Skip to content

ForexGen ForexGen
You are here:ForexGen arrow Academy arrow Level 5 - Professional arrow Carry Trade Risk
Carry Trade Risk PDF Print E-mail

Now, we know that there isn't such a thing as a free lunch. Something that sounds too good to be true must surely have a potential downside. Indeed, the biggest risk in a carry trade strategy is the uncertainty of exchange rates.

When you go long on a currency pair like NZD/JPY as a carry trade, you expect and want the New Zealand dollar to appreciate in value versus the Japanese yen for however long you intend to hold your position for. If NZD/JPY goes up, you will stand to gain not just from the interest spread, but also from capital appreciation. The risk then is of the carry trade pair to decline more in percentage than what you would gain from the interest fees. 

Besides looking for currency pairs which offer a wide positive interest rate differential between the two currencies, you also need to assess the directional bias of the currency pair you are considering, and to determine the potential for the higher-yielding currency to appreciate against the low-yielding one.

In the next section, You will find  the School of Pipsology where you can learne basic analysis and money management techniques, and it may push you to open a demo account 

The trading psychology involves becoming an expert in a multitude of disciplines, including fundamental, technical analysis and sentiment analysis

Before you enter a single trade, read and study enough to know why a tool works, how it works and how well it has worked in many different situations. After you start trading your live account, continue reading and studying some more. The forex market is dynamic and continuously changing. 

 
< Prev   Next >
[ Back ]

User Login






  New User
Lost Password?

Control Panel

Request A Call Back  Download Platform  Trading Academy 
My Account News Center Customer Care  ForexGen FAQs 

Popular

Partnership

     
Start Trading Now With Forexgen

Live Chat

Chat with us now

FX QUOTES

Quotes informer:

Search ForexGen

Accounts

Open A Demo Account   Open A Live Account

Promotions

ForexGen Contests  ForexGen Promotions  Refer A Client

Visitors Popular Searches

forex, forex trading, forex broker, online forex trading, forex market, forex trading software, forex trading system, forex trade, forex software, forex currency trading, forex currency trading system, forex seminar, currency forex online trading, forex online system trading, forex trader, learn forex, forex chart, forex trading platform, forex trading education, currency forex learn online trading, online forex, forex signal, forex news, online forex trading platform, forex trading strategy, forex loan online trading, mini forex trading, forex option, forex exchange, forex training, global forex trading, forex rate, learn forex trading online,business forex online trading, forex trading signal, forex profiting, forex book, forex trading software online, managed forex account, free online forex trading course, broker forex trading, genuine online trading forex, forex day trading, forex system, commodity forex online trading, forex custom indicator, learn forex trading, forex india online trading, forex in india online trading, free forex chart, easy forex, forex online option trading, online forex broker, forex information, global forex, forex factory, forex stock trading, forex scalping, day forex tactic technique thirty trade trading trading wiley, course forex online trading, learn to trade the forex, forex online platforms rating trading, forex trading course, forex real time, forex online strategy trading trading weekly, forex trading training, forex forecast, forex capital market, forex strategy, forex day trading system, forex exchange rate, beat forex from high identify in market odds pattern percentage profit trading trading wiley, forex data, forex investment, forex made easy, managed forex, forex trading style, forex forum, spot forex, forex course, forex currency, forex tutorial, forex education, forex quote, free forex signal, forex stock, forex charting, forex cargo, acm forex, forex forex forex seminar, forex demo, enterprise forex, forex converter, money forex, exchage forcast forex, forex made easy,ways to trade the dollar, forex platform, forex currency trading beginner, forex mini, forex signal system trading, noporn 

RSS News