Vandaag kon ik mijn mail niet meer ophalen van Google apps naar mijn favoriete mailprogramma. Uiteindelijk heb ik de oplossing gevonden. Vermoedelijk wil Google dat iedereen zijn mail account verifieerd om zo dummy (spam) accounts uit te sluiten.

Als je hetzelfde probleem hebt, ga dan in een browser naar dit adres:

https://www.google.com/a/jouwdomein.nl/UnlockCaptcha

Verander jouwdomein.nl in jouw domein (bijvoorbeeld davetromp.nl).

Je ziet dan dit:

Vul je gegevens in en laat aan Google zien dat je een echt mens bent, door de Captcha in te typen. Druk op ontgrendelen.

Je mail zal nu weer van de server opgehaald kunnen worden.

Ik werk als E-Commerce Manager voor Buur Fashion. We ontwerpen, produceren en verkopen twee kledingmerken: Yest en X-Two. Sinds bijna een jaar hebben we een X-Two Brand store in Winschoten aan de Nederlands-Duitse Grens. Het werd tijd dat deze winkel ook een plekje op het internet kreeg onder het domein van X-Two.nl. Samen met een collega heb ik daarom een site op gezet onder http://winschoten.x-two.nl. Aangezien de winkel ook veel Duitse klanten heeft, was het noodzakelijk dat de site ook in het Duits vertaald kan worden. Dit hebben we opgelost door de site automatisch te laten vertalen naar het Duits via Google Translate (Thank you Google for a wonderful service). Vervolgens heeft de site ook de mogelijkheid om de automatische vertaling met de hand te verbeteren. Verder heeft de site een geavanceerde zoekfunctie, een nieuwsbrief, een contactformulier en een nieuwssectie. Ik zou zeggen: neem een kijkje hier.

In mijn laatste bericht over M&S Mode had ik beloofd de website in de gaten te houden. De laatste paar weken heb ik de in de kern goede webshop enorm zien verbeteren. Er zijn goede landingpages toegevoegd. Zo was er bijvoorbeeld een offline brochure ook online doorklikbaar gemaakt en zijn er vershillende pagina’s waar in set wordt verkocht of juist op item type

Verder is er over de betaalwijze geen onduidelijkheid meer. Allen is de verzendwijze nog helemaal niet duidelijk. Al wordt er wel heel duidelijk een verkoop argument aangehaald: voor 20h besteld, de volgende dag al huis.

Afgelopen zomer heb ik bij Sissy Boy een presentatie gehouden onder de noemer “Sissy Boy was here! Creating a buzz”. De presentatie zet globaal een internet marketing campagne uiteen voor hun to openen online shop. 1 Maart is de Sissy Boy webshop geopend en een restyling van de website live gegaan.
De site is een mooie flash site met video en muziek. Er wordt gelinkt naar sociale netwerken, zoals Hyves, Facebook, Youtube en Twitter. Hieronder is mijn presentatie.

Ik heb vooral uiteen gezet hoe Sissy Boy haar klanten online aan zich kan binden en hoe het verhaal van Sissy Boy online een leven kan gaan leiden. Sociale media zijn daar in heel belangrijk. Tot dus ver vind ik dat SB dit best aardig doet. Momenteel hebben ze op al de netwerken waar ze actief zijn bij elkaar iets meer dan 1000 volgers. Zijn dit de 1000 true fans waar Seth Godin het over heeft? Zie mijn post Change, Tribes and Leadership.
Een buzz (en traffic naar de webshop) is een ding, online verkoop (conversie) is wat anders. Daarvoor moet de webshop een ultieme online shopping experience bieden. En hierin vind ik dat SB niet geheel geslaagd is. Zo is het bijvoorbeeld lastig om bij donkere kledingstukken het item goed te zien. De kleding is plat gefotografeerd. Dit ziet er leuk uit, maar hierdoor is het niet altijd duidelijk hoelang een rok of broek, of mouw is, wat kan leiden tot twijfel tot aankoop of foute aankopen, die retour komen. Ik denk daarom dat SB vooral zal verkopen aan bestaande klanten, die de producten al kennen, maar relatief ver van een offline shop wonen of te druk zijn om gewoon te shoppen. De webshop is daarmee een aardige extra service voor het bestaande klanten bestand.

Eindelijk is het dan zover: M&S Mode heeft een webshop. M&S heeft offline winkels in Nederland, Duitsland, België, Luxemburg, Frankrijk en Spanje. Voorlopig verkoopt M&S online alleen in de Benelux. Dit is logisch, want in dit gebied is de consument het meest gewoon aan kopen via het internet. Ook is dit gebied het meest verzadigd met M&S winkels. Groei in een ander distributie kanaal is hier dus het meest gewenst. De shop is basic opgezet. Als klant zit ik tijdens of voor het shoppen al met vragen over hoe ik kan betalen en hoe mijn bestelling geleverd zal worden. En wat als ik het nu terug wil sturen? De onzekerheid hierom is en show stopper, al worden deze vragen netjes onder het kopje klantenservice beantwoord.

De conversie van de shop kan hoger worden door simpel de logos van de betaal en vervoersdienst op de site te plaatsen. Helemaal mooi zou het zijn als er een veiligheidscertificaat op de site staat. er mag geen twijfel over zijn dat de webshop ook echt van M&S Mode is en dat mijn gegevens er veilig zijn.

Goed, ik ga iets kopen. Zou het niet aardig zijn om bijpassende producten aangeboden te krijgen. De shop biedt vergelijkbare producten aan. Voor dat ik het weet heb ik alle broeken gezien, maar heb ik geen zin meer om te kopen.

Deze punten zijn makkelijk om op te noemen, maar een hoop werk om te implementeren. Zij zijn wel zeker de moeite waard. Ik verwacht dan ook dat er de komende maanden nog wat zal veranderen bij M&S online. Ik houd het in de gaten.

Ik ben fan van het open source ontwikkelings- en businessmodel? Als consument wil ik vrij zijn om gratis open source programma’s op mijn computer te installeren. Als zakelijke gebruiker wil ik weten wat ik gekocht heb en wil ik niet afhankelijk zijn van een handje vol dienstverleners die op mijn platform mogen en kunnen werken. Apple heeft met MacOSX het beste uit twee werelden weten te verenigen. Simpel gezegd, is de binnenkant van het systeem open source (Darwin) en de gebruikersinterface (Aqua) closed source. Dit biedt de gebruiker een gelikte ervaring en de ontwikkelaar, geek, techie alle mogelijkheden om naar eigen inzicht het systeem te gebruiken.

Als je een Mac hebt kan je vele open source programma’s installeren.Deze vind je op de website van Apple, maar ook via projecten als Fink en Macports.
Als je ontwikkelaar bent is de Apple open source pagina een goed beginpunt om alle mogelijkheden te ontdekken.
Mijn favoriete open source programma’s voor de Mac zijn Open Office en Gimp (zie de screenshots).

In mijn post H&M online, Zara in Istanboel schreef ik dat de Spaanse winkelketen Zara in tegenstelling to het Zweedse H&M niet actief is op haar facebook page. Inmiddels is Zara ook actief. Nog steeds voert Zara off topic online campagne. Zij heeft namelijk nog geen online sales. De campagne is bedoeld om de klanten te pre-sellen, ofwel warm te maken voor online aankopen. Het effect van de toegenomen activiteit is noemenswaardig. Zo heeft Zara nu op facebook een half miljoen meer fans in vergelijken met de 1,2 miljoen waar ik in augustus over schreef.
Verder heeft Zara mobile apps ontwikkeld, waarmee je met je mobiel de collectie kan bekijken. Zou Zara mikken op mobiele online verkoop?

Power Turk FM is een 100% muziek zender. Ze draaien alleen Turkse Pop muziek. Verder is er een hele range aan genre gebonden “Power” stations.

Sertab Erener is 1 van de grote Turkse zangeressen van deze tijd. Ze heeft een geweldige stem, waar ik vaak kippevel van krijg. Buiten Turkije is zij vooral bekend als winnares van het Euro Vision Song Festival in 2003. Hier is een video van haar laatste single Acik Adres (open adres).

Provided by Dukascopy

Succesfull forex trading is all about discipline and consistency. In order to achieve this, it is most helpful to keep your trading methods simple. Of course your method should not be oversimplifying. As Einstein said: Make everything as simple as possible, but not simpler. In below video trader Nial Fuller is interviewed about his trading style and methods. He clearly explains why keeping it simple works.


If your interested in learning to trade the markets like Nial does, then please visit his website at www.learntotradethemarket.com.

Op maandag 12 januari 2009 is op spectaculaire wijze de zeewaterwarmtecentrale in Scheveningen geopend. Vanaf 2010 zullen 789 nieuwbouwwoningen verwarmd worden door zeewater. De zeewaterwarmtecentrale is de eerste ter wereld en draagt bij aan een duurzaam milieu.

Lees hier het complete nieuwsbericht
Of bekijk een interview met de ingenieur van het project:

Deze elektrische auto is sinds oktober 2009 te koop. Zie de video:

Google heeft een beta versie beschikbaar gemaakt van haar Chrome browser voor linux. Google bied installatie pakketten aan voor Debian, Ubuntu, Fedora en OpenSuse. Ik heb Chrome zonder moeite geïnstalleerd op mijn Ubuntu Desktop. Chrome herkend en integreerd automatisch plugins als adobe flash player en Totem media player.

De Chrome browser voor linux download je hier.
Hieronder zie je waarom je dit zou willen doen.

Video 1: My “Flexible Forex” Day Trading Discovery…:

Bill Poulos just recorded a brand new video for you that reveals how certain groups of traders have been quietly making a killing in the Forex markets recently… while the rest of the global economies struggle.

Bill Poulos is an expert in training Forex Systems. He has developed and marketed several training systems. The most interesting thing is, that he tells us up front that there is no such thing easy money and getting rich quick, but that there are many opportunities, that allow us to make a living or some extra income trading the forex market intraday.  Here are some videos about and with Bill Poulos:

Maemo software | Nokia › The software behind your mobile computer

Maemo brings the power of computers to mobile devices. Designed with the internet at its core, Linux-based Maemo software takes us into a new era of mobile computing.

Met het opkopen van Symbian en het vervolgens vrij geven van de broncode, heeft Nokia laten zien dat het Open Source ontwikkelingsmodel een zeer krachtige is. Tegelijkertijd heeft Nokia begrepen dat Linux georiënteerde gemeenschap zeer veel potentie heeft. Vele open source applicaties worden in sneltrein vaart door de gemeenschap beschikbaar gemaakt voor gebruik op een Linux besturingssysteem.
Daarom is Nokia een actief lid en sponsor van het Maemo project geworden. Maemo was eerst beschikbaar op Nokia Internet Tablets (soort iphone touch), maar nu kan er ook mobiel gebeld worden met een Maemo apparaat. En met alle voordelen van een Linux systeem:

• snel
• multitasking
• vrij

Number One FM  draaide vroeger uitsluitend niet-Turkse pop muziek. Tegenwoordig laten ze ook Turkse pop horen, maar de meest muziek is toch nog steeds niet-Turks.

Slow Turk  is een radio station dat, zoals de naam al aangeeft, langzamere Turkse pop nummers draait.

Over Best FM weet ik niet zoveel te vertellen. Dit radiostation draait Turkse populaire muziek en brengt het nieuws iets uitgebreider dan een muziekstation alleen. Als je iets interessants weet te vertellen over dit station, schrijf dan a.j.b. een comment.

Radyo D behoort net als Kanal D (tv) tot een grote media groep: de Dogan grup. Er wordt voornamelijk Turkse pop muziek gedraaid.

Kral FM is een van de eerste populaire commerciële radiostations van Turkije. Kral FM is begonnen in 1993.

IBM zet Ubuntu in tegen Windows 7 | Webwereld

Gepubliceerd: Woensdag 21 oktober 2009
Auteur: Sander van der Meijs

In de week van Windows 7 probeert IBM klanten weg te houden van dat nieuwe Microsoft-besturingssysteem met een nieuw aanbod voor de desktop. Ubuntu Linux is de basis.

Eigenlijk kiest IBM niet tegen Windows 7, maar voor Ubuntu, omdat zij vrijheid en tegelijkertijd stabiliteit biedt. Ubuntu geeft de vrijheid om met iedere partner samen te werken en zo de best mogelijke keuze te maken. Daarnaast is Ubuntu een stabiele, transparante organisatie.

De afgelopen jaren heeft zij elk half jaar een nieuwe meest up to date versie van het besturingssysteem gedistribueerd. En om de twee jaar distribueert Ubuntu een versie met lange termijn support (beveiligingsupdates). Door deze voorspelbaarheid in updates en upgrades, die nog gratis zijn ook, is het mogelijk voor bedrijven om een goede IT planning te maken. En als privé gebruiker is het weer een zorg minder. Mijn computer thuis, bijvoorbeeld, heb ik nu al 3 jaar lang draaien op Ubuntu Linux zonder deze ook maar 1 keer opnieuw te hebben moeten installeren.

Gant charts zijn handig om het verloop van een project te visualiseren. Vaak zijn er een aantal kritieke stappen die genomen moeten zijn voordat een volgend traject opgestart kan worden. Als de eerste taken een klein beetje uitlopen, kan dat grote gevolgen hebben voor het verdere verloop van een project. Als je de stappen die genomen moeten worden onder elkaar zet met begin en einddata er achter, dan is het lastig om overzicht te houden. Dit is zeker zo als er veel te doen is. Een simpele manier om grip op de zaak te houden en de voortgang makkelijk te delen met team leden is om een project management tool te gebruiken. Een mooi en gratis open source programma vind ik OpenProj.
Er is ook een betaalde service (SAS) genaamd project on demand. Hiermee kan je online een project managen.
Voor het houden van overzicht alleen is een gant chart visualisatie voldoende. Dit is heel eenvoudig online te doen in Google Apps. In onderstaande video kan je zien hou je dit kunt doen.

Een Marokkaan die een Turk nadoet. Zo herkenbaar. Deze is voor jullie abi’s:

Learn how to earn, trading forex online for free

The basic trading principles are made plain and simple for new traders
On the road to progress, everyone must have to break down and build anew. We must unlearn everything that we know and think we know and begin again — from the beginning.

CFDs are ‘Contracts for Difference’

The ‘CFD’ was developed to allow clients to receive all the benefits of owning a stock without having to physically own the stock itself. For example, instead of purchasing 1,000 shares of Microsoft from a stock broker, a client could instead buy a CFD on Microsoft on the GCI trading platform. A $5 per share rise in the price of Microsoft would confer to the client a $5,000 profit, just as if he had purchased the actual shares that are traded on the exchange. A major difference is that there are no exchange fees and many of the inefficiencies of trading the underlying shares on the exchange are eliminated. GCI can therefore offer CFDs with zero commissions and very attractive margin requirements. CFDs have grown in popularity dramatically over the past few years, and we believe that this will increasingly be the preferred way to trade the financial markets.

The other major benefit of trading a CFD is the fact that the client can trade on margin. CFD trading means clients can trade a full portfolio of shares, indices, or commodities without having to tie up large amounts of capital. Using the example above, a client purchasing $50,000 worth of CFD Shares will only be asked to put up a $500 margin.

CFDs then are the future of the Stock and Commodities Markets and the future is here now, available to you right in your own home or office through the use of your Personal Computer and the Internet.

Basic trading principles

In trading stock and currency, there are certain principles that are common to all the different issues or instruments. But at the same time, there can be very great differences, as well. Before we can be enabled to trade profitably, we must obtain to some familiarity concerning them all. Through our observing price movements, we will be able to arrive at some understanding of how and why they fluctuate the way they do.

Forex eBook – Read and Learn

Each issue or currency should be regarded as one independent and unique economic unit — each different, with different parameters, standards, pace of movement, range of prices and character. They may or may not have a professional operator, one who in some way affects, influences or controls its up and down movements. The operator or operators may have different styles and methods of trading and controlling the price movements. Thus the prices in general may move in an orderly or erratic fashion, fast or slowly, predictably or randomly. The movement may keep to a trend or may be trendless. It is different from time to time. But profits can only be made when the market stays on trend or moves predictably. Only then should we get on board. Otherwise, we should get out and stay out.

Each group or issue then should be studied separately. However, since all of them are governed by the same basic principles, we can simply study one main group first and then adjust our settings accordingly for each of the other groups and issues. For our purposes then, let us study CFDs in conjunction with the FX Guides as our initial main focus. The FX Guides are available to those who enroll in our Free Hands-on Training.

Technical trading

For most traders, technical trading rather than fundamental trading is much preferred. And we don’t need to have a degree in economics or finance to be an expert. A short course can bring us up to speed.

Price cycle

The price movement of any and all of the financial instruments undergoes 4 stages – Accumulation, Marking up, Distribution and Marking Down. In this, they are all the same. We only need to change price ranges, time frames, standards and settings.

Support & Resistance, Stops, Entry Limits, Entry Stops

Just like an Indian scout can follow a trail by reading the signs along the way, so can we determine the course of the markets from the price highs and lows and Support and Resistance levels. And we can then set our Stop Loss Prices and Buy and Sell Limits.

Seasons and Cycles

One important difference unique to stock trading is that their price movements coincide with certain seasons and are often cyclical by nature.

Usually not always, towards the end of the year, window dressing begins and carries over to a week or 2 weeks into the new year. The market then overbought, unloading will set in allowing prices to drift down until the Holy Week and income tax payments. A mid-year rally might kick in possibly till August/September, especially if first half performance is positive. Selling usually precedes the payment of tuition fees. Then the cycle repeats in December.

Throughout the year, there are the monthly and quarterly performance reporting of most companies. New mines and oil finds, fresh innovative products entering the market and recently approved drugs or drugs found harmful spark the interest of investors and traders, alike. Presidential elections, wars, civil unrests, and deaths of important personalities; earthquakes, hurricanes, volcanic eruptions and tsunamis; IPOs, declarations of stock dividends and rights offerings — All such likewise incite speculations. There is always something going on that will impact prices.

Strategy

There are so many different methods of earning from our trading, as many as there are traders. Most every strategy can earn. We only need to dance to the rhythm of the music. We should go with the flow, follow the line of least resistance as indicated by the charts. We should listen more to what the market is telling us and not dictate to it based on what we want it to do.

Choosing issues

Going over the whole list to trade, we will always be able to find a few that are poised to move up or down. And here in CFD trading, we not only can make money by going long or first buying. We can also earn by selling short and then buying back at lower prices. But nevertheless, there are advantages to specializing in just a few issues and watching them closely. Predictability with sufficient range equates to greater profit.

Timing

Each issue moves in different cadences or rhythms. They follow different time schedules. There is a time to wait, a time to load and a time to sell.

Allocating lots

How much we should invest or put at risk at any one time should depend on our desired profits and the safety and sufficiency of our capital.

Demo trading

Basing on the charts and through continuous practice, we will be able to adjust our standards and settings to match our expectations and maximize our performance.

Evaluating your performance

No plan being perfect, we should keep improving our overall Strategy as we go. We should learn how to spot problem areas and effect the necessary solution when the need arises.

Before you trade live

For most traders, failure is more the rule. But those who take their studies seriously, train well and practice adequately will have a far better chance of succeeding. Practice makes better all the time. And success becomes inevitable in the end.

Spiritual prerequisites

Lest you be misled, there is an overriding spiritual component to the amassing and enjoyment of wealth. You may be deserving or not deserving and still make a fortune doing most anything, even the immoral and criminal. Through hard work or by just taking it easy, you could be the best trader there is, be a billionaire, be famous and respected. But all that won’t last unless you also first live as God directs. His laws are eternal and unchanging. Eternal life and happiness await those who do His will.”


Source: Online Forex Trading – a knol by Angel Luz

TRT FM is de Turkse staatsradio. Er wordt bijna uitsluitend Turkse muziek gedraaid. Het is vergelijkbaar met de Nederlandse radio 3 FM. Over het algemeen is deze zender minder schreeuwerig dan vergelijkbare commerciële radio stations.

Image via Wikipedia

Forex market is open 24 hours a day. It provides a great opportunity for traders to trade any time of the day or at night. However, although it seems to be not very important at the beginning, the right time to trade is one of the most crucial points to be successful in trading at the forex market.

The best time to trade is when the market is the most active and therefore has the biggest volume of trades. More active currency moves will create a good chance to catch the trade and make some profit.

New York 8am to 5pm EST
Tokyo 7pm to 4am EST
Sydney 5pm to 2am EST
London 3am to 12 noon EST

At times when markets overlap, the highest volume of trades occurs.


Source: Forex Market Hour – a knol by Ardiansyah

Flexibel zijn op zondagochtend om 7 uur. Als de jongste haar pap niet wil en de oudste haar broodje pindakaas niet wil eten, niet boos worden, maar om wisselen.

Image via Wikipedia

Foreign Currency Risk Management

Forex hedging protects you or your company from adverse changes in foreign currency exchange rates on your foreign currency assets and liabilities.

Basic Concept: The forex hedge’s change in value is opposite to the change in value of the foreign currency exposure (hedged item). These two amounts offset each other to obtain cost certainty or revenue certainty by fixing the foreign exchange rate for your transaction.

There is typically a cost associated with forex hedging and generally, forex hedging will require a certain amount of margin cash (retail online forex broker) or available credit from your financial institution, while the forex hedge is outstanding.

There are a couple different methods to complete the forex hedges. For the assumed example, the company uses the United Stated Dollar (((USD)USDUSDas its reporting currency and it has a future Euro payable amount. With all forex hedges, your company is buying one currency and selling another currency.

