apps.

A full-fledged mobile app.Undoubtedly, having a mobile application is a boon. There are tons of useful features (key features are mentioned above) your app can have, which aren’t possible with mobile sites. Mobile apps help to build brand image and customer loyalty by improving service delivery.

Indeed, the mobile app is the best option in current times. So, I would recommend you to pick a mobile app strategy when embarking on your stock trading app development.

Choose the Mobile Platform

It isn’t essential to develop your stock trading mobile app for both Android and iOS. Depending on your region of operation, you can search for data about which mobile platform/OS is used by most of your target audience.

Apps like E*TRADE is compatible with both the mobile platforms because their target audience relates to both the mobile operating systems. If budget is a major concern for you, I suggest you start small and test your beta app on the platform where most of your target customers are.

Also Read:Native vs Hybrid App Development – How Hybrid Wins the Game?

Know Compliances For Your Niche

Every industry has some common as well as unique regulatory compliances for digital companies. These regulations and compliances are related to data security, consumer protection, money laundering, etc., and will vary as per political boundaries. However, I’ve created a list of fintech compliances that will help you understand what should be taken care of. Read it here:Fintech Business Compliances – An Overview

Design the Trading System

The majority of the target user base of a stock trading mobile app is highly educated and has less or no time to waste. Hence, it becomes critical to design the stock trading app in a way that justifies the purpose. The following factors should be taken into consideration during the designing phase of the stock trading app development process:

• It would be best if you started thinking about the user interface and experience of your trading app at the stage of idea formation and requirement documentation.
• When your designs are ready, you should perform usability testing. It is the only chance in your app development lifecycle to ensure that the app is consistent with the original plan.
• It would help if you worked along with your app designer so that your app UI/UX facilitates the process of stockbroking. However, the designer will first design wireframes and then create a prototype for your app.

Also Read:How To Do User Experience Testing – 10 Methods and Tools

The Development Phase

Once you have clarified your requirements and have the app design ready, it’s time to jump straight to the Stock Trading App Development. Every stock market app development phase has three stages:

1. Mobile Development.To develop your stock market mobile app, you would require help from Android and iOS developers. Your iOS developers will need to be familiar with programming languages such as Java or Swift, and the Android developers will know C# or Kotlin. Of course, there are other language options as well; I’ve just included the best examples.
2. Backend Development.For your stock trading app development, you will also be required to hire a backend developer. A back end developer is a specialist who deals with server technologies, including software architecture, database management, and software logic. The developer uses programming languages such as PHP, Ruby, Python, Net, Java, along with MySQL, SQL, and Oracle to ensure the proper functioning of server and database. In simple terms, the backend developer is the one responsible for creating sign-in, alerts, transactions, and other sorts of features.
3. Frontend Development.The front-end part of the stock market application app development includes designing mobile apps and web interfaces. Web interface design will only occur if you’ve decided to build web-interfaces for your stock trading platform. The front-end developer will know programming languages such as HTML, CSS, and JavaScript. The developer will also learn how to work with different frameworks such as Bootstrap, AngularJS, and libraries like jQuery.

During the development phase, apart from the developers, you’ll need a project manager, a graphic designer, and a QA engineer as well.

Cost of Stock Trading App Development

The cost of any software development directly depends on the time required for the development. Based on our experience of developing fintech apps, the time needed for stock trading app development is as follows:

• Environment Setup and App Design: 10 – 18 Weeks
• iOS development: 21 – 40 Weeks
• Backend development: 12 – 20 Weeks
• Admin panel development: 2 – 5 Weeks
• Production and final release: 1 Week

Total time required for Stock Trading App Development: 5-8 months (some of the steps above will be completed simultaneously)

Considering 40 working hrs per week, the total working hours required will be 1840 – 3360 hrs. Therefore depending on your requirements, a rough estimation for themobile stock trading app development cost will be $60,000 – $90,000.

The stock trading software development cost will be less as these are web only platforms, and not designed for mobile use. The cost of stock trading software development is roughly $50,000 – $70,000.

The per-hour development cost for IT professionals varies as per their geographical location. For example, according to a survey by Codementor, in the UK, the average hourly rate IT developers charge is $63. However, Nimble AppGenie charges 25-40 USD per hour for fintech projects.

The foreign exchange market is a 24-hour market where currencies are traded from all around the world. The forex market is engrossed by lots of traders who trade on the fluctuations of the currencies to each other.

The foreign market functions between brokers and banks, individual traders who are represented by a broker and between bands. Investing in currencies involves risk like other investment methods and especially when the economy is volatile, but forex trading is so popular because of the leverage it provides to the traders. In forex trading, traders are not bound by any limits which are imposed by the SEC (Securities and Exchange Commission). This means the traders can take advantage of heavy leverage from it.

Here in this article, you will learn about the different ways through which you can invest in the currency market.

