Bar Chart 

The bar chart records price movements using bars to represent the lowest & highest prices and opening and closing points. The vertical bar end shows the lowest and highest prices, whereas horizontal dashes on the vertical bar’s left indicate the closing price. The dash on the vertical bar’s right shows the closing price. On a daily chart, an individual bar represents 24-hour market movements. 

Candlesticks 

Candlesticks, widely utilized in all trading classes, use match-like setups to signify price actions. Also known as the Japanese sticks, they display the difference between the 24-hour opening and closing prices. 

Green or dashed candles show a higher closing than the opening price. An empty or red rectangle candlestick depicts lower closing prices. A vertical line within the candle body represents the difference between the higher and lowest price on a trading day. 

Line Chart 

A line chart depicts prices as dots on a graph. The rate at which the chart records prices relies on the overall presented periods. For instance, it will include all closing prices for each day if the chart accounts for multiple months. Nonetheless, if the diagram depicts price actions for several years, it will only include weekly or monthly closings. The vertical axis indicates prices, whereas the horizontal one shows time. 

Moreover, monthly and weekly charts compress price movements for longer-range trend evaluation. A seven-day chart can analyze five-year price actions. The technique helps you assess markets from a long-term standpoint – a lucrative perspective that may lack when depending on 24hr timeframes. 

Support & Resistance 

Support and resistance levels are crucial for technical analysis. The former is a value area beneath the current price that can prevent continued declines amid downtrends. Contrarily, resistance is a region beyond the current price that challenges upward actions upon uptrends. Meanwhile, a breached resistance can become a support zone, and vice versa. You can maximize your trading profits using the available charts.

ALSO READ: Forex Scalping: Strategies and methods for beginners

The post Forex Chart Analysis: A Beginner’s Guide to Reading and Understanding Market Data appeared first on Australian Times News.

In this article, we look at the top South African Forex brokers that provide the Volatility 75 index along with good regulation, a wide selection of trading choices, and exceptional customer support.

1.     IG Group

As a reputable and well-respected broker, IG provides a large selection of trading tools and instruments, as well as industry-leading training materials and competitive pricing, making it one of the best Volatility 75 index brokers.

Pros and Cons

Features

2.     Saxo Bank

For traders who can afford the minimum deposit of USD 10,000, Saxo Bank is a great option. Saxo Bank offers over 40,000 different trading options, competitive pricing, amazing trading platforms, brilliant research, and strong customer support.

Pros and Cons

Features

3.     IFX Brokers

IFX Brokers is a South African ECN broker that has been operating since 2018. For as little as $100, South African traders may sign up for a live trading account with IFX Brokers and trade on a variety of international financial markets.

Pros and Cons

Features

4.     AvaTrade

AvaTrade, a global broker with headquarters in Dublin, Ireland, provides a variety of financial products, such as spread betting, CFDs, FX, and social trading.

A trial account is available for customers who want to try using the MT4 forex trading platform before deciding to create an account with AvaTrade, which needs a $250 payment. Both Android and iOS users can download mobile apps from AvaTrade.

AvaTrade offers a large selection of trading accounts, including demos, micro, mini, and standard.

Open a Free Trading Account Now

Pros and Cons

Features

5.     HotForex

HotForex provides six different account types, with the trading rules altering as the minimum deposit rises.

All accounts have variable spreads, however the Zero account has the tightest spreads on foreign currency pairs. A fee is applied based on the volume of trades that are made.

Pros and Cons

Features

Also read: What does the Future of Forex Trading look like?

The post 5 Best Volatility 75 index brokers appeared first on Australian Times News.

Why do people trade?

Let’s look at it this way; forex markets are the largest in the world. This boils down to the dollar value of trading volume. The forex market is also the most liquid financial market. This means that stocks are considered liquid if shares can be bought and sold very quickly, with little to no impact on the actual stock’s price. Furthermore, with the internet, things just catapulted and resulted in more traders coming to the fold. Essentially the average Joe or Jane could trade just as large institutional traders would. The internet is wonderful because it also supplies unlimited access to markets and trading platforms.  

Market liquidity

The most significant reason trading currency is so popular is liquidity; let’s unpack why. This large financial market opens traders up to substantial gains and fast returns. Massive amounts of currency are being traded at any given point, and it is this that supplies the opportunities for liquidity. On the other end, it does open you up to the volatility of the market and some risks, but this is something that can be solved with the correct strategies. Remember that with trading, you need a strategy. And the best traders can vouch for that. 

Accessibility also plays a major part. Since the forex markets are open 24/7, you can trade when it’s convenient for you; another factor that influences its popularity. And since it’s universally accessible, the number of investors, as well as brokers buying and selling, determine the market’s movements. And since trading does not run on a central exchange system, you are trading on a global network. Furthermore, accessibility offers you, the trader, the chance to react to market movements almost instantly and plot your next course of action at that point.  

