Some circumstances can hinder or prevent arbitrage. A discount or premium may result from currency market liquidity differences, which is not a price anomaly or arbitrage opportunity, making it more challenging to execute trades to close a position. Arbitrage demands rapid execution, so a slow trading platform or trade entry
Risk arbitrage trading is a popular trading strategy in times of takeovers involving publicly traded companies. Assume company ABC shares are trading at $30 a share in the market. Upon the close of the market, it emerges that company XYZ has placed a takeover bid that values ABC at $36
Forex arbitrage is the strategy of exploiting price disparity in the forex markets. It may be effected in various ways but however it is carried out, the arbitrage seeks to buy currency prices and sell currency prices that are currently divergent but extremely likely to rapidly converge. The expectation is
Leverage is the use of borrowed money (called capital) to invest in a currency, stock, or security. The concept of leverage is very common in forex trading. By borrowing money from a broker, investors can trade larger positions in a currency. As a result, leverage magnifies the returns from favorable movements in a
Pip is an acronym for percentage in point or price interest point. A pip is the smallest price move that an exchange rate can make based on forex market convention. Most currency pairs are priced out to four decimal places and the pip change is the last (fourth) decimal point.
A currency pair is the quotation of two different currencies, with the value of one currency being quoted against the other. The first listed currency of a currency pair is called the base currency, and the second currency is called the quote currency. Currency pairs compare the value of one
As a trader, another important things to know is, when to trade. The Busiest Forex Market Hours WorldWide In total, there are 15 independent Forex exchanges worldwide, open five days a week, from Monday to Friday. They have four exchanges are considered the busiest and most established exchanges which is
