Foreign exchange refers to the trading of foreign currency or the foreign country currency. Now a days Forex trading has become more popular because it has big margin of profit. If you are interested in making money from Forex trading you should be well acknowledged with the terms and concepts which are mostly used in Forex market because it has great risk of loss. Some concepts are given here for the guidance of beginners.
Bear Raid
A bear raid is a type of stock market strategy, where a trader try to push the price of a stock down by taking large short positions and spreading unfavorable rumors about the target firm. In a bear raid, the manipulators profit on the difference between the original stock price and the lower price. Bear Tack A downward movement in the value of a stock, sector, or market, or investor sentiment that assumes a fall will happen soon. A bear tack is usually used to describe bearish movement in the short to medium term.
Leverage trading
The ability to control large dollar amounts of a commodity or security with a comparatively small amount of capital. Leverage trading is a common practice in foreign exchange trading also called trading on margin.
Exchange Rate
The price of a currency expressed in terms of other currencies. Fixed exchange rates exist when governments agree to maintain the value of their currencies at pre-established levels. This is also known as the rate at which one currency may be exchanged for another.
Inflation
The overall general upward price movement of goods and services in an economy is known as inflation. It is usually measured by the consumer price index. Inflation causes money to decrease in value at some rate, and does so whether the money is invested or not.
Inflation Risk
Inflation risk is the risk that rising prices of goods and services over time, or, generally the cost of living, will decrease the value of the return on investments. Inflation risk is also known as ‘purchasing-power risk’ since it refers to increased prices of goods and services and a decreased value of cash.
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