1. Forward contract. Your company would purchase a forward contract from a banking institution which would give you the right to purchase a contracted amount of euros at a future date at a fixed price. Your future exchange rate would be based upon the current exchange rate, likely profit paid to the bank, and forward points. Forward points are calculated based on interest differential (interest carry costs) on the two currencies traded. You pay interest on the currency sold (USD) and you receive interest on the currency bought (euros). If you change the amount to be paid or the date of the expiry date of the contract, your financial institution will likely charge your company a fee.

· Your company will need adequate credit (borrowing capacity) with the financial institution, which supplies the forward contract.

2. Carry Spot Trade. With a retail online forex broker, you will enter into the carry spot trade whereby your company will buy the Euros and sell your local currency. Over the expected time frame between when you purchase the carry spot trade and complete the euro transaction in the future, your account will be charged the interest differential (interest carry costs). Once again, your company pays interest on the currency sold (USD) and you receive interest on the currency bought (euros). The carry spot trade may be partially or fully terminated at any time, which provides flexibility for when your euro transaction is completed.

· Your company will need adequate margin with the online retail forex broker, which enables the carry spot trade to be transacted.

3. Forex Options. A currency option gives the holder the right, but not the obligation, to sell or buy a face amount of currency at a set price, on or before a given date. A currency option has a strike price—the amount for which the currency can be bought or sold—and an expiration date. U.S. options can be exercised at any time up to and including the expiration date, whereas European options can only be exercised on the expiration date. Options are one-sided contracts that are priced based on a number of variables: exchange rates, interest differentials, duration of contract, historical exchange rate volatility, and a built-in commission for the provider. They offer a method of speculating on future currency movements, but you pay a price for that right to speculate.

4. Forex Exotics tend to be combinations of a variety of products (typically options and forward contracts) with many different names and flavors (including features such as floors, ceilings, collars, participating forwards). They are often sold with the promise of limited downside risk and the potential of unlimited or limited upside benefit. They’re similar to standard options, but should be left to very experienced forex traders because their complex structures often hide extra profits for their providers.

Remember, hedging is not about making money on the hedge transaction. Hedging is obtaining cost certainty or revenue certainty. You are locking in the future exchange rate for a certain future forex transactions.

As an example, let us assume you are a USD currency company. You plan to purchase $40,000 in European product in eight months. If you entered into a carry spot trade to buy 40,000 EUR/USD trade on an online retail forex platform , then you will receive cost certainty in an assumed eight months. With this example, the current EUR/USD price is 1.5600. The first currency listed is known as the quote currency and always equals 1. In this case, therefore, you would buy 1 EUR with selling 1.5600 USD. Your current USD expense is 62,400. (40,000 multiplied by 1.5600)

In the future, your euro payable is a (40,000), so your forex hedge will be to purchase the 40,000 euros on the carry spot trade by selling the USD.

If in the future, the EUR/USD price is 1.61, then you will have made $2,000 on your forex hedge trade [ 1.61 minus 1.56 = 0.05 multipled by 40,000 = $2,000], however, when you make the payment to the supplier, the 40,000 EUR would cost you 64,400 USD. Your net cost for the product would be $62,400 USD. (Actual cash payment to your supplier less the amount made on the forex hedge).

OR

If in the future, the EUR/USD price is 1.51, then you will have lost $(2,000) on your forex hedge trade[ 1.51 minus 1.56 = (0.05) multipled by 40,000 = $(2,000)], however, when you make the payment to the supplier, the 40,000 EUR would cost you $60,400 USD. Your net cost for the product would be $62,400. (Actual cash payment supplier plus the amount lost on the forex hedge.)

This is the hedge. The forex carry spot trade’s win or loss will be offset by the actual amount of money paid to the foreign supplier. In the end, you have obtained cost certainty for your company.

For all forex hedging, your company will pay (or receive) interest carry costs. When you open a carry spot trade as a forex hedge, you are simultaneously buying one currency and selling another. Until the trade is closed (settled), your account will be charged (or earn) the interest differential on the open position. You will be charged interest on the currency sold and you will earn interest on the currency purchased. In your example, you would be buying EUR and selling USD. At today’s interest rates (July 2008), the interest earned will exceed the interest paid, so while the forex hedge is outstanding, you will earn net interest. This will depend upon the two currencies traded.

If you are interested in a specific example (different currencies, amounts and timelines), there is a Cost Comparison Tool at http://fxconsulting.oanda.com/tools/cst-fc.shtml. This tool will give you a breakdown of expected costs for completing the forex hedge with a carry spot trade on an online retail forex platform as compared to using a forex forward from a financial institution. This tool supports 24 currencies from around the world utilizing real time foreign currency rates. Unfortunately not all currencies are supported.

Forex hedging is an excellent risk management tool to avoid unnecessary foreign currency losses on your foreign currency assets or liabilities.”

Source: Forex Hedging – a knol by Murray Thomas

Foreign exchange market
The foreign exchange (currency or forex or FX) market exists wherever one currency is traded for another. It is the largest and most liquid financial market in the world, and includes trading between large banks, central banks, currency speculators, multinational corporations, governments, and other financial markets and institutions. The average daily trade in the global forex and related markets currently is almost US$ 4 trillion.
Market size and liquidity

The foreign exchange market is unique because of:

• its trading volumes
• the extreme liquidity of the market
• the large number of, and variety of, traders in the market
• its geographical dispersion
• its long trading hours: 24 hours a day except on weekends (from 5pm EST on Sunday until 4pm EST Friday)
• the variety of factors that affect exchange rates
• the low margins of profit compared with other markets of fixed income (but profits can be high due to very large trading volumes)
• the use of leverage

Main foreign exchange market turnover, 1988 – 2007, measured in billions of USD. As such, it has been referred to as the market closest to the ideal perfect competition, notwithstanding market manipulation by central banks. According to the BIS, average daily turnover in global foreign exchange markets is estimated at $3.98 trillion. Trading in the world’s main financial markets accounted for $3.21 trillion of this.

This $3.21 trillion in main foreign exchange market turnover was broken down as follows:

• $1,005 billion in spot transactions
• $362 billion in outright forwards
• $1,714 billion in forex swaps
• $129 billion estimated gaps in reporting

Of the $3.98 trillion daily global turnover, trading in London accounted for around $1.36 trillion, or 34.1% of the total, making London by far the global center for foreign exchange. In second and third places respectively, trading in New York accounted for 16.6%, and Tokyo accounted for 6.0%.

Exchange-traded forex futures contracts were introduced in 1972 at the Chicago Mercantile Exchange and are actively traded relative to most other futures contracts. Forex futures volume has grown rapidly in recent years, and accounts for about 7% of the total foreign exchange market volume, according to The Wall Street Journal Europe (5/5/06, p. 20).

Foreign exchange trading increased by 38% between April 2005 and April 2006 and has more than doubled since 2001. This is largely due to the growing importance of foreign exchange as an asset class and an increase in fund management assets, particularly of hedge funds and pension funds. The diverse selection of execution venues such as internet trading platforms offered by companies such as First Prudential Markets and Saxo Bank have made it easier for retail traders to trade in the foreign exchange market.

Because foreign exchange is an OTC market where brokers/dealers negotiate directly with one another, there is no central exchange or clearing house. The biggest geographic trading centre is the UK, primarily London, which according to IFSL estimates has increased its share of global turnover in traditional transactions from 31.3% in April 2004 to 34.1% in April 2007. RPP

The ten most active traders account for almost 73% of trading volume, according to The Wall Street Journal Europe, (2/9/06 p. 20). These large international banks continually provide the market with both bid (buy) and ask (sell) prices. The bid/ask spread is the difference between the price at which a bank or market maker will sell (‘ask’, or ‘offer’) and the price at which a market-maker will buy (‘bid’) from a wholesale customer. This spread is minimal for actively traded pairs of currencies, usually 0–3 pips. For example, the bid/ask quote of EUR/USD might be 1.2200/1.2203 on a retail broker. Minimum trading size for most deals is usually 100,000 units of currency, which is a standard ‘lot’.

These spreads might not apply to retail customers at banks, which will routinely mark up the difference to say 1.2100 / 1.2300 for transfers, or say 1.2000 / 1.2400 for banknotes or travelers’ checks. Spot prices at market makers vary, but on EUR/USD are usually no more than 3 pips wide (i.e. 0.0003). Competition is greatly increased with larger transactions, and pip spreads shrink on the major pairs to as little as 1 to 2 pips.

Market participants

Unlike a stock market, where all participants have access to the same prices, the forex market is divided into levels of access. At the top is the inter-bank market, which is made up of the largest investment banking firms. Within the inter-bank market, spreads, which are the difference between the bid and ask prices, are razor sharp and usually unavailable, and not known to players outside the inner circle. As you descend the levels of access, the difference between the bid and ask prices widens (from 0-1 pip to 1-2 pips for some currencies such as the EUR). This is due to volume. If a trader can guarantee large numbers of transactions for large amounts, they can demand a smaller difference between the bid and ask price, which is referred to as a better spread. The levels of access that make up the forex market are determined by the size of the “line” (the amount of money with which they are trading). The top-tier inter-bank market accounts for 53% of all transactions. After that there are usually smaller investment banks, followed by large multi-national corporations (which need to hedge risk and pay employees in different countries), large hedge funds, and even some of the retail forex market makers. According to Galati and Melvin, “Pension funds, insurance companies, mutual funds, and other institutional investors have played an increasingly important role in financial markets in general, and in FX markets in particular, since the early 2000s.” (2004) In addition, he notes, “Hedge funds have grown markedly over the 2001–2004 period in terms of both number and overall size” Central banks also participate in the forex market to align currencies to their economic needs.

Banks

The interbank market caters for both the majority of commercial turnover and large amounts of speculative trading every day. A large bank may trade billions of dollars daily. Some of this trading is undertaken on behalf of customers, but much is conducted by proprietary desks, trading for the bank’s own account.

Until recently, foreign exchange brokers did large amounts of business, facilitating interbank trading and matching anonymous counterparts for small fees. Today, however, much of this business has moved on to more efficient electronic systems. The broker squawk box lets traders listen in on ongoing interbank trading and is heard in most trading rooms, but turnover is noticeably smaller than just a few years ago.

Commercial companies

An important part of this market comes from the financial activities of companies seeking foreign exchange to pay for goods or services. Commercial companies often trade fairly small amounts compared to those of banks or speculators, and their trades often have little short term impact on market rates. Nevertheless, trade flows are an important factor in the long-term direction of a currency’s exchange rate. Some multinational companies can have an unpredictable impact when very large positions are covered due to exposures that are not widely known by other market participants.

Central banks

National central banks play an important role in the foreign exchange markets. They try to control the money supply, inflation, and/or interest rates and often have official or unofficial target rates for their currencies. They can use their often substantial foreign exchange reserves to stabilize the market. Milton Friedman argued that the best stabilization strategy would be for central banks to buy when the exchange rate is too low, and to sell when the rate is too high — that is, to trade for a profit based on their more precise information. Nevertheless, the effectiveness of central bank ‘stabilizing speculation’ is doubtful because central banks do not go bankrupt if they make large losses, like other traders would, and there is no convincing evidence that they do make a profit trading.

The mere expectation or rumor of central bank intervention might be enough to stabilize a currency, but aggressive intervention might be used several times each year in countries with a dirty float currency regime. Central banks do not always achieve their objectives. The combined resources of the market can easily overwhelm any central bank.Several scenarios of this nature were seen in the 1992–93 ERM collapse, and in more recent times in Southeast Asia.


Hedge funds

Hedge funds have gained a reputation for aggressive currency speculation since 1996. They control billions of dollars of equity and may borrow billions more, and thus may overwhelm intervention by central banks to support almost any currency, if the economic fundamentals are in the hedge funds’ favor.

Investment management firms

Investment management firms (who typically manage large accounts on behalf of customers such as pension funds and endowments) use the foreign exchange market to facilitate transactions in foreign securities. For example, an investment manager with an international equity portfolio will need to buy and sell foreign currencies in the spot market in order to pay for purchases of foreign equities. Since the forex transactions are secondary to the actual investment decision, they are not seen as speculative or aimed at profit-maximization. Some investment management firms also have more speculative specialist currency overlay operations, which manage clients’ currency exposures with the aim of generating profits as well as limiting risk. Whilst the number of this type of specialist firms is quite small, many have a large value of assets under management (AUM), and hence can generate large trades.

Retail forex brokers

There are two types of retail brokers offering the opportunity for speculative trading. Retail forex brokers or Market makers.Retail traders (individuals) are a small fraction of this market and may only participate indirectly through brokers or banks. Retail forex brokers, while largely controlled and regulated by the CFTC and NFA might be subject to forex scams. At present, the NFA and CFTC are imposing stricter requirements, particularly in relation to the amount of Net Capitalization required of its members. As a result many of the smaller, and perhaps questionable brokers are now gone. It is not widely understood that retail brokers and market makers typically trade against their clients and frequently take the other side of their trades. This can often create a potential conflict of interest and give rise to some of the unpleasant experiences some traders have had. A move toward NDD(No Dealing Desk), And STP(Straight Through Processing) has helped to resolve some of these concerns and restore trader confidence, but caution is still advised in ensuring that all is as it is presented.

Other

Non-bank foreign exchange companies offer currency exchange and international payments to private individuals and companies. These are also known as Foreign Exchange Brokers but are distinct from Forex Brokers as they do not offer speculative trading but currency exchange with payments. i.e. there is usually a physical delivery of currency to a bank account.

It is estimated that in the UK, 14% of currency transfers/payments are made via Foreign Exchange Companies. These companies’ selling point is usually that they will offer better exchange rates or cheaper payments than the customer’s bank. These companies differ from Money Transfer/Remittance Companies in that they generally offer higher-value services.

Money Transfer/Remittance Companies perform high-volume low-value transfers generally by economic migrants back to their home country. In 2007, the Aite Group estimated that there were $369 billion of remittances (an increase of 8% on the previous year). The four largest markets (India, China, Mexico and the Philippines) receive $95 billion. The largest and best known provider is Western Union with 345,000 agents globally.

Most traded currencies:

1. United States dollar
2. Euro
3. Japanese yen
4. Pound sterling
5. Swiss franc
6. Australian dollar
7. Canadian dollar
8. Swedish krona
9. Hong Kong dollar
10. Norwegian krone
11. New Zealand dollar
12. Mexican Peso

There is no unified or centrally cleared market for the majority of FX trades, and there is very little cross-border regulation. Due to the over-the-counter (OTC) nature of currency markets, there are rather a number of interconnected marketplaces, where different currencies instruments are traded. This implies that there is not a single exchange rate but rather a number of different rates (prices), depending on what bank or market maker is trading, and where it is. In practice the rates are often very close, otherwise they could be exploited by arbitrageurs instantaneously. Due to London’s dominance in the market, a particular currency’s quoted price is usually the London market price. A joint venture of the Chicago Mercantile Exchange and Reuters, called FxMarketSpace opened in 2007 and aspires to the role of a central market clearing mechanism.

The main trading center is London, but New York, Tokyo, Hong Kong and Singapore are all important centers as well. Banks throughout the world participate. Currency trading happens continuously throughout the day; as the Asian trading session ends, the European session begins, followed by the North American session and then back to the Asian session, excluding weekends.

There is little or no ‘inside information’ in the foreign exchange markets. Exchange rate fluctuations are usually caused by actual monetary flows as well as by expectations of changes in monetary flows caused by changes in GDP growth, inflation, interest rates, budget and trade deficits or surpluses, large cross-border M&A deals and other macroeconomic conditions. Major news is released publicly, often on scheduled dates, so many people have access to the same news at the same time. However, the large banks have an important advantage; they can see their customers’ order flow.

Currencies are traded against one another. Each pair of currencies thus constitutes an individual product and is traditionally noted XXX/YYY, where YYY is the ISO 4217 international three-letter code of the currency into which the price of one unit of XXX is expressed (called base currency). For instance, EUR/USD is the price of the euro expressed in US dollars, as in 1 euro = 1.5465 dollar. Out of convention, the first currency in the pair, the base currency, was the stronger currency at the creation of the pair. The second currency, counter currency, was the weaker currency at the creation of the pair.

The factors affecting XXX will affect both XXX/YYY and XXX/ZZZ. This causes positive currency correlation between XXX/YYY and XXX/ZZZ.

On the spot market, according to the BIS study, the most heavily traded products were:

• EUR/USD: 27 %
• USD/JPY: 13 %
• GBP/USD (also called sterling or cable): 12 %

and the US currency was involved in 86.3% of transactions, followed by the euro (37.0%), the yen (16.5%), and sterling (15.0%) (see table). Note that volume percentages should add up to 200%: 100% for all the sellers and 100% for all the buyers.

Trading in the euro has grown considerably since the currency’s creation in January 1999, and how long the foreign exchange market will remain dollar-centered is open to debate. Until recently, trading the euro versus a non-European currency ZZZ would have usually involved two trades: EUR/USD and USD/ZZZ. The exception to this is EUR/JPY, which is an established traded currency pair in the interbank spot market. As the dollar’s value has eroded during 2008, interest in using the euro as reference currency for prices in commodities (such as oil), as well as a larger component of foreign reserves by banks, has increased dramatically. Transactions in the currencies of commodity-producing countries, such as AUD, NZD, CAD, have also increased.

Factors affecting currency trading

Although exchange rates are affected by many factors, in the end, currency prices are a result of supply and demand forces. The world’s currency markets can be viewed as a huge melting pot: in a large and ever-changing mix of current events, supply and demand factors are constantly shifting, and the price of one currency in relation to another shifts accordingly. No other market encompasses (and distills) as much of what is going on in the world at any given time as foreign exchange.

Supply and demand for any given currency, and thus its value, are not influenced by any single element, but rather by several. These elements generally fall into three categories: economic factors, political conditions and market psychology.

Economic factors

These include economic policy, disseminated by government agencies and central banks, economic conditions, generally revealed through economic reports, and other economic indicators.

Economic policy comprises government fiscal policy (budget/spending practices) and monetary policy (the means by which a government’s central bank influences the supply and ‘cost’ of money, which is reflected by the level of interest rates).

Economic conditions include:

Government budget deficits or surpluses: The market usually reacts negatively to widening government budget deficits, and positively to narrowing budget deficits. The impact is reflected in the value of a country’s currency.

Balance of trade levels and trends: The trade flow between countries illustrates the demand for goods and services, which in turn indicates demand for a country’s currency to conduct trade. Surpluses and deficits in trade of goods and services reflect the competitiveness of a nation’s economy. For example, trade deficits may have a negative impact on a nation’s currency.

Inflation levels and trends: Typically, a currency will lose value if there is a high level of inflation in the country or if inflation levels are perceived to be rising. This is because inflation erodes purchasing power, thus demand, for that particular currency. However, a currency may sometimes strengthen when inflation rises because of expectations that the central bank will raise short-term interest rates to combat rising inflation.

Economic growth and health: Reports such as gross domestic product (GDP), employment levels, retail sales, capacity utilization and others, detail the levels of a country’s economic growth and health. Generally, the more healthy and robust a country’s economy, the better its currency will perform, and the more demand for it there will be.

Political conditions

Internal, regional, and international political conditions and events can have a profound effect on currency markets.

For instance, political upheaval and instability can have a negative impact on a nation’s economy. The rise of a political faction that is perceived to be fiscally responsible can have the opposite effect. Also, events in one country in a region may spur positive or negative interest in a neighboring country and, in the process, affect its currency.

Market psychology

Market psychology and trader perceptions influence the foreign exchange market in a variety of ways:

Flights to quality: Unsettling international events can lead to a ‘flight to quality,’ with investors seeking a ‘safe haven’. There will be a greater demand, thus a higher price, for currencies perceived as stronger over their relatively weaker counterparts. The Swiss franc has been a traditional safe haven during times of political or economic uncertainty.

Long-term trends: Currency markets often move in visible long-term trends. Although currencies do not have an annual growing season like physical commodities, business cycles do make themselves felt. Cycle analysis looks at longer-term price trends that may rise from economic or political trends.

‘Buy the rumor, sell the fact:’ This market truism can apply to many currency situations. It is the tendency for the price of a currency to reflect the impact of a particular action before it occurs and, when the anticipated event comes to pass, react in exactly the opposite direction. This may also be referred to as a market being ‘oversold’ or ‘overbought’.To buy the rumor or sell the fact can also be an example of the cognitive bias known as anchoring, when investors focus too much on the relevance of outside events to currency prices.

Economic numbers: While economic numbers can certainly reflect economic policy, some reports and numbers take on a talisman-like effect: the number itself becomes important to market psychology and may have an immediate impact on short-term market moves. ‘What to watch’ can change over time. In recent years, for example, money supply, employment, trade balance figures and inflation numbers have all taken turns in the spotlight.

Technical trading considerations: As in other markets, the accumulated price movements in a currency pair such as EUR/USD can form apparent patterns that traders may attempt to use. Many traders study price charts in order to identify such patterns.
Algorithmic trading in forex

Electronic trading is growing in the FX market, and algorithmic trading is becoming much more common. According to financial consultancy Celent estimates, by 2008 up to 25% of all trades by volume will be executed using algorithm, up from about 18% in 2005.

Financial instruments

Spot

A spot transaction is a two-day delivery transaction (except in the case of the Canadian dollar, which settles the next day), as opposed to the futures contracts, which are usually three months. This trade represents a “direct exchange” between two currencies, has the shortest time frame, involves cash rather than a contract; and interest is not included in the agreed-upon transaction. The data for this study come from the spot market. Spot has the largest share by volume in FX transactions among all instruments.

Forward

One way to deal with the Forex risk is to engage in a forward transaction. In this transaction, money does not actually change hands until some agreed upon future date. A buyer and seller agree on an exchange rate for any date in the future, and the transaction occurs on that date, regardless of what the market rates are then. The duration of the trade can be a few days, months or years.

