Effects of a Strong Or Weak Philippine Peso Currency

Two conflicting stories came out of a national paper this week. One announced that exporters are badly hurt by the appreciating peso while the other states that the Bangko Sentral ng Pilipinas (BSP) claims that the surging currency is beneficial to the Philippine economy. Those stories seem to tell the Filipinos that we cannot have our cake and eat it too. Whenever there is a good effect, there is a corresponding draw back. Let us take the first statement. There are two types of exporters. One is who imports raw materials, processes it and exports the finished product. The other is one who buys or produces the raw material locally, processes it and exports the result. In the first case, we export only labor. In the second, we export labor and raw material converted by labor into finished product. When the peso is weak, more pesos are spent to buy raw materials. The product is sold to earn a strong dollar. Then labor is paid in weak peso.

When the peso is strong, there will be less pesos spent acquiring raw material. Then the finished product is sold earning weak dollars. There will be more dollars needed to pay labor in strong pesos. What exporters are afraid of is our finished product will be less competitive in the world market if a strong peso raises production costs. Labor costs will rise because there will be more dollars to be converted to pesos to be spent for labor. What will be affected are the export processing zones. Finished products will be less competitive in the world market. Profits will dive and factories may close.

On the other hand, the quality of the peso in the world market is raised. We will need less pesos to service our external debt in dollars. There will be more investors coming because they can earn more than when the peso is weak. Philippine economy will be stronger. There will be more investors coming because the strong peso earned will compensate their efforts. The BSP argues that the peso surge is but temporary. Market forces will eventually force the peso to seek its level. Overseas workers are the ones responsible for the strong peso. When remittances slow down the peso will depreciate. There is a tendency for the overseas workers to live permanently in the place where they work if the government of the country will allow.

The sad part of the business is that even if the peso appreciates, it is never felt locally. Local prices will remain the same. Take for example oil products. If the world market for liquid petroleum gas rises, our local prices rise along with it. If it falls the peso price for Liquified Petroleum Gas (LPG) will remain the same. Even if the peso appreciates, there is still no roll back in LPG prices. There must be something wrong with our economics.

Perhaps we would be much thankful that the peso appreciates. We are an importing country. Since birth we have been conditioned to believe that anything imported is excellent. Imported wines, whiskeys, cigarettes, chocolates, perfumes and cars are better appreciated than local products. With the appreciating pesos, plus the General Agreement on Trade and Tariff all imported luxuries will now be within the reach of the locals. The incoming dollars will go out again. Our overseas workers will have to stay longer if not forever just to keep our economy afloat. While economy is on the rise, we do not institute measures to keep it up.

Our economic planners must pull their acts together. We still are not aware how the strong peso affects the small and medium enterprises. If there is any benefit from the surging currency, the influence must be felt locally in any way otherwise the natives will never be able to benefit from the situation. Is the surging peso beneficial or detrimental?

The Top 3 Pros And Cons Of Forex Technical Analysis

Technical analysis has been a part of financial practice for many decades. It is a method of prediction price movements and future market trends by using chart. It is necessary for you to know the pros and cons of technical analysis so that you can trade with complete ease.

There is no doubt that technical analysis is the easiest and most precise method of currency trading. So, let’s find out the top 3 pros and cons so that you can trade with complete ease.

Pros

1. Provides All Current Information

The current price reflects all currently known information about an asset. While rumors may constantly suggest that the price may plummet or surge, ultimately the current price is the balancing point for all information. As investors and traders sway from one side to the other – buyers or sellers – the asset moves reflecting the current perception of value.

2. Prices Move in Trends

If prices just gyrate wildly and randomly it would be very hard to make money. While wild gyrations do occur, overall prices typically move in trends. There is a directional bias to the price which provides traders with an advantage. Much of technical analysis is about determining when a trend is in place, when it isn’t (called a sideways market, range or correction), and when a trend is reversing.

Most profitable trading methods used by traders are trend following strategies. This means you isolate the trend, and then find opportunities to enter in the same direction as the trend, thus capitalizing on the direction biased price movement.

Trends occur on various “degrees”. For example, you may have a long term uptrend on the daily or weekly chart, but on shorter time frames – or at the far left of a chart – you may have a downtrend.

3. Timing

A major advantage of technical analysis is that it provides you with ways to ‘time’ your trades. With a fundamental approach, your research may dig up some interesting news on a company’s stock that you think may cause it to rise in the future; but when?

With Forex technical analysis you can wait and use you money for other opportunities until the price tells you the stock is ready to move higher.

As there are both merits and demerits of technical analysis, it is also important for you to know the downside. So let’s check out the cons now.

Cons

1. It can be dangerous to depend totally on the assumption that today’s prices predict future prices. They often do, but not necessarily.

