Notice message :Turkish presidential election will be taken place on 24 June 2018 (local time). Please be aware of the forex market changes, especially for Turkish Lira and European Euro, and closely monitor your positions and ensure you have enough margin in the account.

Basic Concepts

Learning to trade in a new market is like learning to speak a new language. It’s easier when you have a good vocabulary and understand some basic ideas and concepts. So let’s start with the basics of forex trading

 

CURRENCY SYMBOLS

3-letter symbols are commonly used to denote currencies such as USD for the US dollar and EUR for the Euro.

 

CURRENCY SYMBOL CURRENCY SYMBOL
US dollar USD Canadian Dollar CAD
European Euro EUR Australian Dollar AUD
British Pound GBP New Zealand Dollar NZD
Japanese Yen JPY Norwegian Krone NOK
Swiss Franc CHF Hong Kong Dollar HKD
Chinese Yuan CNH Mexican Peso MXN
Swedish Krona SEK Turkish Lira TRY
South African Rand ZAR Singaporean Dollar SGD

 

CURRENCY PAIRS

Currencies are quoted in pairs, such as EUR/USD or USD/JPY. The first listed currency is known as the base currency, while the second is called the counter or quote currency. The base currency is the “basis” for the buy or the sell.

 

Example
If you BUY or “GO LONG ON” EUR/USD you buy Euros (and simultaneously sell dollars). You would do so in expectation that the euro will appreciate (go up) relative to the US dollar. On the other hand if you thought that there were reasons that demand for dollars would rise compared to the Euro you would SELL or ‘SHORT” EUR/USD (selling Euros for dollars).

 

PRICE QUOTE

Forex is quoted in pairs, how much one unit of the base (first listed) currency is worth in counter/ quote (second listed) currency.

 

Example
 The EUR/USD at 1.1699 shows how much one euro (EUR) is worth in us dollars (USD). Therefore, 1 EUR = 1.1699 USD

 

LOT SIZE

A lot is the smallest trade size available. Rakuten Securities HK accounts have a lot size of 1K (1,000) units of currency. Account holders can however place trades of different sizes, so long as they are in increments of 1K units like, 2K, 3K, 15K, 112K etc.

Example: Spread of EUR/USD is
0.7 pips which is 0.00007 USD.

SPREADS

Just like in all markets, there are two prices- buy and sell, for every currency pair. The difference between the buy price and sell price is the spread, or the cost of the trade. An example on the left, the spread is 0.7. On a Rakuten Securities HK 1K lot size USD-denominated account, a pip on the EUR/USD currency pair is worth US$0.1.

 

PIP

A pip is the unit used for price quotation change and counting profit or loss in Forex market. In Rakuten Securities HK, most currency pairs are quoted to five decimal places, the fourth spot after the decimal point (at one 100th of a cent) is typically what one watches to count “pips”. For Japanese Yen-related currency pairs, prices are quoted to 3 decimal places, whereas the second spot after the decimal point (a cent of yen) is what one watches to count “pips”. Every point that place moves is 1 pip of movement.

Example
EUR/USD rises from 1.16997 to 1.17007, the EUR/USD has risen 1 pips.

USD/JPY drops from 110.200 to 110.145, the USD/JPY has dropped 5.5 pips.

 

LEVERAGE AND MARGIN

At Rakuten Securities HK, leverage of 20:1 allows you to trade with $1,000 in the market by setting aside only $50 as a security deposit. All trades are executed using borrowed money. This allows you to take advantage of leverage. This means that you can take advantage of even the smallest movements in currencies by controlling more money in the market than you have in your account. On the other hand, leverage can significantly increase your losses. Trading foreign exchange with any level of leverage may not be suitable for all investors.

The specific amount that you are required to put aside to hold a position is referred to as your margin requirement. Margin can be thought of as a good faith deposit required to maintain open positions. This is not a fee or a transaction cost, it is simply a portion of your account equity set aside and allocated as a margin deposit.

 

 

In short, the leverage ratio is determined by the % of margin requirement as you use margin to create leverage.

 

ROLLOVER INTEREST

Traders holding positions for more than one day will receive or pay the interest difference between the two currencies in the pair they are trading. Though daily interest is tiny, leverage* can make this interest significant.