Future

Foreign currency futures are forward transactions with standard contract sizes and maturity dates — for example, 500,000 British pounds for next November at an agreed rate. Futures are standardized and are usually traded on an exchange created for this purpose. The average contract length is roughly 3 months. Futures contracts are usually inclusive of any interest amounts.

Swap

The most common type of forward transaction is the currency swap. In a swap, two parties exchange currencies for a certain length of time and agree to reverse the transaction at a later date. These are not standardized contracts and are not traded through an exchange.

Option

A foreign exchange option (commonly shortened to just FX option) is a derivative where the owner has the right but not the obligation to exchange money denominated in one currency into another currency at a pre-agreed exchange rate on a specified date. The FX options market is the deepest, largest and most liquid market for options of any kind in the world.

Exchange Traded Fund

Exchange-traded funds (or ETFs) are Open Ended investment companies that can be traded at any time throughout the course of the day. Typically, ETFs try to replicate a stock market index such as the S&P 500 (e.g. SPY), but recently they are now replicating investments in the currency markets with the ETF increasing in value when the US Dollar weakness versus a specific currency, such as the Euro. Certain of these funds track the price movements of world currencies versus the US Dollar, and increase in value directly counter to the US Dollar, allowing for speculation in the US Dollar for US and US Dollar denominated investors and speculators.

Speculation

Controversy about currency speculators and their effect on currency devaluations and national economies recurs regularly. Nevertheless, economists including Milton Friedman have argued that speculators ultimately are a stabilizing influence on the market and perform the important function of providing a market for hedgers and transferring risk from those people who don’t wish to bear it, to those who do. Other economists susch as Joseph Stiglitz consider this argument to be based more on politics and a free market philosophy than on economics.

Large hedge funds and other well capitalized ‘position traders’ are the main professional speculators.

Currency speculation is considered a highly suspect activity in many countries. While investment in traditional financial instruments like bonds or stocks often is considered to contribute positively to economic growth by providing capital, currency speculation does not; according to this view, it is simply gambling that often interferes with economic policy. For example, in 1992, currency speculation forced the Central Bank of Sweden to raise interest rates for a few days to 500% per annum, and later to devalue the krona. Former Malaysian Prime Minister Mahathir Mohamad is one well known proponent of this view. He blamed the devaluation of the Malaysian ringgit in 1997 on George Soros and other speculators. Gregory Millman reports on an opposing view, comparing speculators to ‘vigilantes’ who simply help ‘enforce’ international agreements and anticipate the effects of basic economic ‘laws’ in order to profit. in this view, countries may develop unsustainable financial bubbles or otherwise mishandle their national economies, and forex speculators allegedly made the inevitable collapse happen sooner. A relatively quick collapse might even be preferable to continued economic mishandling. Mahathir Mohamad and other critics of speculation are viewed as trying to deflect the blame from themselves for having caused the unsustainable economic conditions. Given that Malaysia recovered quickly after imposing currency controls directly against IMF advice, this view is open to doubt.”

Source: forex – a knol by Ami Dror

A General Guide to the Confused Investor
This article aims to summarize a few important general and basic tips and principles of how to survive the credit crunch, how to build your investment portfolio and how to protect your money. These tools will also enable you to judge and self-assess the contradicting advices given to you by your bankers and financial advisors.

The uncertainty and confusion which hold the global markets these days create a great challenge to all of us, the sophisticated and unsophisticated investors. We all struggle for the same goal – how to protect our money. Some adventurous investors also wish to benefit from this crisis.

There are numerous opinions coming from the top bankers and famous financial advisors. These opinions vary and sometimes contradict each other, a contradiction which demonstrates the most important assumption today – nobody really knows how the markets will behave 3 months, 12 months or 36 months from now. The supprime crisis has changed the rules of the game. A good and safe investment portfolio structured in 2007 may prove to be risky and wrong in 2008 and onwards.

This article aims to summarize a few important general and basic tips and principles of how to survive the credit crunch, how to build your investment portfolio and how to protect your money. These tools will also enable you to judge and self-assess the advices given to you by your bankers and financial advisors:

When do you need it and for which purpose?

This is the first and most important question one needs to ask himself before making an investment. If you need to use your savings within the next 1-2 years, your investment portfolio should be designed differently from another person who invests for a period of 10-30 years (e.g. retirement purpose). While the latter can be more creative today, assuming that in 10-30 years the global economy will stabilize and grow, if you need your savings in the near future (e.g. before 2010), obviously you want to protect your money and avoid taking any short term bets. As mentioned before, the short term views on the global markets are contradicting even among the so-called “financial experts”, thus for you, the short term unsophisticated investor, any short term bet is simply called Gambling.

Cash is the King

Wise people always say “Cash is the King”. The current credit crunch shows again how true it is. The main problem in the markets today is the lack of cash. Lack of cash for financial institutions to drive and fuel the markets, lack of cash for real estate investors to maintain the current property prices and activities, and lack of cash for individuals due to tight conditions for loans taking, layoffs and higher prices of daily consumption.

Cash holding is the ultimate safe-heaven to protect your money. For the ones that need to use their money before 2010, this is the only way to guarantee that your money will be there when you need it, and therefore the portion of cash in your portfolio shall be larger. In order not to loose the value of your cash ($5 of today may buy less in 1-2 years), you shall deposit your cash in an interest accruing account/program at the bank. Most experts predict that the interest rate will rise in the next few years, thus a program which periodically adjust to the market interest rate (as oppose to flat rate) may be the best choice for you.

Also the long term investors may choose to keep higher levels of cash in their accounts. This cash will enable you to purchased distress assets in the future, such assets that have suffered and will probably continue to suffer from the current crisis (e.g. real estate, stocks).

Diversification, Diversification, Diversification

Diversification of your investment portfolio is the first rule taught in every business school. This was true in the past and it has even a greater meaning these days. Every day we read in the financial newspapers different opinions: the US dollar will get even lower vs. the US dollar will rally very soon; This is the right time to enter the stock markets vs. the markets will get even lower; Time to invest in commodities vs. commodities’ prices are too high.

The only way to deal with this confusing pluralism of opinions is keeping your investment balanced and diversified and avoiding from putting too much weight on any specific bet. One may still reflect its long term views in his portfolio, but if you are a believer of emerging markets, for instance, it may be irresponsible to invest 80% of your retirement in emerging stock markets. A balanced portfolio shall include some representation of the basic components: cash, fixed income (bonds), foreign currencies, stocks and others (e.g. commodities or alternative investments), and the percentage shall vary according to your nature and risk appetite and according to your investment horizon and future financial plans.

Stock Markets and Stock Picking

The global markets have taken big hit from the Subprime crisis. Some experts say we have not touched the bottom yet and other believe that the rally is around the corner. Due to uncertainty in the markets the volatility is high – one week the major indexes may be 5% higher and the following week they show a large decline.

Individual shares are even more volatile. Some shares of large companies that were considered in the past “safe” have lost 50-70% in the last 12 months. Common rules of evaluating corporations’ financial stability may not hold any longer. Even in the “good days” of market stability we all know how difficult it is to bet on a specific stock. We all know those funny tests which showed how a random stock picking by a monkey showed better results than portfolios structured by the top financial experts. Other studies showed that the general index such as S&P, NASDAQ or NIKKEI had better results than equity funds, managed by professionals that tried to cherry pick specific stocks from the same index.

Especially these days it may prove wrong to bet on specific stocks. We see the write-offs in so many “safe and credible” corporations, thus we understand that we cannot guess what is hiding in this back box called “financial statements”, and we may not want to trust the experts that proved wrong.

Therefore, sophisticated and unsophisticated investors may choose to put more weight in their portfolios on equity funds focused on specific markets or sectors rather than picking specific stocks. Moreover, one shall always be careful of gambling on penny-stocks with no track record and no proven credibility. It is hard for the largest companies to survive the current crisis, and it may be much harder and sometimes impossible for the smaller companies to survive this crisis. The latter often have less cash to go through these rough times and they may face difficulties to raise more cash from the public market or private investors, thus they have higher risk of bankruptcy.

If you choose to expose yourself to the stock markets you may at least protect yourself by choosing funds that invest in large companies (with average market cap of over $1 billion).

Which markets or sectors to choose for investments is again hard to predict today and the experts’ opinions vary from one end to another. Therefore you may use again the Diversification Rule – invest in markets that are independent from each other. For instance, investing your entire portfolio in Japan and US may not present high diversification as these markets are closely related and their stock markets often have similar trends. Many experts believe in long term vision of the emerging markets, such as Brazil, Mexico, China and Russia. These markets may indeed show higher returns in the long run but may also be more sensitive to future financial crisis. Since the high energy and natural resources prices are identified as a prime reason for the latest stock market declines, you may choose to invest in net-exporters of energy, such as Russia. The later may prove to be somehow more protected from the rising energy prices.

Short Strategy Protections

One may also choose to protect his assets by investing in funds of short strategies. The investors of these funds may gain as long as a specific index falls. You may find variety of short funds focused on general indexes (e.g. NASDAQ) or specific sectors (e.g. Does Jones Real Estate Index). These protections are another tool towards diversification – if the overall market trend is negative, at least one may setoff some of the losses by holding these short funds.

These short funds may also protect the value of your hard assets. For instance, if 50% of your total value is invested in real estate and properties within the US, instead of selling those properties in these harsh days, you may choose short funds which may increase their value as long as the real estate market is dropping.

Fixed Income (Bonds)

Until a year ago many financial advisors held that the risk of bonds is minor and limited. The current credit crunch shows that some corporations cannot repay the bonds issued to the public and therefore the bond holders may loose up to 100% of the investment. However, the bond market is still considered as safer than the stock market. The same assumption against individual stock picking may hold for the bond market as well. The sophisticated and unsophisticated investors often lack the tools to evaluate the risk of investment in specific bonds, especially these days when the credit rating tools proved to be misleading in many cases.

Therefore, you may choose to diversify your portfolio by investing in fixed income funds. Here again you may choose to pick funds of bonds in specific markets (e.g. emerging markets, US market) or specific sectors (e.g. financial sector, real estate sector). You may also choose to invest in funds which focus on governmental bonds, issued and guaranteed by the issuing state. The later are obviously less risky of a default situation. The conservative investors may choose to invest in governmental bond funds in addition to funds focus on bonds issued by large cap corporations with high credit rating. Although, again, these days the high credit rating does not guarantee zero risk of default.

Currencies

Here again the opinions vary. Some experts believe the US dollar will rebound while other hold that it will continue to fall. The same confusion holds for other currencies as well. The exchange rates these days are volatile and some days these currencies behave like stock markets, i.e. daily increase or decrease of 1-2%.

While evaluating which currencies to hold in your portfolio you shall consider the following rules: The first rule is to hold most of your portfolio in the same currency you will need for your future use. For instance, if you save $300k to buy a house in California in the future, holding the same amount in other currencies may increase the risk that your savings will not be sufficient to purchase this house. The second rule is again diversification – some leading currencies lost 15-20% of their value in the last 2-3 years and you do not want to manage a smart portfolio in such wrong loosing currency, which will make your overall returns negative.

The right balance between these two rules may be to hold most of your portfolio in your future use currency while diversifying the rest of your investment portfolio with other currencies. Usually the leading currencies which bankers recommend to hold for diversification are: US dollar, Euro, Swiss Franc, Japanese Yen and British Pound. Additionally you may choose to add more exotic currencies of emerging markets but your local bank may not be able to reward you with interest on these currencies.

Liquidity Rule

Individual investors often invest in liquid instruments only i.e. funds, stocks and bonds that can be immediately purchased or sold. Investing in instruments that can not be liquidated immediately, such as funds or bonds that cannot be sold for 6-12 months, raises another type of risk – the market may change quickly but you cannot adjust accordingly. The latter risk may not please conservative investors which always want to keep the option of prompt exit for rainy days. The recent year and future years may be affected by many of those rainy days.

In case you invest in traded instruments such as stocks, traded funds or traded bonds, always verify that the amount of your investment represents only a small portion of the trading volume of this instrument. Otherwise you may not be able to sell your holdings when you wish to. For instance, many penny-share investors or special bonds investors could not sell their holdings. In case you hold $50k of specific share or bond but the daily trading is only $10k you cannot sell your holdings in a short period without pushing the market price down.

How to Pick a Fund

Today the markets are accessible and may help you to wisely pick the funds for your portfolio. May it be fund of bonds, fund of currencies, commodities or stocks, you can always compare the specific fund recommended by your banker with the parallel ETFs (Equity Traded Funds). The ETFs can easily be viewed through financial databases and websites. The ETFs guarantee the investor linkage to specific index, sector or currency. The ETFs are liquid and can be purchased or sold in the market. Here again you should verify that the trading volume is much higher (and stable in the last 3-12 months) than your personal holdings in this specific ETF.

The ETFs often charge smaller fees and therefore you shall always compare the performance of the equivalent ETF to the fund proposed by your banker or advisor. Bear in mind that banks may sometime try to push you to purchase other mutual funds or private funds since the bank itself may benefit from directing clients to these funds. This may be different from your own interest to maximize your profits and pay lower fees.

Disclaimer:

The information contained in this article and from any communication related to this article is for information purposes only. The author does not hold itself out as providing any legal, financial or other advice, and is not authorized to do so. The author also does not make any recommendation or endorsement as to any investment, advisor or other service or product or to any material submitted by third parties or linked to this article. In addition, the article does not offer any advice regarding the nature, potential value or suitability of any particular investment, security or investment strategy. The material in this article does not constitute advice and you should not rely on any material in this website to make (or refrain from making) any decision or take (or refrain from making) any action.”

Source: Subprime Crisis – How to Survive (Stock Picking, Forex, ETFs and Bonds) – a knol by Samuel

INTRODUCTION

There are various methods to invest your hard earned money without having to rely on mutual fund portfolios, stocks or banks. With today’s market headed in the wrong direction, it’s just simply not safe or viable to invest your money in the stock market unless your a seasoned and experienced investor. So where should you invest your money? This article will explain how trading foreign currency can be a very profitable and satisfying investing experience. This article will detail the steps required in teaching yourself how to trade foreign currencies, what online resources are available for you to reference, which online brokers to open an account with, what kind of account to open and what kind of experience is required. After reading this article, you should have a better understanding of how you can use the foreign currencies market to invest your money.

STEP#1: Learning To Trade Foreign Currency

All it takes to trade currency is some spare time to teach yourself the basics and the motivation to be a successful investor. There are a vast amount of online resources which help teach you how to trade foreign currency. Learning what you’re getting yourself into is absolutely vital. All you really need to get started is a computer and a high speed internet connection,.

The best online resource I’ve been able to find that virtually breaks down every aspect of currency trading into easy and user friendly modules is www.babypips.com. This site breaks down currency trading perfectly and structures its offerings into different classifications, such as kindergarten (Beginner) to University (Expert). Following the www.babypips.com forex education program will give you all the necessary information and education you need to dip your feet into the forex world. The course itself is quite lengthy and requires an initial investment of your time. I can honestly say from experience, that this investment was one of my best. I took the time to read over the course and familiarize myself with the currency market. The foreign exchange market trades 1 trillion dollars worth of currency everyday!! Learning how to take advantage of the currency market is a great investment opportunity Taking this course will also distinguish if this investment method is right for you or not.

STEP#2: Who Should Be Your Online Broker?

Okay, so step one was to complete the www.babypips.com education course, now what? Well, now is the time to register with an online broker and start trading on a practice basis. There are many online brokers out there salivating at the prospect of having you as a customer. So how do you find out which broker you should go with? Well, similar online resources are available which rank online brokerages on all aspects. A good website to check out is www.forexbastards.com.

This site, although sometimes bias, gives real consumer reviews on a wide range of forex brokers. Honestly, I believe no broker is perfect or offers what everyone is looking for. One thing I would do is register for a couple of online foreign exchange brokers that seem to tickle your fancy and try trading using their practice accounts. You’ll find that almost every online foreign exchange broker has the option of trying their trading software/platform on a practice basis for 30-60days if not more. This step is an absolute must because it allows you to try out some diverse trading strategies that you learned during your education course as well as become comfortable with the online brokers online trading application. Many traders make the mistake of going to fast and opening up a live account right away without taking the platform out for a test spin. I’ve virtually tired many online trading platforms and I’ve compiled a list of brokerages which have the most efficient and user friendly trading platforms.

1. Interactive Broker
2. Think or Swim
3. Forex Solutions
4. CMS Forex

5. FXCM

None of these brokers are listed in any particular order of rank, but they are the 5 main online brokerages that I have found to offer an efficient and reliable trading platform.

STEP#3: Type Of Account To Open

After you’ve selected the online broker of your choice, now comes the time to open up a practice account. During the registration process, you’ll find that online brokers will want to know quite a bit of information about you, like where you work and what your income stream is like. The reason for this assesment is to make sure your in the right financial position to open an account. Before trading currency with any online broker, you must be eligible to open an account. If you’ve satisfied and met all the required parameters for opening an online account, you’re well on your way to getting started.

You can generally open an account for as little as $250 but realistically, you’d want to open an account with at least $2500 to earn some realistic profits. If you have $2500 that you don’t see spending in a specified time period then I’d suggest you start with that. However, if $250 is all you would want to invest at first, then start with that.

Next step is to select the type of account you would like to open. If you’ll be trading strictly on your own behalf then and individual margin account would suffice. There are various other types of accounts but the most common is the individual margin account. Once you’ve selected the type of account you’d like to open, its now time to choose the level of margin you’d like to trade with. This step tends to be the most confusing so I’m going to explain how a margined account can be both beneficial and problematic.

Trading currencies using a margined account basically means that you are increasing the value of your funds by way of leverage in order to increase potential profits. However, this also creates the potential of increasing your potential loss. Refer to the example below.

E.g.

Leverage is when your invested cash is used to buy or sell foreign currencies that are worth far more that the investment. Simply put, leverage gets you more currency than you pay for.

When you buy\sell a leveraged currency, the sum you invest is called the Margin. The margin is used by your broker as a deposit for the currency you buy or sell.

A Leverage investment works as the following example:

* You buy/sell foreign currencies for $100
* You receive a leverage with a ratio of 100 to 1
* Your investment is now worth $10,000

(Example taken from Forexondemand.com)

**Be very careful when selecting your leverage ratio when opening your online account as the more leverage you choose decreases the amount of margin you have at your disposal when making a trade.**

STEP#4: Gaining Valuable Trading Experience

Alright, it is now time to execute your first online currency trade. Remember that you should always follow a trading strategy that you feel comfortable with and never deviate from that strategy. Currency trading is not for everyone and involves a high level of patience and nerves of steele. The more trading opportunities you find the better you will become at noticing possible money making patterns. Experience is key in this investment method and the more you accumulate the better you’ll become. Generally, you should practice for at least 6 months using play money before using your own. Why 6 months you ask, well, don’t be fooled by your first 5-10 trades. The more you develop your strategy the better you are able to analyze whether your strategy is successful or not. Once you have some concrete data that your trading strategy is successful, open up a live account and start trading real money. You’ll find yourself more at ease and comfortable trading with some experience under your belt. Although this investment method is risky it can also be very rewarding and satisfying. You don’t have to be a Wall Street professional to invest your own money. All you need is some spare time, dedication to succeed and motivation to be successful. If you posses these qualities along with nerves of steele then trading foreign currency is for you.”

Source: Make Money Trading Forex – a knol by Sam

Cover via Amazon

Below article looks like an extract of the book “Currency trading for Dummies“. You can fin the book in the BeginnersFX Store.

Forex Trading Guide for Beginners
Forex trading has opened up new frontiers for small retail investors who want to get lucky faster and with more regularity then what traditional investment avenues offer.

Introduction

Thanks to the Internet, tens of thousands of individual traders and investors all over the world are discovering the excitement and challenges of online

trading in the forex market. Yet in contrast to the stock market, the forex market somehow remains more elusive and seemingly complicated to newcomers.

Currency Trading For Dummies, Getting Started Edition, strips away the mystique of the forex market for smart, intelligent investors like you who know something about the potential of the forex market but don’t have the foggiest how it actually works. Read this book and then, if you like what you’ve read, put your knowledge and intuition to the test by getting a practice trading account with an online forex brokerage before you put any actual money at risk.

Note: Trading foreign currencies is a challenging and potentially profitable opportunity for educated and experienced investors. However, before deciding to participate in the forex market, you should carefully consider your investment objectives, level of experience, and risk appetite. Most important, don’t invest money you can’t afford to lose.

What Is the Forex Market?

In This Chapter

Getting inside the forex market

Understanding that speculating is the name of the game

Trading currencies around the world

Linking other financial markets to currencies
The foreign exchange market — most often called the forex market, or simply the FX market — is the most traded financial market in the world. We like

to think of the forex market as the “Big Kahuna” of financial markets. The forex market is the crossroads for international capital, the intersection through which global commercial and investment flows have to move. International trade flows, such as when a Swiss electronics company purchases Japanese-made components, were the original basis for the development of the forex markets. Today, however, global financial and investment flows dominate trade as the primary non-speculative source of forex market volume. Whether it’s an Australian pension fund investing in U.S. Treasury bonds, or a British insurer allocating assets to the Japanese equity market, or a German conglomerate purchasing a Canadian manufacturing facility, each cross-border transaction passes through the forex market at some stage.

More than anything else, the forex market is a trader’s market. It’s a market that’s open around the clock six days a week, enabling traders to act on news and events as they happen. It’s a market where half-billion-dollar trades can be executed in a matter of seconds and may not even move prices noticeably. Try buying or selling a half billion of anything in another market and see how prices react.

