Want to Trade in Forex? Ask the Right Questions First!

You can gain a lot of money in Forex trading. But you also need to invest money to start trading. How much do you really need to start trading in Forex? Is a small capital enough? When considering trading in FX market, you should ask yourself the following questions:

What are your reasons for trading?

That is the first question you have to ask yourself and you need to answer it very honestly. If your answer is you’re looking for a quick solution to your finances, admit it and determine if that’s the only reason for trading.

You have to decide on your goals. As soon as you know what direction you’re going, assess yourself if you have what it takes to achieve them. If you are looking to become a full-time trader, you should evaluate yourself if you’re willing to give up money and time to get there. If you intend to make trading a secondary income, you need to be disciplined enough to ensure that you do not over-invest. Every intention comes with questions.

What does the broker require?

It is important to note that startup capital is not the same as the amount you need to start trading. The answer to this question largely depends on your broker, who wants you to invest as much money as possible. For that reason, some brokers might ask for high initial deposits. However, there are others that require no deposits at all, but require you to register for a lifetime account.

How much risks are you willing to take?

It is important to note whether you have disposable income to risk on Forex trading. Are you trading the money that you need for your daily living? If you answer yes, then do not start trading and come back if you have extra cash. Remember that not having a “risk capital” (the money that you can afford to forego) will not only cause you financial problems at home, but you will also fail as a trader. That is primarily because as a beginner in the industry, you are trading just to get experience. Hence, all beginners have a higher chance at failing the first time.

However, even expert traders can fail if they do not have risk capital. Any person who knows the psychology of trading will tell that risking the money you need on Forex or other trading companies is a bad decision. If your trades are losing, you’ll panic, causing you make bad decisions even more.

Deciding if you have enough money to start trading ends with the expectations you have of the market and the risks that you are willing to take. If you are looking for fast income, but you only have little capital and are cautious by nature, you won’t probably attain your goals.

In conclusion, if you are wondering how much you need to trade in Forex, you might want to reflect on the questions that were mentioned above. Those would be enough for you to reach a decision.

Who Leads the Global Car Sales?

Toyota Motor Corporation (NYSE:TM) has remained number one in global auto sales for four consecutive months. They are the leading automaker in the world so far this year. They’ve sold a total of 8.3 million units for the first 10 months of 2015.

Meanwhile, Volkswagen AG (OTCMKTS:VLKKAY), who was involved in the diesel engine scandal that began last September, is trailing behind the Japanese car manufacturer. Volkswagen only sold a total of 8.26 million units during the same time period.

October Sales

According to recent reports, Volkswagen sales in October are down 5.3% over the years. October was the month after the company admitted that they have been deceiving US authorities on their diesel engine emission tests. They have been selling these vehicles since 2009 in the US.

In terms of group sales, Toyota is currently down 1.2% compared to last year but this figure only shows until their sales from January to October. Volkswagen, on the other hand, is down for about 1.7% in the same period compared to 2014.

Comparison of Net Profits

During the first half of the fiscal year 2015, Toyota has been the top player among the global car manufacturers. The Japanese-led company earned a net profit of $10.1 billion over the span of 6 months ending in September. Volkswagen, on the other hand, has net profits of $6.18 billion during the first 6 months of the year, ending in June. These figures say a lot to the direction of their sales towards the end of the fiscal year. It is more likely for Toyota to be maintaining their lead.

Even before the diesel engine controversy, Volkswagen had already trailed behind Toyota in terms of profits. This was due to the slower growth of the auto market in China, where the German car manufacturer actually holds their biggest market share. In addition, Volkswagen sales also slowed down in the growing US auto market. All of that affected the top line and bottom line sales growth of the company.

Volkswagen Faces Lawsuit

Currently, the German automaker is facing lawsuits filed by several authorities worldwide with very expensive settlement costs. They spent about $7.4 billion to cover the expenses of the controversy they are in; however, it seems that amount is insufficient.

Volkswagen conducted a recall of 11 million vehicles worldwide, adding to their corporate financial expenses. For the latest quarter (which is July to September), it has been reported that they’ve incurred a net loss of $1.84 billion because of the special charges taken in order to prevent potential high costs of lawsuits and massive recalls.

Who Benefited the High Growth of US Auto Market?

Among those who benefited the sales growth of US auto market is Ford Motor Company (NYSE:F). They’ve recorded a total net profit of $2.8 billion during the first half of the current fiscal year ending in June. General Motors Company (NYSE:GM), on the other hand, gained net profits of about $2.05 billion for the first 6 months of their current fiscal year.

Are We Closer to a Global Recession? Hopefully Not!

