No? Do you want to be?
If you do, you can't just focus on one aspect of Internet marketing. What I mean is, don't just think about ad copy or just about traffic generation. It takes an "all around" approach to succeed.
First, and foremost, you must get your website visitors' email addresses. Build your prospect list. Use not only a newsletter, but also use autoresponder ecourses, ebooks and reports. All should be given away; the only "payment" being their email address.
Put the signup forms for these ebooks, etc. on your navigation menu and on the content pages throughout your site. You never know which page your visitors will be seeing when they arrive.
Make each signup page a "sales" page. Why should they want the ebook or report? What are the benefits to them? Make it good.
Have great customer support. What? They're not customers? Well, not yet, but they could be. Treat each subscriber and contact as if he or she is the best customer in the world and that person will be more likely to remain your subscriber.
Provide some way for your website visitors to provide feedback. It could be a community blog, forum, or even just a contact form. Just make sure there is some way that your visitors can communicate with you. Make sure that the link to your contact form is on every page of your website.
These days, I don't recommend adding your actual email address to your site because of all the spam bots. They scour your site for your email and soon your inbox will fill up with junk.
Does your website look professional? If you just have a site full of blinking banners and ads, I don't believe you'll succeed in the long run. You need it to look nice - not fancy - just nice, and have valuable content for visitors. If you do, they'll come back.
What about popups? You can use popup windows, but don't go crazy with them. Personally, I do not stay on a site that has more than one popup. I have been on sites where so many windows appear that you can barely get away from the site. That is just plain rude in my book.
A word about promotion. In my opinion, the best way to promote your website is by writing articles. You need articles for your newsletter and to distribute to article directories and other publishers. This is how you get your "name" out in cyberspace...to the people who matter...the ones looking for good content for their own newsletters and websites.
And the most important key to success? Perseverance. Don't give up at the first problem, or even the second. Find a mentor. Ask questions. Do whatever you have to do...but hang in there! You WILL have your OWN success story!
Wednesday, July 8, 2009
Effective Ways To Get More New Ezine Subscribers
1. Swap an ad.
Pinpoint which ads and ezines work best for you by tracking your swaps.
Also try to swap for multiple issues as many people won't respond to your ad until they see it a few times.
2. Purchase ezine ads.
Run ads for your ezine in relevant ezines that you enjoy.
Also search ezine directories for ezines that offer reasonable rates and that reach your target market.
3. Do a thank you page swap.
Get excellent ongoing promotion of your ezine by using your thank you page to swap an ad or recommendation with another ezine publisher.
Choose ezines that your new subscribers would be interested in, but not ezines that compete directly with you.
Also make sure that you only recommend ezines that truly do offer valuable content, so that you won't start off on the wrong foot with your new subscribers.
4. Offer a bonus.
Increase your subscriptions by offering something for free that your target market would find to be of value.
For example, you could offer a free email course, ebook, report or access to your "subscriber only" membership site.
5. Write articles.
Your articles can help you to establish yourself as an expert in your field.
Your articles can also help you to get more new readers that are interested in the topics covered in your ezine.
Just add a resource box that promotes your ezine to your articles, or include a couple of lines of promotion for your
ezine in addition to your other information.
6. Offer a sample issue.
Offer your sample issue on your site or by autoresponder, and when you can use it in your posts to ezine directories.
You can also increase your subscriptions by linking to your sample issue in your resource box when you write articles to
promote your ezine.
7. Provide testimonials.
Increase your ezine's credibility by including testimonials that praise your ezine on your site.
Include your reader's first and last name and web address along with her testimonial, and when you can use testimonials that are specific in nature as opposed to those that are general.
Pinpoint which ads and ezines work best for you by tracking your swaps.
Also try to swap for multiple issues as many people won't respond to your ad until they see it a few times.
2. Purchase ezine ads.
Run ads for your ezine in relevant ezines that you enjoy.
Also search ezine directories for ezines that offer reasonable rates and that reach your target market.
