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One of the basic distinctions of the Forexite company is that the trading conditions make it possible to trade on the Forex market at a low risk the level of which is chosen by a trader him/herself. That's why we call our services a Safe Forex.
One of the main risk indices is an open position to deposit ratio. The index in the Forexite TradeRoom trading terminal is called Current Leverage. For instance, if a 100 000 EUR/USD position is open at the deposit of 10 000 USD, the current leverage then equals to 12.5 (to calculate it you need to convert Euro into US dollars multiplying the position amount by an EUR rate; for the calculation the rate of 1.2500 has been used).
The current leverage changes with exchange rates move because there is constantly profit or loss. At the same time assets in your account called the Current Equity change as well. One should not confuse the current leverage with a position opening leverage which has the value of 100 in the Forexite's trading conditions. The value determines the maximum position that can be open at a given deposit. We believe an optimum leverage is from 5 to 10, so we would not recommend that you open a maximum position.
Reasonable capital management
A substantial factor of experienced Forex traders' success is they manage their funds by the time-proved rules. One of them is as follows: one should risk at a deal of an amount not exceeding a certain percentage of a deposit. Different experts advise to hold to diverse levels, but usually the percentage is from 1% to 5% (for further calculations 2% is used).
Depending on the market environment a reasonable minimum of a EUR/USD Stop order is of about 50 points (a lower one can be executed at occasional short-term fluctuations). At the open position of 100 000 EUR/USD the 1 point's price makes 10 USD (calculated as 100 000 * 0.0001). The 50 points' one makes 500 USD correspondingly. For a 500 USD amount to make 2% of the deposit, the latter should be 25 000 USD. The current leverage in that case will amount approximately to 5 (calculated as 100 000 * 1.2500 / 25 000).
Because the current leverage is easier to make calculations with, let's take the calculated value of 5 and figure out recommended deposits for different amounts of an open position. Thus we get a recommended minimum deposit equal to 2000 USD for a 10 000 USD position, a 200 USD deposit for a 1 000 USD position, and that of 20 USD for a 100 USD position.
Fixed lots trading
The whole thing would seem as simple as that - follow the instructions and trade it easy. But there is a "but", which is that most companies' trading conditions do not allow optional deal amounts. Usually, they offer fixed lots of 100 000 (standard forex) or 10 000 (mini-forex) to trade.
Besides, mini-forex accounts are often artificially separated from standard forex accounts, a mini-forex deposit in many cases being placed both upper and bottom limits on. Limit on a maximum amount of a mini-forex deposit results in a trader being not able to add to the deposit so as to reduce risks to an acceptable level.
Depositing a minor amount, say less than 2000 USD, to trade on Forex, a trader normally faces the challenge the sum being not enough to trade 10 000 USD lots at a low risk. Then the trader is just forced to take undue risks and trade on such terms.
Unlike other companies, Forexite allows making deals for any amounts, starting from 1 USD. Thus you may both buy and sell 125.50 USD and 15 250 USD and 125 100 USD too. Moreover, the Forexite company does not limit a minimum deposit, with trading affordable even from 1 USD. The company also presents a full range of the Forex market services, such as standard forex, mini-forex and micro-forex, in one trading account.
Because a deal amount may be minimal, the risk index, i.e. a position to deposit ratio, may be as minimal as you choose. For example, you may do deals for 10 USD with a 100 USD deposit. The risk index (the current leverage) makes then just 0.1, which affords traders with unrivalled opportunities.
All these features allow Forexite's clients to trade on Forex at as low risks as desired - Safe Forex.
See also: Public quotation