There are more pressing concerns about the global economic health when the OECD released a global economic forecast of below 3 percent. In a span of 3 months, this is the second time that the forecast on the world economy was downgraded.

Does that sound familiar to you? That is because the International Monetary Fund (IMF) was on the same level last month as they have downgraded their forecast for global growth from 3.3 percent to 3.1 percent. Note that recession is defined by the IMF as a “3 percent growth in the world economy”.

Both IMF and OECD enumerated issues that stem from emerging markets, like Russia and Brazil.

China, on the other hand, is having problems with their economy; they’ve already cut their interest rates 6 times, drop their reserve requirement ratio twice, cut their taxes, as well as devalued the Chinese currency.

The most recent inflation rates would reveal that consumer prices were up at 1.3% in October year-on-year, despite the level of economic stimulus.

This economic data only creates more doubt on the impending increase of interest rates that will be implemented by the US Federal Reserve. Market pricing would tell you that there’s about 70% chance that the Fed will be pulling the trigger this month.

The hope for a delay in interest rate hike is actually good news for the US Congressman Brad Sherman. He told Janet Yellen, the chairwoman for the US Fed, to consider not increasing rates simply because it is not “God’s plan”. His comments has since then been a discussion during the Macroeconomic Roundup. Shortly after that, Sherman’s Deputy Chief of Staff told the NBR that those comments were meant to be a joke.

NBR then asked Sherman’s staff as to why would the congressman tell jokes in a very important meeting. His staff suggested that there’s room for humor during congressional meetings.

Boston Ivy Launches new TLDs

Boston Ivy has recently launched their domain registry services. With focus on the financial and trading industry, the company is promoting their latest offering as a service that would help businesses make a name in their respective industries. The top line domains (TLD) available through Boston Ivy are as follows: .broker, .cfd, .forex, .trading, .markets, and .spreadbetting.

Those new TLDs are included in the new opening of domains that are available for bidding through the Internet Corporation for Assigned Names and Numbers (ICANN). Other newly minted names are .technology, .guru, and .xyz.

During his presentation about “Choosing a High Impact Domain Name” at the Finance Magnates London Summit, Solomon Amoako, the Chief Sales Officer of Sedo, enumerated 5 key points when choosing a domain name; two of which are relevant to TLDs.

The first key point he mentioned was research and analysis of demographics and target markets to help understand names and extensions better.

Amoako emphasized that (1) research and analysis of demographics and target markets are important in order to understand names and extensions better and to know which of them fits best. (2) Keeping the domain simple and (3) avoiding the use of numbers or hyphens important as well because difficult names or adding numbers and hyphens won’t stick to the memory of the web users.

Another point he emphasized is (4) finding a domain that would fit your niche. That is, using TLDs like .forex and .trading to promote better connection with your users.

Lastly, (4) considering how your domain will affect “click through rates” (CTR). Amoako said that domains that are easier to understand would affect the CTR on web searches. For paid searches, these are very important because higher CTRs would give sites higher quality scores from search engines, like Google and Bing, which lowers cost per click and reduces costs for acquisition. He also cited an example, IG.Forex; by adding the .forex domain, it easily gives the customers an idea what IG is all about.

Amoako said that the future of marketing with the new TLDs is yet to be seen. But he believes that as soon as companies embrace the new TLDs, such as the .App domain bought by Google, there would be increased market awareness for the web extensions. In terms of .forex domain, he predicted that the FX.Forex would become a million dollar domain in the years to come.

More Than $150m Worth of Fines over Forex Trading to Barclay by the NYC Regulator

The Department of Financial Services in New York discovers the “Last Look” system of Barclays discriminated alongside unsuccessful trades.

On Wednesday, as the US regulator compelled a $150mn fine on Barclay due to the kind of treatment it gave to its foreign exchange clients.

The New York Department of Financial Services (NYDFS) discharge emails cache to back up its finding over the Barclays, which include one in which a managing director says to the staff to “confuse and stonewall” if currency trades related questions were asked.

The punishment, which also necessitates Barclays to sack an unnamed senior person who is involved in its electronic global foreign exchange trading industry, is associated to a computer system devised by the bank to decline customers’ orders that wouldn’t be beneficial.

The “Last Look” system, managed by launching a hold period in between received customer order and it being carried out by Barclays. It permitted the bank to wipe out trades where the rate had shifted against them, usually in just milliseconds.

Clients – who were refined users like of hedge fund – would get messages saying “NACK” (not recognized). A client questioned the 300 messages receipt on a single day in December 2010 but didn’t get a response.

