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May 10, · KZM Close System Forex Trading Part 01 อธิบายตามที่เข้าใจและได้ทดลองปฏิบัติ อาจจะไม่ค่อย. diwaliwishes2017.ml สังคมแห่งการแบ่งปันของนักเทรด Forex เทคนิคการเทรด forex ให้กำไรและการเลือก forex broker ในการเทรด วิเคราะห์ forex signal.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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A Breakdown of the Forex Carry Trade The currency carry trade is a strategy in which a trader sells a currency that is offering lower interest rates and purchases a currency that offers a higher interest rate. In other words, you borrow at a low rate, and then lend at a higher rate. The trader using the strategy captures the difference between the two rates. When highly leveraging the trade, even a small difference between two rates can make the trade highly profitable.
Along with capturing the rate difference, investors also will often see the value of the higher currency rise as money flows into the higher-yielding currency, which bids up its value.
Real-life examples of a yen carry trade can be found starting in , when Japan decreased its interest rates to almost zero. Investors would capitalize upon these lower interest rates and borrow a large sum of Japanese yen. The borrowed yen is then converted into U. Treasury bonds with yields and coupons at around 4.
Since the Japanese interest rate was essentially zero, the investor would be paying next to nothing to borrow the Japanese yen and earn almost all the yield on his or her U. But with leverage, you can greatly increase the return. However this strategy only works if the currency pair's value remains unchanged or appreciates. Therefore, most forex carry traders look not only to earn the interest rate differential, but also capital appreciation.
While we've greatly simplified this transaction, the key thing to remember here is that a small difference in interest rates can result in huge gains when leverage is applied. Most currency brokers require a minimum margin to earn interest for carry trades.
However, this transaction is complicated by changes to the exchange rate between the two countries. If the lower-yielding currency appreciates against the higher-yielding currency, the gain earned between the two yields could be eliminated.
The major reason that this can happen is that the risks of the higher-yielding currency are too much for investors, so they choose to invest in the lower-yielding, safer currency.
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You should also, based on the economic theories mentioned above, have an idea how certain economic factors impact a country's currency. All of the news reports, economic data and political events that come out about a country are similar to news that comes out about a stock in that it is used by investors to gain an idea of value.