AsthaTrade offers a demat and trading account facility with zero account opening charge and attractive brokerage offers. Open an account online in a few minutes seamlessly, no physical paperwork!
What is Currency trading?
Currency trading is the buying and selling of currencies to earn profit from their price movements. Similar to stock trading, forex trading can be done online through online trading portals or apps through registered brokers.
How does it work?
Currency or forex trading is done at forex markets where different currencies are traded. In India, currency derivatives like futures and options are traded through authorised exchanges.
There is no physical market for forex trading and trading is done electronically across different world markets round the clock Mon-Fri.
Benefits of Trading in
Currency in AsthaTrdae
Currency trading does not attract STT or CTT charges thus bringing the overall cost down compared to other securities.
Currency markets have high liquidity due to global participants and continuous trading across time zones. Due to this, currency trading carries comparatively lower risk.
Forex market is wide with participants from across geographies. Traders can trade round the clock since currencies can be traded across international exchanges that operate round the clock in different time zones.
Smaller Lot Size
The lot size in currencies is smaller and lower value; anyone can trade in currencies with small capital. Even beginners who do not want to allocate high initial investment can trade in currencies with small capital.
Multiple Currency Pairs
There are a wide array of currency pairs available to trade where traders take speculative calls on the strength and fluctuations in currencies of different economies.
Hedge with other instruments
Traders hedge their risk in other investments with forex or hedge one currency pair against another to cover risk.
How AsthaTrade Dock Works
Rate of Inflation
Rate of Inflation: An economy with low
inflation rate will
have stronger currency and a high
inflation will result in currency
When interest rates are high in an
economy, there is higher inflow of forex
economy, thus strengthening
If there is political instability and
uncertainty in an country, it is less
attractive for foreign capital inflow and
likely to have higher imports with
unstable industry, leading to currency
During a recession, the interest
usually low, resulting in
less inflow of forex and thus
Fiscal deficit means higher imports
than exports that impacts the
currency. Similarly, high
government debt implies higher
interest payments and lower forex
inflow, this weakening the currency.