 

* Without proper risk management, this high degree of leverage can lead to large losses as well as gains.

 

Register a Rakuten FX Trading Platform Demo (Desktop)

*Required Fields

I acknowledge that Rakuten Securities HK may contact me via phone or e-mail with information on Rakuten Securities HK's products, services, promotional offers and trading education, and assist me in using the forex online trading platform.

Although demo accounts attempt to replicate real-time market scenarios, they are based on simulated market environment. As such, there are key differences that distinguish it from a live account; including but not limited to, the lack of dependence on real-time market liquidity, delay or difference in pricing and spread. The operational capabilities when executing orders in a demo environment may result in atypically expedited transactions, lack of rejected orders, and/or the absence of slippage. Additionally, updates to demo account may not coincide with those of live accounts.

^ Rakuten Securities was ranked as the world’s third largest retail forex broker by volume in March 2017 from Finance Magnates.
Ŧ Only available for clients who hold a Rakuten FX account.
¤ Fixed spreads are offered in Rakuten FX account during at least 95% of the time of the monthly core-time trading period (8am to 2am HKT of every trading day). Spreads shown above and in our website are for reference only and are not guaranteed and may widen beyond the average spreads depending on the market volatility, especially under circumstances of extremely low liquidity, news events or public holidays. Please always refer to the trading platforms for the most updated spreads.
ɞ Order execution rate is calculated based on the AS Streaming and Streaming trading orders in 10k or less order size with lower than 1 pip slippage setting in which were executed during the period between Jan 1 to Nov 1, 2017.
§ Rakuten Securities HK offers Trading Station platform through its partner FXCM.
※ Commission is charged per trade side on both open trade(s) and close trade(s). All commission fees may be subject to change from time to time without prior notice. Please always refer to the most updated Schedule of Standard Fees and Charges.
ʊ MARKETSPEED FX platform is the winner of “Online Forex Trading Platform” by Good Design Award in 2012.
To safeguard your trading account(s), you are highly recommended to set a strong password and change it regularly.

When executing customers’ trades, Rakuten Securities HK can be compensated in several ways, which include, but are not limited to: charging fixed lot-based commissions at the open and close of a trade, adding a markup to the spreads, acting as a counterparty in the transactions. As a result, Rakuten Securities HK’s interests may be in conflict with yours.

Rakuten Securities Hong Kong Limited (“Rakuten Securities HK” SFC CE Number: AIM232) is a wholly owned subsidiary of Rakuten Securities, Inc. (*) Rakuten Securities, Inc., one of the major online brokers in Japan, founded in 1999, is a subsidiary of Rakuten, Inc. (TOKYO: 4755).
The risk of loss in leveraged foreign exchange trading can be substantial. You may not be suitable as you may sustain losses in excess of your initial margin funds. Leverage can work against you. Placing contingent orders, such as “stop-loss” or “stop-limit” orders, will not necessarily limit losses to the intended amounts. Market conditions may make it impossible to execute such orders. You may be called upon at short notice to deposit additional margin funds. If the required funds are not provided within the prescribed time, your position may be liquidated. You will remain liable for any resulting deficit in your account. You should therefore carefully consider whether such trading is suitable in light of your own financial position and investment objectives. Do not speculate with capital that you cannot afford to lose. If you decide to trade products offered by Rakuten Securities HK, you must read and understand the information and disclosure provided by Rakuten Securities HK. Rakuten Securities HK may provide general commentary which is not intended as investment advice and must not be construed as such. Seek advice from a separate financial advisor. Rakuten Securities HK and Rakuten Group assumes no liability for errors, inaccuracies or omissions; does not warrant the accuracy, completeness of information, text, graphics, links or other items contained within these materials. Read and understand the Terms and Conditions on Rakuten Securities HK’s website prior to taking further action.
Information Security on Internet: To protect your privacy, do not access your trading account via public or shared computer or save your password locally in any computer or mobile device after logging in. Rakuten Securities HK will never ask you to send any of your personal information such as account number and password to us directly via e-mails.
(*)Company Registration ID (in Japan): Kanto Local Finance Bureau (Financial Instruments Firms) No.195