Currency Trading Information Channel
Option Arbitrage in the Forex Market
What is arbitrage? Arbitrage is the simultaneous buying and selling of identical financial instruments taking advantage of price discrepancies between different brokers, exchanges, clearing firms, etc. and thus locking in a profit. On paper, arbitrage is a risk-less trading strategy. In the real world however, risks abound.
So why trade arbitrage? Well, if the risks can be managed, arbitrage can be extremely profitable if you can find the opportunities and take advantage of the opportunities before they disappear. After all, the arbitrage opportunity is present because one side is slow to react to market news, momentum, etc. When it corrects the opportunity is gone.
Why arbitrage forex options? Well, because the opportunity exists if you look far it. The forex market is a cash inter-bank / inter-dealer market. In simplest terms, this means the foreign currencies traded in the forex market are traded directly between banks, foreign currency dealers and forex investors wishing either to diversify, speculate or to hedge foreign currency risk. The forex market is not a "market" in the traditional sense due to the fact that there is no centralized location for forex trading activity and, therefore, trades placed in the forex market are considered over-the-counter (OTC). Forex trading between parties occurs through computer terminals, exchanges and over telephones at thousands of locations worldwide.
Therefore the forex market is not as efficient as the NYSE for example. Price discrepancies exist between trading platforms, clearing firms, banks, etc if only for a small period of time. Options pricing is also affected for the same reasons but since there are other components involved in pricing an option than just the price of underlying currency, they tend to exist for longer periods of time.
One of the most common causes of option pricing differences is the calculation of volatility. Volatility is generally the standard deviation measured over a period of time. Sounds simple enough right? Well, if compare the volatility measure across different forex option providers, you'll likely find differences as large as 2%. When you find this you have also probably found an arbitrage opportunity.
Now that you've found an arbitrage opportunity, how do you trade it? Well, that's a bit trickier and this article cannot possibly cover all the risks associated with pulling off the trade but I will list some issues you should consider.
First of all, are the options really the same? Are the contract sizes, expiration dates and times the same? American or European style?
You also need to consider execution risk. Will there be slippage. Will there be a time delay in getting filled. Is the market moving too fast?
Exit strategy, how are you going to exit the trade and still capture the profit? What happens if the options expire in-the money? Out-of-the-money? What if you get assigned a position on one option but not the other?
These are just a few of the issues one must consider when trying to profit from option arbitrage. The key to option arbitrage is not unlike any other trade -- planning and risk management. Plan the trade, manage the risks, and execute the plan and you will be successful.
MORE RESOURCES updated Wed. August / 21 / 2019
What is forex trading and the role of a forex broker? The Voice Online
FOREX TRADING may sound like something unique, but it is not as difficult to explain as most people make it. True, it is different than what you may be used to ...
UPDATE 2-London forex trading turnover surges to record high Reuters
Britain's daily foreign exchange turnover rose to a record high in April, the Bank of England said on Tuesday, as investors concerned about central bank policy ...
Retail forex trading set to go live today Economic Times
Mumbai: A new retail currency trading platform goes live today enabling thousands of small businesses to trade at market prices, possibly ending years of ...
What you need to know about Forex trading The Standard
There are many benefits and advantages of trading forex. Nevertheless, key among them is that there is no waiting for the opening bell.
How Iran Is Using Currency Reforms to Withstand Trump Bloomberg
U.S. sanctions are battering Iran's economy. They have all but stopped Western companies from investing in the Islamic Republic, sent oil production crashing to ...
What you should know before you start trading forex The South African
The burning question most newcomers to the forex market want to know is whether it's possible to make a decent living from forex trading. Maybe not even a ...
'Risk' moves in Asia forex, AUD/JPY higher ForexLive
Sentiment is positive for risk on the session here so far, with AUD and NZD benefitting while yen loses ground The oft-cited forex 'barometer' for risk is AUD/JPY, ...
How to be a forex expert ForexLive
What is the forex market Anyone who has ventured into the real marketplace would definitely have an idea what a Forex is and share the this horizon can bring.
Rupee opens 23 paise higher at 71.48 against US dollar in early trade BusinessLine
The rupee rebounded from six-month low level and appreciated by 23 paise to 71.48 against the US dollar in early trade on Wednesday tracking gains in Asian ...
The currency-trading scandal continues to dog the banks The Economist
Banks are in the frame for Britain's latest collective-action claim.
The Federal Reserve Bank: A Forex Trader’s Guide DailyFX
The Federal Reserve System plays a significant role in the trading of currencies. Learn more about the US central bank, and how to trade Fed interest rate ...
