With the ability to trade rising and falling prices, use leverage and access hundreds of instruments, an ever increasing number of investors are taking advantage of the versatility of trading Forex and CFDs. In this introductory course you will learn how you can place a trade on our Mobile App,WebTrader and MetaTrader platforms.

Please be aware that the following information and examples are for illustration purposes only and should not be considered as trading advice. It’s important to remember you’re merely trading contracts with BDSwiss, not physically trading in the underlying market. This means you don’t actually own the underlying asset. Before investing in these products you should ensure that you understand all the risks involved taking into account your investment objectives and level of experience.

Opening an Account
Once you are ready to start trading, you will need to open a BDSwiss account. You can setup your account and start trading today by following these three steps:

Opening a trading account with BDSwiss takes just a few minutes, deposits are optional and you will be granted immediate access to a virtual $10,000 free demo account to practice trading with.

Just click on the “Sign Up” button and carefully fill in the required fields. Make sure to use a memorable and secure password that you do not share with anyone.

You then need to read and accept the Terms and conditions and verify that you are older than 18+ years of age. Once ready, check the box and hit “Submit”

Click “Continue” to be redirected to your selected regulator and access your personal dashboard.
On your dashboard, you will get an overview of your accounts. You can choose to practice trading on our free demo account or deposit to trade with real funds.

Placing a trade on the BDSwiss WebTrader

The BDSwiss WebTrader Platform was exclusively developed in house to deliver an unparalleled trading experience, it does not require downloading and can be accessed directly on your dashboard.

How to place a trade:
STEP 1: Launch the WebTrader
On your dashboard, select the Account you would like to trade with and click on “Trade Now”. You will be automatically redirected to the BDSwiss WebTrader

STEP 2: Define the Size Your Position
You then need to select the asset you wish to trade from the available categories or by using the search bar. Once you have studied the chart and you are ready to place your trade just select BUY or SELL. The order window on the right side of the page should show your selected asset and whether you are buying or selling. Assuming that you wish to place a trade on the EUR/USD pair, your position size will appear under “Amount” in euro. You can adjust your position size either by clicking directly on the amount field or by using the “+” and “-” tools.

Once you have determined the size of your position, you can also choose to determine at which maximum profit or loss your position will automatically be closed by ticking and modifying the Take Profit and Stop Loss tabs.

STEP 3: Place Your Trade
Once you have adjusted your position, simply click “Place Trade” to open it. A confirmation will appear and you can then click on the positions icon to view your OPEN and CLOSED positions.

If the price moves in the direction you anticipated, you will make a profit

If the price moves in the opposite direction, you will incur a loss.

You can keep your position open for as long as you wish, provided that you have enough available balance. Keep in mind that profits and Losses are realised only when the position is closed.

The Forex market is the largest, most liquid market on the planet. Combined with a highly volatile and extremely competitive CFD market, the FX/CFD industry has attracted massive attention and an ever increasing number of individual investors. Unsurprisingly, trading activity of that size and scope creates unique challenges regarding market regulation.

How is the Forex market regulated?
In an industry so liquid and lucrative, it is essential to have strong regulatory oversight to prevent malpractice. It is important to understand that there is no centralized body governing the currency trading market. Instead, there are a number of governmental and independent bodies that supervise forex trading around the world. These supervisory authorities regulate forex by setting standards which all brokers under their jurisdiction have to comply with. These standards ensure that Forex/CFD trading is ethical and fair for all parties involved.

As the largest and most liquid financial market in the world, the Forex/CFD market is regulated by the same regulating bodies that supervise banks and other financial institutions. The only difference however, is that these regulators can only regulate the Forex market domestically within their jurisdiction. It’s therefore very important for retail traders to look for brokers that obtain regulation which covers the jurisdiction where the trader resides.

What regulation means for traders
With Forex brokers supervised by a regulatory authority investors can be more confident about the credibility of the broker. For a retail trader, the biggest risk of trading with a non-regulated broker is that of illegal activity or schemes. Fraudulent activities include excessive commissions; very lose spreads, hidden Terms and Conditions and even restrictions on withdrawals. Regulatory authorities can provide a level of protection for investors as they can be trusted to restrict, sanction or ban such unwarranted actions and to safeguard investors.

