An Introduction to Currency Option Trading

By Clint BTrading a currency option is another way to create earning opportunities. It allows you to trade in whatever amount and whatever cost you desire. This sounds high risk but the potential of earning huge amount of money is likewise high.
Currency option trading is a popular forex technique that enables you to buy and sell existing right to buy and sell foreign currency. This option is not available to everyone because the process is a bit complicated and it takes time to master the strategy.
An Option is a contract in which the buyer, also called the owner, is given the right to buy or sell an asset at a definite price within a determined timeline. The asset can be currencies, stocks and commodities.
The newest trading currency option involves preference of a particular date at which you anticipate changes in the currency value of the asset. Unlike foreign exchange trading, what the investor is buying is the option to trade currency and not the foreign currency itself.
The process of currency options starts by choosing a currency pair such as USD/EUR, GBP/JPY, USD/CHF and USD/CAD. Depending on your expectation on the currency value or rate of each pair, you may opt to buy either a call option or a put option.
You will have to choose the call option if you suspect that the market price of the asset will likely to increase over and above the strike price. The strike price is the value at which the currency option is traded. Choosing the call option will permit the owner to buy the asset in a lower price than its current value.
If you believe that the market price will plummet, then you have to choose the put option. This option will allow you to sell the asset at a higher strike price than the present price.
The next step is to decide an expiry date. The option you have chosen may expire at the nearest closing hour or probably at the end of a day, week or month. It all depends on how you analyze the currency rates in relation to your chosen expiry date.

The last step of currency option trading is to determine the amount you are willing to invest and then wait for the expiry date. The option you made whether to put or call is subject to finality. You cannot alter it anytime you choose because you have to wait for the expiry date which locks your investment. As always, use caution when trying to use any forex arbitrage strategy.

Article Source: http://EzineArticles.com/?expert=Clint_B

Day Trading Commodities

By Joseph DomotorInvestors who are called as day traders are people who sit at computer terminals constantly monitoring stock prices for opportunities to earn profit. They are also stock owners for short periods of time even for less than 24 hours.
To put simply, day traders are people who buy and sell stocks all day long with the goal of buying stocks that fluctuate in hopes that the value goes up and the trader earns money. Day traders can make profits very quickly. A day trader will hold a stock anywhere from a few seconds to a few hours, but will always sell all stocks before the close of each day. At the end of the day, what trader hopes is to increase the value of the stocks that they own.
Day trading commodities online is almost like a one-stop shop. You virtually have everything you need to get in touch when you log in to your trading account. Most online brokers will have real time quotes, charts, futures news, technical analysis programs and research available for their clients. This will help online traders to make more of their own trading decisions and give ideas in which trading strategies will be implemented that once were not available to any typical retail trader.
If you are going to day trade commodities, you absolutely want to do it online, unless you have someone else managing your account. Executions are very quick, which is way better than having to pick up the phone and call your broker to place orders and filling up prices.
In the marketing world, trading has its own value. While increasing and decreasing values and levels of risk can fluctuate between maximum and minimum, but still many people get into day trading to make some money. Besides, if there is risk, there is reward. If you are trying to get rich right away, the high risks that come along with it will probably break you. Commodity trading is not innately risky. It is only as risky as you want to make it. Most people lose some, because they can't control their urge gamble.
On a regular basis, Day trading commodities increases the value and level of success. Oftentimes, risk factors may affect levels of success. However, it is an optimistic and realistic process with a goal of earning profits.

To learn more about Day Trading Commodities, and how you could build a residual income with the power of Options, grab the free introductory videos at My Trading Profits and get ready to secure your financial future

