Category Archives: General Articles

Understanding Leverage in Forex Trading

More and more people are moving into the forex trading market. There are many attractions of this type of trading, not least of all the amount of financial leverage that is available. Here we will look at what leverage is to understand the pros and cons of how it can impact your career as a trader.

 What is Leverage?

Leverage is a loan that a broker offers to a trader who has a forex account with them, which essentially boosts their account by up to as much as 1,000 times what they have in their account. This allows the trader to control a large amount of money with very little capital. The amount that the broker will lend is expressed as a ratio, typically 50:1, 100:1 or 200:1.

How Does Leverage Work

 Leverage of 100:1 means that for $1,000 in your account, you will actually be controlling a $100,000 position. This means that if you invest $100,000 and it grows to $101,000, if you had come up with the entire capital yourself, your profit would be only 1%. However, with 100:1 leverage, only $1,000 of your money was used making your return an impressive 100%.

Leverage as a Double-Edged Sword

Using our example of 100:1 leverage, your return can be significant if the investment rises. However, what would happen if you lost $1,000? Well, the loss would be relative to the gain if the opposite were true and this would mean that you would lose a whopping 100%. For this reason, leverage has become known as a “double-edged sword” or a “two-way street.”

Controlling Leverage

 Because leverage magnifies losses as well as profits, it needs to be controlled. If we look at two traders who each have $10,000 in their account and each have a 100 pips stop loss, but Trader 1 has 50:1 leverage and Trader 2 has 5:1 leverage, the difference in their losses would be significant. After a 100 pip stop loss, Trader 1 would have lost $5,000 (half of his entire account balance), while Trader 2 would have lost $500 and would more easily be able to move on to another trade. The key is to find the right balance for you between your potential profits and losses so that your profits are significant enough to be worthwhile, while your losses are not too significant to prevent you continuing to trade. The amount of leverage to use is individual and depends on many factors. As a general rule, the longer you plan to keep your position open, the smaller your leverage should be. When opening a position that you expect to only last a few minutes or even a few seconds, many people aim for the highest possible leverage available to aim for the highest possible profit over small market fluctuations. In other words, the amount of leverage depends on your trading strategy and how much you can lose.…

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How To Keep Your Cool When You’re Being Sued

Being sued can be an incredibly stressful experience. Whether you’re facing criminal or civil charges, odds are that you find yourself worrying about your case quite often. It’s normal to feel anxiety when you’re in the middle of a lawsuit. However, you don’t have to completely lose your cool. While you might not be able to completely rid yourself of worry, you can take some steps to breathe a bit easier. Here are some tips on how you can keep your cool throughout your case.

Communicate With Your Attorney

If you don’t know the answer to a question, it’s easy to start imagining all of the hypothetical outcomes and worry about the worst case scenarios. This is why consistent communication with your attorney is essential. Whether you have a very simple question or a more complex question, ask it as soon as possible. For example, if your attorney suggests a litigation support specialist to serve as an expert witness during your trial, ask about his or her credentials and get more information about what role they’ll play in your court proceedings.

Not only does frequent communication with your attorney help you to keep your cool, but it makes your attorney’s job easier as well. Your lawyer needs all of the information that you have pertaining to your case in order to get you the justice you deserve.

Talk Privately

One of the worst things you can do during a court case is to vent about your situation on social media. If the opposing counsel finds your posts, they can be used against you during your trial. This is a frequent issue in family court proceedings. One party will feel frustrated and get the urge to complain about their spouse on social media. These posts can often come back to bite the person who originally posted them.

It’s normal to have a lot of emotions during a court case. However, avoid venting them on social media. Instead, share feelings privately with someone who you love and trust. If you’re truly feeling a lot of pressure and unhappiness surrounding your trial, consider seeing a mental health professional. Therapists and psychiatrists understand the mental tolls that trials can take on people and can help you to work through your feelings.

If you follow these tips, you can keep your cool during your court proceedings.…

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3 Instances Where PayPal will Prove Useful Over Traditional Merchant Accounts and Other PayPal Alternatives

No matter the situation, the chances of having your PayPal account blocked are much higher than when operating a Traditional Merchant Account. This is simply because PayPal doesn’t underwrite. Therefore, if your account means the world to you, it’s time to reconsider solely depending on PayPal- there are several PayPal alternatives. However, below are a few instances where you will find PayPal useful.

When to use PayPal

  • When in the Process of Proving a Business Idea

If you are looking to prove you if your new idea can be a practical business, PayPal is the best way to go. Setting up an account is easy and super fast. Though you may pay a somewhat higher percentage to sort set up charges and transaction fee, the advantage is; you won’t have to pay a monthly fee. With no proof that your concept is workable, you can’t be sure if the business will be operational in the next month or if you may want to modify the model of your business. Such situations will work to your advantage if you don’t have a contract that all other merchant accounts have.

  • As a supplementary payment method

PayPal may also prove useful to your small as well as established company, especially when there is need to attract a group of people abandoning your shopping cart. Also, it may be used to serve the portion that won’t purchase if they can’t use PayPal. However, this will depend on the type of market your business is targeting- it is important to think of it before implementing to ensure PayPal will add to the number of buyers in your shopping cart. Even retailers can use PayPal as an alternative method of payment to their Traditional Merchant account for consumers who may wish to use it.