The regulator’s acting superintendent of financial services, Anthony Albanese said – “this case emphasizes the need for wider omission and action to aid in preventing the mistreatment of electronic, automated dealing platforms on Wall Street that is a greater industry problem that needs serious additional inspection.”

The fine serves as a reminder of the reputational problems that the bank is still facing in the stir of 2012 find for rigging Libor, which ignited a wave of accusations against the Barclays and the whole industry. Moreover, it comes just 2 weeks before the new chief executive of the bank, Jes Staley, gets on his £8m/year role. As his appointment was declared last month, Staley who is a US banker said – “I feel eagerly that we must keep on strengthening trust in Barclays.”

This is the second fine that Barclays received from NYDFS for foreign-exchange-related subject of this year and gets the overall paid by the bank to the NYC regulator to $635 million.  The initial one was part of a  £1.5bn fine on Barclays proclaimed last May, as UK and US regulators declared record-breaking fines for controlling foreign exchange markets.

The perils of banks’ ongoing fines was increased by ratings agency Moody’s in this week’s report that place HSBC, Royal Bank of Scotland and the Barclays at great risk of getting bigger penalties.  Based on Moody’s calculation, 15 major banks had prepared £144bn in paying legal charge and clear up compensation and fines since the start of the banking crisis in 2008.

Barclay acknowledged that it faced additional penalties. It said it “persists to assist with other continuing investigations and to deal associated litigation risk as revealed previously”.

According to the NYDFS, the issue about Last Look happened on specific occasions in between 2009 and 2014. The regulator also added that there were changes on the system made by the Barclays in September and October 2014 as an outcome of the wide investigations into the foreign exchange market rigging, yet that 7% of the activity forced through the platform trading had persisted to give Barclay the advantage until August of this year.

Forex Rigging Probe Prevails Over Unjust Dismissal Case, Resulted in the Fired Out of Citi Trader

The Citigroup foreign exchange dealer who disclosed sharing of confidential information prevails over legal allege against the American bank.

Investigations were done into the claimed rate-rigging, a currency trader based in London sacked by Citigroup after he has won his unfair dismissal case. Perry Stimpson, a forex trader who was fired in November last year, has had his charges supported by an employment trial. He worked at the US bank for over 20 years and was sacked for spreading confidential details of clients with other dealers.

His dismissal arrived after a search into the allegations that some banks’ staff in US and UK was controlling foreign exchange rates and the Libor – the standard which is utilized to outlay trillions of pounds of loan and other financial tools worldwide.

But according to Mr. Stimpson, the management was aware of the sharing of information in chatrooms online.

“We had some guidelines and the penalty given to me was really unfair and harsh,” Mr. Stimpson said in his statement.

As said by Mr. Stimpson during the trial, he had disclosed information in a chatroom yet that whether it was acceptable to do so was “a little grey area”, though he was claiming that such activity is a widespread practice all over the industry. Mr. Stimpson’s claim was supported by Judge Allison Russel, saying that he had been unjustly dismissed and that the Citi had violated his contract by not even giving him notice. But, she ruled also that Stimpson had supplied to his dismissal.

Citi said in a statement – “As we are upset by the tribunal’s verdict, individual liability is vital to us and knowing that, we supported the case in the court.”

“We anticipate that our staff will stick to the highest ethical standards and will not accept any breaches on our code of conduct.”

Citigroup is among the 7 banks fined with over $10bn for failing to prevent dealers from rigging the $5.3 trillion/pay forex market. The bank paid fines amounting to $2.3bn in the US and UK. The City staff watched closely the claims and is one of the numerous claims. Other banks and traders have been monitoring the result of the case with interest, with some more same claims lined up next year.

In September at East London Employment Tribunal is where Mr. Stimpson’s trial was held and the ruling will come on Tuesday.

Trainings on Structured Trade Finance Provided to 1,500 African Bankers by Afreximbank

According to the African Export-Import Bank or Afreximbank for short, there were over 1,500 African bankers and trade finance professionals trained in structured trade finance, providing them the knowledge and appropriate skills in order to boost the continent’s economic status, says by the Bank during a press release taken from ghanabusinessnews.com.

Pointed out in the release, Dr. Benedict Oramah the Bank President who mentioned that the training enclosed both basic and innovative information of the subject in his opening remarks during the 15th Annual Structured Trade Finance seminar in Nairobi held from November 10-13.

“The Structured Trade Finance Seminars’ ultimate goals are to make and expand the African Bankers and trade practitioners’ knowledge on matters concerning structuring trade and production chain finance arrangement of different complexity levels,” Dr. Oramah quoted as he says that Afreximbank was able to structure and supply a good number of deals. It’s quite impressive that it includes the most complicated markets through utilizing the structured finance means.

