Foreign exchange trading risk management

{}Posted in2023/2/25 4:08:25 | 6Browse

Hedging Forex rebate for Exness most common in the cashbackforexexness ForexrebateforExness market, with the intention of avoiding the risk of single line trading The so-called single line trading, is to look at a forexcashrebate to do buy short (or hold position), bearish a currency, do sell short (short position) If the judgment is correct, the profits gained naturally more; but if the judgment is wrong, the loss will not be greater than no hedging The so-called hedging, is the same cashback forex to buy a foreign currency, do buy short another also to sell another currency. It is the same time to buy a foreign currency, do short buying another currency to sell another currency, that is, short selling theoretically, buy short a currency and sell short a currency, to the same silver code, to be considered a real hedging plate, otherwise the size of the two sides are not the same can not do the function of hedging to do so, the reason is that the worlds foreign exchange market is the forexrebates as the unit of calculation of all foreign currencies rise and fall in the dollar as the relative exchange rate dollar strong, that is Therefore, if you are optimistic about a currency, but want to reduce the risk, you need to sell a bearish currency at the same time to buy a strong currency and sell a weak currency, if the estimate is correct, the dollar is weak, the strong currency bought will rise; even if the estimate is wrong, the dollar is strong, the currency bought will not fall too much to sell short the weak currency but fall heavily In early 1990, the Middle East Iraq War ended, the United States became the victorious country, the dollar price also rose steadily, the trend is strong, against all foreign exchange are up, at that time only the yen is still a strong currency at that time, the Berlin Wall fell soon, Germany just unified, the poor economy of East Germany dragged Germany, the economy has hidden worries Soviet political instability, Gorbachevs position was shaken Britain At that time, the economy was also poor, interest rates continue to cut, and the Conservative Party was challenged by the Labour Party, so the British pound is also weak Swiss franc in the post-war as a refuge from the wars attractiveness greatly reduced, also become a weak currency If you buy foreign exchange at that time, long sell British pounds, marks, Swiss francs, while buying short yen, will make a lot of money when the dollar rises, all foreign currencies are down, only the yen fell the least, other foreign currencies have fallen; when the dollar back to soft, the other rising currencies rose less, the yen fell sharply; when the dollar, the other rising currencies rose less, the yen fell sharply. When the dollar weakens, other currencies will rise less, but the yen will rise greatly. In any case, as long as the market at the time so hedge, will profit in 1997, Soross Quantum Fund sold a lot of Thai baht to buy other currencies, Thailands stock market fell, the Thai government can no longer maintain the linked exchange rate, the economy lost a lot of money while the fund is greatly profitable in addition to Thailand, Hong Kong and other countries and regions to maintain the price of the currency linked exchange rate have suffered Hedge funds challenge the Hong Kong government to raise interest rates significantly, overnight interest rates up to 300%, but also use foreign exchange reserves of 120 billion Hong Kong dollars to buy a large number of Hong Kong stocks finally repel speculators

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