Choosing a Regulated Broker
Trading with a regulated broker should be one of the main prerequisites for any individual trader looking to trade forex and CFDs. The fact that a broker is regulated implies that they respect industry standards. A regulated broker not only follows Forex regulation that is aligned with the clients’ best interests, but also offers safety, reliability, and security.
The biggest advantage of trading with a regulated forex/CFD broker is that a financial authority will step in if there are any problems. A broker that is regulated by a financial authority also offers segregated funds, meaning that your funds are not being used for any purposes other than trading. Traders’ funds are held in segregated accounts and cannot be used by the brokerage. What is more, a regulated broker will build its business around its clients and it is more likely to have outstanding customer satisfaction as well as a customer oriented service.

Regulatory Authorities around the world
The following table includes a list of the most important Regulatory Authorities across the globe.

In addition to the above regulatory agencies, the European Union obligates each member to be responsible for the regulation of its financial markets and conform with the E.U.’s Markets in Financial Instruments Directive or MiFID. This also allows for companies regulated in one E.U. member country to service customers in other E.U. member nations.

As trading innovation continues to expand, BDSwiss provides an ever increasing number of tradable assets to its client base. In the course that follows, you’ll learn all the different characteristics of each asset class when it comes to our Forex and CFD product offering.

1. Forex / Currency Pairs

Also known as Forex or FX, the currency markets involve the constant exchange of currencies between banks and other market participants. The foreign exchange market is the world’s largest asset class and the most liquid with a daily trading volume of over $5 trillion.

On our platform, you can trade Forex and CFDs on a wide variety of currency pairs including all major, as well as minor pairs. All currencies have a three letter code; the US dollar for example is quoted as the USD.  Currencies are always quoted in pairs; the value of a currency pair is always set in relation to one member of the pair.  For example GBP/USD is the value of US dollar to the pound. The currency markets, unlike many other markets, are open 24 hours a day, 5 days a week.

Example:
The price of the EUR/USD is at 1.10165 on January 8th 2018 at 13:41. At this point in time for one EUR (Euro) you receive $1.10165 (dollars). You will always receive the price in the second currency for every unit of the first currency.

Trading Info
If the US Federal Reserve (FED) votes to change the nation’s key interest rates, this can affect the value of the U.S. dollar. When the Federal Reserve increases the federal funds rate for example, it normally reduces inflationary pressure and works to appreciate the dollar. The Federal Reserve (FED) discusses key interest rates and overall monetary policy each month.

2. Commodities CFDs

The term “commodities” refers to natural resources that are derived from nature. These are mostly used as raw material for other products. In this sense, commodities are resources that are eventually consumed, for example oil or gold. Each commodity market will have its own particular cycles, determined by supply and demand.

What are Contracts for Difference?
Before we delve further into commodities and other CFD asset classes it is important to explain what CFDs are. Contracts for difference (CFDs) are derivative products which enable you to trade on the price movement of underlying financial assets (such as commodities).

A CFD is an agreement to exchange the difference in the value of an asset from the time the contract is opened until the time at which it’s closed. What is really important to understand is that when trading a CFD you never actually own the asset or instrument you have chosen to trade, but you can still benefit if the market moves in your favour, or make a loss should the market move against you.

On our platforms, you can trade CFDs on the most world’s most popular commodities. The most common of these are gold and oil, and these two have a very important thing in common: At some point in history, people selected a specific weight and currency at which these would be traded.

Example:
Oil and specifically crude oil, which is pumped directly from the ground refers to a lot size called barrel, which corresponds to an amount of 159 litters and is valued in USD (US dollars).

Trading Info
If a tanker ship, carrying 400,000 litters of oil, sinks, it causes a major environmental disaster. The sea will be vastly polluted and oil-coated marine animals will be featured on TV. As tragic as this news might be for nature, the financial market will process it. Viewed objectively, this amount of oil wasted in the ocean is now gone, which means that oil supply falls short. Limited supply can cause the price of crude oil to rise and thus create a trading opportunity for the CFD investor.

3. Indices CFDs

An index (plural indices) always represents a particular market and measures the collective price performance of a group of Shares, usually from a particular country. Indices are often used to track and compare the performance of stock markets.

This of course implies the performance of each index is dictated by the performance of the underlying share prices that make up that index. An index is constructed and calculated independently, sometimes by a bank or by a specialist index provider like the FTSE Group. The choice of the companies included in the index is determined by index calculation rules or by a committee. Not all indices use the same rules, however.