Getting Inside the Numbers

Average daily currency trading volumes exceed $2 trillion per day. That’s a mind-boggling number, isn’t it? $2,000,000,000,000 — that’s a lot of zeros, no matter how you slice it. To give you some perspective on that size, it’s about 10 to 15 times the size of daily trading volume on all the world’s stock markets combined.

Speculating in the currency market

While commercial and financial transactions in the currency markets represent huge nominal sums, they still pale in comparison to amounts based on speculation. By far the vast majority of currency trading volume is based on speculation — traders buying and selling for short-term gains based on minute-to- minute, hour-to-hour, and day-to-day price fluctuations. Estimates are that upwards of 90 percent of daily trading

volume is derived from speculation (meaning, commercial or investment-based FX trades account for less than 10 percent of daily global volume). The depth and breadth of the speculative market means that the liquidity of the overall forex market is unparalleled among global financial markets.

The bulk of spot currency trading, about 75 percent by volume, takes place in the so-called “major currencies,” which represent the world’s largest and most developed economies. Additionally, activity in the forex market frequently functions on a regional “currency bloc” basis, where the bulk of trading takes place between the USD bloc, JPY bloc, and EUR bloc, representing the three largest global economic regions.

Getting liquid without getting soaked

Liquidity refers to the level of market interest — the level of buying and selling volume — available at any given moment for a particular asset or security. The higher the liquidity, or the deeper the market, the faster and easier it is to buy or sell a security.

From a trading perspective, liquidity is a critical consideration because it determines how quickly prices move between trades and over time. A highly liquid market like forex can see large trading volumes transacted with relatively minor price changes. An illiquid, or thin, market tends to see prices move more rapidly on relatively lower trading volumes. A market that only trades during certain hours (futures contracts, for example) also represents a less liquid, thinner market.

Around the World in a Trading Day

The forex market is open and active 24 hours a day from the start of business hours on Monday morning in the Asia-Pacific time zone straight through to the Friday close of business hours in New York. At any given moment, depending on the time zone, dozens of global financial centers — such as Sydney, Tokyo, or London — are open, and currency trading desks in those financial centers are active in the market.

Currency trading doesn’t even stop for holidays when other financial markets, like stocks or futures exchanges, may be closed. Even though it’s a holiday in Japan, for example, Sydney, Singapore, and Hong Kong may still be open. It might be the Fourth of July in the United States, but if it’s a business day, Tokyo, London, Toronto, and other financial centers will still be trading currencies. About the only holiday in common

around the world is New Year’s Day, and even that depends on what day of the week it falls on.

The opening of the trading week

There is no officially designated starting time to the trading day or week, but for all intents the market action kicks off when Wellington, New Zealand, the first financial center west of the international dateline, opens on Monday morning local time. Depending on whether daylight saving time is in effect in your own time zone, it roughly corresponds to early Sunday afternoon in North America, Sunday evening in Europe, and very early Monday morning in Asia.

Chapter 1: What Is the Forex Market?
The Sunday open represents the starting point where currency markets resume trading after the Friday close of trading in North America (5 p.m. Eastern time). This is the first chance for the forex market to react to news and events that may have happened over the weekend. Prices may have closed New York trading at one level, but depending on the circumstances, they may start trading at different levels at the Sunday open.

Trading in the Asia-Pacific session

Currency trading volumes in the Asia-Pacific session account for about 21 percent of total daily global volume, according to a 2004 survey. The principal financial trading centers are Wellington, New Zealand; Sydney, Australia; Tokyo, Japan; Hong Kong; and Singapore. In terms of the most actively traded currency pairs, that means news and data reports fromNew Zealand, Australia, and Japan are going to be hitting the

market during this session Because of the size of the Japanese market and the importance of Japanese data to the market, much of the action during the Asia-Pacific session is focused on the Japanese yen currency pairs (explained more in Chapter 2), such as USD/JPY – forex-

speak for the U.S. dollar/Japanese yen — and the JPY crosses, like EUR/JPY and AUD/JPY. Of course, Japanese financial institutions are also most active during this session, so you can frequently get a sense of what the Japanese market is doing based on price movements.
For individual traders, overall liquidity in the major currency pairs is more than sufficient, with generally orderly price movements. In some less liquid, non-regional currencies, like GBP/USD or USD/CAD, price movements may be more erratic or nonexistent, depending on the environment.

Trading in the European/London session

About midway through the Asian trading day, European financial centers begin to open up and the market gets into its full swing. European financial centers and London account for over 50 percent of total daily global trading volume, with London alone accounting for about one-third of total daily global volume, according to the 2004 survey. The European session overlaps with half of the Asian trading day and half of the North American trading session, which means that market interest and liquidity is at its absolute peak during this session.
News and data events from the Eurozone (and individual countries like Germany and France), Switzerland, and the United Kingdom are typically released in the early-morning hours of the European session. As a result, some of the biggest moves and most active trading takes place in the European currencies (EUR, GBP, and CHF) and the euro cross currency pairs (EUR/CHF and EUR/GBP). Asian trading centers begin to wind down in the late-morning hours of the European session, and North American financial centers come in a few hours later, around 7 a.m. ET.

Trading in the North American session

Because of the overlap between North American and European trading sessions, the trading volumes are much more significant. Some of the biggest and most meaningful directional price movements take place during this crossover period. On its own, however, the North American trading session accounts for roughly the same share of global trading volume as the Asia-Pacific market, or about 22 percent of

global daily trading volume.

The North American morning is when key U.S. economic data is released and the forex market makes many of its most significant decisions on the value of the U.S. dollar. Most U.S. data reports are released at 8:30 a.m. ET, with others coming out later (between 9 and 10 a.m. ET). Canadian data reports are also released in the morning, usually between 7 and 9 a.m. ET. There are also a few U.S. economic reports that variously come out at noon or 2 p.m. ET, livening up the New York after noon market. London and the European financial centers begin to wind down their daily trading operations around noon eastern time (ET) each day. The London, or European close, as it’s known, can frequently generate volatile flurries of activity. On most days, market liquidity and interest fall off significantly in the New York afternoon, which can make for challenging trading conditions. On quiet days, the generally lower market interest typically leads to stagnating price action. On more active days, where prices may have moved more significantly, the lower liquidity can spark additional outsized price movements, as fewer traders scramble to get similarly fewer prices and liquidity. Just as with the London close, there’s never a set way in which a New York afternoon market move plays out, so traders just need to be aware that lower liquidity conditions tend to prevail, and adapt accordingly.

Currencies and Other Financial Markets

As much as we like to think of the forex market as the be all and end all of financial trading markets, it doesn’t exist in a vacuum. You may even have heard of some these other markets: gold, oil, stocks, and bonds. There’s a fair amount of noise and misinformation about the supposed interrelationship among these markets and currencies or individual currency pairs. To be sure, you can always find a correlation between two different markets over some period of time, even if it’s only zero (meaning, the two markets aren’t correlated at all).

Always keep in mind that all the various financial markets are markets in their own right and function according to their own internal dynamics based on data, news, positioning, and sentiment. Will markets occasionally overlap and display varying degrees of correlation? Of course, and it’s always important to be aware of what’s going on in other financial markets. But it’s also essential to view each market in its own perspective and to trade each market individually. Let’s look at some of the other key financial markets and see what conclusions we can draw for currency trading.

Gold

Gold is commonly viewed as a hedge against inflation, an alternative to the U.S. dollar, and as a store of value in times of economic or political uncertainty. Over the long term, the relationship is mostly inverse, with a weaker USD generally accompanying a higher gold price, and a stronger USD coming with a lower gold price. However, in the short run, each market has its own dynamics and liquidity, which makes

short-term trading relationships generally tenuous. Overall, the gold market is significantly smaller than the forex market, so if we were gold traders, we’d sooner keep an eye on what’s happening to the dollar, rather than the other way around. With that noted, extreme movements in gold prices tend to attract currency traders’ attention and usually influence the dollar in a mostly inverse fashion.

Oil

A lot of misinformation exists on the Internet about the supposed relationship between oil and the USD or other currencies, such as CAD or JPY. The idea is that, because some countries are oil producers, their currencies are positively (or negatively) affected by increases (or decreases) in the price of oil. If the country is an importer of oil (and which countries aren’t today?), the theory goes, its currency will be hurt (or helped) by higher (or lower) oil prices. Correlation studies show no appreciable relationships to that effect, especially in the short run, which is where most currency trading is focused. When there is a long-term relationship, it’s as evident against the USD as much as, or more than, any individual currency, whether an importer or exporter of black gold. The best way to look at oil is as an inflation input and as a lim-
iting factor on overall economic growth. The higher the price of oil, the higher inflation is likely to be and the slower an economy is likely to grow. The lower the price of oil, the lower inflationary pressures are likely (but not necessarily) to be. We like to factor changes in the price of oil into our inflation and growth expectations, and then draw conclusions about the course of the USD from them. Above all, oil is just one input among many.

Stocks
Stocks are microeconomic securities, rising and falling in response to individual corporate results and prospects, while currencies are essentially macroeconomic securities, fluctuating in response to wider-ranging economic and political developments. As such, there is little intuitive reason that stock markets should be related to currencies. Long-term correlation studies bear this out, with correlation coefficients of essentially zero between the major USD pairs and U.S. equity markets over the last five years. The two markets occasionally intersect, though this is usually only at the extremes and for very short periods. For example, when equity market volatility reaches extraordinary levels (say, the Standard & Poor’s loses 2+ percent in a day), the USD may experience more pressure than it otherwise would — but here’s no guarantee of that. The U.S. stock market may have dropped on an unexpected hike in U.S. interest rates, while the USD may rally on the surprise move.

Bonds

Fixed-income or bond markets have a more intuitive connection to the forex market because they’re both heavily influenced by interest rate expectations. However, short-term market dynamics of supply and demand interrupt most attempts to establish a viable link between the two markets on a short-term basis. Sometimes the forex market reacts first and fastest depending on shifts in interest rate expectations.

At other times, the bond market more accurately reflects changes in interest rate expectations, with the forex market later playing catch-up.

Overall, as currency traders, you definitely need to keep an eye on the yields of the benchmark government bonds of the major-currency countries to better monitor the expectations of the interest rate market. Changes in relative interest rates (interest rate differentials) exert a major influence on forex markets.

The Mechanics of Currency Trading

In This Chapter

Understanding currency pairs

Going long and short

Calculating profit and loss

Reading a price quote

The currency market has its own set of market trading conventions and related lingo, just like any financial market. If you’re new to currency trading, the

mechanics and terminolgy may take some getting used to. But at the end of the day, most currency trade conventions are pretty straightforward.

Buying and Selling Simultaneously

The biggest mental hurdle facing newcomers to currencies, especially traders familiar with other markets, is getting their head around the idea that each currency trade consists of a simultaneous purchase and sale. In the stock market, for instance, if you buy 100 shares of Google, you own 100 shares and hope to see the price go up. When you want to exit that position, you simply sell what you bought earlier. Easy, right?

But in currencies, the purchase of one currency involves the simultaneous sale of another currency. This is the exchange in foreign exchange. To put it another way, if you’re looking for the dollar to go higher, the question is “Higher against what?”

The answer is another currency. In relative terms, if the dollar goes up against another currency, that other currency also has gone down against the dollar. To think of it in stockmarket terms, when you buy a stock, you’re selling cash, and when you sell a stock, you’re buying cash.

Currencies come in pairs

To make matters easier, forex markets refer to trading currencies by pairs, with names that combine the two different currencies being traded, or “exchanged,” against each other. Additionally, forex markets have given most currency pairs nicknames or abbreviations, which reference the pair and not necessarily the individual currencies involved.

Major currency pairs

The major currency pairs all involve the U.S. dollar on one side of the deal. The designations of the major currencies are expressed using International Standardization Organization (ISO) codes for each currency. Table 2-1 lists the most frequently traded currency pairs, what they’re called in conventional terms, and what nicknames the market has given them.

Table 2-1

The Major U.S. Dollar Currency Pairs

ISO Currency Countries Long Name Nickname Pair

EUR/USD Eurozone*/U.S. Euro-dollar N/A

USD/JPY U.S./Japan Dollar-yenN/A

GBP/USD United Kingdom/U.S. Sterling-dollar Sterling or Cable

USD/CHF U.S./Switzerland Dollar-Swiss Swissy

USD/CAD U.S./Canada Dollar-Canada Loonie

AUD/USD Australia/U.S.Australian-dollar Aussie or Oz

NZD/USD New Zealand/U.S. New Zealand-dollar Kiwi

* The Eurozone is made up of all the countries in the European Union that have

adopted the euro as their currency.

Major cross-currency pairs

Although the vast majority of currency trading takes place in the dollar pairs, cross-currency pairs serve as an alternative to always trading the U.S. dollar. A cross-currency pair, or cross or crosses for short, is any currency pair that does not include the U.S. dollar. Cross rates are derived from the respective USD pairs but are quoted independently. Crosses enable traders to more directly target trades to spe-

cific individual currencies to take advantage of news or events. For example, your analysis may suggest that the Japanese yen

has the worst prospects of all the major currencies going forward, based on interest rates or the economic outlook. To take advantage of this, you’d be looking to sell JPY, but against which other currency? You consider the USD, potentially buying USD/JPY (buying USD/selling JPY) but then you conclude that the USD’s prospects are not much better than the JPY’s. Further research on your part may point to another currency that has a much better outlook (such as high or rising interest rates or signs of a strengthening economy), say the Australian dollar (AUD). In this example, you would then be looking to buy the AUD/JPY cross (buying AUD/selling JPY) to target your view that AUD has the best prospects among major currencies and the JPY the worst. The most actively traded crosses focus on the three major non USD currencies (namely EUR, JPY, and GBP) and are referred to as euro crosses, yen crosses, and sterling crosses.

The long and the short of it

Forex markets use the same terms to express market positioning as most other financial markets. But because currency trading involves simultaneous buying and selling, being clear on the terms helps — especially if you’re totally new to financial market trading.

Going long

No, we’re not talking about running out deep for a football pass. A long position, or simply a long, refers to a market position in which you’ve bought a security. In FX, it refers to having bought a currency pair. When you’re long, you’re looking for prices to move higher, so you can sell at a higher price than where you bought. When you want to close a long position,

Base currencies and counter currencies

When you look at currency pairs, you may notice that the currencies are combined in a seemingly strange order. For instance, if sterling-yen

(GBP/JPY) is a yen cross, then why isn’t it referred to as “yen-sterling”and written “JPY/GBP”? The answer is that these quoting conventions

evolved over the years to reflect traditionally strong currencies versus traditionally weak currencies, with the strong currency coming first.

It also reflects the market quoting convention where the first currency in the pair is known as the base currency. The base currency is what

you’re buying or selling when you buy or sell the pair. It’s also the notional, or face, amount of the trade. So if you buy 100,000 EUR/JPY,

you’ve just bought 100,000 euros and sold the equivalent amount in Japanese yen. If you sell 100,000 GBP/CHF, you just sold 100,000

British pounds and bought the equivalent amount of Swiss francs. The second currency in the pair is called the counter currency, or the

secondary currency. Hey, who said this stuff isn’t intuitive? Most important for you as an FX trader, the counter currency is the denomina-

tion of the price fluctuations and, ultimately, what your profit and losses will be denominated in. If you buy GBP/JPY, it goes up, and you

take a profit, your gains are not in pounds, but in yen. (We run through the math of calculating profit and loss later in this chapter.)

you have to sell what you bought. If you’re buying at multiple price levels, you’re adding to longs and getting longer.

Getting short

A short position, or simply a short, refers to a market position in which you’ve sold a security that you never owned. In the stock market, selling a stock short requires borrowing the stock (and paying a fee to the lending brokerage) so you can sell it. In forex markets, it means you’ve sold a currency pair, meaning you’ve sold the base currency and bought the counter currency. So you’re still making an exchange, just in the opposite order and according to currency-pair quoting terms. When you’ve sold a currency pair, it’s called going short or getting short and it means you’re looking for the pair’s price to move lower so you can buy it back at a profit. If you sell at various price levels, you’re

adding to shorts and getting shorter. In currency trading, going short is as common as going long. “Selling high and buying low” is a standard currency trading strategy. Currency pair rates reflect relative values between two currencies and not an absolute price of a single stock or com-

modity. Because currencies can fall or rise relative to each other, both in medium and long-term trends and minute-to minute fluctuations, currency pair prices are as likely to be going down at any moment as they are up. To take advantage of such moves, forex traders routinely use short positions to exploit falling currency prices. Traders from other markets may feel uncomfortable with short selling, but it’s just some-
thing you have to get your head around. Squaring up Having no position in the market is called being square or flat. If you have an open position and you want to close it, it’s called squaring up. If you’re short, you need to buy to square up. If you’re long, you need to sell to go flat. The only time you have no market exposure or financial risk is when you’re square.

Profit and Loss

Profit and loss (P&L) is how traders measure success and failure. A clear understanding of how P&L works is especially critical to online margin trading, where your P&L directly affects the amount of margin you have to work with. Changes in your margin balance determine how much you can trade and for how long you can trade if prices move against you.

Margin balances and liquidations

When you open an online currency trading account, you’ll need to pony up cash as collateral to support the margin requirements established by your broker. That initial margin deposit becomes your opening margin balance and is the basis on which all your subsequent trades are collateralized.

Unlike futures markets or margin-based equity trading, online forex brokerages do not issue margin calls (requests for more

collateral to support open positions). Instead, they establish ratios of margin balances to open positions that must be maintained at all times.

Here’s an example to help you understand how required margin ratios work. Say you have an account with a leverage ratio of 100:1 (so $1 of margin in your account can control a $100 position size), but your broker requires a 100% margin ratio, meaning you need to maintain 100% of the required margin at all times. The ratio varies with account size, but a 100% margin requirement is typical for small accounts. That

means to have a position size of $10,000, you’d need $100 in your account, because $10,000 divided by the leverage ratio of 100 is $100. If your account’s margin balance falls below the required ratio, your broker probably has the right to close out your positions without any notice to you. If your broker liquidates your position, that usually means your losses are locked in and your margin balance just got smaller.

Be sure you completely understand your broker’s margin requirements and liquidation policies. Requirements may differ depending on account size and whether you’re trading standard lot sizes (100,000 currency units) or mini lot sizes (10,000 currency units). Some brokers’ liquidation policies allow for all positions to be liquidated if you fall below margin requirements. Others close out the biggest losing positions or portions

of losing positions until the required ratio is satisfied again. You can find the details in the fine print of the account opening contract that you sign. Always read the fine print to be sure you understand your broker’s margin and trading policies.

Unrealized and realized profit and loss

Most online forex brokers provide real-time mark-to-market calculations showing your margin balance. Mark-to-market is the calculation that shows your unrealized P&L based on where you could close your open positions in the market at that instant. Depending on your broker’s trading platform, if you’re long, the calculation will typically be based on where you could sell at that moment. If you’re short, the price used

will be where you can buy at that moment. Your margin balance is the sum of your initial margin deposit, your unrealized P&L, and your realized P&L. Realized P&L is what you get when you close out a trade position, or a portion of a trade position. If you close out the full

position and go flat, whatever you made or lost leaves the unrealized P&L calculation and goes into your margin balance.

If you only close a portion of your open positions, only that part of the trade’s P&L is realized and goes into the margin balance. Your unrealized P&L continues to fluctuate based on the remaining open positions, as does your total margin balance. If you’ve got a winning position open, your unrealized P&L is positive and your margin balance increases. If the market is moving against your positions, your unrealized P&L is negative and your margin balance is reduced. Forex prices change constantly, so your mark-to-market unrealized P&L and total margin balance also change constantly.

Calculating profit and loss with pips

Profit-and-loss calculations are pretty straightforward in terms of math — they’re all based on position size and the number of pips you make or lose. A pip is the smallest increment of price fluctuation in currency prices. Pips can also be referred to as points; we use the two terms interchangeably. Looking at a few currency pairs helps you get an idea what a pip is. Most currency pairs are quoted using five digits. The placement of the decimal point depends on whether it’s a JPY currency pair, in which case there are two digits behind the decimal point. All others currency pairs have four digits behind the decimal point. In all cases, that last itty-bitty digit is the pip. Here are some major currency pairs and crosses, with the pip underlined:

EUR/USD: 1.2853

USD/CHF: 1.2267

USD/JPY: 117.23

EUR/JPY: 150.65

Focus on the EUR/USD price first. Looking at EUR/USD, if the price moves from 1.2853 to 1.2873, it’s just gone up by 20 pips. If it goes from 1.2853 down to 1.2792, it’s just gone down by 61 pips. Pips provide an easy way to calculate the P&L. To turn that pip movement into a P&L calculation, all you need to know is the size of the position. For a 100,000 EUR/USD position, the 20-pip move equates to $200 (EUR 100,000 · 0.0020 = $200). For a 50,000 EUR/USD position, the 61-point move translates into $305 (EUR 50,000 · 0.0061 = $305).

Whether the amounts are positive or negative depends on whether you were long or short for each move. If you were short for the move higher, that’s a – in front of the $200, if you were long, it’s a +. EUR/USD is easy to calculate, especially for USD-based traders, because the P&L accrues in dollars. If you take USD/CHF, you’ve got another calculation to make before you can make sense of it. That’s because the P&L is

going to be denominated in Swiss francs (CHF) because CHF is the counter currency. If USD/CHF drops from 1.2267 to 1.2233 and you’re short USD 100,000 for the move lower, you’ve just caught a 34-pip decline. That’s a profit worth CHF 340 (USD 100,000 · 0.0034 = CHF 340). Yeah but how much is that in real money? To convert it into USD, you need to divide the CHF 340 by the USD/CHF rate. Use the closing rate of the trade (1.2233), because that’s where the market was last, and you get USD 277.94. Even the venerable pip is in the process of being updated as electronic trading continues to advance. Just a couple paragraphs earlier, we tell you that the pip is the smallest increment of currency price fluctuations. Not so fast. The online market is rapidly advancing to decimalizing pips (trading in pips) and half-pip prices have been the norm in certain currency pairs in the interbank market for many years.

