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| ADVANTAGES OF FOREX VS. FUTURES |
You get more leverage than futures - but with strictly limited risk!
The sheer size of the forex market (46 times greater than all futures markets combined) and the greater price stability allow you to trade with a much higher degree of leverage than is typical with futures contracts.
Plus, you are able to select the degree of leverage that you wish to
employ in trading. Unless you specify otherwise, Friedberg Direct sets
your leverage level at the industry standard. The actual margin requirements for leverage vary
with account size and pairs traded. Click here
to view new IDA margin requirements.
You have peace of mind knowing you'll never be liable for a debit balance
With Friedberg Direct, you can NEVER have a debit balance! In the event that funds in your account fall below margin requirements, the Friedberg Direct Dealing Desk will simply close all open positions. That means that, even if you are dead wrong and there is a catastrophic market move against you, you can never lose more than the amount of money you have in your account. That provides you with tremendous peace of mind. See for yourself by making a few risk-free virtual trades in your Trading Station demo account.
You get maximum liquidity
Due to its enormous size (46 times bigger than all futures markets combined), the forex market is the most liquid market in the world. The spot forex market is a $2 trillion daily market, making it the largest and most liquid market in the world. This market can absorb trading volume and transaction sizes that dwarf the capacity of any other market. This means that positions can be liquidated and stop orders executed
during normal market conditions without slippage. During excessive
market volatility slippage may not always be avoidable.
You can trade 24 hours a day
The forex market is a seamless, 24-hour market. At 5 PM Sunday, New York time, trading begins as markets open in Sydney and Singapore. At 7 PM the Tokyo market opens, followed by London at 2 AM, and finally New York at 8 AM. As a trader, this allows you to react to favorable or unfavorable news by trading immediately. It also gives you the added flexibility of determining your trading day.
You get near instantaneous execution and firm prices!
With Friedberg Direct forex trading you get near instantaneous execution and price certainty on all orders up to $1
million during normal market conditions. On the Friedberg Direct trading station, you trade directly off real time streaming prices. There is
usually no discrepancy between the displayed price and the execution
price during normal market conditions. Real time streaming prices ensure that market orders, stops, and limits
during normal market conditions and may be executed with minimal to no slippage and/or partial fills.
During excessive market volatility slippage may not always be
avoidable on all market orders, stops, and limits.
You never have to worry about rolling over your positions!
With Friedberg Direct, open positions are rolled over automatically every two days. As a service to you, at 5:00 PM New York time Friedberg Direct automatically rolls over all your open positions (swaps the trade forward) to the next settlement date two business days in the future. As is true with futures, there is often a carrying cost associated with rolling over a position. Moreover, forex positions sometimes can actually make you money on the roll-over. That is because your profit/cost is determined by the difference in interest rates between the two currencies. Thus, if you are long the currency with the higher interest rate in the pair, you will actually gain on the spot rollover through the premium relationship of that currency relative to the short currency. The amount of the gain is determined by the interest rate differential between the two currencies, and fluctuates day to day with the movement of prices. For instance, on any given day, the rollover can be $2 per lot for USD/JPY and $15 for GBP/JPY. Rollover fees are shown in dollars, and are posted in the "interest column" on the Friedberg Direct Trading Station every day at 3:00 pm New York time. For day traders that never hold a position overnight, there are no carrying costs whatsoever. Try out the Trade Station with a virtual account. In order to receive interest, your account must be on 2% maintenance margin; otherwise you are charged on your open positions, whether long or short..
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