KSE-100 index unchanged

KARACHI (December 03 2008): Trading at Karachi share market improved further on Tuesday. However, KSE-100 index remained unchanged. Some activity in second-tier stocks supported the all share index to close in positive at 6,641.75 points, up by 0.08 points. Trading volume at ready market increased to 197,300 shares as compared to 102,900 shares traded a day earlier. No trading was witnessed at the futures counter.Out of the total 11 active scrips, five closed in positive and one in negative while the value of five scrips remained unchanged. "Some positive signals regarding availability of market stabilisation fund and removal of floor invited some buying in second-tier stocks. However, majority of market players stayed on sidelines, opting 'wait and see' policy", analysts said.National Assets was the volume leader with 159,000 shares and gained Re. 0.04 to close at Re. 0.44. Pak Com Leasing closed at Re. 0.56, up by Re. 0.01 with 28,500 shares. Pak Datacom increased by Rs 2.44 to close at Rs 51.41 with 3,200 shares.Sitara Energy gained Re. 0.97 to close at Rs 19.62 with 2,000 shares. Mod Al-Mali lost Re. 0.50 to close at Rs 2.25 with 1,500 shares. Southern Electric increased by Re. 0.05 to close at Rs 3.65 with 1,000 shares. KESC remained unchanged at Rs 3.80 with 500 shares. Chashma Sugar closed at Rs 5.70 without any change, with 500 shares.Japan Power remained unchanged at Rs 4.50 with 500 shares. Millat Tractors closed at Rs 163.92 without any change with 400 shares. Pak Datacom was the highest gainer and gained Rs 2.44 to close at Rs 51.41, while Mod Al-Mali was the worst loser and lost Re 0.50 to close at Rs 2.25

Forex - Investment Management Firms

Investment management firms (who typically manage large accounts on behalf of customers such as pension funds and endowments) use the foreign exchange market to facilitate transactions in foreign securities. For example, an investment manager bearing an international equity portfolio needs to purchase and sell several pairs of foreign currencies to pay for foreign securities purchases.

Some investment management firms also have more speculative specialist currency overlay operations, which manage clients' currency exposures with the aim of generating profits as well as limiting risk. Whilst the number of this type of specialist firms is quite small, many have a large value of assets under management (AUM), and hence can generate large trades.

Forex - Central Banks

National central banks play an important role in the foreign exchange markets. They try to control the money supply, inflation, and/or interest rates and often have official or unofficial target rates for their currencies. They can use their often substantial foreign exchange reserves to stabilize the market. Milton Friedman argued that the best stabilization strategy would be for central banks to buy when the exchange rate is too low, and to sell when the rate is too high — that is, to trade for a profit based on their more precise information. Nevertheless, the effectiveness of central bank "stabilizing speculation" is doubtful because central banks do not go bankrupt if they make large losses, like other traders would, and there is no convincing evidence that they do make a profit trading.

The mere expectation or rumor of central bank intervention might be enough to stabilize a currency, but aggressive intervention might be used several times each year in countries with a dirty float currency regime. Central banks do not always achieve their objectives. The combined resources of the market can easily overwhelm any central bank.Several scenarios of this nature were seen in the 1992–93 ERM collapse, and in more recent times in Southeast Asia.

Forex - Currency Future

Forex - Currency Future

A currency future, also FX future or foreign exchange future, is a futures contract to exchange one currency for another at a specified date in the future at a price (exchange rate) that is fixed on the purchase date. Typically, one of the currencies is the US dollar. The price of a future is then in terms of US dollars per unit of other currency. This can be different from the standard way of quoting in the spot foreign exchange markets. The trade unit of each contract is then a certain amount of other currency, for instance €125,000. Most contracts have physical delivery, so for those held at the end of the last trading day, actual payments are made in each currency. However, most contracts are closed out before that. Investors can close out the contract at any time prior to the contract's delivery date.

Forex - Currency Pair

A currency pair depicts a quotation of two different currencies. The first currency in the pair is the base currency or transaction currency. The second currency in the pair is labelled quote currency, payment currency or counter currency. Such a quotation depicts how many units of the counter currency are needed to buy one unit of the base currency.

For example the quotation EUR/USD 1.2500 means that one euro is exchanged for 1.25 US dollar. If the quote moves from EUR/USD 1.2500 to EUR/USD 1.2510, the euro is getting stronger and the dollar weaker. On the other hand if the EUR/USD quote moves from 1.2500 to 1.2490 the euro is getting weaker while the dollar is getting stronger.

NEW IN FOREX

Getting Started
Client Terminal is a part of the online trading system. It is installed on the trader's computer and intended for:
receiving quotes and online market analysis
instant execution of orders
managing of open positions and pending orders;
various tools for technical analysis
writing of expert advisors, custom indicators, scripts
testing and optimizing trading strategies
For making a decision to trade, reliable on-line information is necessary. For that, quotes and news are delivered at the terminal in real-time. It is possible to analyze markets using technical indicators and line studies. Moreover, to ensure more flexible control over positions, several order types are built into the terminal allowing maximum flexibility.

Forex - Market Liquidity

Market liquidity is a business, economics or investment term that refers to an asset's ability to be easily converted through an act of buying or selling without causing a significant movement in the price and with minimum loss of value. Money, or cash on hand, is the most liquid asset.An act of exchange of a less liquid asset with a more liquid asset is called liquidation. Liquidity also refers both to that quality of a business which enables it to meet its payment obligations, in terms of possessing sufficient liquid assets; and to such assets themselves

Forex - Forward Contract

Forex - Forward Contract

A forward contract is an agreement between two parties to buy or sell an asset at a specified point of time in the future. The price of the underlying instrument, in whatever form, is paid before control of the instrument changes. This is one of the many forms of buy/sell orders where the time of trade is not the time where the securities themselves are exchanged.

The forward price of such a contract is commonly contrasted with the spot price, which is the price at which the asset changes hands on the spot date. The difference between the spot and the forward price is the forward premium or forward discount, generally considered in the form of a profit or [loss] by the purchasing party.

This process is used in financial operations to hedge risk, as a means of speculation, or to allow a party to take advantage of a quality of the underlying instrument which is time-sensitive

FORIEGN EXCHANGE

The foreign exchange (currency, forex or FX) market is where currency trading takes place. FX transactions typically involve one party purchasing a quantity of one currency in exchange for paying a quantity of another. The FX market is one of the largest and most liquid financial markets in the world, and includes trading between large banks, central banks, currency speculators, corporations, governments, and other institutions. The average daily volume in the global forex and related markets is continuously growing. Traditional turnover was reported to be over US$ 3.2 trillion in April 2007 by the Bank for International Settlement. Since then, the market has continued to grow. According to Euromoney's annual FX Poll, volumes grew a further 41% between 2007 and 2008.

Forex - Electronic Trading

Electronic trading, sometimes called etrading, is a method of trading securities (such as stocks, and bonds), foreign currency, and exchange traded derivatives electronically. It uses information technology to bring together buyers and sellers through electronic media to create a virtual market place. NASDAQ, NYSE Arca and Globex are examples of electronic market places. Exchanges that facilitate electronic trading in the United States are regulated by the Securities and Exchange Commission and are generally called electronic communications networks or ECNs.

Etrading is widely believed to be more reliable than older methods of trade processing, but glitches and cancelled trades do occur.