Factoring profit and loss into margin calculations

The good news is that online FX trading platforms calculate the P&L for you automatically, both unrealized while the trade is open and realized when the trade is closed. So why did we just drag you through the math of calculating P&L using pips?

Because online brokerages only start calculating your P&L for you after you enter a trade.To structure your trade and manage your risk effectively (How big a position? How much margin to risk?), you’re going to need to calculate your P&L outcomes before you enter the trade.

Understanding the P&L implications of a trade strategy you’re considering is critical to maintaining your margin balance and staying in control of your trading. This simple exercise can help prevent you from costly mistakes, like putting on a trade that’s too large, or putting stop-loss orders beyond prices where your account falls below the margin requirement. At the minimum, you need to calculate the price point at which

your position will be liquidated when your margin balance falls below the required ratio.

Understanding Rollovers and Interest Rates

One market convention unique to currencies is rollovers. A rollover is a transaction where an open position from one value date (settlement date) is rolled over into the next value date. Rollovers represent the intersection of interest-rate markets and forex markets.

Currency is money, after all Rollover rates are based on the difference in interest rates of the two currencies in the pair you’re trading. That’s because what you’re actually trading is good old-fashioned cash. When you’re long a currency, it’s like having a deposit in the bank. If you’re short a currency, it’s like having borrowed a loan. Just as you would expect to earn interest on a bank deposit or pay interest on a loan, you should expect an interest gain/expense for holding a currency position over the change in value. Think of an open currency position as one account with a pos-

itive balance (the currency you’re long) and one with a negative balance (the currency you’re short). But because your accounts are in two different currencies, the two interest rates of the different countries apply. The difference between the interest rates in the two countries
is called the interest-rate differential. The larger the interest rate differential, the larger the impact from rollovers. The narrower the interest-rate differential, the smaller the effect from rollovers. You can find relevant interest-rate levels of the major currencies from any number of financial-market Web sites. Look for the base or benchmark lending rates in each country.

Applying rollovers

Rollover transactions are usually carried out automatically by your forex broker if you hold an open position past the change in value date. Rollovers are applied to your open position by two offsetting trades that result in the same open position. Some online forex brokers apply the rollover rates by adjusting the average rate of your open position. Other forex brokers apply rollover rates by applying the rollover credit or debit directly to your margin balance. Here’s what you need to remember about rollovers: Rollovers are applied to open positions after the 5 p.m. ET change in value date, or trade settlement date. Rollovers are not applied if you don’t carry a position over the change in value date. So if you’re square at the close of each trading day, you’ll never have to worry about rollovers. Rollovers represent the difference in interest rates

between the two currencies in your open position, but they’re applied in currency-rate terms. Rollovers constitute net interest earned or paid by you, depending on the direction of your position. Rollovers can earn you money if you’re long the currency with the higher interest rate and short the currency with the lower interest rate. Rollovers cost you money if you’re short the currency with the higher interest rate and long the currency with the lower interest rates.

Understanding Currency Quotes

Here, we look at how online brokerages display currency prices and what they mean for trade and order execution. Keep in mind that different online forex brokers use different formats to display prices on their trading platforms.

Bids and offers
When you’re in front of your screen and looking at an online forex broker’s trading platform, you’ll see two prices for each currency pair. The price on the left-hand side is called the bid and the price on the right-hand side is called the offer (some call this the ask). The “bid” is the price at which you can sell the base currency. The “offer” is the price at which you can buy the base currency.

Some brokers display the prices above and below each other, with the bid on the bottom and the offer on top. The easy way to tell the difference is that the bid price is always lower than the offer price. The price quotation of each bid and offer you see will have two components: the big figure and the dealing price. The big figure refers to the first three digits of the overall currency rate and is usually shown in a smaller font size or even in shadow. The dealing price refers to the last two digits of the overall currency price and is brightly displayed in a larger font size.

For example, in Figure 2-1 the full EUR/USD price quotation is 1.3493/95. The 1.34 is the big figure and is there to show you the full price level (or big figure) that the market is currently trading at. The 93/95 portion of the price is the bid/offer dealing price.
Figure 2-1: A dealing box from the FOREX.com trading platform for EUR/USD shows the current bid and offer price. The “bid” (on the left) is the price at which you can sell Euros. The “offer” on the right, is the price at which you can buy Euros.

Spreads

A spread is the difference between the bid price and the offer price. Most online forex brokers utilize spread-based trading platforms for individual traders. Look at the spread as the compensation the broker receives for being the market-maker and executing your trade. Spreads vary from broker to broker and by currency pairs at each broker as well. Generally, the more liquid the currency pair, the narrower the spread; the less liquid the currency pair, the wider the spread. This is especially the case for some of the less-traded crosses.

Currency Trading For Dummies, Getting Started Edition

Choosing Your Trading Style

In This Chapter

Determining what trading style fits you best Understanding the different trading styles Developing and maintaining market discipline

Before you get involved in actively trading the forex market, take a step back and think about how you want to approach the market. There is more to currency trading than meets the eye, and we think the trading style you choose is one of the most important determinants of overall trading success. This chapter takes you through the main points to consider as you define your own approach to trading currencies. We review the characteristics of some of the most commonly applied trading styles and discuss what they mean in concrete terms. We also run you through the essential elements of developing and sticking to a trading plan.

Finding the Right Trading Style for You
We’re frequently asked, “What’s the best way to trade the forex market?” That’s a loaded question that seems to imply there’s a right way and a wrong way to trade currencies. Unfortunately, there is no easy answer. Better put, there is no standard answer — one that applies to everyone. The forex market’s trading characteristics have something to offer every trading style (long-term, medium-term, or shortterm) and approach (technical, fundamental, or a blend). So in terms of deciding what style or approach is best suited to currencies, the starting point is not the forex market itself, but your own individual circumstances and way of thinking.

Real-world and lifestyle considerations

Before you can begin to identify the trading style and approach that works best for you, give some serious thought to what resources you have available to support your trading. As with many of life’s endeavors, when it comes to financial-market trading, there are two main resources that people never seem to have enough of: time and money. Deciding how much of each you can devote to currency trading helps to establish how you pursue your trading goals. If you’re a full-time trader, you have lots of time to devote to market analysis and actually trading the market. But because currencies trade around the clock, you still have to be mindful of which session you’re trading, and of the daily peaks and

troughs of activity and liquidity. (See Chapter 1 for trading session specifics.) Just because the market is always open doesn’t mean it’s necessarily always a good time to trade. If you have a full-time job, your boss may not appreciate your taking time to catch up on the charts or economic data reports while you’re at work. That means you’ll have to use your free time to do your market research. Be realistic when

you think about how much time you’ll be able to devote on a regular basis, keeping in mind family obligations and other personal circumstances.

When it comes to money, we can’t stress enough that trading capital has to be risk capital and that you should never risk any money that you can’t afford to lose. The standard definition of risk capital is money that, if lost, will not materially affect your standard of living. It goes without saying that borrowed money is not risk capital — you should never use borrowed money for speculative trading.
When you determine how much risk capital you have available for trading, you’ll have a better idea of what size account you can trade and what position size you can handle. Most online trading platforms typically offer generous leverage ratios that allow you to control a larger position with less required margin. But just because they offer high leverage doesn’t mean you have to fully utilize it.

Making time for market analysis

The full version of Currency Trading For Dummies talks about the amount of data and news that flows through the forex market on a daily basis — and it can be truly overwhelming. So how can an individual trader possibly keep up with all the data and news? The key is to develop an efficient daily routine of market analysis. Thanks to the Internet and online currency broker pages, independent traders can access a variety of information.

Your daily regimen of market analysis should focus on:

Overnight forex market developments: Who said what, which data came out, and how the currency pairs reacted.

Daily updates of other major market movements over the prior 24 hours and the stories behind them: If oil prices or U.S. Treasury yields rose or fell substantially, find out why.

Data releases and market events (for example, the retail sales report, Fed speeches, central bank rate announcements) expected for that day: Ideally, you’ll monitor data and event calendars one week in advance, so you can be anticipating the outcomes along with the rest of the market.

Multiple-time-frame technical analysis of major currency pairs: There is nothing like the visual image of price action to fill in the blanks of how data and news affected individual currency pairs.

Current events and geopolitical themes: Stay abreast on issues of major elections, political scandals, military conflicts, and policy initiatives in the major currency nations.

Technical versus fundamental analysis

Ask yourself on what basis you’ll make your trading decisions — fundamental analysis or technical analysis?

Fundamentals are the broad grouping of news and information that reflects the macroeconomic and political fortunes of the countries whose currencies are traded. Most of the time, when you hear someone talking about the fundamentals of a currency, he’s referring to the economic fundamentals.

Economic fundamentals are based on:

Economic data reports

Interest rate levels

Monetary policy

International trade flows

International investment flows

The term technicals refers to technical analysis, a form of market analysis most commonly involving chart analysis, trend-line analysis, and mathematical studies of price behavior, such as momentum or moving averages, to mention just a couple. We don’t know of too many currency traders who don’t follow some form of technical analysis in their trading. Even the stereotypical seat-of-the-pants, trade-your-gut traders are

likely to at least be aware of technical price levels identified by others. If you’ve been an active trader in other financial markets, chances are, you’ve engaged in some technical analysis or at least heard of it. Followers of each discipline have always debated which approach works better. Rather than take sides, we suggest following an approach that blends the two disciplines. In our experience, macroeconomic factors such as interest rates, relative growth rates, and market sentiment determine the big-picture direction of currency rates. But currencies rarely move in a straight line, which means there are plenty of short term price fluctuations to take advantage of — and some of them can be substantial.

Technical analysis can provide the guideposts along the route of the bigger price move, allowing traders to more accurately predict the direction and scope of future price changes. Most important, technical analysis is the key to constructing a well defined trading strategy. For example, your fundamental analysis, data expectations, or plain old gut instinct may lead you to conclude that USD/JPY is going lower. But where exactly do you get short? Where do you take profit, and where do you cut your losses? You can use technical analysis to refine trade entry and exit points, and to decide whether and where to add to positions or reduce them.

Sometimes forex markets seem to be more driven by fundamental factors, such as current economic data or comments from a central bank official. In those times, fundamentals provide the catalysts for technical breakouts and reversals. At other times, technical developments seem to be leading the charge — a break of trend-line support may trigger stop-loss selling by market longs and bring in model systems that are

selling based on the break of support. Subsequent economic reports may run counter to the directional breakout, but data be damned — the support is gone, and the market is selling. Approaching the market with a blend of fundamental and technical analysis improves your chances of both spotting trade opportunities and managing your trades more effectively. You’ll also be better prepared to handle markets that are alternately reacting to fundamental and technical developments or some combination of the two.

Different Strokes for Different Folks

After you’ve given some thought to the time and resources you’re able to devote to currency trading and which approach you favor (technical, fundamental, or a blend), the next step is to settle on a trading style that best fits those choices. There are as many different trading styles and market approaches in FX as there are individuals in the market. But most trading styles can be grouped into three main categories that boil down to varying degrees of exposure to market risk. The two main elements of market risk are time and relative price movements. The longer you hold a position, the more risk you’re exposed to. The more of a price change you’re anticipating, the more risk you’re exposed to. In the next few sections we detail the three main trading styles and what they really mean for individual traders. Our aim here is not to advocate for any particular trading style, because styles frequently overlap, and you can adopt different styles for different trade opportunities or different market conditions. Instead, our goal is to give you an idea of the various approaches used by forex market professionals so you can understand the basis of each style.

Short-term, high-frequency day trading

Short-term trading in currencies is unlike short-term trading in most other markets. A short-term trade in stocks or commodities usually means holding a position for a day to several days at least. But because of the liquidity and narrow bid/offer spreads in currencies, prices are constantly fluctuating in small increments. The steady and fluid price action in currencies allows for extremely short-term trading by speculators intent on capturing just a few pips (explained in Chapter 2) on each trade.

Short-term forex trading typically involves holding a position for only a few seconds or minutes and rarely longer than an hour. But the time element is not the defining feature of short- term currency trading. Instead, the pip fluctuations are what’s important. Traders who follow a short-term trading style are seeking to profit by repeatedly opening and closing positions after gaining just a few pips, frequently as little as 1 or 2 pips. In the interbank market, extremely short-term, in-and-out trading is referred to as jobbing the market; online currency traders call it scalping. (We use the terms interchangeably.) Traders who follow this style have to be among the fastest and most disciplined of traders because they’re out to capture only a few pips on each trade. In terms of speed, rapid reaction and instantaneous decision-making are essential to successfully jobbing the market.

When it comes to discipline, scalpers must be absolutely ruthless in both taking profits and losses. If you’re in it to make only a few pips on each trade, you can’t afford to lose much more than a few pips on each trade. Jobbing the market requires an intuitive feel for the market.

(Some practitioners refer to it as rhythm trading.) Scalpers don’t worry about the fundamentals too much. If you were to ask a scalper for her opinion of a particular currency pair, she would be likely to respond along the lines of “It feels bid” or “It feels offered” (meaning, she senses an underlying buying or selling bias in the market — but only at that moment). If you ask her again a few minutes later, she may respond in the opposite direction. Successful scalpers have absolutely no allegiance to any single position. They couldn’t care less if the currency pair

goes up or down. They’re strictly focused on the next few pips. Their position is either working for them, or they’re out of it faster than you can blink an eye. All they need is volatility and liquidity. Retail traders are typically faced with bid/offer spreads of between 2 and 5 pips. Although this makes jobbing slightly more difficult, it doesn’t mean you can’t still engage in short- term trading — it just means you’ll need to adjust the risk parameters of the style. Instead of looking to make 1 to 2 pips on each trade, you need to aim for a pip gain at least as large as the spread you’re dealing with in each currency pair. The other basic rules of taking only minimal losses and not hanging on to a position for too long still apply. Here are some other important guidelines to keep in mind when following a short-term trading strategy:

Trade only the most liquid currency pairs, such as EUR/USD, USD/JPY, EUR/GBP, EUR/JPY, and EUR/CHF.The most liquid pairs have the tightest trading spreads and fewer sudden price jumps.

Trade only during times of peak liquidity and market interest. Consistent liquidity and fluid market interest are essential to short-term trading strategies. Market liquidity is deepest during the European session when Asian and North American trading centers overlap with European time zones — about 2 a.m. to noon Eastern time (ET). Trading in other sessions can leave you with far fewer and less predictable short-term price movements to take advantage of.

Focus your trading on only one pair at a time. If you’re aiming to capture second-by-second or minute-by-minute price movements, you’ll need to fully concentrate on one pair at a time. It’ll also improve your feel for the pair if that pair is all you’re watching.

Preset your default trade size so you don’t have to keep specifying it on each deal. Look for a brokerage firm that offers click-and-deal trading so you’re not subject to execution delays or requotes. Adjust your risk and reward expectations to reflect the dealing spread of the currency pair you’re trading.

With 2- to 5-pip spreads on most major pairs, you probably need to capture 3 to 10 pips per trade to offset losses if the market moves against you.

Avoid trading around data releases. Carrying a short- term position into a data release is very risky because prices can gap sharply after the release, blowing a short term strategy out of the water. Markets are also prone to quick price adjustments in the 15 to 30 minutes ahead of

major data releases as nearby orders are triggered. This can lead to a quick shift against your position that may not be resolved before the data comes out.

Medium-term directional trading

Medium-term positions are typically held for periods ranging anywhere from a few minutes to a few hours, but usually not much longer than a day. Just as with short-term trading, the key distinction for medium-term trading is not the length of time the position is open, but the amount of pips you’re seeking/risking. Where short-term trading looks to profit from the routine noise of minor price fluctuations, almost without regard for the overall direction of the market, medium-term trading seeks to get the overall direction right and profit from more significant currency rate moves.

Almost as many currency speculators fall into the medium term category (sometimes referred to as momentum trading and swing trading) as fall into the short-term trading category. Medium-term trading requires many of the same skills as short-term trading, especially when it comes to entering/ exiting positions, but it also demands a broader perspective, greater analytical effort, and a lot more patience.

Capturing intraday price moves for maximum effect The essence of medium-term trading is determining where a currency pair is likely to go over the next several hours or days and constructing a trading strategy to exploit that view. Medium-term traders typically pursue one of the following overall approaches, with plenty of room to combine strategies:

Trading a view: Having a fundamental-based opinion on which way a currency pair is likely to move. View trades are typically based on prevailing market themes, like interest rate expectations or economic growth trends. View traders still need to be aware of technical levels as part of an overall trading plan.

Trading the technicals: Basing your market outlook on chart patterns, trend lines, support and resistance levels, and momentum studies. Technical traders typically spot a trade opportunity on their charts, but they still need to be aware of fundamental events, because they’re the catalysts for many breaks of technical levels.

Trading events and data: Basing positions on expected outcomes of events, like a central bank rate decision or a G7 meeting, or individual data reports. Event/data traders typically open positions well in advance of events and close them when the outcome is known.

Trading with the flow: Trading based on overall market direction (trend) or information of major buying and selling (flows). To trade on flow information, look for a broker that offers market flow commentary, like that found in FOREX.com’s Forex Insider Flow traders tend to stay out of shortterm range-bound markets and jump in only when a market move is under way.

When is a trend not a trend?

When it’s a range. A trading range or a range-bound market is amarket that remains confined within a relatively narrow range of prices. In currency pairs, a short-term (over the next few hours) trading range may be 20 to 50 pips wide, while a longer-term (over the next few days to weeks) range can be 200 to 400 pips wide. For all the hype that trends get in various market literature, the reality is that most markets trend no more than a third of the time. The rest of the time they’re bouncing around in ranges, consolidating, and trading sideways. Although medium-term traders are normally looking to capture larger relative price movements — say, 50 to 100 pips or more — they’re also quick to take smaller profits on the basis of short-term price behavior. For instance, if a break of a technical resistance level suggests a targeted price move of 80 pips higher to the next resistance level, the medium-term trader is going to be more than happy capturing 70 percent to 80 percent of the expected price move. They’re not going to hold on to the position looking for the exact price target to be hit.

Long-term macroeconomic trading

Long-term trading in currencies is generally reserved for hedge funds and other institutional types with deep pockets. Long-term trading in currencies can involve holding positions for weeks, months, and potentially years at a time. Holding positions for that long necessarily involves being exposed to significant short-term volatility that can quickly overwhelm margin trading accounts. With proper risk management, individual margin traders can seek to capture longer-term trends. The key is to hold a small enough position relative to your margin balance

that you can withstand volatility of as much as 5 percent or more.

Carry trade strategies

A carry trade happens when you buy a high-yielding currency and sell a relatively lower-yielding currency. The strategy profits in two ways:

By being long the higher-yielding currency and short the lower-yielding currency, you can earn the interest rate differential between the two currencies, known as the carry. If you have the opposite position — long the low-yielder and short the high-yielder — the interest-rate differential is against you, and it is known as the cost of carry. Spot prices appreciate in the direction of the interest rate differential. Currency pairs with significant interest rate differentials tend to move in favor of the higher yielding currency as traders who are long the high

yielder are rewarded, increasing buying interest, and traders who are short the high yielder are penalized, reducing selling interest.

So let me get this straight, you may be thinking: All I have to do is buy the higher-yielding currency/sell the lower-yielding currency, sit back, earn the carry, and watch the spot price move higher? What’s the catch? The catch is that downside spot price volatility can quickly swamp any gains from the carry trade’s interest-rate different tial. The risk can be compounded by excessive market positioning in favor of the carry trade, meaning a carry trade has become so popular that everyone gets in on it. Figure 3-1 illustrates the trending price gains of a carry trade, punctuated by sudden price setbacks.

Carry trades usually work best in low-volatility environments, meaning when financial markets are relatively stable and investors are forced to chase yield. Keep in mind that carry trades need to have a significant interest-rate differential between the two currencies (typically more than 2 percent) to make them attractive. And carry trades are definitely a long- term strategy, because depending on when you get in, you may get caught in a downdraft that could take several days or weeks to unwind before the trade becomes profitable again.

Figure 3-1: NZD/JPY trends higher in line with carry trade fundamentals

(New Zealand’s interest rates are much higher than Japan’s), but it meets sharp setbacks along the way.

Developing a Disciplined Trading Plan

No matter which trading style you decide to pursue, you need an organized trading plan, or you won’t get very far. The difference between making money and losing money in the forex market can be as simple as trading with a plan or trading with out one. A trading plan is an organized approach to executing a trade strategy that you’ve developed based on your market analysis and outlook. Here are the key components of any trading plan:
Daily NZD/JPY Carry trades can see significant spot price gains punctuated by rapid price reversals.

Determining position size: How large a position will you take for each trade strategy? Position size is half the equation for determining how much money is at stake in each trade.

Deciding where to enter the position: Exactly where will you try to open the desired position? What happens if your entry level is not reached?
Setting stop-loss and take-profit levels: Exactly where will you exit the position, both if it’s a winning position (take profit) and if it’s a losing position (stop loss)? Stop loss and take-profit levels are the second half of the equation that determines how much money is at stake in each trade.

That’s it — just three simple components. But it’s amazing how many traders, experienced and beginner alike, open positions without ever having fully thought through exactly what their game plan is. Of course, you need to consider numerous finer points when constructing a trading plan, and we focus on them more in the full version of Currency Trading ForDummies. But for now, we just want to drive home the point that trading without an organized plan is like flying an airplane blindfolded — you may be able to get off the ground, but how will you land?