Article Source: http://EzineArticles.com/?expert=Joseph_Domotor

Top Advantages of Retail Day Trading

By Chris W. Dunn
There are two types of day traders; institutional and retail. For many years, institutional was the most common kind. Recently, thanks to its many advantages and flexibility, retail day trading has become much more popular.
Institutional day traders work for financial institutions. The advantage of working for an institution is that you usually have more formal trading education and many more resources, knowledge, and tools made available to you at work. The equipment available is much more expensive since it is paid for with the institution's money. These are all great benefits, but nothing beats the flexibility of a retail day trader.
Retail day traders work for themselves, either from home or from an office that they have set up. Working for yourself has its obvious advantages. You are your own boss, you are on your own schedule, and you do not have the pressure of a boss always behind you, watching what you are doing. Since having your own computer and an internet connection is so common and easy to get today, it is easy to put to practice your trading methods right from your home. With a fast connection you can smoothly do your job and earn money without leaving the house. With a laptop you can take your computer with you and work from any location.
Some people may not think that they would be able to take advantage of working from home by day trading since they do not know the skills. However, with a trading course and some experience you can learn all the tools of the trade and prepare yourself for a job as a retail day trader. Besides learning about systems and tools, it is important to know exactly how the market works. Having an inside knowledge of the system is important since numbers move fast and you have to be able to stay on top of it all in order to do your job correctly and earn money. By the time you are done with the course you will have as much of an advantage and knowledge as institutional day traders working in an institution have.

Chris Dunn is an e-mini day trader with a strong focus on high probability trading strategies and skill development. You can get top-level day trading training through the Emini Academy's online day trading courses and personal coaching programs.

Article Source: http://EzineArticles.com/?expert=Chris_W._Dunn

Trend Relativity

By Hideyoshi Taro
Trends is valid only the time frame they occur. Chart patterns in time frames larger and smaller than the current trend are independent. This inter-relationship applies all the way from 1-minute through yearly chart analysis.
That's why traders must always operate within various time frames. The most profitable positions will align to support and resistance on the chart one amplitude above the trade and display low risk entry points on the chart one amplitude below.
Price evolves through bull and bear conflicts in all time frames. When ongoing trends are not in gear with specific charting periods, trade preparation may become subjective and dangerous.
The perfect opportunity to enter a trade rarely exists. An obvious breakout on one chart may face resistance on the longer-term view just above a planned entry level. Or a shorter-term chart may display so much volatility that any entry becomes a dangerous enterprise.
Successful trading needs a careful analysis of conflicting information for entering a trade only when favorable odds rise to an acceptable level. If you face with a good setup in one time frame but marginal conditions for those surrounding it, use your experiences and skills to evaluate the overall risk. If risk/reward ratio is in a tolerable range, consider execution even if all factors do not favor success.
However, chart information priority parallel chart length. For example, major highs and lows on the weekly chart carry greater importance than those on the 1-hour chart.
Profit opportunity aligns to specific time frames. This trend relativity error often forces a new position just as the short-term swing turns sharply against the entry. Trend relativity errors rob profits on good entries as well. No one wants to leave money on the table. Natural wave motion may whipsaw the position sharply and sends the trade into a substantial loss well before reaching a reward target.
Most traders should never change their holding period without detailed pre-planning. Specific time frames require unique skills that each trader must master with experience.
Begin with a sharp focus on the next direct move within a predetermined time frame. Prepare a written trading plan that states how long the position will be held and stick with it. Establish a profit target for each promising setup and then reevaluate the landscape that price must cross to get there. Consider the pure time element of the trade. Decide how many bars must pass before a trade will be abandoned, regardless of gain or loss.

Taro is an experience trader who trades in stocks, futures, forex. He strongly focuses on technical analysis, trading systems and money management.
If you would like to find more articles on MetaStock Tutorials, MetaStock Formulas, Trading Systems and Money Management. Please go to MetaStock Trading System.

You would also find the recommended trading books, DVDs, software and tools at MetaStock Trading Store.