3. Do a thank you page swap.
Get excellent ongoing promotion of your ezine by using your thank you page to swap an ad or recommendation with another ezine publisher.
Choose ezines that your new subscribers would be interested in, but not ezines that compete directly with you.
Also make sure that you only recommend ezines that truly do offer valuable content, so that you won't start off on the wrong foot with your new subscribers.
4. Offer a bonus.
Increase your subscriptions by offering something for free that your target market would find to be of value.
For example, you could offer a free email course, ebook, report or access to your "subscriber only" membership site.
5. Write articles.
Your articles can help you to establish yourself as an expert in your field.
Your articles can also help you to get more new readers that are interested in the topics covered in your ezine.
Just add a resource box that promotes your ezine to your articles, or include a couple of lines of promotion for your
ezine in addition to your other information.
6. Offer a sample issue.
Offer your sample issue on your site or by autoresponder, and when you can use it in your posts to ezine directories.
You can also increase your subscriptions by linking to your sample issue in your resource box when you write articles to
promote your ezine.
7. Provide testimonials.
Increase your ezine's credibility by including testimonials that praise your ezine on your site.
Include your reader's first and last name and web address along with her testimonial, and when you can use testimonials that are specific in nature as opposed to those that are general.
Internet Marketing VS Forex Currency Trading
Have you ever tried to make money online and failed?
Did you follow your guru's advice and still fail?
Here's an alternative...
Have you noticed that when someone’s trying to sell you something - such as a system for making money - they always make it look far easier than it is?
Let’s look at two Internet businesses, almost as diametrically opposed as it’s possible to be – Internet Marketing and Forex Currency Trading.
You’ve probably heard the old Internet adage – build a better website and they will come. Well it ain’t true!
You could put up a site advertising dollars for a dime and they still wouldn’t come – because they wouldn’t know where to look!
Let’s look at what you need to have in place in order to build a successful Internet marketing business.
First of all, you need a product. If you’ve been reading the recent Internet marketing blurb you’ll know you need a niche product.
Actually, the new thing is sub-niche but whatever they call it, you need a product for which there is high demand but low supply.
Finding a suitable niche is the hardest part of the whole process but let’s say you have a killer product, what else do you need?
The List.
Ask any Internet marketeer and they will say that the most important part of your business is your opt-in list.
For people to join your list you usually have to give them something of value such as a free eBook or report on a subject related to your main product line.
To keep them interested, you need to keep in touch with them offering them additional information, advice and tips.
Website.
To promote your opt-in list you need a website (although there are other ways of promoting your list, too) with features that will encourage people to sign up to your list.
You also need a killer website with killer copy to describe – and sell - your killer product. This may or may not be the same as the one you use for your opt-in list.
Killer copy.
Maybe you’re not a good copywriter. There are many eBooks on the subject that can help you or you can pay someone to write copy for you.
You need a domain name, preferably one with some relation to the product but good domain names are becoming increasing difficult to find.
Ads.
To get people to visit your website in the first place you need to register it with the search engines.
SEO (Search Engine Optimisation) is an art in itself. You can mug up on the subject or pay someone to do the job for you (but be aware that not all experts are!).
You might also want to place ads for your list in newsletters and ezines. The better ones will charge you although you might get a free ad in return for an article.
Autoresponder.
To automate your business you need an autoresponder. These clever devices automatically send emails to everyone on your opt-in list at predetermined intervals, and contain predetermined copy.
For example, you could create a series of emails containing, say, five parts of a free course to be sent one a day over the first five days.
Then emails would be sent once a week advertising a different product each time.
Whenever anyone signs up to your list they automatically start at the beginning so everyone gets the full cycle of marketing material.
We haven’t even looked at affiliate sales and marketing but I’m sure you get the picture.
The basic idea of selling over the Internet sounds good but there’s a lot more to it than most people realise.
Forex Currency Trading
Someone said that trading is the last frontier, the last place where men and women can stand up and pit themselves against the world.