Leverage

In trading, leverage is defined as borrowing an amount of money needed to invest in something else. With forex, you will see that money is borrowed from a broker. So why does it work? Well, traders, if this is done strategically, can benefit here. Forex offers high leverage because it uses the first margin requirement. This way, traders can both control and build up substantial amounts of money. 

There is power in leveraging, and it is largely due to forex brokers who trade in mini and macro-lots. So, what are they? Let’s start with a mini lot. This is one-tenth of the size of a standard lot, while a micro-lot is one-hundredth of a standard lot. Even when we look at restricted forex trading, the leverage is at 30:1. Here’s an example. Say a trader traded in five micro-lots of EUR/USD with a $5 margin deposit. The deposit can double to a 10-pip move. However, if the market moved by 100 pips in favour of the trader, their $5 deposit would balloon to $50.  

Strategies

The wonderful thing about trading is that you can use strategies. You are encouraged to form your own strategies to maximise your return. Essentially, you will be setting yourself up for success. This adds to the appeal of trading and is one of the reasons for its popularity. But why is that? Think about it this way; when you run a major business, you must have a business plan, as well as a strategy to ensure you are effective in your sector. It is the same for trading. You can also change your strategy depending on the market. Sometimes adjusting your trading strategy offers even more than you thought it would. 

Further to this, technical analysis of the markets is a key driver in making the best possible trading decisions. And more so in the forex environment. Strategies also involve research, such as looking up how interest rates can affect your trading and understanding what is currently trending in the markets. Traders can use charts and indicators to predict trends and price movements. All of this can be analysed against earlier trends. It’s simply a wonderful aspect of trading. 

The post Why trading currency is so popular  appeared first on Australian Times News.

First of all, forex doesn’t have any specific regulations that apply to it. It is unregulated, so people can trade with anyone they want, anywhere they want. Most countries don’t even have a set minimum dollar amount that you need for a successful transaction, which means there’s no need to go to banks or government offices and request a deposit. There’s also no need for forex companies to be registered or regulated. You just need to know how much money you’re willing to invest and be ready to make a deal. Not only that, but with global currency exchange rates and international trades, currency fluctuations are minimal, meaning there’s no need for currency hedging. Finally, forex trading involves no user fees, meaning you have total control of your capital, and it’s yours to do with it how you want.

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With this freedom to choose the trading environment, it makes sense that the forex market will develop fast. In fact, it already seems to be developing at an unprecedented rate, with new brokers and technologies popping up all over the place. Globally, the number of people trading forex has increased exponentially since the early 2000s. With every year of development comes more opportunities, and thus more traders looking to go for it. Furthermore, the number of currencies available for forex trading will continue to grow steadily, thanks to the globalisation of international transactions and the expansion of the Internet. As more new traders are created, the demand for new financial products, such as forex will also continue to increase.

It’s hard to imagine the forex market becoming mainstream without some kind of regulation, which would prevent a lot of fraud and abuse, but international regulations are not very strict. For example, while most central banks in most countries restrict the use of foreign currency for daily transactions, the US has no restrictions at all on its citizens’ ability to use foreign currency for day-to-day transactions, so long as they are not doing so to avoid taxes. So, if you’re a US citizen and you want to buy something on Amazon using dollars, they can just buy it from you and pay you in dollars. But if you want to buy something on eBay using euros, they have to convert euros into dollars first before the transaction can go ahead. Since international regulations are fairly lax, a big part of the forex markets is unregulated.

(https://pixabay.com/illustrations/entrepreneur-begin-start-up-chart-2411763/)

There is also no need to register and be licensed in order to trade forex. All it takes is a computer, a good internet connection and some basic knowledge of the relevant regulations. The biggest advantage, of course, is that you can do it from virtually anywhere, which makes it easy and convenient for everyone. Another advantage of the global nature of the forex market is that, unlike stocks or bonds, you don’t have to worry about which country you will be able to trade in and whether the forex exchange rate will be favourable. 

On top of that, the fact that forex is a highly volatile market is why a lot of traders trade several different pairs at the same time. The best way to get a good return on your trading is to use a forex broker. Brokers allow you to open an account with them, which is essentially a virtual bank account that allows you to deposit funds, withdraw funds from your account, and trade with your money, all from the comfort of your home. They are the perfect solution when you want to invest in the forex market but do not have access to your own personal bank account.

Another important thing to consider when trading forex is that there are no barriers or restrictions on the amount of foreign exchange you can trade. There’s no need to hold any cash aside from the minimum amount to start trading. Because of the reasons stated above, forex continues to be a dynamic and exciting market to be involved in, and it will be interesting to see how it continues to develop in the future.