1. Multinational Corporations

A lot of shareholders participate indirectly in the forex market via their holding in companies that do considerable business in foreign countries. Some of the most popular companies that have overseas exposure are IBM, Amazon, McDonald, Walmart, Coca Cola, Dunkin Donuts, Domino’s, Nike, Toyota, Lego etc.

The profits and revenues acquired from foreign countries are magnified if the foreign currency increases in value against the dollar. It is because those profits are changed into dollars for the purpose of financial reporting. So, a more powerful foreign currency will generate more dollars in exchange.

1. Standard Forex Trading Account

You can open a standard forex trading account with a well-reputed, and trusted broker like Oinvest and trade currencies from all around the globe. There are many variations in how the forex market works as compared to the U.S stock market:

• There is no regulatory authority over it, and it is not a regulated exchange.
• Currencies are traded in pairs if you are trading one currency will go down (short), and the other currency will go up (long).
• There is no uptick rule for taking short positions.
• Currency brokers often make money through spreads and swaps instead of commissions.
• There is no upper limit for your position.

1. Foreign Bond Funds

There are a lot of mutual funds that put money in foreign government bonds. These bonds draw interest denominated in the foreign currency. If the foreign currency goes up compared to your currency, then the obtained interest swells when that currency is changed back in your currency.

Some examples of these types of mutual funds are Templeton Global Bond Fund, Merk Hard Currency Fund, and Aberdeen Global Income Fund.

1. ETFs and ETNs

ETN is exchange-traded notes, and an ETF is exchange-traded funds. Both ETFs and ETNs are traded like shares. And it can be a way to invest in foreign currencies without directly investing in forex.

By opening a standard trading account, traders can buy ETFs, and through that, they can get access to currencies. Some examples of such ETFs are UUP, ProShares UltraShort Euro, the Invesco DB US Dollar Index Bullish Fund, or EUO etc.

Exchange-traded notes (ETNs) are very much similar to corporate bonds. And they have the same exposure to the forex market that ETFs have.

1. CDs & Savings Accounts

EverBank, now known as TIAA Bank, provides a WorldCurrency certificate of deposit (CD). In certain countries, this CD makes interest at local rates. CD also provides a forex trading account which works like a money market account and enables the transfer of money between major currencies.

The CDs are dependent upon the exchange rate movements, but it provides a much higher interest rate than a dollar-dominated certificate of deposit. When these CDs get matured, the trader will get back less dollars than he has invested if the dollar becomes stronger compared to the foreign currency.

Bottom Line

In the currency market, the currencies are influenced by economic, geopolitical and events around the world. At this time, access to the currency market is so easy as any trader can invest in it through a standard trading account and an internet connection.

As every serious trader knows Forex trading strategies are an essential part of Forex training. They range from reversal through to continuation strategies with each one having its own specific set of rules, entry and exit points. Knowing how these Forex trading strategies work and when they are most likely to fail is a core element of the learning process for any aspiring new trader.

Another crucial element of Forex training is the notion of support and resistance. They re defined as follows:

Support – a price area where a horizontal line is drawn connecting two price hits which have bounced in the upwards direction. Market price is decreasing when suddenly it starts to pull back upwards. It then decreases again with another pull back at the same price level as the first one. The horizontal line that connects the two pull back price points is called the support line. The line literally creates support for that particular price level.

Resistance – a price area where a horizontal line is drawn connecting two price levels which have bounced in the downward direction. Market price is increasing thus moving upwards; but suddenly it starts to pull back in the downwards direction. It then reverses back into the original upward direction only to pull back downwards at the same price point as the first one. The horizontal line that connects the two price points is called the resistance line. It creates a resistance point at which the market cannot continue upwards.

The reason why it is crucial to know about support and resistance is because they can drastically slow down your profits or even reverse your Forex trading strategies back to create a loss. The point is that there is a reason why there is support or resistance at a certain price level. It does not matter what this reason is. What is important is that traders respect it as a potential profit stop. So, if a profit target is 30 pips but there is a heavy support/resistance line blocking the way at 25 pips, profit should be taken at 25 pips. If orders are left to fight the support/resistance lines you are simply hoping for the best. You may get through some of them but in the long-run it is not worth the wait.

Another factor to bear in mind is that support can become resistance and resistance can become support. For example, as price breaks through resistance whilst moving upwards it is very common to see the price pull back to the line it broke through originally and bounce back upwards as a result. In this manner historical resistance has now become new support. The same can happen in the other direction.

In summary, it pays to be extra careful when support or resistance lines are apparent in the market when Forex trading strategies are being used. It is common for a trader to lose faith in his/her strategy when they see it bounce from this horizontal line simply because they haven’t studied it in their Forex training. In this instance it is not the strategy that is at fault, it is the lack of knowledge.