It sounds very Wild Westish but most of it is true! You win or lose entirely by your own efforts and if you win, it’s like having your very own bank.
However, even owning a bank is a business and you still have to work hard to put the money there – and to keep it!
Unlike Internet marketing where all your efforts, in one form or another, are geared towards making people join your list and then selling them stuff,
Currency Trading has no customers. That’s worth repeating – with currency trading, you don’t need customers.
No customers means you don’t need any of the associated accoutrements that go with Internet marketing such as:
Products
Web site
Domain name
Opt-in list
Ads
eBooks and reports
Autoresponder
Any other marketing aids
So far so good, but what do you have to do and what do you need? Well, you need to know what currency prices are doing.
You can get a list of prices at the close of each trading day free from many web sites. If you want to trade during the day – intraday trading,
you can get real-time prices for a nominal fee from several data suppliers.
In the foreign exchange currency market, commonly called forex, you can get this data and charting software free from many web sites.
Okay, that’s the easy bit. In order to trade currencies, you need to analyse the data and determine which way price is heading.
In other words you need a system and this will require study and dedication.
There’s lots of other stuff you have to know, too – trading terminology, margin, leverage, money management, order types, trader psychology and more.
But all of this is available in eBooks and courses and on the Net.
You also need some money upfront to fund your trading account. With forex you can begin with as little as $300-500 although you would be advised to start with more.
So while you don’t have the ongoing quest for new customers, new products and inventive sales techniques,
you do need some sort of education or training before you begin and you need discipline while you’re trading.
For more information on getting started with forex currency trading, go to: www.webkept.com
Making money takes work whether it’s online or off. Make sure you know what’s involved before you start and remember that the more you put into a business, the easier it gets.
About the author:
From the author of the hit Forex Currency Trading book - "Mechanical Discretion", Amin Sadak has created another masterpiece for Business Opportunists.
His new teaching manual "The Affluent Desktop Currency Trader" provides an alternative for people looking for online business opportunities.
Amin teaches the method he uses to download $1000+ every week.
Did you follow your guru's advice and still fail?
Here's an alternative...
Have you noticed that when someone’s trying to sell you something - such as a system for making money - they always make it look far easier than it is?
Let’s look at two Internet businesses, almost as diametrically opposed as it’s possible to be – Internet Marketing and Forex Currency Trading.
You’ve probably heard the old Internet adage – build a better website and they will come. Well it ain’t true!
You could put up a site advertising dollars for a dime and they still wouldn’t come – because they wouldn’t know where to look!
Let’s look at what you need to have in place in order to build a successful Internet marketing business.
First of all, you need a product. If you’ve been reading the recent Internet marketing blurb you’ll know you need a niche product.
Actually, the new thing is sub-niche but whatever they call it, you need a product for which there is high demand but low supply.
Finding a suitable niche is the hardest part of the whole process but let’s say you have a killer product, what else do you need?
The List.
Ask any Internet marketeer and they will say that the most important part of your business is your opt-in list.
For people to join your list you usually have to give them something of value such as a free eBook or report on a subject related to your main product line.
To keep them interested, you need to keep in touch with them offering them additional information, advice and tips.
Website.
To promote your opt-in list you need a website (although there are other ways of promoting your list, too) with features that will encourage people to sign up to your list.
You also need a killer website with killer copy to describe – and sell - your killer product. This may or may not be the same as the one you use for your opt-in list.
Killer copy.
Maybe you’re not a good copywriter. There are many eBooks on the subject that can help you or you can pay someone to write copy for you.
You need a domain name, preferably one with some relation to the product but good domain names are becoming increasing difficult to find.
Ads.
To get people to visit your website in the first place you need to register it with the search engines.
SEO (Search Engine Optimisation) is an art in itself. You can mug up on the subject or pay someone to do the job for you (but be aware that not all experts are!).
You might also want to place ads for your list in newsletters and ezines. The better ones will charge you although you might get a free ad in return for an article.