Article Source: http://EzineArticles.com/?expert=Hideyoshi_Taro

The Matter of Time in Trading

By Hideyoshi Taro
Chart patterns that offer trading opportunities form equally through all time frames. The setups remain valid in chart of every time frame, whether they appear on 5-minute or monthly bars.
Each time frame attracts a specialized group of traders that interacts with all other groups through the universal mechanics of greed and fear. This results in trend convergence, divergence through different time lengths. Successful traders improve performance when they adjust their chart view to match the chosen holding period.
Successful trade execution aligns positions through several time frames. By doing this, first choose a primary chart screen that its time frame reflects the holding period and matching strategy. Then study the chart one magnitude above that period to identify support, resistance and other landscape features that impact risk/reward ratio. Lastly, shift down to the chart one magnitude below the primary screen and identify entry points.
The trading system that uses three different time frames, defined by Alexander Elder in his book "Trading for a Living", is called Triple Screen System.
Time frame analysis above and below the current setup chart will identify opportunity and risk in most cases. For example, when a promising setup appears on a 1-hour chart, a trader checks the daily chart for support and resistance but uses the 5-minute chart to time execution to the short-term flow of the market. This approach works through all time levels.
Amateur traders routinely fail at time management. Many never identify their intended holding period before they enter a trade. Others miss major support and resistance that appears on the next above magnitude chart. Some sit on nonperforming positions for weeks and tie up important capital while excellent opportunities pass by.
In all cases, time works as efficiently as price since all time frames display unique properties that enhance or damage the odds for profit.
Every opportunity arrives with a time shadow hanging over it. You have to focus attention on important feedback at the exact time that the information will likely impact that market. It may offer an execution window that closes in minutes or offer an exit that should be taken immediately when it arrives.
Successful traders must manage time as efficiently as price. Use both price and time triggers for stop loss management. Time should activate exits on nonperforming trades even when price stops have not been hit. Execute only when time bias improves the odds for profit.

Taro is an experience trader who trades in stocks, futures, forex. He strongly focuses on technical analysis, trading systems and money management.
If you would like to find more articles on MetaStock Tutorials, MetaStock Formulas, Trading Systems and Money Management. Please go to MetaStock Trading System.

You would also find the recommended trading books, DVDs, software and tools at MetaStock Trading Store.

Article Source: http://EzineArticles.com/?expert=Hideyoshi_Taro

Swing Trading Verses Momentum Trading

By Hideyoshi TaroGenerally, periods of trending market last a relatively short time in relation to longer sideways market. But rather than stand aside, many traders think they are seeing trends where the market are not trending.
In trending market, fast-moving stock's prices attract attention and awaken great excitement. Many novice traders fever with these hot plays. The financial press makes these more danger with frantic reporting of big gainers and losers. But gaining profits by momentum trading requires great skill and discipline.
Typically, price seeks equilibrium. When unsettling events destabilize a market, counter-trend force emerges quickly to put it to a stable state. This inevitable backward reaction follows each forward impulse. Novice traders fail to consider this action-reaction cycle when they enter momentum positions. They blindly execute trades that rely on a common but dangerous trending-following strategy, then trend reversals appear suddenly.
Novice traders enter small price swings on the false assumption that the action represents a new breakout for a major trend. Although these errors may not incur large losses, they damage equity and confidence at the same time.
Some traders, in the other hand, may appreciate the market's complexity and realize that trading mastery requires many diverse skills. As price usually cycles through regular phases, strategy needs to adapt quickly to capitalize on the current crowd. So, swing trading, that execute right near support or resistance, is a powerful alternative. This classic trading style requires more precise planning than momentum. However, it allows measurable risk and highly consistent rewards.
Swing traders seek to exploit direct price thrusts as they enter positions at support or resistance. They analyze chart pattern characteristics to indicate short-term market inefficiencies. The swing trading strategy is a time frame independent methodology. Some traders are able to apply this strategy by never holding a position overnight.
Nowadays, the revolution in high-speed trade execution opens swing strategies that last for minutes instead of days. Dependable price patterns appear on charts in all time frames, swing setups offer the short-term charts the same opportunities that appear on longer-term charts.
Swing trading provides a natural framework to identify changing conditions and apply new methods to exploit them. However, as its core, swing trading is not the opposite of momentum trading. During the times that strong price movement characterizes a market, disciplined momentum strategy becomes the preferred swing trade. In this way, modern swing traders can apply the principles of risk management and price boundaries and use momentum's greed to their advantage.

