Asset Management Asset management refers to the process of developing, operating, maintaining, and cost-effectively selling assets. Most commonly used in finance, the term is used about individuals or firms that manage assets on behalf of individuals or other entities. Importance There are several reasons why businesses should be concerned about it, including: 1. Enables a…
Interest rate An interest rate is either the cost of borrowing money or the reward for saving it. It is calculated as a percentage of the amount borrowed or saved.1 You borrow money from banks when you take out a home mortgage. Other loans can be used for buying a car, an appliance, or paying…
Futures market To understand fully what a futures market is, it’s important to understand the basics of futures contracts, the assets traded in these markets. Futures contracts are made in an attempt by producers and suppliers of commodities to avoid market volatility. These producers and suppliers negotiate contracts with an investor who agrees to take on both…
Margin Call To understand a forex margin call, it is essential to know about the interrelated concepts of margin and leverage. Margin and leverage are two sides of the same coin. Margin is the minimum amount of money required to place a leveraged trade. Leverage provides traders with greater exposure to markets without having to fund the…
Currency Revaluation What is Currency Revaluation? In a fixed exchange rate regime, only a decision by a country’s government, such as its central bank, can alter the official value of the currency. Developing economies are more likely to use a fixed-rate system to limit speculation and provide a stable system. A floating rate is the opposite of a…
Currency Appreciation Currency appreciation in the same context is an increase in the value of the currency. Short-term changes in the value of a currency are reflected in changes in the exchange rate. Basics of Currency Appreciation In a floating rate exchange system, the value of a currency constantly changes based on supply and demand. Therefore, the…
How is forex profit calculated Calculating Profit and Loss How forex profit is calculated? The actual calculation of profit and loss in a position is quite straightforward. To calculate the P&L of a position, what you need is the position size and the number of pips the price has moved. Therefore, the actual profit or…
Technical analysis Technical analysis is the framework in which traders study price movement. Foreign exchange markets are particularly well suited to using technical analysis. The high levels of liquidity in terms of trading volumes and some players, and sensitivity to big long-term national-level trends means that forex markets tend to trend over time and patterns often…
Resistance Level The resistance level can visualize using different technical indicators rather than simply drawing a line connecting highs. What is Resistance? Initially, the resistance level on a candlestick chart is the price when you can expect more sellers than buyers. It prevents the price from rising further and the resistance levels indicate a price…
Support Level Support level occurs where a downtrend expects to pause due to a concentration of demand. It refers to the price level that an asset does not fall below for a period of time. Buyers, entering the market whenever the asset dips to a lower price, create an asset’s support level. In technical analysis,…