Autoresponder.
To automate your business you need an autoresponder. These clever devices automatically send emails to everyone on your opt-in list at predetermined intervals, and contain predetermined copy.
For example, you could create a series of emails containing, say, five parts of a free course to be sent one a day over the first five days.
Then emails would be sent once a week advertising a different product each time.
Whenever anyone signs up to your list they automatically start at the beginning so everyone gets the full cycle of marketing material.
We haven’t even looked at affiliate sales and marketing but I’m sure you get the picture.
The basic idea of selling over the Internet sounds good but there’s a lot more to it than most people realise.
Forex Currency Trading
Someone said that trading is the last frontier, the last place where men and women can stand up and pit themselves against the world.
It sounds very Wild Westish but most of it is true! You win or lose entirely by your own efforts and if you win, it’s like having your very own bank.
However, even owning a bank is a business and you still have to work hard to put the money there – and to keep it!
Unlike Internet marketing where all your efforts, in one form or another, are geared towards making people join your list and then selling them stuff,
Currency Trading has no customers. That’s worth repeating – with currency trading, you don’t need customers.
No customers means you don’t need any of the associated accoutrements that go with Internet marketing such as:
Products
Web site
Domain name
Opt-in list
Ads
eBooks and reports
Autoresponder
Any other marketing aids
So far so good, but what do you have to do and what do you need? Well, you need to know what currency prices are doing.
You can get a list of prices at the close of each trading day free from many web sites. If you want to trade during the day – intraday trading,
you can get real-time prices for a nominal fee from several data suppliers.
In the foreign exchange currency market, commonly called forex, you can get this data and charting software free from many web sites.
Okay, that’s the easy bit. In order to trade currencies, you need to analyse the data and determine which way price is heading.
In other words you need a system and this will require study and dedication.
There’s lots of other stuff you have to know, too – trading terminology, margin, leverage, money management, order types, trader psychology and more.
But all of this is available in eBooks and courses and on the Net.
You also need some money upfront to fund your trading account. With forex you can begin with as little as $300-500 although you would be advised to start with more.
So while you don’t have the ongoing quest for new customers, new products and inventive sales techniques,
you do need some sort of education or training before you begin and you need discipline while you’re trading.
For more information on getting started with forex currency trading, go to: www.webkept.com
Making money takes work whether it’s online or off. Make sure you know what’s involved before you start and remember that the more you put into a business, the easier it gets.
About the author:
From the author of the hit Forex Currency Trading book - "Mechanical Discretion", Amin Sadak has created another masterpiece for Business Opportunists.
His new teaching manual "The Affluent Desktop Currency Trader" provides an alternative for people looking for online business opportunities.
Amin teaches the method he uses to download $1000+ every week.
Thursday, June 4, 2009
Long Term Carry Trade Fundamentals
While reading a recent CNBC article about current events something clicked for me.
Here is the passage:
The dollar rose broadly on Thursday as yields on 10-year U.S. government bonds jumped more than 50 basis points in the last two weeks, drawing Japanese investors into overseas assets like global semi-conductor stocks, banks and U.S. junk bonds, according to Reuters.
Do you remember the massive unwinds that occurred during the past year? Do you remember all the talk about money heading towards Japan due to risk aversion?
Pay attention, this is significant. It's also backs up my much touted long term notion that carry trade currency pairs are in for a recovery.
Given the quote above what do you think will happen once the jobs numbers start to turn around in the US economy? I'll tell you what I think. I think interest rates and yields will start to rise. What do you think all that money sitting in Japan will do if there is a hot US economy paying good yields? I suspect that it will leave Japan in order to earn good returns.
Guess what that will do to the Yen? That's right, it will drop like a stone. When that happens you'll see carry trading pairs rise massively.
Okay, I realize this may be a year to two away, but as long as we do eventually get a worldwide economic stabilization this is what is in store for us. Anyway, if you are a rookie, be careful, as you can't simply make long term bets willy-nilly. The market can always move against future expectations long enough to blow up your account and it often does so as soon as you throw caution to the wind.