2. Replying on charts completely will not help you to pick up the signals about the changing of a trend until the change has actually taken place. This means you could miss up to one-third of the fluctuations in currency trading.

3. It is also possible in currency trading to act on a pattern prematurely or in a bit of a panic. If a large number of currency traders do this, it can create a self-fulfilling prophecy.

Go through the points above on the advantages and disadvantages of technical analysis to get more familiar with Forex technical analysis while trading.

Oversubscribed IPO – The Secret on How to Get in and Profit

IPOs or Initial Public Offerings, are simply put, one of the best investments available. The key is however, finding the right one and with a little knowledge and some basic research, you can be one of those investors you’ve been reading about. In this article I’m going to show you what an “Oversubscribed IPO” is and how and “Oversubscribed IPO” can be something you really should take a closer look at.

The single most important fundamental when it comes to IPOs is demand. Without it, I don’t care what kind of company you’re looking at- point is, without demand, you’re looking at a disaster in the making.

Demand with IPOs is a bit different than other investments per se, as demand on an existing equity simply means volume. Demand on an IPO means that there are or there aren’t investors looking to cash in on a newly formed public company, and the more demand you have for an IPO, the higher the price will be.

An Oversubscribed IPO is an IPO that has yet to trade, but has a following of investors wishing to buy in, that exceeds the amount of shares being issued. Think of it a simple supply and demand situation. An Oversubscribed IPO is no more different than silver, gold or oil. Once the momentum pushes demand past supply, the price skyrockets.

So now that you should have a good concept of what an Oversubscribed IPO is, I want to explain what it means to you, the IPO Investor, and how you can profit from it.

Face it, getting in on a hot IPO as just a “regular investor” without loads of connections or cash is pretty much impossible, but there is a backdoor in and using this particular method, I have personally been able to pick up gains exceeding 3000% and I’ll explain that right now.

The key to entering into a hot IPO or an Oversubscribed IPO for that matter, without being a part of the “private placement” is to place your order for the IPO on trading day, but before the market even opens. That may seem strange, but I can assure you that this relatively little known process can do 2 things for you:

1. It gets you in on the IPO as an “aftermarket buyer” at the very first price the IPO trades at and;

2. It can possibly save you boatloads of money.

The secret is to call your broker (on-line brokers too) after 8:30 eastern time and place the order for the IPO as a “limit order”. OK, so what is a “limit order”?

A limit order is an order that the investor specifies the most he or she is willing to pay and the amount of shares he or she would like to purchase. Now this can be as little as 1 share and could be as high as 100,000 and beyond.

So placing this “limit order” on your Oversubscribed IPO on trading day, after 8:30am EST, ensures you get in on that IPO the very millisecond it debuts as a public company, so as long as your order qualifications are met (Price and # of shares).

So essentially, there’s no worrying. You’re order will execute when the IPO starts to trade and that sometimes can be anywhere from 10:00am and as late as 1:30pm for some of the hotter IPOs. That being said, if you didn’t place a limit order and wait until the IPO starts to trade, precious time may go by and in that space, the IPO’s price could go up very quickly, and when you actually get around to buying it, it may be well over the first price.

In the end, an IPO limit order saves you money when you’re dealing with high profile IPOs, hot IPOs are an Oversubscribed IPO.

What You Need To Know About The Forex Robot

A Forex robot is a computer program that undertakes Forex trading on your behalf. The program works relying on a set of trading signals that help it to define whether to sell or purchase a given currency at a given time. If you are looking to automate your Forex trading, you should go for the robots. You can easily buy them on the internet.

Benefits of Forex robots

There are many advantages that come with automating your Forex trading using the Forex robots. Some of these advantages include:

It’s passive: When you are trading the manual way, you have to dedicate time to study the market, keep yourself updated with the industry news, and regularly inspect the trading charts. This isn’t the case when you are using robots. When using the machines all you need to do is give them instructions when you want them to buy and sell, and you can go on with other activities. This saves you time as you make passive money-you don’t invest your time and resources into it.

More practical: Highly experienced designers design most of the programs. Due to this, the programs can analyze the trading charts even better than you can. As a result, they can identify a trading opportunity or even a trend that you wouldn’t have. During the development, the robots are integrated with parameters that allow them to make the right buying decisions. They first study the trends, and once they have identified an opportunity, they go ahead and open a trade.

Fast: The programs have the ability to scan millions of trading charts within seconds and reach a decision. This allows you to make money even if the opportunity lasts for only a short time.

Guide to working with trading robots

Before you buy a robot, there are some things you should know. You should be aware that the effectiveness of the robots is dependent on how good the creator is. If the creator is crappy, so will be the robot. For peace of mind, take your time before buying the program. Research both online and offline of the best programs to use.

