Frequently Asked Questions
All your questions can be answered here, whether you are a novice trader or an experienced one. Stay informed with the latest news and expert analysis.
Frequently Asked Questions
All your questions can be answered here, whether you are a novice trader or an experienced one. Stay informed with the latest updates and expert analyses.
The forex trading market is currently the world's largest financial market, with a daily trading volume of around 4 trillion USD. The exchange rates of various currencies fluctuate and appear in the form of currency pairs during trading, such as Euro/USD (EUR/USD) and USD/JPY. It involves buying one currency while simultaneously selling another in a currency pair.
The forex market operates 24 hours a day, five days a week, from 5:00 PM Eastern Time on Sunday to 5:00 PM Eastern Time on Friday. Trading starts in Sydney and progresses around the globe to Tokyo, London, and finally New York. Forex trading is not centralized in an exchange; it operates as an over-the-counter (OTC) or interbank market.
The most commonly traded or active currencies in the forex market are those of countries with stable governments, reputable central banks, and low inflation rates. The major currency pairs that dominate the daily trading volume include USD, JPY, EUR, GBP, CHF, CAD, and AUD.
Margin is the collateral used by traders to establish positions based on leverage. In the forex market, leverage ratios typically range from 0.2% to 5%, allowing investors to trade actively with high leverage. However, the margin system, while amplifying profits, also increases trading risks.
For example, if Mr. Zhao wants to trade an equivalent of 100,000 USD today and the margin ratio is 0.2%, Mr. Zhao only needs $200 as margin to execute this trade. In other words, with $200 margin, he can trade $100,000, amplifying his capital by 500 times. Therefore, by investing $10,000, he can engage in a $5 million trade.
The quotes on the trading platform include the normal trading spreads, derived from the interbank trading spreads of all major currency pairs. LXFX profits from the spreads in currency trading.
Overnight interest is the interest earned or paid by clients when holding positions overnight. The calculation of overnight interest occurs at 5:00 PM Eastern Time. The interest earned or paid depends on the direction of the open position and the different interest rates of the two currencies. For example, if the interest rate of the British Pound is much higher than that of the Japanese Yen, a trader going long on GBP/JPY (holding British Pound) can earn interest from the spread of the open position. Conversely, if going short on GBP/JPY (holding Japanese Yen), the trader needs to pay interest.
In the spot forex market, the actual value date is two days later. For example, the price on Thursday reflects on Monday, and the price on Friday reflects on Tuesday. Therefore, on Wednesday, we need to calculate three days of rollover interest to compensate for the overnight interest caused by the weekend (no rollover interest is charged on the delivery date as the market is closed over the weekend).
In forex trading, the most commonly used risk management tools are "take profit orders" and "stop-loss orders." During normal market hours, take profit orders limit the highest buying price or the lowest selling price, allowing selling at a higher price or buying at a lower price than the current market price. Stop-loss orders are typically used to automatically liquidate positions at a specific price level when the market moves against the investor's trading direction, helping to minimize losses. However, these orders do not guarantee risk avoidance at all times.
At LXFX, you can trade spot gold and silver 24 hours a day, 5 days a week. The trading hours for spot gold and silver at LXFX are from 18:00 Eastern Time on Sunday to 17:00 on Friday. The market will be briefly closed only from 17:15 to 18:00 each day.
Gold spot contract: 1 lot or 1 contract equals 100 troy ounces. Silver spot contract: 1 lot or 1 contract equals 5000 troy ounces.
LXFX provides leverage of up to 100:1. High leverage brings more profits but also involves risks.
The point value for one point in gold spot trading is $10 per lot (i.e., 100 ounces), and in silver spot trading, it is $50 per lot (i.e., 5000 ounces).
No. As long as there is sufficient margin in your account, your position will remain valid until you close it. Similar to forex trading, open positions in gold trading automatically extend to the next trading day's settlement time after the New York market closes at 17:00 Eastern Time.
If trading 1 lot of crude oil, the value of 1 point is $1. If trading 5 lots, the value of each point is $5.
Yes, you can leave positions over the weekend or major holidays. However, please ensure that your account's margin balance is sufficient to withstand market fluctuations. Like currency pairs, crude oil trading often experiences so-called gap phenomena during reopening. We recommend that the funds in your trading account can withstand at least a 1% adverse movement in positions to avoid forced liquidation.
It represents the USD price of 1 barrel of Brent crude oil (UKO/USD) or West Texas Intermediate crude oil (USO/USD).
Crude oil can be classified into light and heavy crude based on API gravity and into sweet and sour crude based on sulfur content. Brent crude is a light, sweet crude produced from several oil fields in the North Atlantic. Typically, the price of Brent crude is higher than the composite index of the Organization of the Petroleum Exporting Countries (OPEC). West Texas Intermediate (WTI) crude is relatively light and has lower sulfur content, with its price usually lower than Brent crude.