What this means for me is that I may be more willing to accumulate carry trade positions at moments of opportunity. Keep an eye out for fundamentals and watch leading economic indicators such as the Baltic Dry Index or the price of copper.
As you can see these indexes are rising. However, they are still at historically low levels. Are we just in a bounce with respect to worldwide economic activity or are we simply coming up from a recent bottom? You decide.
Here is the passage:
The dollar rose broadly on Thursday as yields on 10-year U.S. government bonds jumped more than 50 basis points in the last two weeks, drawing Japanese investors into overseas assets like global semi-conductor stocks, banks and U.S. junk bonds, according to Reuters.
Do you remember the massive unwinds that occurred during the past year? Do you remember all the talk about money heading towards Japan due to risk aversion?
Pay attention, this is significant. It's also backs up my much touted long term notion that carry trade currency pairs are in for a recovery.
Given the quote above what do you think will happen once the jobs numbers start to turn around in the US economy? I'll tell you what I think. I think interest rates and yields will start to rise. What do you think all that money sitting in Japan will do if there is a hot US economy paying good yields? I suspect that it will leave Japan in order to earn good returns.
Guess what that will do to the Yen? That's right, it will drop like a stone. When that happens you'll see carry trading pairs rise massively.
Okay, I realize this may be a year to two away, but as long as we do eventually get a worldwide economic stabilization this is what is in store for us. Anyway, if you are a rookie, be careful, as you can't simply make long term bets willy-nilly. The market can always move against future expectations long enough to blow up your account and it often does so as soon as you throw caution to the wind.
What this means for me is that I may be more willing to accumulate carry trade positions at moments of opportunity. Keep an eye out for fundamentals and watch leading economic indicators such as the Baltic Dry Index or the price of copper.
As you can see these indexes are rising. However, they are still at historically low levels. Are we just in a bounce with respect to worldwide economic activity or are we simply coming up from a recent bottom? You decide.
Twitter Forex Tweet Strategy
Have you been following people involved in fx trading on twitter?
Have you noticed how many people are happy to tell you what happened? While macroeconomic news and previous day post analysis can be useful, it certainly doesn't help you make a trading decision based on current charts.
I have a little proposal to make.
Instead of tweeting that you've opened a long or short position provide some information that other people can use to apply their own strategies. Frankly, I don't care what crappy decisions others are making. I care what the charts are saying. I'll do my own technical analysis and decide on my own trades.
So, tell me that a pattern is forming on a named pair's chart in a certain timeframe. For example, right now the AUDJPY is retesting May highs of 76.00 and obviously this is true on any chart -- though you may need a longer chart to actually see it.
Then, I can whip open my chart, draw some lines, figure out a strategy, and trade on the opportunity.
To summarize, we need to tweet about opportunities that are shaping up. We need to just drop each other a note that something is happening. Anybody who has traded for any length of time can figure out what to do -- but unless we have the luxury of trading full time we just can't spot all the opportunities.
In short. Smarten up and stop trying to show the world how damned smart you are. We don't care!
How about we call this the Useful Forex Tweet Agreement (UFTA).
UPDATE: I've tweeted the AUDJPY information (again) using the #ufta tag...
Have you noticed how many people are happy to tell you what happened? While macroeconomic news and previous day post analysis can be useful, it certainly doesn't help you make a trading decision based on current charts.
I have a little proposal to make.
Instead of tweeting that you've opened a long or short position provide some information that other people can use to apply their own strategies. Frankly, I don't care what crappy decisions others are making. I care what the charts are saying. I'll do my own technical analysis and decide on my own trades.
So, tell me that a pattern is forming on a named pair's chart in a certain timeframe. For example, right now the AUDJPY is retesting May highs of 76.00 and obviously this is true on any chart -- though you may need a longer chart to actually see it.