Trading Education – Learn Automated Forex Trading

by

kevin lie

Choosing the appropriate time and place to invest money becomes very hard when living in a world undergoing a financial crisis. When investing precious money in a marketplace worth multi-trillion dollars, the question on everyone’ mind is “Can I make money from Forex trading or even automated Forex trading software?” Well, a simple answer to this question is yes.The proper research and study of the functionality of currency trading including the Forex automated robots has proved that this method is profitable.

Automated forex trading is currency trading by using what are commonly called ‘robots’, also known as “Expert Advisers”, to run the open accounts that the investor has in the market. These robots have their place in many successful and profiting investments, it helps if the investor has some Forex education and is mentality capable of using such a massively rewarding but a horribly punishing system of investments. When dealing with any broker, the investor should use a certain trading platform like the meta 4 platform which is the most widely used. It is considered a very advanced program that makes Forex trading to be very easy with its own set of graphs and tools. These set of tools enable the investor to create his own trading robot or better still just download a prebuilt robot and install it on your PC. Then it’s just a matter of letting it run, it does everything automatically, turning the investor’s PC into it’s own little trading machine. Something that is often overlooked is that automated forex trading software can help add skills to even the best of forex traders. There are tests available and various simulations that you can do with the software to help you tighter up the areas that you may not be very good at. You will find that time and time again, getting good forex training is mentioned in becoming a successful currency trader, and this is just another step on the path of becoming completely educated in the process of currency trading. Now if you are suing the automated forex trading software, you will need to keep your eyes on a few situations to make sure you don’t take a hit in the areas that the software falls short in. One of these is the software’s inability to adapt to sudden news that will make the market fluctuate unexpectedly.This is an area where people are most likely to lose money because the information that the software is using as its database, may not be the most current. When that happens, the user is going to have to be on top of the situation and recognize this trend and compensate for the software.

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So, you’ve decided to dip your toes into the world of trading, and you discovered that there are so many different ways to learn it. You may have even found out that it would be much smoother when coupled up withonline mentoring.Why consider getting a mentor and what sort of advantages come with them helping you learn to trade? Here are some of the big reasons that you may want to seriously consider this option and see if this learning method is a good fit for you: You Get Real-Time ExperienceYou’ll benefit from an ongoing market analysis and experience by being in direct contact with a senior trader who is analysing the market weekly. By seeing what the experts are doing, you will get exposure to a higher level of analysis while comparing them to yours, which will help you understand your mistakes and improve on them. As a result, you will come out of these sessions, feeling more confident and feeling like you have a better grasp of trading. It Will Help Traders Improve Their Trading Performance.City Traders Imperium offers weekly webinars discussing various topics on trading psychology to help traders improve their overall trading performance that is usually due to their lack of discipline and understanding of themselves as traders. City Traders Imperium does this over a12-month membership programmebecause they believe that trading is a journey, and bad habits take time to change. So, by having weekly lessons on topics, such as risk management, trading psychology, combined with offering weekly market review and analysis, it will help traders to become profitable through integrating the psychological part of their trading into their technical analysis. Potential Future OpportunitiesOften mentors think beyond the scope of a trading course; they seek to train beginners up to expert level with the view of recruiting them within their own trading business. As such, you may find yourself with the opportunity tostart your FX trading careerin a way which is mutually beneficial for you and your mentor. Online Forex mentoring, particularly when it’s individually customised like what City Traders Imperium offers, can do a lot of good and help you to work out what it is that matters most for you and how you want to accomplish your goals. It could take time, but it can help you get a meaningful foot in the door in the FX trading industry upon completion of the programme.

Best Forex Trading Education

by

Ricky Lee

There are many forex trading courses and educational material that a person can find online. However how does someone go about finding the best Forex trading education information? Certainly there are huge amounts of information that will educate you about Forex trading, but not all of it will help you to achieve your goals of making a profit rather than losing.

Below are some guidelines which should help you to find the best forex trading education course Point 1 – Avoid Day Trading Systems Many people when starting out in Forex trading will be enticed into thinking that the best way of making money is through day trading. Certainly if you were to ask a person who is selling a Forex trading course for details relating to their real time track record with regard to profits relating to day trading they will not be able to provide one to you. So if you are looking to produce an income from your trading then do not waste your time on day trading. Point 2 – Real Time Profit Records When buying any sort of forex education course, you need to be provided with these records. If a person selling their system does not have confidence in the abilities of their system and are not investing their own monies then why should you. Unfortunately some of these courses being offered online today are from people who have either never traded in their lives or have failed when they have used the system themselves. Point 3 – Understand It Once you find a forex trading system which either has a track record or is willing to show their real profits then there are some other things which you will need to take into consideration. It is important that you learn everything you can about the system in question so that you understand it completely. Unfortunately if you have no understanding of how the system works then you will not have the confidence to trust in it and follow the system through to a likely conclusion if you start to suffer losses. By keeping these points in mind, you will find the best Forex trading education that is suited to your kind of personality. There are literally hundreds of places on the web that can offer you an education as well as free advice on Forex trading so do some investigating and you will soon find one that is ideal for you.

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