A benchmark index is the index most commonly used to track where a particular market is heading. On BDSwiss trading platforms, you have the ability to trade your preferred market through indices. A few of our main benchmark indices include:

• The Dow – the Dow Jones Industrial Average, the original stock market index, was created by Charles Dow in 1884. It follows the price of the 30 biggest companies on the New York Stock Exchange.
• Standard & Poor’s 500 (S&P 500) – this is the most widely tracked measure of the US stock market. It tracks the prices of the biggest 500 companies listed on the New York Stock Exchange and the NASDAQ.
• FTSE 100 – launched in 1984, the FTSE tracks the prices of the biggest companies by market capitalisation listed on the London Stock Exchange.
• Euro Stoxx 50 – this index was created to follow the prices of the biggest 50 shares in the Eurozone countries.
• DAX – founded in 1988, the DAX follows the shares of the largest 30 companies listed on the Frankfurt Stock Exchange.

What moves indices?
Indices tend to be affected by broader market moves which can determine the price of many companies. Typical examples include political unrest or uncertainty, national inflation statistics or unemployment numbers or changes to interest rates.

Example
A very popular index among BDSwiss customers is the German stock index, commonly known as the DAX. It contains the 30 largest companies in Germany. If the U.S. imposes new tariffs on German goods, these companies will inevitably suffer the consequences, causing the DAX to plummet on the news.

Trading Info
Most German companies are exporters, i.e. they generate their profits mainly outside of Germany. A weak euro causes better conversion rates on goods sold abroad. Sales increase, along with profits and the total value of the company. Generally speaking, the weaker the Euro gets, the more the DAX is expected to rise.

4. Stocks CFDs

A stock price reflects the value of an investment in a company. This is determined by dividing the total value of the company by the total number of shares issued. The fluctuation in the market is mainly determined by supply and demand. Corporate data will also have a significant influence on stock value.
It is important to remember that when you enter stock CFD trade you don’t buy the stock itself but instead agree a contract with the broker to settle the difference in value between the entry and exit price of the Stock. With CFDs you can sell shares as easily as buying them, allowing you to take advantage of price moves even in a falling market.

Example:
Let’s assume that Coca Cola (stock) was trading at a price of €36.195 and in sum, the Coca Cola Company has issued 4.39 billion shares. This is the maximum number of shares available for purchase. If one stock is worth € 36.195, then the entire Coca-Cola Company will be worth a total of €158.9 billion.

Trading Info
Apple presents their new products at the beginning of September. Both on the official “Announcement Day”, and on following days, the stock price of Apple tends to be volatile. The customers process the impressions and form an opinion as to whether the new products are good or bad. A sensational release is therefore very likely to push APPL share prices higher. On the contrary, a disappointing release will dampen demand for the product and can push APPL lower.

5. Cryptocurrency CFDs

A cryptocurrency is a digital or virtual currency designed to work as a medium of exchange. Cryptocurrencies operate independently of banks and governments, but can still be exchanged, or in this case speculated on, just like any physical currency. Digital currencies use cryptography to secure and verify transactions as well as to control the creation of new units.

BDSwiss allows you to speculate on the value of a number of leading cryptocurrencies without owning them via CFD trading. Cryptocurrency CFD pairs are traded in much the same way as forex pairs, meaning that there is always a quote and a base currency in each pair. With BDSwiss you can trade all the major cryptocurrencies including Ripple, NEO, Dashcoin, OmiseGO, Zcash, EOS, Iota, Monero, Bitcoin Cash, Bitcoin, Ethereum and Litecoin against a number of fiat currencies such as the EUR and the USD.

Example:
Let’s assume that you wish to invest in Bitcoin because you think its price is about to appreciate. You then need to consider how BTC will fare against the EUR or the USD. If the euro is performing well on the day for example, this could mean that bitcoin’s increase will not be as dramatic relative to a strong euro. So let’s assume that  you instead choose to trade BTCUSD, because you think bitcoin will fare better against the USD. If BTCUSD climbs you will profit, if BTCUSD drops then you will suffer a loss.

Trading Info
Media hype can easily lead to an increase in cryptocurrency price, while negative news can lead to a decline in their value. For instance, news that scare bitcoin users such as breaches in blockchain’s security or funds stolen from bitcoin wallets can cause BTC prices to drop as investors lose their trust in the cryptocurrency. On the flip side, when governments adopt Bitcoin or state that it can be regulated, BTC prices tend to rally.