Then, I can whip open my chart, draw some lines, figure out a strategy, and trade on the opportunity.
To summarize, we need to tweet about opportunities that are shaping up. We need to just drop each other a note that something is happening. Anybody who has traded for any length of time can figure out what to do -- but unless we have the luxury of trading full time we just can't spot all the opportunities.
In short. Smarten up and stop trying to show the world how damned smart you are. We don't care!
How about we call this the Useful Forex Tweet Agreement (UFTA).
UPDATE: I've tweeted the AUDJPY information (again) using the #ufta tag...
Forex Tips - Microtrading
The AUDJPY currency pair is currently trading around the 76.00 mark.
Over the last twenty days, from May 7 through May 27, I've been experimenting with a concept I've been calling microtrading.
I don't intend to close all of my positions at the moment, but if I did my account NAV would increase by more than 10% over that period.
While I realize that active trading can return spectacular results compared to a paltry 10% it does require a lot more effort and time. Personally, my full time job and other issues have my complete attention. I don't have the luxury of time or the mindset to take larger risks at the moment.
Anyway, open up your trading platform and I'll walk you through the process of trading this strategy.
1) On May 10 we topped out around 76.00 on the AUDJPY pair.
2) Based on my account size I could safely open long positions for every fall of 20 pips. This isn't the goal but it is the maximum density of trades I'd allow.
3) As the price of this currency pair dropped to around 70.50 on May 15 I would accumulate positions based on the previous point. Basically, when you see what looks like a support point or if the price moved down a lot while you were at work or sleeping, then you open another micro trade.
4) When any one trade has more than 200% profit with respect to margin committed and you believe you are at a resistance point, consider unloading it.
5) Be patient when the market moves sideways. In terms of serious monetary strategies a week or a month is not a long period of time. Keep in mind that you are trading a carry trade pair so you will be paid to wait.
6) I firmly believe that eventually the AUDJPY pair will recover strongly. I'm willing to hold positions for long periods of time as I wait for this. If you don't believe this or you aren't willing to wait, then this strategy may not be useful for you.
Using the above method, with almost zero stress except for impatience during several weeks of sluggish movements, my trading account never committed more than 6% of it's NAV (using 50:1 leverage which is the maximum at my fx broker -- Oanda). However, this morning, as I've stated above, I could close out all my positions at a 10% NAV gain.
This is a simple trading system, though purists may balk at calling it a "system" due to its loose definition. Wait for a drop and buy tiny positions. Capture large profits when they present themselves. Be patient and don't accumulate too large a portion of your NAV. I'd definitely recommend using Oanda due to the ability to trade any size positions and the fact that you can't trade with extreme leverage.
Over the last twenty days, from May 7 through May 27, I've been experimenting with a concept I've been calling microtrading.
I don't intend to close all of my positions at the moment, but if I did my account NAV would increase by more than 10% over that period.
While I realize that active trading can return spectacular results compared to a paltry 10% it does require a lot more effort and time. Personally, my full time job and other issues have my complete attention. I don't have the luxury of time or the mindset to take larger risks at the moment.
Anyway, open up your trading platform and I'll walk you through the process of trading this strategy.
1) On May 10 we topped out around 76.00 on the AUDJPY pair.
2) Based on my account size I could safely open long positions for every fall of 20 pips. This isn't the goal but it is the maximum density of trades I'd allow.
3) As the price of this currency pair dropped to around 70.50 on May 15 I would accumulate positions based on the previous point. Basically, when you see what looks like a support point or if the price moved down a lot while you were at work or sleeping, then you open another micro trade.
4) When any one trade has more than 200% profit with respect to margin committed and you believe you are at a resistance point, consider unloading it.
5) Be patient when the market moves sideways. In terms of serious monetary strategies a week or a month is not a long period of time. Keep in mind that you are trading a carry trade pair so you will be paid to wait.
