Learn Cross Forex Trading Course from
Our Experts
Forex Market Training in Chennai
Join hands with our Currency/Forex Market Training course, one of the best forex trading training institutes in Chennai. As of now, RBI ( Reserve Bank Of India ) has approved very few pairs trading in India.
In India the following currency pairs are available to trade:
Trading Timings : 9 am to 5pm only.
CROSS CURRENCY PAIRS
EURUSD
GBPUSD
USDJPY
It is legally allowed to trade Forex within Indian Exchanges like NSE. As per RBI guideline, all Indian resident including banks and financial institutions can do forex trading in currency pairs. The main currency pairs are EUR/USD, GBP/USD, USD/JPY, USD/INR, EUR/INR, GBP/INR and JPYINR. So, if you are trading with brokers who have membership in mention exchange it is absolutely legal.
Course Duration 1 week. Call us for the course fee.
How to open a forex trading account in India?
You need to open a currency derivative account with any stock broker. Also, you can open a free forex account here.
You’ll need following documents:
- Pan Card
- One ID Proof: Aadhar/DL/Voter Id/Passport
- One Cancelled Cheque
- 6 month bank statement or ITR copy
- 1 photo
- Must be at least 18 years old.
- Must an Indian Resident.
Problems with Forex trading in India
NSE has introduced cross currency pairs and pairs with INR. However, there are still serious problems. Few of the list below:
Trading hours
Trading at NSE closes at 5:00 PM where as Europe and USA markets open after that. This brings overnight price change risk.
Liquidity Risk
There are not enough trading in cross currency pairs on NSE. So, it’s hard to find buyers and sellers.
INR is Not Free Float
RBI controls price of INR time to time, that makes it harder for a trader to speculate direction.
Fixed Lots
Lots are fixed on NSE, you don’t have flexibility to choose different lot sizes.
Fixed Expiry
Future and option contract expires. Also, we don’t have longer contracts. Where as, CFD in international markets don’t expire.
A forex account is one that holds deposits in one or more currencies for trading. These trades are based on the movement of the foreign exchange market. With this type of account, you can now unlock vast and potentially significant returns from global markets. These and other factors draw investors to forex trading.
What is Forex trading?
Before we discuss the various advantages of a FOREX trading account, let’s understand FOREX trading in detail.
FOREX, the word is a portmanteau, a blend of the words foreign currency and exchange, and self-explanatory. In FOREX, you trade in the currency market, which is the largest market in the world. The daily estimated trading volume is USD 6 trillion, spread over different hotspots around the world and remains active for 24 hours.
FOREX trading is unlike the stock or commodity market. In FOREX, traders trade currency pairs in the direction of the market. Unlike buying stocks, when you trade in currencies, you are simultaneously buying one currency and selling the other. And, you don’t need a DEMAT account for currency trading, as there is no delivery of currency involved. Most trades in the currency market are cash-settled. For online FOREX trading, you only need a currency trading account.
If you are wondering, forex trading can add diversity to your portfolio and let your investment exercise better. The market remains open for 24*7 involves a variety of players from government, banks, institutional investors, travellers, corporations, and amateur traders.
However, the forex market is decentralised. The market operates in different locations like London, Singapore, Tokyo, or New York. To participate in the market abroad, you would need a broker with an international reach.
In India, you can trade in forex derivatives in the BSE and NSE exchanges. However, the market is highly regulated, and trading in non-INR currencies is prohibited under FEMA rules. Before you start trading, go through the rules and guidelines released by the RBI regarding FOREX trading in India, so you don’t end up at the wrong side of the law.
What Are The Basics Of FOREX Trading?
Currencies are always traded in pairs. You can trade in currency derivatives in the Indian bourses. Futures in four currency pairs and F&O in three cross-currency pairs (EUR-USD, GBP-USD, and USD-JPY) are available for trading in the Indian exchanges.
To trade in foreign currencies, you will have to start by opening a currency trading account. Here are the steps involved in that,
- Open a trading account with a reputed broker with a proven record in the market
- Complete the KYC process to make the account functional
- The broker will ask you to deposit the required margin to start trading
- Request requisite access credentials from your broker
Currency trading market is highly dynamic, and the introduction of online forex trading has made it even more agile. FOREX traders are now equipped with highly sophisticated software to trade within seconds of a trading opportunity. It can be a little difficult for a new trader to get the hang of it at the beginning. So, if you are planning to trade in the currency market, here are a few tips that can be the ice breaker.