A CFD is also known as a contract for difference. It is a derivative product with an underlying asset as its basis. CFDs enable you to trade on the price movement of underlying financial assets (such as indices, shares, cryptocurrencies and commodities).

A CFD functions as an agreement to exchange the difference in the value of an asset from the time the contract is opened until the time at which it’s closed. It is important to note that with a CFD you never actually own the asset or instrument you have chosen to trade, but you can still benefit if the market moves in your favour, or make a loss should the market move against you.
In this way, a CFD allows you to trade nearly every underlying asset including those which are considered “rare” or nearly impossible to trade. An index, for example, contains a large number of different stocks, which would normally require a very large capital outlay to own. CFDs offer you the opportunity to speculate on the price of such an index without having to invest a large amount of capital. Instead, you choose exactly how much you would like to invest and your profits or losses are also relative to the volume of your position.
Once you close your position, the profit or loss is calculated by determining the difference in position opening and closing price of the underlying asset. The more the underlying asset moves in your anticipated direction, the more you can profit and vice versa.

How does it work?
A CFD is a leveraged product, which means you only pay a margin (collateral), which corresponds to a fraction of the actual position value. Using leverage also means that you only need to deposit a small percentage of the full value of the trade in order to open a position. This is called ‘trading on margin’. While trading on margin allows you to magnify your returns, losses will also be magnified as they are based on the full value of the position.
Leverage essentially enables you to reap the profits or suffer of trading with larger volumes with little capital outlay. This also implies that small price movements can create high profits as well as high losses.

Placing a CFD Position
Before opening a CFD position, you first need to decide if you want to invest in rising or falling prices for the underlying asset. Once you open a CFD position, the price change will be determined. At closing the difference between the price at the opening of the position and the price at the closing of the position will be calculated.

The difference multiplied by your traded volume determines your profit or loss, depending on if it has been set for falling or rising. It is also important to note that unless you are trading a futures contract on certain commodities, CFDs have no expiration time.

Lots and Pips
A CFD is always calculated in contract sizes. This contract size illustrates the extent to which an asset is traded. A standard contract also referred to as a Lot, for the EUR/USD currency pair is equivalent to a volume of $100,000. The next important step is to know the value of a Pip. A Pip is the smallest accountable value of the underlying asset. For the EUR/USD currency pair a Pip has an value of 0.0001.

Profit and Loss
The exact profit or loss is dependent on both the price and the contract size. Whenever you trade a CFD you are dealing with high volumes, which are calculated according to this formula:

Bid/Ask price * Contract size * Number of contracts

Let’s assume for example that you want to open a position on a falling EUR/USD price with one standard lot, this would mean the following position value: $1.09715 * $100,000 * 1 = $109,715. In order to open any position, you must have a certain balance in your trading account. When opening a position a security deposit will be deducted from your account balance, this is the so-called Margin.

For the EUR/USD position it is calculated with 1% of the position value. This means for the example above, you would need to have a security deposit of $1,097.15; this amount must be available in your trading account.

In case of win
Assuming that the market moves in the way that you anticipated. The EUR/USD price falls to a new level of $1.09153/$1.09161. You opened a position on a falling price, meaning you had to sell the EUR/USD first and buy it back now to close the position. Therefore, for you, the asking price of $1.09161 is important. With a CFD the difference between the positions is used for the pay-out. Meaning that your position for this price has a current value of: $1.09161 * $100,000 * 1 = $109,161

Since you seemingly have opened a position on a falling exchange rate, the calculation of your profits would be as follows: Entry price – Exit price = Profit = $109,715 – $109,161 = $554

Upon closing this position, $544.00 will be credited to your account. In addition, your initial security deposit  (Margin) $1,097.15 will also be made available again.

In case of loss
In this case scenario, the market moves counter to what you predicted. The EUR/USD exchange rate rises to a new level of $1.10248/$1.10256. Again here the asking price is important. The asking price is now $1.10256 giving your position a value of: 1.10256 * $100,000 * 1 = $110,256

Your loss would be calculated using the following formula: Entry price – Exit price = Loss = $109.715 – $110.256 = -$541

Keep in mind that since you had already set aside a security deposit of $1,097.15 from which your loss on this position would be deducted so the difference of $556.15 would then be returned to your account.

Currency trading is the most liquid and robust market in the world. In fact, no other market can compare to the sheer value of this massively traded market. The forex or foreign exchange market is a global decentralized market for the trading of currencies.

