Available about Forex trading in Russia

Ask is the price at which the purchase of the base currency is made for the one quoted on Forex.

Spread – the difference between the best prices of sell and buy orders at the same time for an asset.

Let’s imagine this situation: you opened an account in rubles (RUB) with a broker, put an amount in rubles (RUB) there, and for some part of rubles (RUB) you want to buy euros (EUR) for dollars (USD) on the euro-dollar (EURUSD) pair. That is, you need to change rubles (RUB) at the USDRUB exchange rate to dollars (USD) and already buy the coveted euros (EUR) with the dollars (USD) you have earned. This is the essence of the deal. All this will be done for you by the broker on your command, that is, when you click the appropriate BUY/SELL button (BUY/SELL), indicating how much (LOT) USD.

The exchange rate is indicated on Forex by the symbol XXX/YYY, where XXX is the base currency and the quoted currency. For example, EUR / USD – euro-dollar, USD/RUB-dollar-ruble. In the first case, USD is the quoted currency, in the second case, USD is the base currency.

Let’s understand how the price of the currency exchange rate of the instrument is formed.

The Forex currency. The Bid and Ask prices

Those who trade in Forex are not alarmed by the difference in prices between the best Ask buy price and the best Bid sell price. It happens the other way around. The absence of a spread, the so-called zero spread, is alarming. Because it becomes unclear who forms this zero spread. The presence of a spread, the difference between the best buy price and the sell price – is a natural process rather than an artificial one.

And yet, many call the spread the broker’s earnings. Yes. If not from the commission, then from the spread, the broker earns on us on each of our transactions. I think that the spread exists and it is constantly changing, it is not wise to blame brokers. Let’s try to disassemble this mechanism and see what’s inside :).

Let’s go to the market and go to the stalls where they sell apples. Behind the counter, sellers – in front of the counter, buyers. And if it’s a wholesale market, it’s even more interesting.

It is clear that sellers want to sell more expensive, and buyers want to buy cheaper. So much for the price difference. So much for the spread. And all are standing. Posted their prices. Nobody buys anything.

This state can be called a little differently: everyone posted their pending orders.

But now there is a buyer who urgently needs to buy some apples on the market, namely all that the seller has, but at any nearest cheap price, i.e. 75 kg at 101 rubles. No more expensive.

I bought. The market situation has changed. The seller left satisfied with 75 kilograms for 101 rubles.

The price went up and the cheap seller left.

The best selling price has changed and increased. Now it is 101 rubles per kilogram.

That is, the activity of a market buyer who wants to urgently buy a product, buy, as they say in Forex from the market, provoked an increase in prices and a change in the spread.

Now let’s assess the situation in which the seller urgently appeared ready to sell all his goods at any nearest price that the buyer will offer.

Availability of a seller from the market

We are looking at how the market situation will change after this action.

From the market seller, prices dropped

The spread increased and the best price to buy Ask decreased and became 97 rubles.

Indication of the spread in MT4.

Here is how the price index is displayed with the help of the price glass in other platforms.

The depth of market in MetaTrader 5.

And in another platform.

It is clear, according to a slightly simplified mechanism, how the movement, the change in the exchange rate of the currency instrument occurs. How Bid, Ask and Spread prices are formed.

But let’s go back to the brokers and their demo account.

Broker – an intermediary that provides a meeting of buyers and sellers in the market. To be able to perform operations on the Forex market, you need to choose a broker that meets the necessary criteria and open a trading account with him.

Demo account – a training account with virtual money, where a novice trader can train, make transactions without the risk of losing capital.

Forex Broker

A good broker, Forex brokerage office (Forex) is 50% of success in trading on the market. Explains what to follow when choosing. Who are brokers and how to work with them?

For those in a hurry, you can take a look at —https://brokers.ru/brokers (https://brokers.ru/brokers)

Explanations on the regulators and types of broker work and account types are just below.

Work in the Forex market (Forex) is not directly possible, and it is useless and meaningless. You will have to work remotely via the Internet, and this is more convenient, through brokerage offices or brokers.

Forex brokers are firms that specialize in transactions in the foreign exchange market, sometimes stock, futures, etc., which, in theory, must have a Forex license for this activity, for example, from the Central Bank of the Russian Federation in Russia. The presence of a license, and this can be checked in the specialized sections on the website of the Central Bank of the Russian Federation, is like a “quality mark” for a brokerage office. Because in order to get a license in Russia, for example, a broker needs to fulfill a phantasmagoric number of requirements in accordance with Russian legislation. Not like over the Hill. Russian brokers licensed by the Central Bank of the Russian Federation are preferable. Finam Forex currently has such a license.