And no matter how good your trading plan is, it won’t work if you don’t follow it. Sometimes emotions bubble up and distract traders from their trade plans. Other times, an unexpected piece of news or price movement causes traders to abandon their trade strategy in midstream, or midtrade, as the case may be. Either way, when this happens, it’s the same as never having had a trade plan in the first place. Developing a trade plan and sticking to it are the two main ingredients of trading discipline. If we were to name the one defining characteristic of successful traders, it wouldn’t be technical analysis skill, gut instinct, or aggressiveness — though they’re all important. Nope, it would be trading disci-

pline. Traders who follow a disciplined approach are the ones who survive year after year and market cycle after market cycle. They can even be wrong more often than right and still make money because they follow a disciplined approach.

Taking the Emotion Out of Trading

If the key to successful trading is a disciplined approach —developing a trading plan and sticking to it — why is it so hard for many traders to practice trading discipline? The answer is complex, but it usually boils down to a simple case of human emotions getting the better of them. Don’t under estimate the power of emotions to distract and disrupt. So exactly how do you take the emotion out of trading? The simple answer is: You can’t. As long as your heart is pumping and your synapses are firing, emotions are going to be flowing. And truth be told, the emotional highs of trading are one of the reasons people are drawn to it in the first place. There’s no rush quite like putting on a successful trade and taking some money out of the market. So just accept that you’re going to experience some pretty intense emotions when you’re trading.

The longer answer is that because you can’t block out the emotions, the best you can hope to achieve is understanding where the emotions are coming from, recognizing them when they hit, and limiting their impact on your trading. It’s a lot easier said than done, but keep in mind some of the following to keep your emotions in check: Focus on the pips and not the dollars and cents. Don’t be distracted by the exact amount of money won or lost in a trade. Instead, focus on where prices are and how they’re behaving. The market has no idea what your trade size is and how much you’re making or losing, but it does know where the current price is.

It’s not about being right or wrong; it’s about making money. The market doesn’t care if you were right or wrong, and neither should you. The only true way of measuring trading success is in dollars and cents. You’re going to lose in a fair number of trades. No trader is right all of the time. Taking losses is as much a part of the routine as taking profits. You can still be successful over time with a solid risk-management plan.

Getting Started with Your

Practice Account

In This Chapter

Getting the most out of your practice account

Pulling the trigger

Managing the trade

Evaluating your results

The best way for newcomers to get a handle on what currency trading is all about is to open a practice account. Almost every forex broker offers a free practice

account to prospective clients; all you need to do is sign up for one on the broker’s Web site. Practice accounts are funded with “virtual” money, so you’re able to make trades with no real money at stake and gain experience in how margin trading works. Practice accounts give you a great chance to experience the forex market. You can see how prices change at different times of the day, how various currency pairs may differ from each other, and how the forex market reacts to new information when major news and economic data is released. You also can start trading in real market conditions without any fear of losing money, experiment with different trading strategies to

see how they work, gain experience using different orders and managing open positions, improve your understanding of how margin trading and leverage work, and start analyzing charts and following technical indicators. Practice accounts are a great way to experience the forex

market up close and personal. They’re also an excellent way to test-drive all the features and functionality of a broker’s platform. However, the one thing you can’t simulate is the emotion of trading with real money. To get the most out of your practice-account experience, treat your practice account as if it were real money.

Pulling the Trigger

It’s trigger-pulling time, pardner. This section assumes you’ve signed up for a practice account at an online forex broker and you’re ready to start executing some practice trades. You make trades in the forex market one of two ways: You can trade at the market, or the current price, using the click-and deal feature of your broker’s platform; or you can employ orders, such as limit orders and one-cancels-the-other orders (OCOs).

Clicking and dealing

Many traders like the idea of opening a position by trading at the market as opposed to leaving an order that may or may not be executed. They prefer the certainty of knowing that they’re in the market. Actively buying and selling are also elements that make trading and speculating as much fun as hard work. Most forex brokers provide live streaming prices that you can deal on with a simple click of your computer mouse. To execute a trade on those platforms:

1. Specify the amount of the trade you want to make.

2. Click on the Buy or Sell button to execute the trade.

The forex trading platform responds back, usually within a second or two, to let you know whether the trade went through:

If the trade went through, you’ll receive a pop-up confirmation from the platform and see your open position listing updated to reflect the new trade. If the trade fails because the trading price changed before your request was received, you receive a response indicating “rates changed,” “price not available,” or something along those lines. You then need to repeat the steps to make another trade attempt. Attempts to trade at the market can sometimes fail in very fast-moving markets when prices are adjusting quickly, like after a data release or break of a key techni-

cal level or price point. Part of this stems from the latency effect of trading over the Internet, which refers to time lags between the platform price reaching your computer and your trade request reaching the platform’s server. If the trade fails because the trade was too large based

on your margin, you need to reduce the size of the trade. Understand from the get-go that any action you take on a trading platform is your responsibility. You may have meant to click Buy instead of Sell, but no one knows for sure except you.

Using Orders

Orders are critical trading tools in the forex market. Think of them as trades waiting to happen, because that’s exactly what they are. If you enter an order and a subsequent price action triggers its execution, you’re in the market, so be as careful as you are thorough when placing your orders in the market. Currency traders use orders to catch market movements when they’re not in front of their screens. Remember: The

forex market is open 24 hours a day, five days a week. A market move is just as likely to happen while you’re asleep or in the shower as while you’re watching your screen. If you’re not a full-time trader, then you’ve probably got a full-time job that requires your attention when you’re at work. (At least your boss hopes he has your attention.) Orders are how you can act in the market without being there. Experienced currency traders also routinely use orders to: Implement a trade strategy from entry to exit Capture sharp, short-term price fluctuations Limit risk in volatile or uncertain markets Preserve trading capital from unwanted losses Maintain trading discipline Protect profits and minimize losses

We can’t stress enough the importance of using orders in currency trading. Forex markets can be notoriously volatile and difficult to predict. Using orders helps you capitalize on short term market movements while limiting the impact of any adverse price moves. While there is no guarantee that the use of orders will limit your losses or protect your profits in all market conditions, a disciplined use of orders helps you to

quantify the risk you’re taking and, with any luck, gives you peace of mind in your trading. Bottom line: If you don’t use orders, you probably don’t have a well-thought-out trading strategy — and that’s a recipe for pain.

Types of orders

Multiple types of orders are available in the forex market. Bear in mind that not all order types are available at all online brokers, so add order types to your list of questions to ask your prospective forex broker.

Take-profit orders Don’t you just love that name? An old market saying goes, “You can’t go broke taking profit.” Use take-profit orders to lock in gains when you have an open position in the market. If you’re short USD/JPY at 117.20, your take-profit order will be

to buy back the position and be placed somewhere below that price, say at 116.80 for instance. If you’re long GBP/USD at 1.8840, your take-profit order will be to sell the position some where higher, maybe 1.8875.

Limit orders A limit order is any order that triggers a trade at more favor able levels than the current market price. Think “Buy low, sell

high.” If the limit order is to buy, it must be entered at a price below the current market price. If the limit order is to sell, it must be placed at a price higher than the current market price.

Stop-loss orders Boo! Sound’s bad doesn’t it? Actually, stop-loss orders are critical to trading survival. The traditional stop-loss order does just that: It stops losses by closing out an open position that is losing money. Use stop-loss orders to limit your losses if the market moves against your position. If you don’t, you’re leaving it up to the market, and that’s dangerous.

Stop-loss orders are on the other side of the current price from take-profit orders, but in the same direction (in terms of buying or selling). If you’re long, your stop-loss order will be to sell, but at a lower price than the current market price. If you’re short, your stop-loss order will be to buy, but at a higher price than the current market.

Trailing stop-loss orders

You may have heard that one of the keys to successful trading is to cut losing positions quickly, and let winning positions run. A trailing stop-loss order allows you to do just that. The idea is that when you have a winning trade on, you wait for the market to stage a reversal and take you out, instead of trying to pick the right level to exit on your own. A trailing stop-loss order is a stop-loss order that you set at a fixed number of pips from your entry rate. The trailing stopadjusts the order rate as the market price moves, but only in the direction of your trade. For example, if you’re long EUR/CHF at 1.5750 and you set the trailing stop at 30 pips, the stop will initially become active at 1.5720 (1.5750–30 pips).

If the EUR/CHF price moves higher to 1.5760, the stop adjusts higher, pip for pip, with the price and will then be active at 1.5730. The trailing stop continues to adjust higher as long as the market continues to move higher. When the market puts in a top, your trailing stop will be 30 pips (or whatever distance you specify) below that top, wherever it may be.

If the market ever goes down by 30 pips, as in this example, your stop will be triggered and your position closed. So in this case, if you’re long at 1.5750 and you set a 30-pip trailing stop, the stop initially becomes active at 1.5720. If the market never ticks up and goes straight down, you’ll be stopped out at 1.5720. If the price first rises to 1.5775 and then declines by 60 points, your trailing stop will have risen to 1.5745 (1.5775–30 pips) and that’s where you’ll be stopped out. Pretty cool, huh?

One-cancels-the-other orders

A one-cancels-the-other order (more commonly referred to as an OCO order) is a stop-loss order paired with a take-profit order. An OCO order is the ultimate insurance policy for any open position. Your position stays open until one of the order levels is reached by the market and closes your position.

When one order level is reached and triggered, the other order automatically cancels.Let’s say you’re short USD/JPY at 117.00. You think if it goes up beyond 117.50, it’s going to keep going higher, so that’s where you decide to place your stop-loss buying order. At the same time, you believe that USD/JPY has downside potential to 116.25, so that’s where you set your take-profit buying order. You now have two orders bracketing the market and your risk is clearly defined. As long as the market trades between 116.26 and 117.49, your position remains open. If 116.25 is reached first, your take profit triggers and you buy back at a profit. If 117.50 is hit first, then your position is stopped out at a loss. OCO orders are highly recommended for every open position.

Managing the Trade

So you’ve pulled the trigger and opened up the position, and now you’re in the market. Time to sit back and let the market do its thing, right? Not so fast, amigo. The forex market isn’t a roulette wheel where you place your bets, watch the wheel spin, and simply take the results. It’s a dynamic, fluid environment where new information and price developments create new opportunities and alter previous expectations.

We hope you’ll take to heart our recommendations about always trading with a plan — identifying in advance where to enter and where to exit every trade, on both a stop-loss and take-profit basis. Bottom line: You improve your overall chances of trading success (and minimize the risks involved) by thoroughly planning each trade before getting caught up in the emotions and noise of the market. Depending on the style of trading you’re pursuing (short-term versus medium- to long-term) and overall market conditions (range-bound versus trending), you’ll have either more or less to do when managing an open position. If you’re following a medium- to longer-term strategy, with generally wider stop-

loss and take-profit parameters, you may prefer to go with the “set it and forget it” trade plan you’ve developed. But a lot can happen between the time you open a trade and prices hitting one of your trade levels, so staying on top of the market is still a good idea, even for longer-term trades.

Monitoring the Market while Your Trade Is Active
No matter which trading style you follow, it pays to keep up with market news and price developments while your trade is active. Unexpected news that impacts your position may come into the market at any time. News is news; by definition, you couldn’t have accounted for it in your trading plan, so fresh news may require making changes to your trading plan. When we talk about making changes to the trading plan, we’re referring only to reducing the overall risk of the trade, by taking profit (full or partial) or moving the stop loss in the direction of the trade. The idea is to be fluid and dynamic in one direction only: taking profit and reducing risk. Keep your ultimate stop-out point where you decided it should go before you entered the trade.

Staying alert for news and data developments

If your trade rationale is reliant on certain data or event expectations, you need to be especially alert for upcoming reports on those themes.

Part of your calculus to go short EUR/USD, for instance, may be based on the view that Eurozone inflation pressures are receding, suggesting lower Eurozone interest rates ahead. If the next day’s Eurozone consumer price index (CPI) report confirms your view, the fundamental basis for maintaining the strategy is reinforced. You may then consider whether to increase your take-profit objective depending on the market’s
reaction. By the same token, if the CPI report comes out unexpectedly high, the fundamental basis for your trade is seriously undermined and serves as a clue to exit the trade earlier than you originally planned. Every trade strategy needs to take into account upcoming news and data events before the position is opened. Ideally, you should be aware of all data reports and news events scheduled to occur during the anticipated time horizon of your trade strategy. You should also have a good understanding of what the market is expecting in terms of event out comes to anticipate how the market is likely to react.

Keeping an eye on other financial markets

Forex markets function alongside other major financial markets, such as stocks, bonds, and commodities (e.g. gold, oil, etc.). Important fundamental and psychological relationships (discussed more in Chapter 1) exist between other markets and currencies, especially the U.S. dollar, so look to developments in other financial markets to see whether they confirm or contradict price moves in the dollar pairs.

Evaluating Your Trading Results

Regardless of the outcome of any trade, you want to look back over the whole process to understand what you did right and wrong. In particular, ask yourself the following questions:

How did you identify the trade opportunity? Was it based on technical analysis, a fundamental view, or some combination of the two? Looking at your trade this way helps identify your strengths and weaknesses as either a fundamental or technical trader. For example, if technical analysis generates more of your winning trades, you’ll probably want to devote more energy to that approach.

How well did your trade plan work out? Was the position size sufficient to match the risk and reward scenarios, or was it too large or too small? Could you have entered at a better level? What tools might you have used to improve your entry timing? Were you patient enough,

or did you rush in thinking you’d never have the chance again? Was your take profit realistic or pie in the sky? Did the market pay any respect to your choice of take-profit levels, or did prices blow right through it? Ask yourself the same questions about your stop-loss level. Use the

answers to refine your position size, entry level, and order placement going forward.

How well did you manage the trade after it was open?

Were you able to effectively monitor the market while your trade was active? If so, how? If not, why not? The answers to those questions reveal a lot about how much time and dedication you’re able to devote to your trading. Did you modify your trade plan along the way? Did

you adjust stop-loss orders to protect profits? Did you take partial profit at all? Did you close out the trade based on your trading plan, or did the market surprise you somehow? Based on your answers, you’ll learn what role your emotions may have played and how disciplined

a trader you are. There are no right and wrong answers in this review process; just be as honest with yourself as you can be. No one else will

ever know your answers, and you have everything to gain by identifying what you’re good at, what you’re not so good at,

and how you as a currency trader should best approach the market.Currency trading is all about getting out of it what you put into it. Evaluating your trading results on a regular basis is an essential step in improving your trading skills, refining your trading styles, maximizing your trading strengths, and minimizing your trading weaknesses

This version by FxPundit.com – Original Created and Distributed by Forex.com

Source: Forex Trading For Dummies – a knol by FxPundit

Image via Wikipedia

Textilia – Zara opent webshop

Het moederbedrijf Inditex maakte bekend in het najaar van 2010 een webshop te openen van Zara.
In eerste instantie alleen voor de landen Spanje, Frankrijk, Duitsland, Groot-Brittannië, Italie en Portugal, maar de bedoeling is om dat op termijn naar meer landen uit te rollen.”

Dit is in lijn met de verwachting die ik in mijn post “H&M online, Zara in Istanboel” heb uitgesproken.

Samen delen.
Van toetjes tot badkamers.

Sahur bij McDonalds at Journalist in Turkije
Mooie anekdote over het moderne Turkije! Ik deel alleen niet de mening, dat dit in het algemeen opgaat voor Turkije, maar inderdaad wel voor bepaalde gebieden en gemeenschappen. Ik bedoel, je zal maar opgroeien in bijvoorbeeld Uskudar, Istanbul. Mijn indruk is, dat mensen zich daar toch heel moeilijk los kunnen maken van sociale druk. En laten we eerlijk zijn, een klein beetje druk kan soms net zijn wat iemand nodig heeft. In die zin kan druk ook steun betekenen, of sociale cohesie.

Een voorbeeld: Mijn Turkse vrouw deed altijd mee aan vasten toen zij nog in Istanbul woonde. Dit deed zij zonder moeite en met plezier. Maar sinds zij in Nederland woont, lukt het haar niet meer. Dus ook mijn moderne Westers georiënteerde schoonfamilie heeft al die tijd druk op haar uitgeoefend? Of hebben ze haar gesteund? De discussie over omgevingsdruk gaat, denk ik, meestal over waar de grens tussen steun en druk ligt. Mijn ervaring is, dat als puntje bij paaltje komt, mensen je inderdaad zelf laten kiezen wat je wil. De emoties kunnen echter voor dat het zover is behoorlijk hoog zijn opgelopen. Ofwel, het gelaten “leven en laten leven”, dat ken ik maar van een kleine groep Turken.

Zara is zonder twijfel de ongekroonde koningin van de Fast Fashion . H&M  is een goede runner up. Beide bedrijven hebben prachtige websites. H&M verkoop daar al online kleding. Zara doet dit (nog) niet. De vraag is of ze dit zal gaan doen. En hoe en wanneer? Als zij dit gaat doen, dan zal zij waarschijnlijk alle ongeschreven regels van de online verkoop breken, net zoals zij ook de regels van de Fashion Supply Chain heeft gebroken . Ik ben benieuwd. Als het zover is, dan zal ik er zeker over schrijven op mijn blog.

Het eerste wat ik dacht toen ik de websites van H&M en Zara zag, was: “Zij nemen internet serieus, want die sites zien er gelikt uit en kosten heel wat centen.” Later dacht ik: “Wacht even, zij nemen internet te serieus.” De sites zijn prachtig ontwikkeld, maar het belangrijkste onderdeel van internet is maar minimaal aanwezig, namelijk: Interactie! De enige mogelijkheden tot interactie zijn contact leggen via email, het invullen van een formulier en het plaatsen van een bestelling. De sites zijn opgezet als massa mediaal push instrument. Het is net tv, maar dan op het internet. En dat is een gemiste kans; zeker als we de media wereld bekijken vanuit de visie van internet marketing guru Seth Godin.

H&M creëert wel interactie op sociale netwerken als Facebook , Twitter en Youtube. Ze heeft net als Zara 1,2 miljoen fans op Facebook. Maar terwijl Zara geen levendigheid creëert op haar Facebook page , is H&M juist zeer actief met foto’s, video’s, links, mededelingen over nieuwe winkels, een forum, een events calendar en polls. Blijkbaar heeft H&M besloten om de interactiviteit buiten de eigen website te zoeken en zich, naar het lijkt, in te bedden in Facebook.

Als Zara niets doet en H&M heel actief is, hoe kan het dan zijn dat beiden 1,2 miljoen fans hebben? Ik denk, dat dit komt doordat mensen graag willen laten zien dat zij fan zijn van iets. Als je fan wordt op Facebook, dan laat je dit zien aan jouw netwerk. Als het dus voor het hebben van veel fans niet uitmaakt wat je doet, waarom is H&M dan zo actief? Dit is waarschijnlijk, omdat zij al wel online kleding verkoopt en Zara niet. H&M probeert online klanten aan zich te binden. Zij probeert, zoals Seth Godin dat noemt, ‘a 1000 true fans’ te hebben. Ware fans willen niet alleen het merk laten zien, maar willen zich vooral verbonden voelen met andere fans. Hier is interactie voor nodig. Het idee is dat ‘a 1000 true fans’ het verhaal, in dit geval over H&M en de webshop, gepassioneerd doorvertellen. En dat op die manier gewone consumenten door mensen in hun omgeving worden over gehaald om online te kopen.

Eerlijk gezegd, denk ik dat Zara een super fantastische fashion webshop in voorbereiding heeft. De Zara Home webshop  is er al. En zodra de fashion webshop er is, zal ook Zara interactie gaan zoeken met klanten online. Als ze slim is, gaat ze ook opzoek naar ‘a 1000 true fans’, die ze verbindt en leidt. In de tussentijd moet Zara toch iets doen om de website onder de aandacht van klanten te krijgen en te houden. Dit doet ze alleraardigst door ‘off topic’ te gaan op haar website door middel van het item Spy City.

Spy City zijn 5 online reportages over 5 grote wereldsteden waar Zara winkels heeft; te weten: New York, Parijs, Tokio, Madrid en Istanboel. Over elke stad wordt er verteld wat er te doen is en wordt er een beeld geschetst van de omgeving van de winkellocaties. De fotografie is prachtig. Zie hier een paar screenshots.

Things to do in Istanbul: Bazar natuurlijk!

Vis eten nabij Balikci Sabahattin

Zara in Bagdad straat

Website: Zara in Istanbul
Zie ook: Inditex

… Een oog toe doen als op een kinderfeestje zes meisjes op je bed aan het trampoline springen zijn.

Radyo Maydonose  is een van de meest populaire muziek radio stations in Turkije. Ze draaien een mix van Turkse en niet-Turkse Pop.

Multitasken. Terwijl je eet moet je er voor zorgen dat eentje niet met haar T-shirt in de mayo hangt, terwijl je de vingers van de andere uit een stopcontact probeert te houden. Oh ja en dan nog eten natuurlijk.

Show Radyo   is een entertainment zender. Hier hoor je de laatste roddels uit de Turkse entertainment wereld afgewisseld met Turkse Pop muziek.

IstanbulFM  draait uitsluitend Pop muziek van eigen Turkse bodem. Live radio vanuit Istanboel.

Hoezo is het levensonderhoud in Turkije veel lager? Wat een onzin. Als je je kinderen daar goed onderwijs wil laten volgen, dan kost je dat toch zeker 20000 euro per jaar. Ok, als je je kinderen naar Turkije wil sturen om een lagere levensstandaard na te streven, dan zal je die wel vinden.

Het kabinet maakt een einde aan de export van kinderbijslag naar Turkije en Marokko.