Based to the statement, networking opportunities for those participants can also be created through the seminar conducted so as to promote intra-African banking organizations and develop collaboration by financial institutes in African financing trade.

The Deputy Governor of Kenya’s Central bank, Shiela Mmbijjewe was reported to have stated that the structured finance played a significant role in stabilizing the African market and that the training conducted by Afreximbank will lead to the likelihood that those problems in African can be solved by African-made solutions.

As what Ms. Mmbijjewe said, today’s poor trade statue was connected to the existing financing gap of Africa.

Moreover, the ACBF or the African Capacity Building Foundation Executive Secretary Prof. Emmanuel Nnadozie reported that the accessibility of budget-friendly trade finance was a main restraint in trading development in the African continent and noted that by way of the structured trade finance seminar. Afreximbank was meeting the urgent necessary skills to structure trade dealings.

Afreximbank was responsible in organizing the Structured Trade Finance Seminar, being part of the initiatives to raise the trade and the trade finance capacities of main players in the trade sector of Africa together with the mandate and the missions to become “the Centre of Excellence in African trade agreements.

The Bank said over 120 participants from 24 various countries worldwide all over African, united by others from U.S.A, United Kingdom, United Arab Emirates and India joined the seminars.

Qatar Holds Euromoney Conference for 2015

Financial technology, also known as FinTech, has been one of the areas that made significant growth over the past years. It captured the attention of the financial industry, both banking institutions and venture capitalists, as it is considered to be the solution to a wide variety of challenges in the sector.

The rise of the digital technology in the financial industry has resulted to quite a number of good improvements. Some of the improvements have led to enhance marketing. Furthermore, ease of access was also observed. However, it has also generated a wide range of risks for central banks and various financial institutions, according to the leading experts of the industry. Some of these risks include fraud and security. This has been a longstanding problem not only in Qatar, but also in other countries as well. Many financial sectors around the world are working to address this problem.

Euromoney Qatar Conference 2015

The upcoming Euromoney Qatar Conference 2015, which will be held at The Ritz-Carlton, Doha on December 9 to 10, will be gathering a number of specialists that will look at the issues associated with financial technology, such as the rise of “crypto-currencies” and several solutions that are available for financial institutions, like the banks and financial services companies.

The conference also aims to analyze and evaluate the effectiveness of the development of the new wave of technology in Qatar, as well as to check the opportunities for the nation as it is developing its knowledge-based economy.

forex
Doha to Host Euromoney Conference 2015. By www.qna.org.qa

FinTech in the Global Scale

According to experts, the challenge for Qatar is to deploy FinTech gin a global scale. According to the survey conducted by the Economist Intelligence Unit in 2015, about 50 percent of the nation’s global banking executives believe that their organization lacks a clear and strategic vision for their future in digital technology.

During the opening morning of the Conference, the Minister of Information and Communications Technology, H.E. Dr. Hessa Al-Jabber will be delivering a keynote that addresses the digital future of Qatar. He will also be addressing the role of the ICT industry in securing, as well as maintaining the nation’s position of being the world class destination for trade and investment.

On day two of the conference, it will be opened with a series of panel discussions that will be focusing much on technology and finance. Several financial personalities will be in attendance, such as Gert Botha, the Chief Executive Officer of Hive Technology; and Hadi Raad, the Head of Emerging Products and Innovation for Visa.

The conference is among the several conferences that are set to run in the coming months which aim to focus greatly on many critical issues faced by the financial sector of Qatar.

The conference will be held under H.E. Sheikh Abdullah bin Nasser bin Khalifa Al Thani, who is the Prime Minister Of the State of Qatar. It will include contributions from H.E. Sheikh Abdulla Bin Saoud Al-Thani, Governor of Qatar Central Bank; Sir John Scarlett, Former Head of MI6; H.E. Mr. Ali Shareef Al Emadi, the Finance Minister of the State of Qatar; and Dimitris Tsitsiragos, the Vice President of the International Finance Corporation.

Overview of Euromoney

Euromoney Conferences is actually the leader in organizing the financial events of both the developed and developing markets for cross-border investments, as well as capital markets. Euromoney Conferences has run many events in over 60 countries since the late 1970s with booming success. It has organized some large-scale conferences in the major financial capitals throughout the world. It has also organized conferences for selected Middle East countries, most notably Egypt, Kuwait, Lebanon, Saudi Arabia, and Qatar.

On Islamic Finance Industry

The rapid expansion of Islamic finance reflects its ability to meet the diverse demands of consumers and businesses, thereby fostering growth.

