William Albert Securities Limited offers tight spreads on Forex CFD trading for all major currency pairs, plus a huge range of exotics and mini-Forex contracts, with a standard margin from just 1% .
What is Forex?
Foreign exchange or FX trading, also known as Forex is a currency market where one currency is traded against another. It allows the investor to leverage from the anticipated currency market movements.
How does it work?
When the investor anticipates the view that one currency will either rise or fall in value against another currency, he effectively purchases one currency while simultaneously selling the other.
The most popularly traded pairs include Euro against US dollar, Pound against US dollar, Australian dollar against US dollar, euro against British pound and US dollar against Japanese yen. These are represented as EUR/USD, GBP/USD, AUD/USD, EUR/GBP and USD/JPY.
A good example of a Forex trade would be to buy sterling (GBP), while selling the US dollar (USD). This is an example of placing a 'buy' trade on the Forex pair GBP/USD.
See the Forex trading example below for a better understanding of how to trade Forex CFDs.
Forex trading with William Albert Securities limited has the following advantages:
- Simple Forex trading
- All leading pairs available
- Vast range of exotics
- Mini contracts at the same tight spreads
Forex trading at Stock Indices
- Easy to buy or sell
- 24-hour dealing on the leading indices
- Live prices based on the level of the underlying index
- Flexible transaction sizes
Trading Forex or stock indices with William Albert Securities Limited is very similar to trading our Share CFDs. You buy or sell at our live price and put forward a fraction of the full contract value as a deposit. One key difference is that there is no commission to pay on any of our non-equity markets. All our charges are included in the dealing spread.
Trade all our Forex contracts commission-free. You can open a new position at just 2% of the contract value. The only charge is our dealing spread: for most major FX pairs this is either 2 or 3 pips, for a full or mini contract. All our contract sizes are set out in the Contract Details.
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Examples for Forex Trading
Buying Euro/USD
Opening the position
If you decide to go long for the Euro against the Dollar, and WASL’s quote is 1.3452/1.3454. Assume you buy 5 contracts (the equivalent of E500, 000) at 1.3454.
The value of your position is E500, 000 x 1.3454 = $672,700. To open the position you deposit a sum of just 2% of the position. Your deposit is therefore 2% x $672,700 = $13,454.
Adjustments on Interest
While the position remains open, your account is debited or credited to reflect the effect of the interest rate differential between the euro and the dollar.
Euro interest rates are lower than dollar rates, and you incur interest for holding a long position in the lower-rate currency, so the interest adjustment is debited from your account.
Closing the position
Three weeks later, let’s assume EUR/USD has risen to 1.3796/1.3798, and you take your profit by selling 5 contracts at 1.3796. Your profit on the trade is calculated as follows:
Closing transaction E500, 000 (5 contracts) x 1.3796 = $689,800
Opening transaction E500, 000 (5 contracts) x 1.3454 = $672,700
Profit on trade $17,100
The overall profit is calculated by including the accumulated daily interest rate adjustments.
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