De tegemoetkoming in de kosten van … Lees verder: Export kinderbijslag Turkije stopgezet
http://bit.ly/2TnHwk

Onlangs kwam ik er achter dat mijn ex-collega Fatma niet alleen een zeer gewaardeeerde collega is geweest, maar dat we al die tijd een zelfde hobby en interesse hebben gehad, nl.: Lekker (Turks) Eten en bloggen. Hier onder is een link naar mijn favoriete Turkse snack.
Sigara Borek
Fatma’s Cuisine blog is te volgen op: http://fatmadesertrose.blogspot.com/

Uit je dagdromen gehaald worden door een handje, dat zwaait voor je ogen: 'aarde aan pappa!'.

BNR , ofwel business news radio, is een Nederlandse radio zender. Het is één van de weinige radio stations waar ik naar luister. Meestal luister ik in de trein of in de auto. Geen onzin, gewoon nieuws en achtergronden. Verder hebben ze allerlei thema programma’s. BNR carriere, BNR ondernemen, BNR leiderschap, etc.. In een aankondiging van deze thema’s schakelden ze leiderschap gelijk aan succes behalen. Zo van: ‘Succes behalen …: BNR Leiderschap!’ Mijn eerste buikreactie was, dat dit een nog al overdreven manier is om succes te bepalen en naar leiderschap te kijken. Mensen die de top bereiken zijn in deze visie succesvol. Tegelijkertijd impliceert deze visie dat mensen die niet de top bereiken ‘loosers’ zijn. Nadat ik tot dit inzicht ben gekomen heb ik direct ‘Vaderschap’ aan mijn LinkedIn profiel toegevoegd. Ik ben dan wel geen businessleader, maar ik beschouw mijn leven wel als een succes, met name doordat ik veel voldoening en zingeving haal uit mijn vaderschap.

Alain de Botton noemt de door BNR gebezigde visie in bijgevoegde TED video een ‘merotocratsche visie’. Dit is de visie waarin iedereen die de wil heeft om de top te bereiken, de mogelijkheid heeft om deze te behalen. Dit is een hele positieve visie. Zij kenmerkt onze tijd. Er zit alleen een negatieve kant aan, nl.: Een ieder die NIET de top haalt, heeft het aan zichzelf te wijten. Dit legt een enorme druk op ons om de allerbeste te zijn in wat we doen en veel geld en status te verzamelen als bevestiging hiervan. Alain pleit voor een vriendelijkere visie op Succes behalen. Ik zeg: AMEN!

Succesvol creatief zijn?

Soms kom je bij iemand voor het eerst in huis en krijg je een totaal nieuwe visie op die persoon. Mensen kunnen we leren kennen door te kijken naar de spullen die zij (lief) hebben. Vanuit die gedachte vind ik het altijd leuk om rond te lopen op een Bazar in Turkije. Daar leer je namelijk echt de Turken kennen. Hieronder is een foto impressie bijgevoegd van de Bazar in Karamursel.
In het begin van de Bazar koop je huishoudelijke spullen, dan textiel, kleding en schoenen en vervolgens etenswaren. Alle groente en fruit is heerlijk vers en komt maar van een paar kilometer ver. De koopman heeft ze of zelf verbouwd of ze direct bij de boer gehaald. Hij kan je vertellen waar het vandaan komt. Dit maakt het niet alleen goedkoop, maar ook nog (wat transport betreft) erg duurzaam. En dat smaakt veel lekkerder. Lekker Turks eten kan ook in Nederland. Kijk daarvoor eens op www.lekkerturkseten.nl.

Ik zit momenteel in Belek, Turkije en was vorige week nog in de buurt van Istanboel. Op beide locaties wordt op terassen nog volop gerookt, terwijl het ook daar verboden is. Handhavers van de wet heb ik nog niet gezien. Maar wat zijn ook 1500 handhaafteams op een bevolking van 70 miljoen en miljoenen toeristen. Voor Nederlandse begrippen is 1500 veel. Maar hier is het niets.
Vertrek je als fervent roker binnekort naar Turkije? Neem het rookverbod dan serieus! De eerste toeristen zijn namelijk al beboet. …

Alle berichten over dit onderwerp bekijken
http://bit.ly/zcQbl

Sinds een aantal weken is het in Turkije verboden om in openbare gelegenheden te roken. Voor zover ik begrepen heb, geldt dit verbod ook voor 'çay bahçi' (theetuinen). De eerste tekenen van een falende handhaving van het verbod?

Oliver Stone heeft het goed gezien en laten zien in zijn film Wallstreet uit 1987. De Gordon Gecko’s van deze wereld zijn wolven. The wolf of Wallstreet is hier een uit het leven gegrepen voorbeeld van.
Toch blijft het een machtig mooie speech, die Michael Douglas afsteekt in bijgevoegde film. Hij praat over handelstekorten, rekenschap aan de aandeelhouders, coporate bureaucrats en over “you get it right or you get eliminated.” Je zou haast gaan geloven dat deze wolf in schaapskleren inderdaad een bevrijder van bedrijven is. Maar niets is minder waar, want een andere gevleugelde uitspraak van Gordon Gecko is:

“It’s all about bucks kid. The rest is conversation.”

Update 15-09-2009
Zie de video verderop in de post of zoek een naar de scene via google.

Als ik mijn relatie met mijn Turkse vrouw voorzichtig stereotypeer als water en vuur. Hoe zou dan de relatie kunnen zijn tussen een Spaanse vrouw en een Turkse man? Olie en vuur, misschien? Wellicht is dit de gedachte van waaruit Antonio Gala zijn boek La Pasion Turca heeft geschreven. Het boek, verfilmd in 1994 door Vincente Aranda, heb ik (nog niet). Maar voor wat ik van de film gezien heb, vliegen de vonken ervan af.

Dat is niet meer. Gisteren nacht is een algemeen rookverbod in Turkije van kracht is geworden. De boetes op overtreding van het verbod zijn hoog. Hopelijk wordt de handhaving van dit verbod een succes.

Image via Wikipedia

Auroville  is een stadje in Zuid-India. Het is een (hippie) experiment, dat begonnen is in 1968 (na de “summer of love ”). Na meer dan veertig jaar is de stad uitgegroeid tot 2000 inwoners afkomstig uit 40+ landen. Het doel van het experiment is onderzoek te verrichten naar humanitaire eenheid (Aikispirit ). Dat klinkt zweverig, maar als je ziet wat er concreet gedaan wordt in Auroville, dan is dat zo gek nog niet. Kijk maar eens naar deze video  of een van de vele videos op het internet .

Als je even verder kijkt dan de boom-knuffelende mensen, die je in de video ziet, dan zie je dat Auroville vele praktische zaken voor elkaar heeft gekregen, zoals:

• uit een woestenij is 1000 hectare bos gecreëerd.
• 6000 locals hebben werk aan Auroville.
• duurzame bouw en energievoorziening.
• onderwijs en gezondheidszorg is beschikbaar gemaakt voor de lokale bevolking.

En al deze praktische zaken zijn voortgekomen uit streven naar “Humanitaire Eenheid” (Aikispirit). Dit gedachtegoed heeft duizenden mensen van over de hele wereld bewogen om naar Auroville te gaan en hun steentje bij te dragen. En dit zijn over het algemeen hoog opgeleiden: artsen, architecten, economen, kunstenaars, etc.. Met zo een club kan je natuurlijk een aardige stad bouwen. In de echte wereld heb je natuurlijk met een hele andere groepssamenstelling te maken. Toch ben ik ervan overtuigd, dat Auroville een bijdrage kan leveren aan de rest van de wereld. Zij inspireert en laat zien hoe het ook anders kan.

Heb je het gevoel, dat je ook hier en nu iets wezenlijks wil veranderen. Lijkt het je mooi om te werken aan Humanitaire Eenheid? Overweeg dan om Aikido te gaan beoefenen. Dit is een zeer fysieke en praktische manier om Humanitaire Eenheid / Aikispirit te ontdekken en te leren gebruiken.

Mijn Aikido leraar Jan Rusman zegt altijd: ‘In de beweging ontmoet je elkaar, meer niet.’. Het woord ‘ontmoeten’ is te ontleden als ‘niet moeten’. Dit betekent geen dwang, geen kracht, maar ontspanning en ontvankelijkheid voor wat komen gaat. Wie ga jij vandaag ontmoeten?

Shared by Dave

ik vraag me toch echt af of dit ook op gaat voor mensen die hun salaris in Turkse lires ontvangen. En dan praat ik nog niet eens over de vele Istanboel Turken die hun baan zijn verloren. Maar goed, voor de Europese toerist is een lang weekend Istanbul wellicht iets goedkoper geworden.
Istanbul, with a population of at least 12 million, dropped from 23rd place last year to 53rd in this year’s list compiled by international consultancy firm Mercer.
http://ping.fm/sAEuC

Creativiteit is prachtig, maar heeft nog altijd een ondergeschoven plaats in ons onderwijssysteem. Naar de volwassenheid toe ontgroeien wij onze creativiteit en voor we het weten doen we alles met ons hoofd en zijn we onze kinderlijke passies kwijt. Echt waar? Ja, echt waar. Schoolsystemen zijn opgericht rond 1900 om onze industrialiserende maatschappij te voorzien van geschikte arbeiders. Maar wat zijn geschikte arbeiders? Mijn dochter gaat nu net naar school. Echter over 50 jaar zal zij nog steeds gebruik maken van wat ze nu leert. Wat moet zij nu dan leren? Sir Ken Robinson licht deze gedacht op humoristische wijze toe in bijgevoegde TED.COM video. Een paar quotes:

“Kids will make mistakes. If they don’t know, they’ll give it a go. They are not affraid to make mistakes.”

En vooral in bedrijven regeert de angst fouten te maken. Dit hebben wij op school geleerd. Deze angst belemmert ons om met creatieve oplossingen te komen. Ik ervaar die angst ook, maar probeer de moed te vinden om tegen de stroom in te zwemmen. En ik kan je zeggen, dat dat niet makkelijk is.

“Jillian isn’t sick. She’s a dancer.”
Je kan haar natuurlijk ook met ADHD diagnosticeren en haar kinetische intelligentie en creativiteit onderdrukken. Of je kan haar zoals mijn ouders met mij gedaan hebben, haar op judo-les doen (Bedankt, pap, mam!).

Boeken

Mijn vrouw vertelde me over een artikel dat ze gelezen heeft op de website van de nieuws zender Sky Turk. Het is weer zo heet in het oosten van Turkije, dat vele mensen op het dak slapen om de hitte in huis te ontvluchten. Het gevolg is dat er in de afgelopen weken ongeveer 2000 mensen van daken zijn gevallen, waarvan er 5 zijn overleden. Helaas zijn het vooral kinderen die slachtoffer worden. In Nederland zeggen we dat de mussen van het dak vallen, als het heet is. Maar mensen…?

Shared by Dave

Dit is natuurlijk een zeer slechte zaak. Recht is hierdoor alleen voor de rijken. Het is interessant om eens op een rijtje te zetten, hoe dit toch kan gebeuren:
1. Er is slechte samenwerking, of zelf strijd tussen overheidsinstanties; in dit geval financien en justitie.
2. Entropie van Istanbul, ofwel de kosten van het leven in Istanbul gaan de opbrengsten te boven doordat er te weinig orde is.
ISTANBUL – Lawyers in many main court districts in Istanbul are halting their free… http://ping.fm/fhzQ7

Zucht, nog een lange weg te gaan eer Turkije echte vrijheid van meningsuiting heeft en een volwaardige rechtstaat is. Gelukkig zijn dit soort blokkade’s makelijk te omzeilen. Alleen het feit dat een rechter instemt met het beperken van een medium is natuurlijk een zeer kwalijke zaak. Een beter alternatief zou zijn om hetzelfde medium te gebruiken om een positieve campagne te voeren over het gedachtegoed van Ataturk. Ik ben ervan overuigd, dat Ataturk dat liever zou hebben gehad http://ping.fm/7q2Nx

Schrijfster Elizabeth Gilbert spreekt in bijgevoegde video over creativiteit en hoe wij in het westen daar tegenaan kijken sinds de renaissance. De creatie als ultieme verdienste van de mens legt een enorme druk op een kunstenaar. De oude Grieken en Romeinen zagen creativiteit als iets dat werd ingegeven door demonen of geniussen. Als je dus succes zou hebben, kwam het gedeeltelijk door jouw genius. Dit behoedt je voor al te grote ego-trips. Andersom beschermt deze zienswijze ook bij het uitblijven van succes.
Dan maakt Elizabeth een stap naar de goddelijke interventie. God laat zich zien via het werk van een kunstenaar. En als dit gebeurt roept men: Allah, Allah! Dit is door de Morren meegenomen naar Spanje, waar het verbasterd is tot: Ole, ole! Dit hoor je vaak bij flamenco optredens als de muzikanten lekker op dreef zijn, ofwel Flow ervaren. Ikzelf ervaar dit het meest als ik Aikido doe en noem het Aiki-spirit. Flow is een fenomeen dat uitgebreid onderzocht is met als boegbeeld Hoogleraar in de psychologie Mihaly Csikszentmihalyi. Zijn meest bekende boek hierover heet ook “Flow”. Interessant genoeg is hij het fenomeen Flow op het spoor gekomen toen hij onderzoek deed naar Creativiteit.

Mijn broer over Flow.
Boeken

Shared by Dave

Lijkt me super. Yoga in Turkije klopt. Lees ook mijn post ‘Namaz of namaste’.
Eén van mijn favorieten is een 8-daagse Yoga Retreat in Turkije. Alleen het woord zegt al genoeg toch? De Yoga Retreat in Turkije staat in het teken van …

Alle berichten over dit onderwerp bekijken
http://ping.fm/uiEDY

Istanbul Ataturk airport is een prima vliegveld. Ok, als je van een binnenlandse vlucht door moet naar een internationale, dan is het even zoeken. Ik vloog samen met nog een doorgewinterde reiziger en we verbaasden ons er over dat een gemiddelde transit passagier een overstap in een uur kan maken. We vermoeden dat dat vaker niet, dan wel lukt, want wij hebben flink door gestapt en redden net onze aansluitende vlucht. We zijn net op tijd op de juiste pier. Maar waar naartoe nu? Waar is de gate? Kapi 312 nerede?

‘Ouderdom komt met gebreken’ luidt het gezegde. Dit is tot op zekere hoogte waar. Het is echter belangrijk hoe je met jouw gebreken weet om te gaan, zowel psychisch als fysiek. Mijn grote voorbeeld wat dit betreft is mijn Aikido sensei Jan Rusman. Vandaag wordt hij 71 jaar oud. Wat is het een heerlijkheid om met hem te mogen trainen. Hij zelf vertelt dikwijls hoe sterk hij als jongeman was. En dat hij door vermindering van zijn spierkracht alleen maar beter is geworden in Aikido. Hij is meer ontspannen en soepel van bewegen geworden, geeft hij aan. In lichaam en in geest. Een groot deel van zijn beperkingen heeft hij zo kunnen overstijgen. En hij moedigt zijn leerlingen aan hetzelfde te doen.

Domo arigato gosai mashta, Jan san.

Ik overweeg om mijn vaderschap op te nemen in mijn CV. Waarom, zal je zeggen? Nou, omdat het vaderschap kwaliteiten bij mij naar boven heeft gebracht, die ook zeer relevant zijn voor werkfuncties. Empathie, flexibiliteit en creativiteit bijvoorbeeld.
Voorbeeld: mijn jongste kan nu nog niet praten. Als ik wil weten hoe zij zich voelt, of wat ze wil, dan kan ik het haar niet vragen. Ik moet mij daarom continue verplaatsen in haar belevingswereld. Dit stimuleert de ontwikkeling van mijn inlevingsvermogen.
Mijn oudste dochter daarentegen kan zich prachtig uitdrukken, maar wel zo goed, dat ik soms zeer lastige onderhandelingen met haar moet voeren over schijnbaar triviale zaken als welke kleding ze draagt naar school.
Kinderen kunnen op de meest onverwachte momenten hun kont tegen de krib gooien en al je plannen voor de dag in de war schoppen. Mijn ervaring is dat je de boel kan laten de-escaleren door oprecht begrip en liefde te tonen en jouw plannen in licht aangepaste vorm door te voeren.
Daarnaast zijn mijn kinderen ook mijn spiegel en mijn geweten. Als ik schreeuw, schreeuwen ze terug. Als ik aandacht geef, dan geven zij dat ook. En als ik vloek, zegt mijn oudste: “Pap, dat moet je niet zeggen.”.

Als bedrijf kan je vandaag de dag een mooie balans en winst & verlies rekening hebben, maar zonder werkkapitaal, geld ben je nergens. Cash is king! Bedrijven geven aan steeds langer op hun geld te moeten wachten. Nog even en er wordt alleen nog zaken gedaan op de Jerry Maguire manier:

Show
Me
The
Moneeeeeeey!

Bekijk de bijgesloten video en dan begrijp je wat ik bedoel:

Shared by Dave

Eindelijk is het zover. De EU laat zijn ware gezicht zien. Zolang lidmaatschap van Turkije ver weg lijkt doen we alsof zij mag toetreden. Dat zijn wij moreel verplicht aangezien de Turken al jaren trouwe bondgenoten zijn. Maar als puntje bij paaltje komt is Turkije toch te anders (lees: niet christelijk). Zo van: ik hou van je, maar kan niet met je trouwen. Het ontbreekt aan moed.

Bondskanselier Merkel is er tegen dat Turkije lid wordt van de Europese Unie, en president… http://ping.fm/Cp3hn

Ik was laatst in Adana voor een trouwerij. Prachtige stad in een rivier delta die uitmondt in de Middellandse zee aan de zuid-kust van Turkije. Het was lekker warm, namelijk 35¤ C, dus besloot ik om lekker te gaan zwemmen. En terwijl ik aan het zwembad lag met een koud biertje naast me, keek ik naar dit prachtige plaatje (zie foto). De situatie gaf mij een gemengd gevoel toen vanuit de Cami “Allah akbar” geroepen werd. Dat is zoals ik Turkije ken. Er is niet één Turkije. Er zijn vele Turkijen. Arm, rijk, strikt gelovig, gematigd, groot, klein, … Veelal vind je deze tegenstellingen in één situatie en is het zaak om voor jezelf helder te hebben waar jij dan staat en wat je grenzen zijn. In die zin heb ik veel geleerd van Turkije.

Shared by Dave

Afgelopen maandag heeft de Turkse overheid het al makkelijker gemaakt voor Turkse bedrijven om buitenlandse kredieten te verkrijgen en nu verlaagt de Turkse centrale bank de rente. Dit kan goed zijn voor de Turkse economie, maar het zet de Lire wel onder druk. Forex handelaren: sell TRY?
ISTANBUL – Turkey's Central Bank on Tuesday cut its benchmark overnight borrowing and lending rates by a more-than-expected 50 basis points in a bid to prop up the economy against the… http://ping.fm/wuyyb

Bonussen! Iedereen heeft het erover tegenwoordig. Heb jij een bonus? Maar wat is een bonus eigenlijk? Een bonus is volgens mij een beloning voor goede prestaties met het doel prestaties van mensen te verbeteren. Maar wat maakt een beloning nu echt een beloning en een prestatie een goede prestatie?

Belonnen is het omgekeerde van straffen. Straf heeft het grootst mogelijke sturende effect op gedrag van mensen als het consequent en direct wordt toegepast. Dus regels moeten helder zijn en voor iedereen gelden. Straf dient direct na overtreding van de regels opgelegd en uitgevoerd te worden. Een uitgestelde straf wordt wel als vervelend ervaren, maar niet meer in relatie van het ongewenste gedrag gezien, waardoor het sturende effect op dit gedrag gering is. Belonen naar prestatie werkt precies andersom. Regels en te behalen doelen moeten niet voor iedereen hetzelfde zijn, maar op de persoon afgemeten zijn, zodat die het beste uit zichzelf moet halen. Dat vind je misschien niet eerlijk, maar het is wel praktisch. Als alle regels en doelen voor een ieder gelijk zouden zijn, dan zouden sommigen makkelijk en anderen onmogelijk de doelen behalen. De eerste groep is de prikkel tot betere prestaties kwijt nadat de doelen behaald zijn. De tweede groep zal al gauw opgeven, omdat de doelen toch niet haalbaar zijn. Een bonusregeling kan daarom het grootste effect opleveren als het maatwerk is. Dit lukt gelukkig vaak wel. Vele werknemers hebben ooit weleens een POP (Persoonlijk OntwikkelingsPlan), PPP (Persoonlijk Prestatie Plan), of iets dergelijks gemaakt. Hierin worden persoonlijke (maatwerk) doelen gesteld m.b.t. het werk. Vaak hangt van het behalen van die doelen een beloning af.

Om na te kunnen gaan of doelen behaald worden, worden deze doelen specifiek gemaakt. Dit wordt ook gedaan om een beoordeling zo objectief mogelijk te maken. Ook dit klinkt weer heel eerlijk, maar het is juist deze eigenschap van doelen, die heeft geleid tot de wantoestanden, die nu aan de hand zijn in met name (maar niet alleen) de financiele sector. Het is namelijk mens eigen om je te richten op de geformuleerde doelen en daarbij andere (vaak langere termijn bedrijfs-) doelen uit het oog te verliezen, of zelfs tegen te werken. Dit is zeker zo als het behalen van doelen hoge (geldelijke, maar ook emotionele: “goed gedaan”) beloningen opleveren.

Een doel is een versimpeling van de werkelijkheid. Doelen stellen helpt groepen mensen aan te sturen en focus te geven. Maar maak van het doel geen doel opzich!