Taro is an experience trader who trades in stocks, futures, forex. He strongly focuses on technical analysis, trading systems and money management. If you would like to find more articles on MetaStock Tutorials,  

MetaStock Formulas, Trading Systems and Money Management. Please go to MetaStock Trading System. You would also find the recommended trading books, DVDs, software and tools at MetaStock Trading Store.

Article Source: http://EzineArticles.com/?expert=Hideyoshi_Taro

Day Trading - An Overview

By Joanne LindsayDay trading is an activity which includes selling and sharing of financial instruments within the same day, that too before the closing of market. It is quite a flexible market. Everyday it is with new rises and falls in points, therefore one should have the complete knowledge about it before investing.
As it is not a constant field, therefore one should not invest beyond his limits. It's unpredictable nature can leave you with big profits and loses as well. It would be better if one sell his shares as soon as the market goes up quickly with low percentage. Because at that time many big players will purchase a big part of the shares. So one can earn substantial profits.
One can contact the technical analysers and experts in order to confirm about the fluctuations in the market. On that basis one can buy or sell his or shares. There are also two more techniques of Up tick rule and Stop Order. So one should also have knowledge about them. Generally those who does not follow these techniques result in loss only. These techniques suggest about the appropriate time of entering in the market and rise and fall of the shares.
Now-a-days all the information is available on internet. Along with the correct information about the fluctuations in shares, the essential details and suggestions are also mentioned so that one can invest after clear understanding. Internet has made this activity a common one and not limited for few. Even one can sell or purchase his shares while sitting at his home,through internet. Trading news is the best medium to observe a practical shifts in the points. The traders those who are new and want to be in this business can also follow books and seminars which provide essential details about it.
This is a good medium to earn reasonable profits and make business everyday. But it is really necessary to ensure that one has all the basic and deep knowledge regarding this business. As this involves all the possible risks, and, according to a general view of the experts there are very few who understands about it and generally end their day with loss.

For any help on day trading, check out the info available online; these will help you learn to find the how to day trading!

Article Source: http://EzineArticles.com/?expert=Joanne_Lindsay

Investment in Africa

By Okwuegbunam Francis E.
Africa has remained a continent with abundant natural and human resources that has not been tapped. These resources are waiting for investors within and outside the continent to tap in and reap the dividends. The various sectors that require investors are listed but not limited below:
Agriculture. This sector remains untapped despite various attempts by many administrations to develop it. The continent has enough arable land to grow agricultural products. The land is so fertile with enough Sun shine and rain fall. And with a moderate investment, there is guarantee of profit and return on investment. Some of the areas to invest on agriculture are cropping and animal husbandry. The areas in cropping to invest on are but not limited to are...cash cropping (palm plantation, palm oil production, palm kernel, cocoa, rubber, groundnut, etc), food cropping (yam production, cassava production and processing, rice production, beans etc), Animal husbandry (poultry, piggery, fishery, snail, honey production etc). To invest in cash cropping such as palm or coca production therefore, West African sub-regions countries should be considered such as Nigeria, Togo, Benin Republic, Cameroon. The region of these countries should be Southern parts. These areas have good weather conditions for these crops.
Mining. The continent has great deposit of solid, liquid and gaseous minerals in her soil that still require investment. Though this sector has enjoyed great exploration by various administrations, but still remained unexplored. And many of these deposits are discovered every year. Some of the minerals are but not limited to: Gold, Silver, Coal, Tin, Limestone, Iron ore, Zinc, Crude oil, Natural gas etc. These following countries have these mineral deposits: Nigeria (crude oil, iron ore, limestone, coal, tin etc) Ghana (gold, crude oil etc) South Africa (aluminum, tin, coal etc). These minerals deposit are in abundance, and requires exploration.
Energy. The continent is so blessed with all year round Sun shine, many bodies of water, wind and so. These natural recourse can be enhanced to generate electricity. Many African countries do not enough electricity to drive their industries. The following countries need electricity, Nigeria, Togo, Equatorial Ginie, Republic of Benin etc. fortunately these countries have enough all round Sun shine, natural gas, and petroleum. These can be used to generate renewable electricity using solar panels and its components or gas turbine or petroleum generator.
Production. The continent depends so much on imported goods from Europe, Asia, America etc. Production plants can be established there close to sources of raw materials. And with her abundance human resources, cost of labor will be cheap. In this way, finished goods can be exported to other continents to make great wealth. It is always important to locate any industry to the source of raw materials as this will reduce the cost of production. These raw materials from agriculture, mining, petroleum industries are exported to other continents, hence increase the cost of production and the cost of products. With available human resources, there the cost of labor will be low.
It is time for investors to go bak to Africa and tap into her abundant resources.