Another thing to consider is the customer support service provided by the seller. Just like any other computer program, the robot is bound to develop problems at a particular time. To avoid jeopardizing your trading, you should research and find out the quality of the customer support provided by the provider. You should call, text, and even email the seller and see how fast he/she responds. For peace of mind, only work with a provider with the best service.

You should avoid a provider who responds in hours or even days. A good provider should reply within minutes.

Conclusion

This is what you need to know about Forex trading robots. While the machines do your work easy, just like humans, they make mistakes; therefore, you should expect to make profits at certain times, and loses on other occasions.

Best Stock Tips for Successful Stock Trading

Finding out goals and developing strategies are the essence of successful trading of Indian stocks. There are numerous other factors that need to be considered as well. Rather than thinking about completely the cost factor, it will be prudent on your part to reflect on the value of the Indian stocks that you are going to invest. As per the stock tips service provider, distributing your money in a broad range of stocks for both long-term and short-term will always keep you at the engaging edge. It is after carrying out research, keeping updated with what is occurring recently in the Indian stock market, making use of investment tools such as stock technical study, fundamental study, etc. that you can discover the potentiality of any specific NSE or BSE stock. One of the further most followed stock tips are purchasing when everybody is selling and selling when everybody is purchasing. Well, there are different parameters to be regarded as well.

Doing proper analysis before you invest money in any Indian stock is a need if you want to get huge ROI. You should go by rumors. There are various new investors who have a tendency to go after rumors and finally end up acquiring losses. Select an online stock trading platform or an economic news portal that have sustained a satisfactory relationship in the market. If you become an associate of an online stock trading platform, one that gives solutions further than brokerage, you can get perfect stock tips in synchronization with your trading targets.

The Indian stock market is occupied with complexities in the eyes of new investors and those who are not aware about the knowledge of the market. It will look like a difficult job, but once you manage and understand the techniques, the complexities or the difficulties included will robotically vanish. You will get it fun and exciting and the profits obtained will only increase your enthusiasm. But, you should control your emotions; your online stock trading may provide you with large profits or you may lose everything that you have spent. So, a careful approach and going after the aforesaid stock tips will help you get the returns that you have anticipated. Do not be determined by the notion that a BSE stock will always go round to your benefit. Any Indian stocks whether NSE or BSE are subject to variations in the market. The method by which you take your course along will fix on whether you will get profit or loss.

Wise investors go for new organizations that increase quickly for short-term investment and blue chip organizations for the long-term. Markets are more perilous in the short-term. You will have to give your time and efforts completely for the same as price varies by the second or minute.

Forex Trading for Total Beginners

Stock investment, binary options, and foreign exchange (Forex) trading – these are some of the popular ways of generating additional income aside from choosing the traditional ways (building a small business or applying for a part-time work). Which do you prefer? Oh, so you’re already familiar with stock investment and binary options. You don’t mind trying them but you would be glad to learn about other potential sources of investment income. And so, your wish is my command! You landed here because you want to know some facts about Forex trading, didn’t you? This article won’t make you an expert on the subject, but it can certainly answer the simplest questions that you have at this moment. No need to beat your brains out!

The Basics of Foreign Exchange

Currencies and foreign exchange are important to various people in different parts of the world. They are needed to keep foreign businesses running. For example, you are an American tourist traveling in Europe. Of course, you can’t pay in dollars to go to the popular tourist destinations there. You will need to exchange your dollars for the local currency.

So you see, there is a continuous need to exchange currencies. Due to this fact, Forex market has become the biggest financial market in the world.

Forex Trading Defined

Doing this type of investment means you’re trading currencies against each other. You may opt to buy one while selling another. When you trade Forex, you basically attempt to make a profit by guessing that the value of one currency will go up or go down compared to another; for instance, a lot of EUR/USD. You choose when you want to close the trade. You can do it anytime the market is open.

Some Advantages

So, you can gain profits. What else? What makes this type of trading a lot more beneficial to you?

• You can try a free demo account.

This is mostly beneficial for beginners like you especially if you are a bit doubtful about yourself. Trying a free demo account prepares you for the time that you will need to really invest your money in the hopes of earning real profits. It likewise helps you figure out if Forex trading is for you.

• The market trades 24 hours a day.

So, you don’t plan to do it full-time. That’s just fine. You can trade at any time of the day because the market never sleeps.

• There is no fixed lot size.

Want to participate with a small lot size, let’s say, $25? No problem! You determine your own position size.

There you have it; the set of basic pieces of information about Forex trading. Do you want to try it? Or do you want to learn more detailed facts? You better choose the latter for now. There are numerous things you need to know, and you should make the most out of your resources. The good thing is, there are lots of them! Indeed, you need to be very careful in trying to make an investment. But it also pays to be bold enough to take risks. Just make sure you are equipped with enough knowledge about what you’re doing.