6) I firmly believe that eventually the AUDJPY pair will recover strongly. I'm willing to hold positions for long periods of time as I wait for this. If you don't believe this or you aren't willing to wait, then this strategy may not be useful for you.
Using the above method, with almost zero stress except for impatience during several weeks of sluggish movements, my trading account never committed more than 6% of it's NAV (using 50:1 leverage which is the maximum at my fx broker -- Oanda). However, this morning, as I've stated above, I could close out all my positions at a 10% NAV gain.
This is a simple trading system, though purists may balk at calling it a "system" due to its loose definition. Wait for a drop and buy tiny positions. Capture large profits when they present themselves. Be patient and don't accumulate too large a portion of your NAV. I'd definitely recommend using Oanda due to the ability to trade any size positions and the fact that you can't trade with extreme leverage.
Microtrading: Decent Returns?
I blogged about this idea not too long ago. The concept is to use very small trades relative to your available margin and net asset value (NAV). I'm doing this with the AUDJPY pair so that when I accumulate positions I am earning a positive carry trade return.
My trade size over the last week has been such that the margin involved in each trade is 0.2% of my NAV. That's tiny. Twenty five trades in and you are looking at using 5% of your available margin.
However, the carry trade interest would represent approximately a 3.65% return if annualized. At the same time my unrealized profits had me up almost 4% earlier this morning. This 4% unrealized profit is due to only the last 10 days of trading. We've had a downturn, I've accumulated positions, and the AUDJPY has jumped just recently.
Anyway, I hope this demonstrates that short term scalping is not the only way to earn money using forex. While this concept won't make you rich overnight the risk is very low and the returns can be good compared to currently available financial instruments
My trade size over the last week has been such that the margin involved in each trade is 0.2% of my NAV. That's tiny. Twenty five trades in and you are looking at using 5% of your available margin.
However, the carry trade interest would represent approximately a 3.65% return if annualized. At the same time my unrealized profits had me up almost 4% earlier this morning. This 4% unrealized profit is due to only the last 10 days of trading. We've had a downturn, I've accumulated positions, and the AUDJPY has jumped just recently.
Anyway, I hope this demonstrates that short term scalping is not the only way to earn money using forex. While this concept won't make you rich overnight the risk is very low and the returns can be good compared to currently available financial instruments
Theory: Trading With Little To No Margin
As I often do, especially when the markets are excruciatingly slow in determining when to make the next significant move, I've been thinking about Forex.
Take a mental walk with me...
The DOW falls from 10,000 to 5,0000 and loses 50% of it's value. It returns from 5,000 to 10,000 and gains 100% of it's value.
Wait, think about that for a minute. In the normal world having the ability to gain double digit gains, per year, is considered excellent.
If you are confident that an upward cycle will eventually happen, in a suitable time frame of course, then movement is valuable. If you aren't trading on margin, and you don't have the associated risk, then you can afford to look at each dip in price as an opportunity.
While this may be applicable to the DOW, it is ever more applicable to the Forex markets. If you are trading with little or no margin it's simply a matter of scaling your entry and exit based on price moves. This is very similar to the gridding concept that I posted recently.
However, when the margin is gone the risk is gone. You choose the price range you expect and scale your entry and exit points within it. If you must, you leave some positions in place while you recapitalize to attack another range. In fact, perhaps you simply allocate a set number of dollars per thousand pip trading range. If the price falls into a lower range you simple ante up and play within a lower range -- while your higher range positions provide interest income.
However, keep in mind, it's possible that currency pairs adjust interest rate differential. This could erode or reverse the suitability of holding a pair over a long period of time
Take a mental walk with me...
The DOW falls from 10,000 to 5,0000 and loses 50% of it's value. It returns from 5,000 to 10,000 and gains 100% of it's value.
Wait, think about that for a minute. In the normal world having the ability to gain double digit gains, per year, is considered excellent.
If you are confident that an upward cycle will eventually happen, in a suitable time frame of course, then movement is valuable. If you aren't trading on margin, and you don't have the associated risk, then you can afford to look at each dip in price as an opportunity.