CBK's warning over online forex traders Standard Digital
The Central Bank of Kenya (CBK) has warned members of the public against dealing with unlicensed and unregulated online foreign exchange dealers.
How to Trade Forex in Kenya Benzinga
Interested in forex trading in Kenya? Learn how to participate in this market, rules and regulations, and the best brokers to use for forex trading.
S.Korea's foreign currency trading rises in Q2 on increased volatility - Xinhua | English.news.cn - Xinhua
S.Korea's foreign currency trading rises in Q2 on increased volatility - Xinhua | English.news.cn Xinhua
SEOUL, July 25 (Xinhua) -- South Korea's foreign currency trading rose in the second quarter on an increased volatility in the foreign exchange market, central ...
How to Analyze Data for More Profitable Forex Trading Global Trade Magazine
Successful forex trading is the art of being able to predict when currencies are going to shift in value in relation to each other...
USD Price Outlook: US Dollar Eyes FOMC Minutes & Jackson Hole DailyFX
Forex traders could experience significant US Dollar volatility over the next week with the release of the July FOMC minutes Wednesday and Jackson Hole ...
6 Tips for Choosing the Best Broker for Currency Trading Online South Florida Reporter
Forex is the world largest financial market. An average of 4.5 trillion dollars is traded each day. Unfortunately, unlike other financial markets such as stock trading ...
Trade ideas thread - Monday 19 August 2019 ForexLive
Good morning, afternoon and evening all. Big week coming up! Any charts, technical analysis, trade ideas, thoughts, views, ForexLive traders would like to share ...
Canadian Dollar Price Targets: USD/CAD Bulls Eye Key Resistance Pivot DailyFX
The US Dollar is targeting resistance near two-month highs vs Loonie with the long-bias vulnerable near-term. These are the levels that matter on the USD/CAD ...
Surge in forex volatility rouses traders from slumber Financial Times
Wall Street delights at fall in the renminbi and a sharp move in the Argentine peso.
Bankers hawk hedging as trade war hits China's yuan KFGO News
By Samuel Shen and Andrew Galbraith SHANGHAI (Reuters) - In a Shanghai room packed with small businesses ranging from furniture makers to garment ...
Asia stocks mixed as bond markets signal recession warning CNBC
Shares in Asia were mixed on Thursday as the main yield curve in U.S. Treasurys inverted, triggering fears over the state of the U.S. economy.
Pound to euro exchange rate: GBP is being dictated by ‘Brexit barometer’ - is it positive? - Express
Pound to euro exchange rate: GBP is being dictated by ‘Brexit barometer’ - is it positive? Express
THE POUND'S strength against the euro is being well and truly dictated by Brexit, claim currency experts. Sterling is enduring a rollercoaster ride of fluctuating ...
Risk mood still tepid at the start of the European morning ForexLive
European stocks have turned a tad lower while US futures are still flat on the day currently. Meanwhile, Treasury yields are holding lower as well with 10-year ...
Clearcorp to launch forex trading platform for bank customers on Aug 5 BusinessLine
Clearcorp Dealing Systems India Ltd (Clearcorp), a wholly owned subsidiary of Clearing Corporation of India Ltd (CCIL), will launch its forex trading platform, ...
Cryptocurrency is it good for business? | London Business News London Loves Business
Business and commerce have evolved over the millennia. From the days of hunters and gathering to farming where skills and products were bartered and then ...
The secrets of trading with fundamentals Born2Invest
Technical analysis often trumps fundamental analysis when it comes to analyzing the financial markets. Forex traders often use technical analysis because they ...
Trading the News | James Stanley | Podcast DailyFX
Learn about trading the news with DailyFX currency strategist James Stanley on Trading Global Markets Decoded.
The Best Forex Brokers in Turkey (Updated 2019) • Benzinga Benzinga
Looking to trade forex in Turkey? Learn how to trade, the best brokers to use for forex, and pros and cons of using each in 2019.
The Bank of Japan: A Forex Trader’s Guide DailyFX
The Bank of Japan (BOJ) plays a major role in the trading of currencies. Learn more about Japan's central bank, and how to trade BOJ interest rate decisions.
Broker with 10-year experience offers clear advantages ForexLive
*Content* contributed by InstaForex If a customer chooses a provider with vast experience and a wide clientele, he or she relies on its apparent advantages.
Crude oil settles at $56.21 ForexLive
Up $1.24 or 2.44% WTI crude oil is settling the day at $56.21. That is up $1.34 or 2.44%. The low reached $54.84. The high reached $56.30. ForexLive By Greg ...