So why do we need them? But why? To work in the Forex market, first, we must have a working amount in the currency, or ruble equivalent. And this amount we will have to give to save and for our work to our chosen broker. This is, as it were, a banking structure. But its duty is to enter into a contract with us, to act on the open market, in accordance with the contract concluded with us and with our orders to open or close transactions. They do this not for free, but for a fee. Or it is income from the spread. We have already learned what this spread is. Or with a commission on each of our transactions.

As elsewhere, there are responsible brokerages whose goal is stable and leading work in the market and a stable legal income. There are also “sharashkin offices”, the so-called” kitchens”, the purpose of which is to” cut down your loot” and dissolve.

Normal brokers do not make noise, do not bother you, like gypsies sometimes. They simply exist, work, and advertise their activities in the usual way. “Kitchens”, as a rule, call on phones and brazenly impose themselves, hunting for your money.

Let’s see what a simple speculative trade looks like in the Forex market. Let’s say you opened an account with a broker, the parameters of which suit you, and deposited a certain amount to it. Now you can act with a fraction of this amount, called a Lot or lot share. For example, with Lot A, we ask the broker to open a deal to buy some currency at the price of X. Based on the subsequent price increase. And after some time, if the growth assumption was correct, you give the broker the opposite order to the previous one. About the sale of the same Lot A at price Y. Price Y is greater than price X. The sale of the Lot And you helped out a greater amount of original currency than you invested. The difference is yours.

Leverage is the ratio between the amount of collateral and the borrowed funds allocated for it by the broker. Leverage of 1: 100 means that you need to have an amount 100 times less than the amount of the transaction on your broker’s trading account in order to make a trade.

Well, if you are at least a ruble millionaire. You can invest a significant amount for the Forex market. Accordingly, you can get a significant profit on the difference. But, if you do not have a significant amount. In this case, the broker gives you the opportunity to use leverage. What is leverage? For example, a leverage of 1: 100 means that the broker increases your invested amount by 100 times. Thus, it gives you the opportunity to work on the open market for a much larger amount. For example, when buying a currency, it increased your amount 100 times. You have worked a large amount and your profit is calculated from the increased amounts. The danger is that if you choose the wrong direction of the transaction, your losses are also calculated from large amounts. Therefore, you need to be very careful in using the amount of leverage.

A demo account with a broker is a great opportunity to practice trading with virtual money. You need to start with it.

Previously, the broker was contacted by phone. Now all this happens through a trading platform (software package) on a computer, tablet, or smartphone.

The so-called brokerage “kitchens” are not set up for you to make a profit. Rather, you can say that they are determined to appropriate your deposit with various organizational and technical tricks.

For example, it is not timely to execute your order about the beginning or end of the transaction, or to execute your orders not at your ordered price. There may be input and temporary distortions of quotes.

Therefore, the conclusion suggests itself. When choosing a broker, it is necessary to check the license. In the case that no license has been to look carefully at the reviews about this broker. The essential question is how many years this broker has been working in the Forex market. Well-known, long-established brokerages are not interested in deceiving you. And they spend a lot of time maintaining their reputation.

A very important issue is the resolution of legal conflicts that may arise during trading. For example, if a broker has its head office outside the Russian Federation, the solution of many legal issues can be very complicated. On the contrary, if the broker is located within the Russian Federation, and even more so has an extensive network of offices in cities, then interaction with it in case of legal conflicts is much easier.

I can’t recommend a specific broker to you. Each has its own set of services and trading accounts. I can only speak for myself. I studied with a Forex Club broker. I work with the RoboForex broker. You have to choose a broker yourself, having found it through the search engines Google and Yandex, expending great efforts on the evaluation of the terms, read the reviews or search data on the license. I’m not going to point the finger at anyone here. Like a good one. This one’s bad. Everything changes all the time. In short, the broker who can safely pay you the money you earned, and choose. This is almost the most important thing in all trading on the Forex market. I.e., the contract-offer or whatever you need to read very carefully not only before the first transaction, but even before making money on your deposit.

On many sites, the name of the regulator for the broker is placed opposite the name of the broker.

Regulators for brokers: