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inetinfotech123 (3)

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Specialists from The Fido Academy will go through seven essential forex trading strategies in a set of well-defined articles as part of an endeavor to educate and enlighten the minds of aspiring traders. In this article, we will take a closer look at the Carry Trade Strategy Want to learn Advanced Trading Strategy for forex Contact below details, For More Info: Visit: Contact no: ( 91) 82484 64994 Mail-id: info@thefidoacademy.com – PowerPoint PPT presentation

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Title: inetinfotech123 (3)


1
An Expert Guide To Learn Advanced Trading
Strategies For Forex Part 2Carry Trade
Strategy
2
INTRODUCTION
  • One of the most important aspects of currency
    trading is creating an effective Forex trading
    strategy. To make a profit, traders should work
    on reducing losing trades and improving winning
    trades.
  • Any trading strategy that helps you achieve this
    goal has the potential to be rewarding. In
    general, several types of traders have
    established a wide range of trading tactics to
    help you earn in the market.
  • A trader must learn Advanced Trading Strategies
    that are appropriate for their forex trading and
    investment horizon.

3
SEVEN KEY FOREX TRADING STRATEGIES
  • Experts from The Fido Academy will go through
    seven key forex trading tactics in a set of
    well-defined articles as part of an endeavor to
    educate and enlighten the minds of prospective
    traders.
  • Breakout Trading Strategy
  • Carry Trade Strategy
  • Fundamental Analysis Strategy
  • Momentum Trading Strategy
  • Range Trading Strategy
  • Trend Trading Strategy
  • Moving Average Crossover Strategy
  • Each article is easy to understand and ideal for
    individuals who are still honing their skills. In
    previous article we saw the Breakout Trading
    Strategy and now We'll take a closer look at the
    Carry Trade Strategy in this article.

4
What is a Carry Trade Strategy?
  • A Carry Trade is an investment strategy in which
    a high-yielding currency funds a low-yielding
    one. A trader who employs this method tries to
    profit from the disparity in rates, which can be
    significant depending on the level of leverage
    used. 
  • In the forex market, the carry trade is one of
    the most common trading methods. Because the
    interest rate spreads on these currency pairings
    are relatively broad, the most popular carry
    trades have been buying currency pairs like the
    Australian dollar/Japanese yen and the New
    Zealand dollar/Japanese yen. Identifying the
    high-yielding and low-yielding currencies is the
    primary stage in putting together a carry trade.

5
The Basics of a Currency Carry Trade
  • The Carry Trade is among the most often used
    currency trading methods. It's similar to the
    adage "buy low, sell high." The comfortable
    pathway to start a carry trade is to spot which
    currency has the highest yield and which has the
    lowest.
  • The most common carry trades include buying
    currency pairings with wide interest rate
    spreads, such as the AUD/JPY and the NZD/JPY.

6
  • Mechanics of the Carry Trade
  • As long as the exchange rate between the
    currencies does not change, a trader can profit
    from the differential in interest rates between
    the two countries. Many professional traders
    utilize this strategy since the profits can be
    substantial inclusive of leverage. If the trader
    in our example chooses a common leverage factor
    of 101, he stands to profit ten times the
    difference in interest rates.
  • Best time to Get in and Get Out
  • When central banks are increasing or considering
    hiking interest rates, it is the perfect time to
    enter a carry trade. Many people are jumping on
    the carry trade bandwagon, causing the currency
    pair's value to rise. Similarly, at times of low
    volatility, these trades work effectively.
    Because these traders are willing to take on more
    risks, The Traders will get rewarded until the
    currency's value does not collapse. 
  • However, traders will not benefit awesomely from
    a period of interest rate lowering in Carrying
    trades. The change in monetary policy has
    resulted in a variation in currency values. When
    interest rates fall, demand for the currency
    falls as well, making it tougher to sell the
    currency. Essentially, there must be no movement
    or some degree of appreciation for the carry
    trade to be profitable.

7
For More Info
  • Visit https//thefidoacademy.com/
  • Contact no (91) 82484 64994
  • Mail-id info_at_thefidoacademy.com
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