Yen, Swiss franc fall on optimism about central bank action CNBC
The safe-haven yen and Swiss franc retreated against the dollar on Monday, as risk sentiment gradually improved after a week of turmoil on hopes that major ...
Bitsuns is a technology-driven digital currency trading website - Press Release Digital Journal
Bitsuns is a technology-driven digital currency trading website, with its users across more than 100 countries around the world, and it is very popular among ...
Young “Omnipreneur” Offers Artificial Intelligence Software to His Forex Trading Students - Thrive Global
Young “Omnipreneur” Offers Artificial Intelligence Software to His Forex Trading Students Thrive Global
You've heard of entrepreneurs before, right? Entrepreneurs are people who take huge financial risks in order to turn their great ideas into profitable business ...
Bitcoin has become an unlikely safe haven as global turmoil has rocked markets. But not everyone thinks t.. - Business Insider
Bitcoin has become an unlikely safe haven as global turmoil has rocked markets. But not everyone thinks t.. Business Insider
Cryptocurrencies such as bitcoin are becoming more and more appealing to investors as safe haven assets as trade tensions and geopolitical forces whip glo...
Gold Price Outlook: XAU Pull Back to Fibonacci Support DailyFX
The bullish run in Gold has continued and prices set a *fresh* six-year-high on Tuesday of this week. Gold prices have since pulled back to the Fibonacci level ...
Aussie Trading On A Positive Footing This Morning Action Forex
For the 24 hours to 23:00 GMT, the AUD rose 0.12% against the USD and closed at 0.6775. LME Copper prices declined 1.0% or $57.5/MT to $5698.0/MT.
EDITORIAL COMMENT: A good start for bureaux de change Chronicle
The parallel foreign currency market is illegal but over the past 19 years of biting forex shortage, it assumed a status of legality with companies pegging their ...
S&P 500 Price Targets: SPX Consolidation Levels – Technical Trade Outlook DailyFX
The S&P 500 remains within a broad consolidation level just below a key pivot zone we've been tracking for weeks. These are the levels that matter on the ...
Gold Price Targets: XAU/USD Bulls on a Break– Technical Trade Outlook DailyFX
Gold continues to ease back from a major resistance target with prices in consolidation just below. These are the levels that matter on the XAU/USD charts this ...
How To Really Make Money in Forex Trading Pulse Headlines
Forex trading by the retail public is increasingly becoming popular nowadays. What was once a territory of giant financial organizations, businesses, and banks,
U.S. banking regulator approves simpler 'Volcker Rule' ban on proprietary trading Kitco News
WASHINGTON (Reuters) - A U.S. banking regulator announced Tuesday he had approved a final rule simplifying the “Volcker Rule,” which restricts risky ...
Hedging in Forex Trading Tradimo
Hedging is a topic often asked about by advanced learners. In this article, we want to clarify whether and when it makes sense to take a closer look at the ...
Forex Trading for Beginners Yahoo Finance
Forex trading can be an exciting and lucrative activity, but it can also be tough, especially for beginners. Newcomers underestimate the important of financial ...
Currency war: It appears that remains more of a potential risk than a reality – Charles... - Forex Crunch
Currency war: It appears that remains more of a potential risk than a reality – Charles... Forex Crunch
Jeffrey Kleintop, Senior Vice President, Chief Global Investment Strategist at Charles Schwab points out that despite many rate cut around the world.
Top Market Charts for Next Week: Dollar, Gold, Oil, Dow and More DailyFX
An unexpected buoyancy in volatility is the common feature across the global markets landscape. More significant market swings have earned a few ...
US Dollar May Rise vs Nordic FX From Trade Wars, FOMC Minutes DailyFX
The US Dollar may extend gains against Nordic FX if risk aversion from US-China trade tensions is exacerbated by the release of FOMC and ECB meeting ...
EUR/USD technical analysis: Fiber capped below 1.1090 resistance in the New York... Forex Crunch
EUR/USD is on the back foot near 2-week lows. The levels to beat for sellers are the 1.1067 and 1.1027 supports. EUR/USD daily chart On the daily.
Maltese crypto exchange ceases trade next month Newsbook
CGEX, the Maltese subsidiary of the South Korean crypto-currency exchange Coinone, is to end trading next month. An announcement on their website last ...
Gold retreats from daily highs, continues to trade above... Forex Crunch
Wall Street pushes lower following three-day winning streak. 10-year US Treasury bond yield fails to break above 1.6%. US Dollar Index finds resistance.
