Forex trading in kenya answers

Leverage allows you to trade with more money than you have in your account, but it also increases your risk of loss. Use caution when choosing a broker and make sure you understand the risks involved. Open the trading account Make sure you choose a broker with a free demo account so that you can practice and get comfortable with their platform. Learn about the various order types, how to open and close positions, use technical indicators, etc.

Choose a trading platform You need a trading platform to trade currency pairs and make profitable deals. There are different types of them, each with its own unique features. The most popular ones include Metatrader 4 and 5, as well as NinjaTrader. In addition, you can always do your research before choosing a platform and starting the trading process.

Manage the risks When trading, you should practice risk management principles to ensure you can continue trading another day, even after sustaining a losing streak. There are rules for protecting your downside, ensuring profits are realized, and determining an appropriate size for your position. By following them, you can trade more confidently and successfully. Place trades Right after picking a broker and a platform to trade, you can start the process by placing your first trade.

Make sure the risks are under control and start things. Conclusion Forex trading can be a profitable business for those who are willing to learn the ropes and put in the time and effort to practice. However, foreign brokers especially those licensed from island nations such as the Bahamas, Panama, etc. There is a prevalent rise in clone brokers, they disguise as regulated brokers with a good name; robbing innocent Africans of their money.

Unregulated and poorly regulated brokers attract retail traders by offering them excessive leverage ratios. Leverage allows a trader to open a big trade position with little funds. This means that the broker borrows the trader funds to trade, and gets a refund after the position is closed.

In Australia and Europe, leverage ratios are restricted by the government to between and However, in Africa, these same brokers can offer clients leverage as high as However you can also record losses 1, times your initial deposit. High leverage can lead to increased profit. However, if a loss is made, it can be disastrous because you may end up owing your broker. The higher the leverage ratio, the riskier the trade.

Asides from an excessive leverage ratio, forex brokers operating in Africa, engage in rigorous advertisement, encouraging people to trade without informing them of the associated risks. They offer bonuses on any amount you deposit, which entices the public to invest with them.

While regulated brokers in developed nations are forced to display the statistics of losses on their websites, this doesn't apply to them when they operate in Africa. Investor Compensation Funds usually pay some form of compensation to a trader when he loses money, but this is when you trade with a broker regulated by your home country.

The Securities and Exchange Commission SEC of Nigeria has advised the public to abstain from retail forex trading as it is not regulated by them and may be subject to abuse in the country. Retail traders using foreign forex brokers have a lot to lose whilst trading.

Limited Trading Instruments Another way of trading forex is via currency derivatives. Futures and options are popular derivatives. Firstly a currency futures contract gives you the right to buy or sell a fixed amount of currency, at a fixed price at a specified future date.

Secondly, a currency option gives you the right but not the obligation to buy or sell a currency futures contract at a fixed strike price and fixed future date. If you fear the exchange rate of a currency will fall in future, you can buy a put option that gives you the right to sell.

However, if you fear it will rise you can buy a call option that gives you the right to buy without any obligation. Options are derivative contracts and can be used to hedge risk and for speculation. If retail forex trading were regulated across Africa, it would necessitate the need for exchanges in Africa to start offering currency derivatives. Traders can lose more than their capital Negative Balance Protection means that you can't lose the money borrowed to you by your broker.

You can only lose your initial margin contribution, should a trade go against your favour. When your margin falls below the maintenance margin level, a margin call is triggered by the broker. This means you have a leverage of The loss is greater than your initial deposit.

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Day traders buy and sell throughout the trading session, but they close out all positions by the end of the day to avoid the extra risk incurred when taking overnight positions. Swing trading: This strategy is based on entering and exiting the market based on momentum technical indicators. The strategy has no time constraints, so swing traders may take overnight positions. The strategy calls for identifying movements called trends and then establishing currency positions that follow the trend until it concludes.

Source: XE. The Kenyan shilling is divided into smaller units known as cents. If you do decide to develop your own trading plan, your forex trading success depends in large part on how well your strategy performs and whether you have the discipline to follow it within the overall scope of your trading plan. Any successful strategy can be incorporated into a trading plan, whether you prefer to trade trends for long-term profits or scalp the market intraday.

Keep in mind that many strategies might initially seem to work well but that they may eventually yield lackluster results due to changing market conditions. All brokers operating in Kenya that provide access to the forex market must be authorized and regulated by the CMA.

Select from among the well-regulated brokers listed below to find the best online brokerage available to Kenyan forex traders. More Details. Throughout his experience within the financial fields, Obegi has been able to develop an automated Forex trading system which is unbelievably lucrative. Obegi is the Director of the Nairobi School of Forex, where he shares his knowledge of the Forex trading system and automated tools he developed. Joshua Matumo Joshua Matumo is the founder and managing director of a company called Fourth street Consultants.

Matumo began his trading career in at Strathmore University and specializes in trading currencies as well as commodities. Joshua Matumo is known to be excellent when it comes to risk management and professional market analysis alike. Fourth street Consultants also offers consultations and comprehensive courses on Forex trading.

Kamau works as a banker aside from trading. Forex trading has allowed Kamau to earn an extra income alongside his traditional day job. Kamau is still seen as a newbie in Forex trading, but the progress made on the path of becoming one of the most famous Forex traders in Kenya is without a doubt amazing.

For two years Sylvia found, read and learned as much as possible on how to become a successful forex trader in Kenya. Muchai signed up to multiple online trading courses, opened numerous demo accounts, and attended trading seminars both on and offline. Patrick Mahinge Patrick Mahinge can best be described as a serial webpreneur who started trading forex in Mahinge does not hold any academic qualifications in finance and studied Journalism at Egerton University.

Eight years ago, after failing to secure a formal employment, he started looking into online forex trading. Patrick Mahinge is the founder of the Kenya Forex Firm, which provides training and portfolio management services for potential forex traders situated in Kenya. He also works as an online blogger and builds new businesses from home. Vincent Nyagaka Vincent Nyagaka is forex trader with over 6 years of experience in the field.

He decided to venture into forex trading after his traditional income was not sufficient, purchasing online courses and learning as much as possible. Nyagaka later founded Benstride where he teaches students on how to trade in Forex. He offers a free beginners forex course and a premium forex course on his site. In order to get started in the Forex Market is relatively easy and requires only a few steps. With this being said, Beginner Traders need to keep in mind, signing up and knowing how the Forex Market works, is two completely different things.

The Following 6 Steps should be taken in order to make a start: Firstly, a trader should invest in a modern device that has the ability to connect to internet. This will be used in order to trade. The device chosen can range from a smartphone or tablet to a laptop or desktop computer.