Okwuegbunam Francis

Article Source: http://EzineArticles.com/?expert=Okwuegbunam_Francis_E.

The Value Averaging Investment Strategy

 By Bruce Ramsey
Value Averaging (VA) is a hybrid of Dollar Cost Averaging (DCA), which is more familiar to most investors, and the process of portfolio rebalancing. Proponents of the VA investment strategy feel that this method allows those who use it to experience the proverbial "best of both worlds."
How Value Averaging Works
Michael E. Edleson, a former Harvard finance professor, used simulations to compare the Value Averaging method to dollar cost averaging and also to the purchases of a constant number of shares in every investment period. While potential differences in risk were not considered, he concluded that Value Averaging provided investors with "an inherent return advantage" in keeping with the time-honored recommendation to "buy low and sell high."
Edleson, who was also a former Nasdaq Chief Economist, feels that a missing ingredient has been added to DCA that makes Value Averaging a superior method - focusing on a portfolio's anticipated rate of return, which assists in pinpointing periods of under and over-performance in the stock market.
Dollar cost averaging is based on the principle that, rather than investing a large sum of money at one time, you should make small investments over a designated time period. For example, if you had $12,000 on January 1st that you planned to invest, you would invest $1,000 on a monthly basis through to December. It is felt that your risk would be reduced, especially in times of high volatility, because you would be purchasing stocks in a range of prices over a 12-month period, rather purchasing all of the shares in a lump sum for the same price.
With the Value Averaging strategy, whenever a portfolio under-performs, the share prices will probably also be low, and investors will therefore have to make a larger investment to make up for the under-performance. The converse is also true, and if the portfolio outperforms it's targeted rate of return, share prices will tend to be high as well, and that is not the time to purchase more shares. Investors may even profit from a sale, as long as they are guided by the portfolio target value, which is a calculated value. While dollar cost averaging is unchanging, value averaging forces sales when prices rise sharply and forces larger purchases - more shares purchased - when prices fall.
Value Averaging definitely proves its worth and works best when the stock market is highly volatile, because it forces investors to be disciplined when they invest.
Using Value Averaging
VA is a formula based investment technique, where a mathematical formula is used to guide how much is invested into a stock at a specific time. VA's goal is to increase a stock's value, rather than its market price, by a calculated amount on a periodic basis.
To begin, you determine the amount of money you will need to set aside to reach a particular goal, such as financing your retirement. Next, based on the yearly return you expect to realize on what you invest, you calculate what you will have to invest every month in order to attain that goal. For example, if you plan on accumulating $500,000 within a 20-year period and determine that you can earn 8% annually, you would need to set aside approximately $875 each month. This would enable you to track your progress toward that goal on a month-by-month basis.
Note that with this method, the emphasis is on establishing a portfolio target value or "value path." For example, suppose that at the end of the 12th month you realize that your portfolio value should be at $10,950 according to your plan, but because of a downturn in the stock market, it is only worth $10,000. This indicates that in the following month, you should invest an additional $950 along with your usual $875 for a total of $1,825 in order to stay on track.
Realistically, this is a procedure that you would follow every month, and whenever you fall behind, you would add to your monthly investment. By way of contrast, whenever the return on your investment was higher than you expected and your portfolio was worth more than the pre-determined value, that would be the time to reduce your usual investment or consider selling some of your stock.
Value averaging can also be modified so that no sales take place, which is important when investing in non tax-sheltered accounts.
What You Can Expect
Value averaging works better than DCA in almost all market conditions, the benefits are really accentuated in a highly volatile market.
Under the Value Averaging approach, the ending total value will be pre-determined before you start your investing program, so as in our example above the ending value is $500,000. In other words, when you start the value averaging program, the ending amount is known, but the amount to be invested monthly varies.
Under the dollar cost averaging approach, the total portfolio value at the end of the period could be any value, but the total amount to be invested is fixed - in this example, 12 months times 20 years times $875, for a total amount invested of $210,000. When you start a dollar cost averaging program, the amount to be invested is known, but the ending amount isn't.
In summary, Value Averaging is an investment strategy that provides a more systematic way for investors to reach their investment goals and it is a promising investment technique that merits broader attention from financial advisors, financial institutions and the investing public.
For a more theoretical review of the two strategies and examples of how they compare under different market conditions, you can refer to the paper "A Statistical Comparison of Value Averaging Vs. Dollar Cost Averaging and Random Investment Techniques" by Paul Marshall.