  • When you are making low Sales

If your business is just picking up and your sales are below 10,000 per month, there is no need to spend time and energy protecting your business with a traditional merchant account. Also, there are fewer chances of an Aggregator flagging your account as opposed to when you have 100k or more- which will come with many liabilities especially if your business is considered high-risk.

While PayPal is lately under a lot of criticism, you may want to use it to your advantage, especially in the above cases. Also because it is the most common method of online payment- you may be losing many potential buyers.…

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What is Arbitrage in Forex?

In Forex trading, the way to make a profit usually is to anticipate the direction of price movement in the future. However, there are actually other ways to profit without having to guess the direction of price movement, commonly known as market-neutral strategy. One of them, Forex Arbitrage. What is it in Arbitrage in Forex?

Definition of Arbitrage in Forex

Meaning of Arbitrage in Forex and financial trading world in contrast to the use of the term arbitration in law (jurisprudence). Arbitration is a way of trading in which traders tried to profit from price differences between the instrument in two different markets. In English, the trader arbitrage strategy commonly referred to as “arbitrageurs”.

The arbitrageurs typically do buy in the market while at the same time do sell the same amount of the trade size in other markets, with the aim of profiting from the difference between prices in the two markets. It is possible to do because the products (assets / instruments) The same could be traded at different prices in different locations.

For example, some companies registered in more than one stock market, even multinational companies could be listed on the stock market at several different countries. Theoretically, the share price should be in the same range as it comes from the same company. However, the fact that the flow of information does not flow at the same rate to all parts of the world and the market is not always efficient functioning fully. Therefore, the share price for the company is not always the same in different stock markets.

People who know the difference in price can buy shares on the exchange are worth less, while doing that sell in the stock price of his position higher. Thus, the profit will be locked. For more information, click here.

If so, how do arbitrage in Forex?

Traders who wish to arbitrage in Forex basically do the same thing; they do buy in a currency broker that provides lower prices, while at the same time do sell at a broker that provides higher prices. Net of transaction costs, the profit is the remainder of the difference between the two prices. How can vary, but the point is trying to take advantage of price anomalies.

Forex arbitrage practices including strategies that are often run by hedge fund firms and actors Forex trading at the institutional level. However, rarely do so at the level of the retail trader. In addition to its retail Forex broker between the price less the same, as well as not a few retail Forex broker prohibits the use of arbitration.

There are several ways you can do when this strategy allowed or impossible to enforce. The first way is to do Forex arbitrage between the two brokers who provide different bid prices for a currency pair (Broker Arbitrage). While the second way to use Triangular Arbitrage similar to hedging.

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Common Factors Why People Sell Their Business

In the competitive world of business, there are usually hundreds of transactions made each week. These transactions include acquisitions, management buyouts recapitalizations, leveraged buyouts and mergers. Corporations with million Canadian dollars are also involved in these transactions. What do you think are the reasons behind websites posting articles on why entrepreneurs sell a business? Read on to know some of these points when planning to sell your business in Canada.

Business Value

You should know the value of your business in the existing marketplace so you will know if selling it at certain time is viable. Consider getting your company into liquidity whenever you have an opportunity. Operating a business is actually risky and you will get more and hold on to it longer when your risk to failure is greater. There is no liquidity in a business unless you go through a selling transaction of a part of the whole company.

Tired of Business Risk

Entrepreneurs tend to be more confident in taking their risk during the early stages of their business. If you would want to grow your business beyond its initial stages, take every possible chance you have in the market. The value of your company grows and entrepreneurs become more conservative as their company grows with fear that there will be greater damage compared to the time when it is still developing. Older Canadian entrepreneurs tend to avoid risky situations like fixing bad strategies for damage control since they do not have enough time to do it.

Entrepreneurs need to find ways on how to exit their investment, making it a smart decision for their business.

Best Time to Change

The decision of business owners to sell their business because it’s the right time is not only the main reason though an opportunity for liquidity can be considered as a good factor. Corporate founders and CEOs may think of retirement after 15-20 years of spending their energy, resources and time in building the company. Another possibility may be the readiness of the owner for change and search for a new opportunity.

Buyer Motivation

Private equity is considered more suitable of quick engagement of the owner, evaluation of the business and completion of acquisition. Disputes among the family members can be a driver of acquisitions. However, incoming investors can prevent dysfunctional individuals and can restore excellent business management practices.

Sellers may plan to sell their business for strategic or operational purposes such as:

  • Finance for an expansion
  • Place for better management
  • Get market share
  • Diversify focused customer base
  • Increase capital for any acquisition
  • Secure for succession in leadership
  • Diversify service and product offerings

But before selling your business, you should note the following:

  • Timing of business sale
  • Looking for the right, best prospective buyers
  • Preparing your company for sale through the right technology, audited financials and good executive team

It is a smart idea to plan-out the exit of your company and prepare when there is a right timing so you can maximize the value of your company in Canada.…

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