- Understand the trading style. The FOREX market behaves differently from the others, and hence, you will have to develop a sense of trading in the currency market
- Don’t try to trade in all available currency pairs. Follow one or two currencies like the US Dollar or British Pound to develop a trading strategy
- Successful currency trading is all about trading with sense, effective risk management while having a clear sight of your goal
- Know your limits – plan entry and exit carefully. No trade is a sure shot, so you will have to judge your risk appetite well before trading. A clear idea of the market will help you set your expectations right and losses small
What are the benefits of opening a forex trading account with Angel Broking?
- Low Commission: A large brokerage house like Angel Broking offers moderately lower commissions. These allow investors to trade in forex markets if they have a currency account
- No Middlemen: There are no middlemen involved when you are with Angel Broking, which facilitates seamless transactions
- Standardised Lot Size: Angel Broking gives standardised lot sizes for ease of trading. These range from 1000-100,000 units of currency
- Low Transaction Costs: Transaction Costs tend to be as low as 0.07%
- High Liquidity: A forex account tends to cater to a highly liquid market. This enables trades with full price discovery
- Instant Transactions: Transactions online are instantaneous
- Low Margin, High Leverage: Given that the margins are nominal, you can afford to take higher calculated risks when trading through your currency account
- Online Access: Angel Broking provides 24/7 web-enabled back-end service
- Interbank Market: Access to the interbank market, a global network of institutional currency traders, makes sure there is sufficient liquidity at all times
- No insider trading
- Limited regulation
- No account maintenance charges for the first year
HOW YOU CAN BENEFIT FROM FOREX
- - Low Commission
- - No Middlemen
- - Standardized Lot Size
- - Low Margin, High Leverage
- - Online Access
- - Interbank Market
- - Transaction Costs as low as 0.07%
- - High Liquidity
- - Instant Transactions
- - Self-regulatory
- - No Insider Trading
- - Limited Regulation
How to open forex trading account in India?
Angel Broking allows you to open a online. When you buy and sell foreign currencies, you tend to benefit from exchange rate fluctuations. These trades generally get executed in pairs, e.g. EUR/USD, GBP/USD, USD/JPY. Here’s an easy guide on how to open a forex trading account:
Application
Brokerage houses often provide the comfort of having the documentation completed at your home. A representative carries the Account Opening, and the Know Your Client (KYC) forms with him or her
Along with submitting the completed account opening form, you will also need to provide additional documents. These documents serve as identity, address and financial proofs. This is an extensive list of documents you will need:
Why open a forex account online?
The online trading platforms have transformed FOREX trading. It helps in price discovery and speedy executions. There are several advantages of opening an online trading account, like the ones listed below.
- Transactions take place in real-time
- Quick execution and settlement of the trades
- Easy access to your account, carry out trades from anywhere
- Trading with your currency account does not involve intermediaries
- Low transaction costs and with 0 insider trading
With all these benefits and seamless processes, it makes sense to open forex trading account with Angel Broking today!
Conclusion : Currency trading is like any other form of trading. There will be days when you will make several winning trades, and on the other days, you may lose. Learn from your mistakes and build a better strategy. Find a good broker to open an online forex trading account and don’t hesitate to tap into their market wisdom.
PRODUCT SPECIFICATION
| Contract Specification → | |
|---|---|
| Underlying | Rate of exchange between 1 USD & INR |
| Pair | USD/INR, EUR/INR, GBP/INR, JPY/INR |
| Contract Months | 12 consecutive calendar months i.e. a view up to 1 year in future can be taken |
| Expiration date and time / Last trading day & time | At 12:30 noon, two working days prior to the last Mumbai Interbank Settlement day of the month |
| Min Price fluctuation / Tick size | 0.25 paise or INR 0.0025 |
| Settlement Daily Interim MTM settlement Final settlement | Cash settled in INR Based on daily closing price of the contract Based on LTDs RBI reference rate |
| Margin required for 1 lot USD/INR | 1.75% on the first day & 1% thereafter |
| Market timings | 9:00 AM to 5:00 PM |
| Events likely to impact USDINR rate → | General trend for demand/supply of USD | Impact on USD | Impact on INR |
|---|---|---|---|
| Increase in exports of India | Excess inflow of USD in the country | Depreciates | Appreciates |
| RBI is selling USD to meet demand for the dollar | Supply of USD increases | Depreciates | Appreciates |
| NRI Forex remittance is increasing | Increase in USD inflow | Depreciates | Appreciates |
| Positive trade balance | Increase in USD inflow | Depreciates | Appreciates |
| Increase in exports of India | Demand for USD increases | Depreciates | Appreciates |
| Rise in global prices of commodities | Demand for USD rises due to costlier imports | Depreciates | Appreciates |
| FIIs buying back USD | Excessive USD outflow | Depreciates | Appreciates |
| RBI is buying USD to absorb excess USD due to Forex inflows | Absorption of excess USD liquidity | Depreciates | Appreciates |
