Foreign exchange refers to the exchange of foreign exchange currencies. Foreign exchange margin actually refers to the general term for foreign exchange transactions that use margin. As a market with an average daily trading volume of 1.5 trillion U.S. dollars, in April 2010, it reached a market with a daily trading volume of 4 trillion U.S. dollars. The scale of the foreign exchange market is 46 times that of the global futures market. Because of this, the foreign exchange market is the most liquid market in the world.

In a nutshell, foreign exchange refers to foreign currencies or other currencies. Various means of payment represented by currencies for international settlement of claims and debts. Foreign exchange margin is one of the financial derivatives instruments. It is a financial derivative that uses a certain proportion of funds to buy and sell various currencies in the foreign exchange market, and conducts value-added transactions that expand hundreds or even hundreds of times in response to the direction of exchange rate fluctuations. It is also called leveraged foreign exchange. Margin foreign exchange was created in the 1970s.

Foreign exchange margin has the characteristics of futures, also known as currency futures. It is a futures contract based on foreign exchange and is the first type of financial futures. It is mainly used to avoid foreign exchange risks, that is, exchange rate risks.

Foreign exchange margin trading, also known as contract spot foreign exchange trading, margin trading, and virtual trading, refers to the signing of entrusted transactions between investors and financial companies (banks, traders, or brokers) that specialize in foreign exchange trading. For foreign exchange contracts, by paying a certain ratio of trading margin (generally no more than 10%), you can buy or sell foreign exchange of 100,000, hundreds of thousands or even millions of dollars at a certain financing multiple. Therefore, this kind of contract-based buying and selling is just a written or verbal commitment to a certain price of a certain foreign exchange, and then waiting for the price to rise or fall before settling the sale, making profits from the changing price difference, and of course also bearing the responsibility. risk of loss. Since this kind of investment requires large or small amounts of capital, it has attracted the participation of many investors in recent years.

The advantages and advantages of foreign exchange margin:

1. Adopt margin trading and make full use of the principle of leverage to achieve a small gain.

2. Foreign exchange margin trading can be operated in both directions and is very flexible. Investors can be either bullish or bearish, so that the currency exchange rate will fluctuate to a certain extent within a day. Based on the principle of two-way operation, investors can not only make profits by buying at low prices and selling at high prices; they can also make profits at high prices. Sell ??first, then buy at a lower price and make a profit. These two features are very similar to futures trading.

3. With the 24-hour and T+0 trading modes, foreign exchange margin trading can be conducted 24 hours a day (except for global closures on weekends). Moreover, the T+0 model also makes investors’ transactions very casual and convenient. Investors can enter the foreign exchange market for trading at any time, and investors can enter and exit the market at will to change investment strategies.

4. Foreign exchange margin trading has no expiration date, so investors can hold positions indefinitely. Of course, investors must first ensure that there are sufficient funds in the account, otherwise they will face consequences when the funds are insufficient. Risk of forced liquidation.

5. Investors choose a wide variety of currencies when conducting foreign exchange margin transactions, and all convertible currencies can become trading varieties.

Foreign exchange margin trading appears in the form of contracts, and its main advantage is to save investment amounts. When buying and selling foreign exchange in the form of a contract, the investment amount is generally no more than 5% of the contract amount, but the profit or loss is calculated based on the entire contract amount. The amount of the foreign exchange contract is determined according to the type of foreign currency. Specifically, the amount of each contract is 12,500,000 yen, 62,500 pounds, 125,000 euros, and 125,000 Swiss francs. The value of each contract is approximately US$100,000. The amount of each contract for each currency cannot be changed according to the investor's requirements. Investors can buy or sell several or dozens of contracts based on the amount of their deposit or margin. Under normal circumstances, investors can buy or sell a contract with a margin of US$1,000. When the foreign currency rises or falls, the investor's profit and loss are calculated based on the contract amount, which is US$100,000.

The so-called foreign exchange margin transaction refers to signing a contract with a designated investment bank, opening a trust investment account, depositing a foreign exchange margin as a guarantee, and the investment bank sets the credit operation limit. Investors can freely buy and sell spot foreign exchange of the same value within the quota, and the profits or losses caused by the operation will be automatically deposited or deducted from the above-mentioned investment account. It allows small investors to use less funds to obtain larger transaction limits, enjoy the same use of foreign exchange transactions as global capital to avoid risks, and create profit opportunities in exchange rate changes.

Of course, if you don’t want to spend time learning relevant investment knowledge and don’t have time to sit in front of the computer and keep an eye on the market, you can also join some excellent order-calling platforms, where people often gather A group of domestic and foreign trading masters with considerable trading experience can synchronize their trading orders into your account through platform technology. For example, the well-known "Trader" in China is an online order placing platform focusing on the global foreign exchange market.

Through simple registration, users can settle in as a strategist or investor, and then perform their respective duties. "Strategists" can share transaction orders in their trading accounts on the platform; and "investors" can also set up After following the order rules, you can leave the computer, and the "trader" will push the transaction order shared by the "strategist" directly to the "investor" trading account, achieving complete synchronization between the two. At "Trader", we use advanced Internet technology to enable investors to easily receive trading orders shared by strategists. At the same time, in order to help investors find satisfactory strategists, "Trader" has set up a comprehensive ranking system. Investors can rank strategists based on fields such as "yield rate", "win rate", and "average daily order volume". Sorted, investors can then also go to each strategist's individual homepage to view their trading statistics. "Traders" have established a complete profit sharing mechanism. By sharing their own transaction orders, strategists can obtain corresponding cash income according to the number of times investors follow orders. Investors can also earn profits based on the transaction orders shared by trading masters. Trading profits can be obtained.

Features of foreign exchange margin:

1. Low investment cost, 10% less than actual investment!

2. Two-way trading and investment, there are profit opportunities in both ups and downs!

3. High profits, the possibility of profit more than doubling in one day!

4. Risk controllability, limit price and stop loss point can be preset!

5. The funds are flexible and funds can be withdrawn at any time!

6. Global 24-hour trading, with many profit opportunities!

7. Low handling fee, less than one thousandth!

8. The global daily trading volume exceeds one trillion U.S. dollars, making it not susceptible to human manipulation!

9. High transparency, all market prices, data and news are public!

10. Transactions are fast. In most cases, foreign exchange transactions are completed in real time! ,

11. Foreign exchange margin is an easy investment, and the main factors for profit can be said to be experience, information and luck. Foreign exchange is a means of payment expressed in foreign currency for international settlement. This means of payment includes credit instruments and securities expressed in foreign currencies, such as bank deposits, commercial bills, bank drafts, bank checks, foreign government treasury bills and their long and short-term securities, etc.

The International Monetary Fund’s definition of foreign exchange is: “Foreign exchange is held by the monetary administration in the form of bank deposits, Treasury bills, long-term and short-term government securities, etc., and can be used when the balance of payments is in deficit. claims”.

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