Spot Forex vs. Forex Futures

Many who become interested in Foreign exchange trading wonder what the crucial differences between Spot Forex and currency futures are.  While both forms of trading involve making decisions regarding the future prospects of global currencies there are a number of subtle differences traders should take note of before deciding which product is suitable for them.

Future Contract (Forward Contract)

A futures contract is a legally binding contract that obligates the two pa...

What is an STP Broker?

forex_generic2STP stands for Straight through Processing. Unlike Market Makers when an STP Brokerage receives an order from a client it passes it straight through to its liquidity provider(s).  The liquidity providers used by STP Brokerages vary and can include banks, hedge funds, exchanges and even other Forex brokerages. While Market Mak...

The Trade Weighted US Dollar Index

What Is the Trade Weighted US Dollar Index?The Trade Weighted US Dollar Index, like the standard US Dollar Index measures the value of the US Dollar relative to a basket of world currencies. The Trade Weighted Index was introduced by the Federal Reserve back in 1998 for two main reasons. Firstly in anticipation of the Euro, which lead to the elimination of several currencies used in calculating the standard US Dollar Index. Secondly, it was felt that the standard US Dollar Index w...

What is the US Dollar Index?

An Index is a single number which is calculated from array of different data points. Those of you who have traded stocks will be well aware of stock indexes. For instance the FTSE100 tracks the performance of the 100 largest companies listed on the London Stock Exchange and is weighted to ensure the Index accurately tracks the performance. To do this bigger companies are given extra weighting. The US Dollar Index is calculated in a very similar manner.The US Dollar Index (USDX) is a meas...