While this may be applicable to the DOW, it is ever more applicable to the Forex markets. If you are trading with little or no margin it's simply a matter of scaling your entry and exit based on price moves. This is very similar to the gridding concept that I posted recently.
However, when the margin is gone the risk is gone. You choose the price range you expect and scale your entry and exit points within it. If you must, you leave some positions in place while you recapitalize to attack another range. In fact, perhaps you simply allocate a set number of dollars per thousand pip trading range. If the price falls into a lower range you simple ante up and play within a lower range -- while your higher range positions provide interest income.
However, keep in mind, it's possible that currency pairs adjust interest rate differential. This could erode or reverse the suitability of holding a pair over a long period of time
MT4 EA: Average Position Based Trading
While I don't have any pictures to show, yet, I am working on an EA that trades AUDJPY based on the market price relative to the average price of positions held.
The first few passes at this type of system were pitiful. My testing starts from September of last year to now while only opening long positions. As you can imagine this is a difficult period of time for a long only system!
However, late last night I was able to complete a test that showed profits.
The strategy behind this EA is basically as follows:
If you've just seen a recent downward movement open an initial position.
If the price is high enough above or below your average order open price, open another.
If the current price is above your average price close your lowest and most profitable position.
Try not to open any position while in a downward movement regardless of the above rules.
Obviously, the last item mentioned is not simple, but it is the key to account survival. If you open too many positions and the market falls too far you will get a margin call.
As ever, I'm basically using the AUDJPY for this. I am interested in strategies that can accumulate a safe quantity of long positions such that they pay me to wait for the eventual upturn.
I'll provide updates once/if I'm able to get appropriate results.
... continuing ...
Here's a chart showing this:
Notice the wicked looking draw down during challenging periods of AUDJPY decline?
The first few passes at this type of system were pitiful. My testing starts from September of last year to now while only opening long positions. As you can imagine this is a difficult period of time for a long only system!
However, late last night I was able to complete a test that showed profits.
The strategy behind this EA is basically as follows:
If you've just seen a recent downward movement open an initial position.
If the price is high enough above or below your average order open price, open another.
If the current price is above your average price close your lowest and most profitable position.
Try not to open any position while in a downward movement regardless of the above rules.
Obviously, the last item mentioned is not simple, but it is the key to account survival. If you open too many positions and the market falls too far you will get a margin call.
As ever, I'm basically using the AUDJPY for this. I am interested in strategies that can accumulate a safe quantity of long positions such that they pay me to wait for the eventual upturn.
I'll provide updates once/if I'm able to get appropriate results.
... continuing ...
Here's a chart showing this:
Notice the wicked looking draw down during challenging periods of AUDJPY decline?
Thursday, March 26, 2009
Trading Currency Through Online Forex Brokers
Access to foreign exchange (forex), the most extensive market on the planet, is generally through an intermediary known as a forex broker. Similar to a stock broker, these agents can also provide advice on forex trading strategies. This advice to clients often extends to technical analysis and research approaches designed to improve client forex trading performance.
Financial institutions are generally the most influential in the forex market through high-volume, large-value forex currency transactions. Historically, banks enjoyed monopolistic access to the forex markets, but through the Internet, any forex speculator can also enjoy 24 hour access to the market via a forex broker.
Secure web connections today allow many forex traders to work from home, where ready access to news and other technical advice informs decisions on what forex positions to take. Similar moves are being made by stock brokers, who are also moving out of banks and other traditional institutions.
Your needs in the market will influence your choice of forex broker. Online forex brokerage firms, known as houses, provide those new to the forex market with detailed research, advice and simulators to learn how to use their forex trading tools. The experienced online forex trader is catered to by other broking houses, with in-depth advice, but less focus on forex trading instruction based on the assumption that you are familiar with the forex market. To make an informed choice, it is advisable to trial several differing online forex broking houses and their trading tools to find the best fit for your needs.
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