Weekly Gold Price Forecast: Into the Jackson Hole Vortex DailyFX
Traders shouldn't be surprised if gold prices spend most of the week trading sideways ahead of the Federal Reserve's Jackson Hole Economic Policy ...
CBK warns against online forex dealers Business Daily
The Central Bank of Kenya (CBK) has again warned citizens against unauthorised foreign-exchange trading as analysts asked for a ban on third-party ...
AUDUSD Monthly Range on Radar Ahead of Fed Economic Symposium DailyFX
The monthly opening range sits on the radar for AUDUSD as attention turns to the Kansas City Fed Economic Symposium in Jackson Hole, Wyoming.
GBPUSD Price Outlook Fragile as Boris Johnson Heads to Europe DailyFX
UK PM Boris Johnson is off to Europe for meetings with French President Emmanuel Macron and German Chancellor Angela Merkel with Sterling traders ...
Crypto exchanges in South Korea prone to Bankruptcy Forex Crunch
97% of the county's domestic exchanges are prone to bankruptcy due to low trading volumes. South Korean startups are allegedly seeking to list their coins.
Barclays assess Brexit impacts: GBP, house prices to fall, inflation to rise and a recession - ForexLive
Barclays assess Brexit impacts: GBP, house prices to fall, inflation to rise and a recession ForexLive
A few snippets from Barclays on what they see the impact of a no deal Brexit - GBP fall - trade barriers - rate cuts from the Bank of England - a housing market ...
Loonie Trading On A Positive Footing This Morning Action Forex
For the 24 hours to 23:00 GMT, the USD rose 0.41% against the CAD and closed at 1.3327. In the Asian session, at GMT0300, the pair is trading at 1.3321, with ...
Indian Apex Court Grills RBI over Bitcoin Trading Ban newsBTC
The courtroom battle between India's bitcoin exchanges and the central bank appears to go in favor of the former. In a hearing today, the Supreme Court.
Currency Trading for Beginners Benzinga
If you're new to currency trading – look no further. FOREX.com is one of the world's largest forex brokers. Account holders get competitive pricing, award-winning ...
OpenBazaar Developers Launch a Crypto Marketplace for Mobile CoinDesk
OB1, the developers behind the online decentralized marketplace and currency trading platform OpenBazaar announced a mobile counterpart called Haven.
Future Returns: The Risk and Reward of Foreign Currency Exchange Markets Barron's
While most advisors recommend leaving the foreign currency exchange market to the pros, individual investors are increasingly entering the market as ...
Trade currency pairs: your guide to trade currency pairs Capital.com
Currency trading takes place on the foreign exchange, or forex, market. The forex (abbreviated as FX) market is a global decentralised market for the trading of ...
Forex trading – what are the best currencies to trade? Capital.com
In the world of currency trading, an essential fact is frequently overlooked, which is that foreign exchange rates are reference numbers, not expressions of ...
Apply "the secret" to forex trading success ForexLive
What's "the secret" behind successful traders? The Forex market is the largest trading network in the world with $1.8 trillion dollars being exchanged every day.
Forex Trading Philippines Benzinga
If you live in the Philippines, trading in the forex market has its own set of rules. Learn how to trade, and the best forex brokers to use for 2019.
Venezuela loosens currency exchange controls to allow forex trading Reuters
CARACAS (Reuters) - Venezuela will allow local banks to open foreign currency trading platforms as part of a loosening of the OPEC nation's exchange controls ...
Sterling briefly rebounds from near three-year lows The Irish Times
UK currency trading at 91.38p against euro.
Best platform for Forex trading Augusta Free Press
Forex or as most people know it, foreign exchange, is a decentralized world market where people can trade, buy or sell currencies.
Forex Trading Opportunities for the Week Ahead [Video] FXStreet
About the Author Sam Eder is a currency trader and author of "The Definitive Guide to Developing a Winning Forex Trading System" and ...
VertoFX raises $2M for its African and EM currency trading platform TechCrunch
VertoFX, an Africa and emerging markets-focused currency trading and payment startup, has raised a $2.1 million seed round, led by Accelerated Digital ...
A Detailed Look at Forex Trading Kalkine Media
In simple terms, forex trading, is the currency trading. It is one of the most liquid and traded financial markets in the world, with transaction volume exceeding $ 5 ...
AUD/USD Forex Signal DailyForex.com
AUDUSD: 0.6746 area remains pivotal. Last Thursday's signals were not triggered, as none of the key levels identified then were reached yet.