Bruce Ramsey is the Portfolio Manager of the Blue Chip Value Averaging mutual fund. The world's first mutual fund that uses the Value Averaging investment strategy to make its buy and sell decisions.

Article Source: http://EzineArticles.com/?expert=Bruce_Ramsey

Bank of America Savings Account Interest Rate

         Bank of America is the one of the best bank and financial institution in the United States of America. You can get good interest rates for your savings and investments made in this bank. This bank is more secure to invest and get maximum returns. I have listed some of the best savings account interest rates which is available in this bank as on June 2010. You have to check the latest rates either online or by visiting the bank when you invest your amount.
For opening a savings account, you have to maintain a minimum balance of $300 per day. The rate of interest is 0.1% and there is no monthly maintenance fee if you maintain the minimum balance that you have to maintain per day. You also get a free internet banking service with your savings account. In case if you do not maintain the minimum balance required, you have to pay charges for the same.
This bank also accepts certificate of deposits as your investment options. The CD interest rates is 1% for a 18 month CD. You can surf for more detailed information. You can also find Bank of America checking account interest rate and bond rates online.
This bank also gives mortgage loans for purchasing new homes or for refinancing. You can find the mortgage rates from the website or by visiting the bank. These rates are fixed based on your type of mortgage loan, your location and your loan amount. These interest rates vary from time to time. So please check the latest rates when you plan for your investments.

Article Source: http://EzineArticles.com/?expert=Balajee_Kannan

Private Equity and Investment

By Madan G Singh
The source of funding of any project has great importance. This is so as no business deal or venture is possible without finance. Private equity investments are one such source of finance. These funds have assumed great importance and statistics prove that private sources finance new ventures at a gigantic rate, that is almost 25 times more than finances from other sources. Thus private finance givers have turned into excellent investors for new projects.
Private equity investors are investors who have a high net worth and asset value and have liquid cash available. These investors are the back bone of private equity investments. Last year 300,000 firms and enterprises were launched in the USA and nearly one seventh of this lot was financed by these equity investments.
Private equity investors have made a mark in the financial field and they have had a tremendous impact in the entrepreneurial market. It is estimated that that these investors fund anything in a range from $20 - $60 billion annually.
Private investors with money to spare generally keep their money and investments in non-public companies. Thus a equity investor will most likely make an investment for 3 to 7 years, in contrast to venture capitalists who invest in companies at the inception stage or launch and also for much shorter periods
Private equity firms will follow some parameters while making an investment,that will include a strong management team and the company's ability to bring in profit. They will also look at the growth potential of the company and whether an investor's capital is safe as well as good return on his capital.He will also look at the exit clauses in case the equity investor wants to get his investment out.
Thus Private equity is never in loss making companies. Private investors are there to get a good return on the money they have invested and as such they will track the profit graph of any company they invest in. The private equity investor will look for agreements that give him a share of the profit generated at the time of exit. This will be an important clause for him as he can use the profit to invest in some other company.
From 2007 onwards the private equity financiers did take a nose dive as the economic scenario had become bleak,but at the turn of the present year the investors are back and have funds to spare as recession is on the way out.

Article Source: http://EzineArticles.com/?expert=Madan_G_Singh