Tag Archives | trading system

Market Overlaps & What You Should Know

The currencies market is different from all others because it’s a truly global market. Its hours of operation begin at 6pm EST on Sunday and runs until 4pm EST on Friday. And while it might be possible to trade the entire 118 hours in between, we don’t recommend it—you need to sleep sometime! There are times when the markets are active and moving, and you can use these times to benefit your trading!

There are four major currency centers in the world: Sydney, Tokyo, London, and New York. Though these hotspots are all across the globe, you can probably guess that some of the most active markets will be found within their overlap. Here are the three market overlaps you should know about:

New York/London (8am to 12pm EST) – More than 70% of all trades occur within this time period, making it by far the heaviest market overlap in the markets.

Sydney/Tokyo (2am to 4am EST) – The ideal currency pair to aim for in this period is the EUR/JPY, as these are the two main currencies involved.

London/Tokyo (3am to 4am EST) – This overlap sees the least amount of action of the three because most American traders won’t be awake at this time, and the one-hour overlap gives little opportunity to watch large pip changes occur.

As you can see, all hours are not created equal in the currencies market. If you have the opportunity, take advantage of these market overlaps in your trading and see what happens. Good luck!

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Ask & Bid: Knowing the Spread

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One of the most frustrating things for new traders is overcoming the spread. The spread is the difference between the bid price and the ask price at a given time. You should always consider the spread before you enter a position, as the move you’re anticipating may not be significant enough for you to turn a profit.

This difference in price can dishearten some traders. When they’ve gone into a position on a currency with a wide spread, they’re starting off in the hole, and the price has to climb that much further before they make a profit. A tighter spread, however, means you can turn a profit that much faster, as the moves don’t have to be as big.

Spreads are directly tied to volume. When there’s less volume in the markets, spreads will be larger; when there is more volume, spreads will be tighter. Volume trends aren’t a secret by any means, and you can use this knowledge to your advantage. The markets see the most volume between 8am and 12pm EST. Around 5pm EST, the markets see the lowest volume of the day.

It’s also worth noting that certain brokers offer a fixed spread while others offer a variable spread. Variable spreads bring the potential both for tighter spreads during periods of high volume in the markets, as well as wider spreads when the market is seeing low volume. Though fixed spreads are generally wider than variable, they bring predictability during periods of market volatility.

We know—it’s just another thing you need to think about before you get into a trade. But as you take these things into consideration, you’ll start to just see these things without thinking about them! But for now just remember:

Less Volume = Wider Spread
More Volume = Tighter Spread

As a side note, we at the Apiary Fund have done everything we can to make our narrow spread work for our traders. If you’re not a part of the fund currently, check out our Trader Orientation Webinar to find out more about the unique advantages provided by the Apiary Fund.

 

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What is the Forex Market, and How Does It Work?

A market is simply a channel for exchange. You’ve probably heard of the Chicago Mercantile Exchange, or the New York and London Stock Exchanges. These are three of the many major centers of exchange. They actually serve as physical centers of exchange to facilitate trading. Stocks, bonds, options, derivatives, and futures are all traded freely on the floors of these trading centers.

The currencies market, however, is different. There is no central exchange playing host to hordes of traders. There is no money exchanging hands amidst endless shouting. Believe it or not, the currencies market, also called the foreign exchange or forex market, is the largest liquid market in the world. To better comprehend just how big the forex market is, let’s take a look at the numbers. The New York Stock Exchange, the largest exchange in the world, sees about $15o billion move through it every day. The forex market moves about $4 trillion each day– making it around 26 times as large!

Because it effectively dwarfs other markets, the forex market has some benefits to offer its traders. For example, because of its size, combined with the lack of a centralized location, currencies are virtually free of external control. Even the largest banks can’t throw enough weight around to manipulate the market–the amounts required would be too extreme. This means an even playing field for us individual traders and small trading operations!

There’s a lot to be said about the forex market, so if you’d like to know more about trading, feel free to visit us at www.apiaryfund.com or give us a call at 1-801-701-1650.

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3 Advantages of the Forex Market

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Lots of investors prefer different markets for lots of reasons. There’s not really a single answer for why any market is better than another, but today I thought I’d share three advantages of the forex market:

1. Volatility

The volatility of the forex market is sometimes cited as its biggest risk–and I won’t try to tell you that’s not true. Volatility comes with inherent risk.  But just like any other investments, securities with the highest risk also come with the highest yield.

I remember my early days of trading when I’d place an order and go to sleep, only to wake in the morning and find that my hopes and dreams had been crushed overnight. Naturally, I blamed the market when I should have blamed myself. I now know that with proper risk management, as taught in Apiary’s curriculum, you can make the market volatility work in your favor!

 2. Volume

So how does the increased volume of the forex market afford you an advantage? If you’ve had any experience trading other securities, you no doubt are familiar with placing an order and waiting hours, or even days, for that order to be filled. With fewer buyers and sellers in a certain market, you might not always have someone looking to fill an order–so you wait.