Once an impenetrable industry, the market for various Islamic financial products is becoming more and more global. Studies show that the worldwide assets of the Islamic financial industry are more than $1.87 trillion, which is a huge growth from having merely $150 billion during the mid-90s.

Key Issues and Themes

According to Dr. Mohammad Al-Hashel, the Governor of the Central Bank of Kuwait, the first theme is about the concerns on increasing financial inclusion through access to finance. This is important for economic stimulation and welfare improvement for the underprivileged individuals. The Islamic Finance will do this by promoting Islamic micro-financing to small and medium-sized enterprises.

Another theme that was discussed is how they could strengthen their regulations and supervision in order to encourage financial stability. They need more efforts to improve the regulatory frameworks of the Islamic financial industry, while making sure that there is consistency in its application.

The third theme discussed was the development of Islamic bonds, Sukuk, and other long-term Islamic financial instruments aimed for financing infrastructure and sustaining development. In order to do so, they have to improve their legal, regulatory, and disclosure terms, as well as market infrastructure.

Challenges in Facing Islamic Finance

Dr. Al-Hashel noted that there are two key challenges in facing Islamic Finance; and that is: market development, and the establishment of robust supervisory and regulatory frameworks.

According to him, stakeholders are well aware of these challenges and the need to address them. But, they also know that improving market development and regulatory frameworks are a continuous process in terms of changing the needs of the industry, as well as demographic and macroeconomic environments.

The TJN’s Index of the World’s Offshore Tax Havens

The Tax Justice Network compiled a 2015 index of the world’s offshore havens showing 2 Asian countries, Hong Kong and Singapore, rising from their previous ranking for financial secrecy. The Chinese territory is currently in the number 2 spot, trailing behind Switzerland.

According to the Tax Justice Network that is based in London, both of these financial hubs in Asia have made insufficient reforms to their corporate secrecy regimes. If you must know, the TJN campaigns for transparency in terms of finance. In the previous index made in 2003, Singapore’s ranking has moved from the 5th place to the 4th place; meanwhile, Hong Kong was in the number 3 spot.

The TJN said, “Singapore, in fourth place, poses many of the same threats that Hong Kong does: a lack of serious reforms to its corporate secrecy regime; a lack of interest in creating country- by-country reporting or in creating public registries of beneficial ownership.”

The Global Market

The TJN says that the two countries account for about 4% of the global market in terms of financial services offshore. These two hubs are highly exposed to offshore processes mainly because they have increasing assets that are under management and they are regional financial hubs as well.

The Spokesperson of the Financial Services and Treasury Bureau of Hong Kong sent a response through an e-mail regarding the survey to the TJN saying, “We do not have laws protecting bank secrecy and so we have never attracted foreign capital by such means. Hong Kong has all along been highly supportive of international efforts to enhance tax transparency and combat tax evasion.”

The US Ranked 3rd

The U.S., on the other hand, was on the 3rd spot for secrecy according to the TJN; primarily because they refused to take part in the global system of exchanging bank data devised by the Organization for Economic Cooperation and Development.

According to the report by Forbes, the TJN accused the IRS of being stingy in terms of sharing its data.

The Cayman Islands

Despite being criticized by many U.S. politicians and media that they are a so-called “tax haven”, Cayman Islands is ranked below the U.S. in the latest edition of the financial secrecy index according to the TJN.

The Huffington Post writes that the Financial Secrecy Index report shows that there is an approximately $21 to $32 trillion worth of privately-owned financial wealth that are lightly taxed, if not untaxed at all, in secrecy jurisdictions around the world. The city, on the other hand, doesn’t maintain company ownership details among their official records.

Aside from that, the index also noted that the region doesn’t avoid the promotion of tax evasion through a tax credit system. It also doesn’t require residents to pay certain agents to inform the domestic tax officials regarding payments to non-residents.

Other Countries

Even the United Kingdom hasn’t escaped the spotlight. According to the TJN, they could have easily surpassed Switzerland.

Macau, which only makes below 0.2% of the global market in terms of offshore financial services, is considered a small player compared to other jurisdictions, says the TJN.

India, on the other hand, has made a notable improvement in the last 2 years in terms of financial transparency.

The TJN

The Tax Justice Network evaluates a country’s financial secrecy by combining global data of offshore financial territories, along with the qualitative rating of 15 secrecy indicators such as existence and availability of registers for trusts and foundations; bank secrecy; companies; beneficial owners; accounts and financial reports; efficiency of tax implementation and administration, as well as tax-evasion and anti-money laundering laws; automatic exchange of information; bilateral treaties and worldwide contracts and commitments; and worldwide judicial cooperation.