The last samurai is ongetwijfeld één van de mooiste films die ik gezien heb. Prachtige beelden, thematiek en … muziek (van Hans Zimmer). Het stuk Idyll’s end geeft mij altijd een gevoel van weemoed, hoop en kracht tegelijk. Weemoed als bij Adagio for strings van Barber. Hoop en kracht zoals je verwacht van een holywood productie. Luister ook eens naar het stuk Red Warrior. Na ongeveer 1 minuut wordt het stuk gemixt met KI-AI van strijders uit de film. Misschien komt het doordat ik aikidoka ben, maar ik krijg daar kippevel van. http://ping.fm/VeZ9R

Shared by Dave

De afgelopen jaren hebben veel mensen in Turkije spullen gekocht en betaald met “taksit”, ofwel op afbetaling, in termijnen, op de pof. Turkse bedrijven en banken hebben massaal consumenten aankopen gefinancierd. En nu het geld opraakt, mag er makelijker in buitenlandse valuta geleend worden. Voor forex handelaren: eur / try kopen? Of nog beter usd / try kopen, nu de greenback lijkt aan te sterken?
ISTANBUL – The Turkish government revealed a series of measures to ease… http://ping.fm/8mvLp

De titel van deze blog post is een opmerking die ik een tijdje geleden hoorde uit de mond van Bent Sensei bij Aikido Ryu Jan Rusman in Haarlem. Wat hij probeerde te zeggen is, dat een te harde directe atemi (stoot / slag) de beweging van uke (aanvaller) zal breken en de energie teniet zal doen. Hier door zal je als tori (uitvoerder) opeens merken, dat je zelf heel hard moet gaan werken om nog iets voor elkaar te krijgen. Er is namelijk geen energie meer van de tegenstander, die je kan benutten. Ik zie dit als een aardige analogie voor het ingrijpen in organisaties / groepen. Als een groep niet goed (genoeg) functioneert, kan je als leidinggevende bikkelhard ingrijpen. Ik heb wel meegemaakt, dat ik een nieuw aangestelde leidinggevende ervan verdacht heb, dat hij / zij een “lastige” collega bewust heeft laten ontslaan met het doel serieus genomen te worden. Het grote nadeel van deze aanpak manifesteerde zich op langere termijn. De leidinggevende moest zelf de beweging in de organisatie houden door zelf alles te initiëren. Niets ging meer als vanzelf. Het krachtige optreden van deze leidinggevende had alle beweging uit de organisatie gehaald.
Had de leidinggevende dan maar niks moeten doen? Nee, controle is belangrijk. Maar even belangrijk is de manier waarop de controle wordt gevoerd. Aikido heeft mij geleerd, dat controle met een glimlach mogelijk is. Eigenlijk, is de glimlach een teken van ware controle. Dingen voor elkaar krijgen met een glimlach. Wie wil dat nu niet?

In Turkije is de problematiek zoals geschetst in mijn post WieDoetErWat.nu geheel anders. In Turkije werkt de overheid minimaal mee aan kinderopvang. (Laat ze eerst maar eens goed onderwijs regelen.) Turkse vrouwen kunnen gelukkig vaker dan Nederlandse vrouwen terug vallen op hun informele netwerk (ouders / buren). Tegelijkertijd vechten ze vaak tegen traditionele verwachtingspatronen, zowel thuis als op het werk. Ik heb veel met Turkse vrouwen gewerkt en zaken gedaan. Ze hebben allen mijn respect verdiend:
Semra, Selma, Seda, Ayse, Fatma, Meltem, Nursel, Olay, Banu, Ebru, Ilknur, …
Het artikel Turkish women on their way to the top – UT Nieuws – weekblad van de Universiteit Twente geeft een goed beeld van een Turkse carrière vrouw.

Heel mijn werkend leven werk ik al in de kledingbranche. 90% van mijn collega’s is altijd vrouw geweest. Ik vind het daarom opmerkelijk, dat op top posities in de kledingbranche de mannen in de meerderheid zijn. Vele collega’s heb ik zien worstelen met de spagaat die werken en “zorgen voor” is. Mijn nicht Renate Tromp heeft dit ook opgemerkt en hier een documentaire over gemaakt.
WieDoetErWat.nu – Documentaire: “Samen Delen Samen Spelen
Het gebrek aan werkende (top) vrouwen is veelbesproken. Maar is het werkelijk een persoonlijke keuze van luie vrouwen? Of is het een politieke keuze?”
Mooie documentaire Renate. Ik kijk uit naar volgend werk.

Dit geldt niet aleen voor Turkije, maar zeker ook voor landen als Roemenie en Bulgarije, die al tot de EU behoren.
ANKARA – A senior EU official stressed the importance of democratization in Turkey through increased civilian oversight of the security sector, speaking at a security conference in Ankara yesterday.
http://ping.fm/Vx2Cs

Als ondernemer kunt u alvast gaan uitrekenen hoeveel uw platte of hellende dak kan opbrengen. Tenminste, als de regering haar impulsplannen daadwerkelijk …

http://ping.fm/7MQNC

Apple heeft ongetwijfeld een van de meest succesvolle online video campagnes ooit: Mac versus PC

Mac is relaxed.
PC is stijf en gecompliceerd.

Op dezelfde wijze kunnen we Sissy Boy spiegelen aan anderen.

Sissy Boy is all about you.
Other brands are all about the brand.

Script voorbeeld:

(Rechts: Jongen in laag hangende jeans en T-shirt met heel groot TOMMY erop)
Tommy: Hi, I’m Tommy
(Links: Jongen in SB outfit, zonder grote merk opschriften)
SB: Hi, I’m Sissy Boy. Where you going Tommy?
Tommy: I’m going to the city. How about you?
SB: I’m going to the beach.
SB: What’s with the name, Tommy?
Tommy: I like to show my friends I got style.
SB: Why? Aren’t your friends interested in you?
Tommy: I don’t know…
SB: That’s to bad, you should ask them

Etc., etc., etc.

"Celebrate life,

Not fashion"

Sissy Boy was here

"Build a home,

Don’t decorate one"

Sissy Boy was here

"Pas je aan aan omgeving en tijd,

Niet aan anderen"

Sissy Boy was here

"Kies voor jezelf,

Ook voor anderen"

Sissy Boy was here

"Deel je tijd,

Niet te zuinig"

Sissy Boy was here

Waarom deze vraag?
Seth Godin:"If you’re not upsetting anyone, you’re not making change. And if you’re not changing anything, you’re not convincing, not selling"

Als we deze vraag kunnen beantwoorden, dan betekent het dat we iets onderscheidend gecreeerd hebben. Iets wat de moeite waard is om over te praten, om verder te vertellen.

De brainstorm is begonnen met het beantwoorden van de vraag:

Who are we upsetting?

Oilily

Kakkers

Absolutely Fabulous types

Bling blings

The over serious ambitious

De a-relaxten

De status belusten

(Hema) Eenheidsworst liefhebbers

Strak design liefhebbers

Arrow, Tommy, McGregor, Ikea, Cottonfield, Matinique, Inwear aanhangers

Fashion victims

Het aangepaste kind

Conformisten

Zodra de "Sissy Boy was here" uitingen zijn opgemerkt door de community, kunnen we vervolg stappen zetten door de community te laten reageren op de vragen:

Wat doe jij?
Wat draag jij vandaag?
We dagen mensen uit om foto’s, video’s en teksten te sturen, die opgenomen kunnen worden in de campagne.
De bijdragen van de community kunnen worden geplaatst op een community gedeelte van Sissy Boy . Com: My Sissy Boy. De uitingen kunnen hier besproken worden en krijgen een cijfer. Elke maand worden de beste uitingen opgenomen in de Sissy Boy was here campagne.

Het idee is dus om eerst zelf een reeks uitingen te maken die vertalen waar Sissy Boy voor staat. Vervolgens zal de Sissy Boy tribe hier mee aan de haal gaan.

De grote vraag is: hoe zien die uitingen er uit?
Ik heb gisteren avond een uurtje zitten brainstormen met mijn broer en de ideeen vlogen over tafel. In de volgende posts zal ik de ideeen presenteren.

D66 wil dat de energiemonopolies in Europa worden doorbroken. De monopolies zorgen ervoor dat nieuwe innovatieve en duurzame energiebedrijven geen toegang krijgen tot het energienetwerk. D66-lijsttrekker voor het Europees Parlement Sophie in ‘t Veld: ”Helaas slaagt de EU er tot nu toe onvoldoende in te zorgen voor een vrije, innoverende Europese energiemarkt. Dit moet veranderen.” http://ping.fm/wRQJv

Microwave beams sending electricity from space to power our homes may sound like a concept straight out of a science fiction novel, but with a recent announcement from PG&E, we may actually see a solar powered space station in the near future. The system would consist of a series of solar powered satellites 22,000 miles above the Earth’s equator that would generate electricity, convert it into radio waves and then transmit to a base station on Earth. PG&E has entered into a contract with California-based SolarEn Corp. to supply 200 MW of power by 2016. If they succeed in making space solar power affordable, this new technology could be a huge contender in meeting the world’s energy needs.

Read the rest of PG&E Announces Solar Power From Space By 2016

http://tinyurl.com/cymwqx

The Vatican is going solar in a big way. The smallest country in the world recently announced that it intends to spend 660 million dollars to create what will effectively be Europe’s largest solar power plant. This massive 100 megawatt photovoltaic installation will provide enough energy to make the Vatican the first solar powered nation state in the world!

Read the rest of Vatican to Build Europe’s Largest Solar Power Plant

http://tinyurl.com/d9mq9e

Today we’re excited to announce the launch of our new Energy 101 series, in which we’ll be exploring the future-forward technologies that stand to upgrade our grids, reduce our energy footprint, and slow the speed of global warming. Unless you have been living in a cave for the past few years, you’ve probably heard terms like “energy conservation”, “off-grid energy“, and “smart grid” tossed around. But before getting into the nitty-gritty of transitioning to renewable energy, we should stop and examine where exactly our power comes from now.

Read the rest of Energy 101: Where Does Our Power Come From?

http://bit.ly/CUV6e

Uit onderzoek van TNO  blijkt dat het stimuleren van elektrisch vervoer een effectievere maatregel is om de luchtkwaliteit te verbeteren dan de invoering van een milieuzone. Daarom investeert de stad 10 miljoen euro in elektrisch vervoer.
Dit wordt onder andere besteed aan de aanleg van oplaadpunten en een subsidieregeling waardoor elektrisch vervoer wordt gestimuleerd. De [...]

http://bit.ly/FQ7Ce

(IPS) In de buurt van het Spaanse Sevilla is de grootste zonnetoren ter wereld in gebruik genomen, die meer dan tienduizend gezinnen van groene stroom kan voorzien.
De PS20 van energiebedrijf Abengoa Solar heeft een vermogen van 20 megawatt. Na enkele test vorige week bleek de installatie nog krachtiger dan voorzien. “Het feit dat de [...]

http://bit.ly/15Kij7

Dit zogenoemde feed-in-tarief, dat relatief onafhankelijk is van politieke druk, is de belangrijkste factor voor het Duitse succes. …

http://bit.ly/6Fi6L

Mensen laten vaak hun naam achter door te schrijven: “ Dave was here”. Je krast dit in een boom of een WC-deur, of schrijft het op een muur. Het is een klein beetje een rebelse daad . Op dezelfde wijze stel ik een campagne voor waarin Sissy Boy zijn sporen nalaat online, maar ook offline.

Uitingen in woord (denk aan Loesje), beeld en geluid volgens de bij het doel uitgezette belevenis. Fans van SB zullen deze uitingen gaan sparen en we bieden de mogelijkheid ze zelf te maken, te uiten, te delen, verder te vertellen.

Voorbeelden volgen!!!!!!
Let’s brainstorm!

Het “Sissy Boy was here” concept draait om aanwezig zijn in webspace (denk aan google maps, youtube, wikipedia, facebook, etc.) om vervolgens mensen van al die plekken te verbinden en te leiden vanaf Sissy Boy . Com
Let’s connect!
Let’s lead!

De case spreek van het volgende doel: Breng de Sissy Boy totaal belevenis onder de aandacht over heel veel lijnen.De Sissy Boy totaal belevenis is (volgens www.sissy-boy.com – Over Sissy Boy) gebaseerd op:

“Het zijn de mensen die centraal staan bij Sissy-Boy. De kracht van de kleding ligt in de persoon die ze draagt, niet in de buitenwereld die verwachtingen oplegt. Persoonlijkheid geeft kleding immers pas echt haar volle expressie.”

Het doel is vanuit de visie bekeken:

• Zoek, verbind en leid de Sissy Boy Tribe volgens bovenstaande belevenis.
• Creeer een beweging volgens bovenstaande belevenis.
• Vind 1000 echte fans van bovenstaande belevenis.

De belevenis die hier is beschreven kan het beginpunt van de campagne zijn. Als we tijdens de campagne meer in contact komen met de fans, de stamleden, de Sissy Boy familie, dan zullen zij steeds meer bij gaan dragen aan de beleving.

Ik benader de opdracht vanuit onderstaande visie.
Ik ben van mening dat een merk en haar producten een verhaal kunnen vertellen. Deze verhalen spreken uit wat de fans van het merk verbindt. Een merk kan succesvol zijn als het een leidende rol neemt in het verbinden van mensen. Ik denk, dat Sissy Boy in een uitstekende positie is om op zoek te gaan naar de Sissy Boy Tribe en deze te leiden. Bij het opzetten van een campagne moeten we ons continue de volgende vragen stellen:
- Wie stoten we voor het hoofd?
- Wie verbinden we?
- Wie leiden we?
De schrijver Seth Godin zet deze visie in een kwartiertje uiteen. Zijn praatje is te bekijken op mijn blog.

Vanuit Sissy Boy:
“We willen als Sissy-Boy de website en het verkeer daaromtrent gaan optimaliseren, waarbij we gebruik willen maken van zowel direct marketing, experience marketing en internetmarketing.
Sissy-Boy opent op 12 augustus de 1e winkel over de grens, namelijk Antwerpen. We hebben de intentie en ambitie om hierna vele winkels in Belgie te laten volgen. Dat wil zeggen dat Sissy-Boy in Nederland, maar ook zeker in Belgie duidelijk en goed gepositioneerd moet worden. Een aantal weken voor 12 augustus willen we starten met het Sissy-Boy Offensief . In deze strategie moeten naast de eerder genoemde vormen van marketing ook guerilla marketing en virale marketing een enorme rol gaan spelen. Sissy-Boy is een totaalbelevenis en die willen we over heel veel lijnen naar buiten brengen; denk aan nieuwsbrieven, weblogs, internetfilm, guerilla & film, .
 
Hoe zou jij dit doen? Welke internetmiddelen zou je gebruiken? Welke guerilla/belevenis middelen zou je gebruiken? Hoe ga je om met film & internet? Hoe bereiken we zowel de nederlandse maar ook zeker de belgische klant zodat de opening en de tijd daarna succesvol wordt! Denk hierbij ook aan je tijdsplanning!”

Mijn vertaling: Creeer een (internet) buzz specifiek rond de opening van nieuwe winkels en het merk Sissy Boy in het algemeen.

Amsterdam wil de productie van duurzame energie in de stad een flinke impuls geven. De gemeente gaat daarom, samen met het bedrijfsleven en woningcorporaties, een eigen duurzaam energiebedrijf oprichten.
De bedoeling is dat in 2025 een derde van de Amsterdamse energiebehoefte komt uit lokaal geproduceerde energie. Dat liet de gemeente maandag weten.

In het Japanse Yokohama is ’s werelds eerste batterijwisselsysteem en automatisch oplaadstation voor elektrische auto’s gepresenteerd. De voorziening moet de grootschalige overstap van consumenten op elektrisch rijden versnellen. Het verwisselen van de accu’s gebeurt volledig geautomatiseerd en duurt 80 seconden. Het gaat sneller dan benzine tanken en is bovendien schoner en makkelijker voor de bestuurder.

Tesla bouwt elektrische Mercedes A – Klasse – ZERAuto

Hoe groot schat je de kans dat MB de ForFour aan bv Duracar  verkoopt, zodat deze in grote aantallen bij NedCar gemaakt kan gaan worden? …

Tight Spreads, Quality of Execution, No Discrimination
The best brokers offer the tightest variable spreads possible with no discrimination when it comes to account size, trade size, or type of customer. This topic provides guidelines for choosing the right broker, including a series of questions you can ask potential brokers to determine if they are right for you.

The Best Forex Broker for You
The best brokers are those that offer the tightest variable spreads possible with no discrimination.

* Every client should get exactly the same spread regardless of account size or trade size or type of customer.
* The broker should not engage in the practice of providing hidden kickbacks to introducing brokers or white-label partners.
* As a client, you should also have access to real-time spreads that are clearly displayed next to quotes, and published spread data from the last seven days.

Brokers that offer fully automated trading, end-to-end, with no direct human involvement and no dealer intervention are able offer the tightest spreads.

Switching Brokers
If you’re already trading in the forex market, switching to a broker with a better spread policy can result in a big payoff in terms of your profits. And the cost of switching is low — essentially the cost of a wire transfer.

Before making the switch, a proper competitive analysis is well worth it. But it takes time and effort, and possibly an investment. At the very least be sure to:

1. Understand what spreads are really costing you and how lower spreads would improve your return. For details, see Forex Spreads.
2. Understand the spread policies of various brokers. In detail. For help, see Spread Questions for Forex Brokers below.
3. Understand different brokers’ quality of execution, given your trading style:
* Open an account with more than one broker and try them out. It will be money well spent.
* See what their existing clients have to say by asking for references, or consulting the broker’s or market maker’s (uncensored) bulletin board.
* Finally, try various brokers’ demo platforms. But beware: demo platforms often execute much better than the real ones.

Spread Questions for Forex Brokers
Transparency with respect to spreads enables you to understand not only what you’re paying, but under what circumstances and why. It will quickly reveal the presence–or absence–of value.

The following is a list of questions to help you evaluate forex brokers with respect to spreads:

* What are the typical spreads?

Not just for one or two of the more popular currency pairs, but for all of them. You don’t want to be constrained from trading new pairs later on. “Loss-leader” pricing has no place in forex markets.

* Are the spreads fixed or variable?

The interbank forex market has variable spreads. If you are trading with fixed spreads you are, in effect, paying for an insurance premium (unless you trade only around news announcements when markets tend to be more volatile) since fixed spreads are traditionally higher than variable spreads. Is it worth it? That depends on your trading pattern.

o If fixed, are there any exceptions to the fixed-spread policy?

If you read the fine print, there may be. And, if so, you are paying for insurance without getting full coverage. Make sure the exceptions are clearly spelled out. And find out when the policy on exceptions last changed to gauge how frequently the rules change.

o Are there any restrictions on trading or entering orders around news announcements?

Again, if there are, then what are you paying insurance for? Make sure any restrictions or conditions are spelled out.

* Do the spreads differ depending on ticket size?

In the interbank market, spreads are wider for larger ticket sizes. When you review typical spreads it is important to understand the ticket sizes that they apply to. And if spreads differ depending on ticket size, find out what the typical spreads are for different ticket sizes. All too often, brokers offering matching platforms display very tight spreads, but these spreads apply only to very small ticket sizes.

* Do all clients on the platform get the same spreads, all the time?

Or does the spread depend on who you are, how large your account is, or who introduced you to the broker?

* Are there clients who get rebates or volume discounts?

If so, guess who’s paying for the rebates? If different clients get different spreads, then find out what you have to do to join that privileged group that gets a better spread.

* Does a portion of the spread for any client go to anyone other than the firm?

Forex brokers frequently agree to pay third parties, such as introducing brokers and sales agents, a portion of the spread on your trading activity. While some firms argue that introducing brokers are not really getting a portion of the spread, don’t be fooled. Ask if the introducing broker is being paid in direct proportion to your trading activity. There is nothing inherently wrong with this practice, but it is a fact worth knowing. Only then can you decide if the introducing broker is providing enough added value for the amount you are (indirectly) paying him/her. And you should also ask if you could get better spreads by cutting out this middleman and trading directly.

* Or more generally: does anyone other than the firm itself get paid as a result of your trading activity?

You’d be surprised, but some firms pay their traders and sales agents in proportion to the firm’s profit on your trades: a nice conflict of interest that raises inevitable questions about quality of execution.

* Does the firm have an open, uncensored forum where their clients can post trading experiences?

Open, uncensored forums are a good place to get an initial understanding of what existing clients think of the broker’s platform and quality of execution. It is important to have access to all posts for at least the last 12 months. If this sort of information is not available, ask why not. And note that “chat rooms” are something different, typically because their purpose is not to warehouse the historical information you need. But beware: since the Internet allows for anonymity, it is often very difficult to determine who is really behind a post. How do you separate real concerns, real problems, and real compliments from, say, posts by agents working on behalf of a particular broker? There are some generally recognized guidelines. Note the total number of posts made by any individual, and read some of their previous posts to judge their credibility. Discount extreme comments by traders who are new members or who have posted only a few messages. These individuals are most likely guerrilla marketers who blitz forums–sometimes overtly, at other times covertly.

* How does the demo platform differ from the real platform in terms of execution and spreads?

A demo platform can be useful to observe how prices and spreads vary under different market conditions. And it can give you an idea of how good the quality of execution is, but only if the demo platform behaves exactly the same as the real one. Beware: rejected trades, delayed execution, price-skewing and stop-hunting often happen only on the real platform. And sometimes, even spreads may be different. Also ask if there’s a time limit or “trial period” for using the demo platform. One of the best uses of a demo platform is to test new trading strategies over time.

* What is the minimum to open an account, and what is the minimum trade size?

Unfortunately, the only way to truly test quality of execution is to try the real thing. Some brokers will impose a minimum account opening balance or require a minimum trade size, which can make testing a platform prohibitively expensive.

Published by Kara Collins under Creative Commons license 3.0