Is forex trading profitable? Capital.com
Want to learn how to make money on forex? Find out the major factors to consider and learn how to profit from forex trading.
The Twilight Trading Hour Strikes Currency Markets Again The Wall Street Journal
There is a fragile spot in the $5.1 trillion currency market: early morning in Asia. This one- to two-hour period when U.S. traders are heading home—but market ...
Why Forex Trading is growing 7NEWS
It might come as a surprise that foreign exchange is not a 'relatively' new means of trading. Here are some reasons why retail forex trading is growing.
Are forex trading signals for you? ForexLive
What you need to know about signals from UBCFX Foreign exchange or forex is defined as the exchange of a nation's currency for that of another is. Overall, the ...
Never lose hope in currency trading business Rocky Mountain Collegian
Sponsored *Content*: Never lose hope in currency trading business A good trader will know about the right kind of performance in the business. It is very.
FX Trading - Currency Trading FXTM
Discover the details of foreign exchange, currency trading, currency pairs, forex market hours, forex trading fundamentals, trading signals and more. | FXTM ...
What is Forex Trading? Complete Beginner's Guide MoneyCheck
Forex is the art of buying or selling one currency for another - Find out more in our complete guide to Forex Trading for Beginners.
A Guide to Trading Forex in Canada Benzinga
Looking to trade forex in Canada? Read our guide to learn about the rules, regulations, and the best brokers to use in 2019.
Shaving Milliseconds Off Currency Trades Could Make Singapore Billions Bloomberg
Follow Bloomberg on LINE messenger for all the business news and analysis you need. Singapore is grabbing an opportunity measured in milliseconds to win a ...
Forex Trading – What You Need to... Forex Crunch
Forex trading is popular with many people because you do not need to make a large investment to get started. However, while it's certainly possible to.
Learning the basics of forex trading The Financial Express
You need to invest through a Sebi authorised broker to ensure that your forex trading actions are legal.
A Guide to Forex Trading in Hong Kong Benzinga
With FOREX.com, you will get competitive pricing, award-winning customer *service*, actionable data, and powerful trading platforms to help you make the best ...
Forex Trading Tools Benzinga
FOREX.com is one of the world's largest forex brokers. Account holders get competitive pricing, award-winning customer *service*, actionable data and powerful ...
Forex trading: Understanding account types and differences ForexLive
Instaforex: See what different account options are available to FX traders There are a number of different account types available in the FX sphere and this article ...
Learn the Basics of Trading Currencies FX Empire
Learning the basics in currency trading is not complicated. Building your own strategy to make and making it work is a different story.
Forex Vs Stocks: Top Differences & How to Trade Them DailyFX
Learn the main differences between forex and stocks to understand the best market to trade based on your trading style and strategy.
What Are The Benefits Of Forex Trading? ValueWalk
As already mentioned, Forex trading does not cost a lot of money if you are beginning, especially when compared to equity markets.
How to Start Forex Trading in South Africa: A Complete Guide • Benzinga Benzinga
Learn more about how to start trading forex in South Africa, including what you'll need to start and the best forex brokers.
Must Know Essentials about How to Do Forex Trading The Costa Rica News
For you to become a successful forex trader, it is important to have an infallible strategy that will provide effective guidelines on how to do forex trading. By.
How to Trade Forex | Forex Trading Examples IG Bank
Follow six steps to easily start trading forex. See forex trading examples, learn how FX markets work and find out what you need to do to place your first trade.
5 Tips for Investing in Currency | Investing 101 U.S. News & World Report
Currency can help balance a portfolio but investors must be careful.
How to Trade Forex - and Is It Worth the Risk? TheStreet.com
Trading currencies is an enormous part of the world market. Here's how it works and whether it's worth the risk....VLKAF.
How Does Forex Trading Work? FinSMEs
Forex trading is one of the most profitable money-making options — a successful trader can double their investment in 6 months. However, it is also extremely ...
Forex traders fret as sleepy markets slow to calmest in years Reuters
LONDON (Reuters) - The $5.1-trillion-a-day foreign exchange market is suffering more than most from central bank decisions to move in tandem and keep ...
A Guide to GDP and Forex Trading DailyFX
GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to ...
Forex trading volumes fall 9.6% to $1.62 trln in May - CLS Nasdaq
LONDON, June 10- Average daily foreign exchange trading volumes fell 9.6% year-on-year in May to $1.62 trillion, CLS said on Monday, as calmer.
Best Forex Trading Software Benzinga
Forex trading is an around the clock market. Benzinga provides the essential research to determine the best trading software for you in 2019.