But forex is by far the largest market, so volume isn’t an issue. With so many buyers and sellers out there actively trading, you’ll find that you never have to wait for an order to be filled.

 3. Leverage

I’ve written a bit on leverage before, but if you haven’t heard of it before, here’s a simple explanation: Think of leverage as money a broker lends to a trader to increase the trader’s buying power. In the United States, brokers can give traders fifty-to-one leverage. This means that for every dollar a trader puts into an investment, a broker will match it with forty-nine.

Leverage is a huge advantage to the forex market because it gives you more weight to throw around. Because Apiary works through a broker in New Zealand, our traders actually get 100:1 leverage. That means when a newly-funded trader starts working with a $2500 account, they’re really working with $250,000 worth!

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Japanese July and Seasonality

Just as time can affect trading on a 24-hour basis, there are also times when the currency market develops patterns of activity throughout the year. This is called seasonality.

One of the most notable examples of seasonal currency patterns is called Japanese July. Eight of the past ten years has seen the US dollar strengthen against the yen in July. Though it’s difficult to pinpoint an exact reason behind this pattern, there is definitely a strong correlation between these two currencies during the month of July! Keeping this sort of seasonality in mind can tell you that July might be a good time to scale up in good long positions and to take smaller-than-usual short positions.

There are other historical patterns that seem to happen throughout the year, so find out what they are and take advantage! Good luck, and happy trading!

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3 Reasons Apiary is a Company You Can Trust

The financial industry can be a sketchy place, and if you’re not careful you could fall victim to the multitudes of scams that prey on the unsuspecting newbie. We at the Apiary Fund, however, want to be a light in darkness. We want to lead by example as we do our part to change this industry’s reputation. As such, we want to emphasize the top 3 reasons Apiary is a company you can trust:

1. We Don’t Hide Our Names

There are two reasons someone should conceal their identity: 1) You’re a superhero, or 2) you’re a scam artist. Because we at the Apiary Fund are neither of these, we are not afraid to associate our names with our company.

We not only give out our names, but we even have pictures and links to connect with us on other platforms! Meet the team here!

2. The Apiary Promise

We have not only attached our names to the company, but we, the company and the individuals that comprise the company, have made a promise to our associates. We developed the promise to ensure transparency and confidence in the company. You can trust our promise — no scams, no investment, no risk. Read the company promise here!

3. Our Forums Are Open to the Public

If you look around hard enough, you’re bound to find a lot of people who have a lot of ideas about what the Apiary Fund is and how the company operates. But the truth is that most of these opinions are pure conjecture. Very few people who publish their opinions online have ever been a part of the fund. Going to these sources to do your due diligence is like reading a review for Red Lobster written by someone who hates seafood!

If you want to hear what our traders say, check out Apiary’s forums. Only our traders and associates can contribute posts, but the forum is open to the public to read. This is a much more reliable source, as all of the contributors have first-hand experience with the company. You’ll even get a good idea of what to expect as far as atmosphere and social support! See what our traders are saying here!

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Tips for Managing Position Size

Large position sizeAt the heart of money management is the decision of increasing or decreasing your investment. To illustrate this, imagine you own a store that sells athletic equipment. Because no sport lasts all year, you’d find yourself changing your floor inventory based on which sports are approaching, which are in full swing, and which are ending soon.

When it comes to changing position size, the rule is to increase your position size during favorable market conditions for your product. In your store, you’d have more football equipment on the sales floor during the fall when you know conditions are favorable for that sport. The other side of this rule is to decrease position size during unfavorable conditions. As football season winds down and basketball season begins, the products in your store would decrease inventory to reflect the new season.

Small position sizeFortunately, in the market there are two seasons: highly predictive and less predictive. You’ll want to increase your position size in highly predictive conditions and decrease your position size in less predictive conditions. Controlling your investment size is key to keeping your losses to a minimum. This, in combination with other elements of money management as emphasized by the Apiary Investment Fund, will ultimately lead to profitable trading!

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A Tip on Trading Systems

With Thanksgiving just a couple days away, we’d like to not only encourage a balance in your diet that will leave you feeling healthy and proud, but we’d also encourage a balance between risk and reward in your trading system!

Here’s an example of risk vs reward: If you go to a casino and bet everything you have on red, then you have a 49% chance of doubling your money and a 51% chance of losing everything. The same applies to trading; you can make a lot of money if you’re risking a lot, but then risk of ruin is very high. You need to find a healthy balance between risk and reward.

Let’s say you define ruin as losing 20% of your account and success as making 20% profit. Having a trading system with past performance results lets you calculate your risk of ruin and your chance of success.

Your risk of ruin should be always less than 5%, and your chance of success should be 5-10 times higher. So, if your risk of ruin is 4%, then your chance of success should be 40% or higher.

This is just a little trading system tip to keep in mind over the holiday! We at the Apiary Fund are sure thankful for all of you that make this community so great! Have a happy Thanksgiving, and if you’re traveling, be safe!

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