When trading currency pairs, you’re effectively buying one currency and selling the other currency. Let’s take a simple example to illustrate how this works: the EUR/USD is a commonly traded currency pair. The EUR is the symbol for the Euro and the USD is the symbol for the US Dollar. In the above currency pair, the EUR is referred to as the base currency and the USD is referred to as the quote currency. The ratio is actually viewed as a single unit, even though it refers to 2 individual currencies. In other words, you trade the EUR/USD as a currency pair – not the EUR or the USD.

For example, a quote of EUR/USD of 1.10 means that 1 euro buys 1.10 U.S. dollars. A rise of the quote of EUR/USD to 1.20, means that now 1 euro buys 1.20 U.S. dollars. In this situation, the euro became stronger and the dollar weaker. The goal of a forex trader is to anticipate the rise or fall of a currency’s value, in order to buy or sell that currency.

Major World Currency Pairs
There are many currencies being used around the world, but just a few are considered “major” currencies which when combined form the “major” pairs. There are six most traded forex pairs in the market, these include:

EUR/USD: The euro and the U.S. dollar.
USD/JPY: The U.S. dollar and the Japanese yen.
GBP/USD: The British pound sterling and the U.S. dollar.
USD/CHF: The U.S. dollar and the Swiss franc.

As you can see, all currencies listed above are used in developed economies, as they make up the highest share of the world trade, which makes these currencies the most traded in the world.

Minor and Exotic Pairs
Minor Pairs are those currency pairs that are less traded than major currency pairs. They are also less liquid than and they often have wider spreads. As a general rule, minor currency pairs are any pairs other than the six major currency pairs listed above. Exotic currency pairs typically include a currency from an emerging market country. The reason that they are called exotic currency pairs has nothing to do with the location of the country, but rather the additional challenges involved in trading these currency pairs. Just like minor pairs, exotic currency pairs also feature wider spreads and fewer market-makers.

Currency Value Fluctuations
Usually, currency pairs don’t fluctuate that much. Most pairs will move less than 1% daily, making forex one of the least volatile financial markets. Liquidity in the forex market however is extremely deep, so if you decide to buy or sell currency, it will take you milliseconds to do so. That’s why a relatively high leverage ratio is made available when trading forex. Leverage can increase the value of potential gains from small movements but also increase the risk of higher losses.

What Moves a Currency?
Currency values can change quickly and for many reasons. Sometimes it’s a reaction to external political and economic news, such as Great Britain’s exit from the European Union. Other times, the market itself drives value changes. Oftentimes, both external and internal events can drive currency value changes and it’s a trader’s ability to accurately forecast those changes that can create profits or losses.

A currency pair is mathematically a division or a fraction. We describe the pair EUR/USD, as Euro divided by US Dollar. Positive news about the Euro, for example, unexpectedly high inflation in Europe, would raise the value of the Euro.

On the other hand, positive news for the US dollar would raise the value of the USD. As the second currency in the currency pair, this would lead to a negative performance in the EUR/USD rate.
Other factors like interest rates, new economic data from the largest countries and geopolitical tensions, are just a few of the events that may affect currency prices. BDSwiss’ free Economic Calendar will give you a chronological ordering of all the important financial announcements and data releases in the upcoming weeks, allowing you to keep track of events that can affect the financial markets.

On our Economic Calendar you can find when the world’s biggest financial announcements will take place as well as what the projected value will be. You also have the ability to filter your results based on date, preference, country and/or importance.

Why you should pay attention to the time?
In general, currencies are traded 24 hours a day, but not every currency is always traded in the same volume. Traders around the globe tend to trade in their local/national currency as these are the most familiar to them and they have a certain affinity for it. For this reason, a Japanese trader would most likely prefer a currency pair that contains the JPY (Japanese Yen), whereas an American would tend towards pairs that contain the USD (US Dollar). This favouritism can also be seen as a time factor, as local currencies are more highly traded during standard trading hours.

Other traders can use this knowledge to their advantage and looks for currency pairs which are NOT affected by this time factor. Currency pairs that are only being influenced make it easier to speculate on their direction because you will only need to factor in what can be affecting one of the currencies in the pair.

Understanding the risks
Finally, it cannot be stressed enough that trading foreign exchange on margin carries a high level of risk, and may not be suitable for everyone. Before deciding to trade foreign exchange or any other CFD product you should carefully consider your investment objectives, level of experience, and risk appetite.