However, for now, it’s still a very niche market; it still has plenty of room to grow and become more widely used. Forex trading is a fast-paced, fast-growing, but relatively small market compared to the likes of stock and bond markets. In fact, it’s a market with so much potential for growth that it could easily overtake the stock and bond markets. And as a result, it will become a lot more popular and a lot bigger. It’s all a matter of time…

The post What does The Future of Forex Trading look like? appeared first on Australian Times News.

It’s also worth producing a strategy that best suits your preferred trading style, so you can discover what is the best forex trading platform for you, before you open a position on the ever-changing market. 

If you are looking to invest in the Australian dollar (AUD), for example, then you would need to keep up-to-date with relevant news and events, which could affect the currency. 

With this in mind, let us take a look at how the pandemic has affected Australia’s economy, and what this means for the value of the AUD.

Omicron

The World Health Organization (WHO) first stated that COVID-19 was a strain of concern, and declared the start of the global pandemic, back in March 2020. Following this, Australia has seen multiple lockdowns and restrictions, to try and keep the virus under control. 

In December, Australia saw an eruption of Omicron cases – with the new variant significantly slowing down the recovery of their economy, following the peak of the pandemic. 

Naturally, this has had a significant effect on the health of the country’s economy, and in turn, the value of the AU Dollar (AUD). 

Whilst Australia battles to recover from the height of the pandemic, and with an average of 2850 Omicron cases in hospital on 18^th January 2022, many believe that some of the hardest hit states are only just coming down from their peak. 

Due to this, many businesses are facing staff shortages and disrupted supply chains as workers are forced to isolate. On top of this, tourism is at an all-time low, with the country having faced multiple lockdowns — this has heavily impacted the travel, hospitality and entertainment sectors. 

A strong recovery

Prior to the Omicron outbreak – and the lead up to the Christmas period – the economy had made a surprisingly strong recovery. Employment levels had risen faster than expected and previous lockdowns and restrictions were lifted, as well as retail sales surging for the second month in a row. 

With this in mind, as the Omicron variant slows its spread and the nation returns to a bit of normality once again, that the retail, travel and tourism industries will soar – so that the economy will make a speedy recovery. 

However, it will still be a couple of weeks until we know for sure if Australia’s Omicron cases have peaked, and if they are dropping significantly enough for positive change to be made.

The value of the AUD

In December, when the uncertainty of the outbreak hit, the AUD was valued at around 0.54 to the British pound (GBP), a slight decrease in comparison to 0.55 to GBP in November. At the time of writing, in January 2022, the value of the AUD stands at 0.53 to GBP. 

In August 2021, in the midst of lockdowns, the value of the AUD was at 0.52, which then saw a rise in the following months. Looking back at market data from that period in time, there is hope that Australia will follow previous patterns, and continue to make a strong recovery as they come out the other side of the pandemic.

When it comes to forex trading, it’s important to keep an eye on all the different factors that could affect the health of a country’s economy. These include pandemics, political events, natural disasters, physical capital, natural and human resources, and even technology. These are also factors which can boost said economy. 

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If you’re looking to make an investment in a certain company, you’ll discover that recessions have a different impact on different types of stocks. Some of the businesses, during a recession, have outperformed. Others, such as travel companies and industrials, have a tendency to underperform, resulting in a decline in their stock value.

Trading Strategies to Use During a Recession

During recessionary periods, even tiny currencies experience depreciation as governments attempt to mitigate the impact of the recession via quantitative easing measures such as lower base interest rates.

From the perspective of a trader, a recession may also induce risk-averse investors to be more careful in their investments (including large institutions and big banks). Some investors, on the other hand, may see a recession as an opportunity to boost their profits by purchasing currencies at low-interest rates and then selling them once the market starts to recover. 

During a recession, one of the most common strategies to earn money for traders is to sell their stocks short. Selling assets in order to profit from decreasing markets is known as shorting. It is a basic Forex technique for beginners that enables investors to profit from declining markets by selling their assets. In order to use this strategy, investors most frequently start their Forex career with currency trading brokers, which additionally allows traders to use tools for forecasting future price changes. In addition to that, you may speculate on the price variations of an asset without really holding the thing in question.

When the market begins to recover, you may decide to go long. This is particularly true if you make a mistake and the market declines far more than you anticipated. The first rebound, during which many shares will be at their lowest point in many years, will be the time when many traders and investors will decide whether or not to purchase or sell stock. This is the circumstance in which they will purchase at this price in order to gain the most profit from any future recovery after the recession.

In addition to investing directly in stocks, it is feasible to benefit from a post-recession bounce. As a shareholder, you get the ability to vote and to receive dividends. Creating a CFD or spread betting account, as well as a share dealing account, may be used to get started in the financial markets. Hedging your investments is a common approach and stock trading method, and it is especially effective during recessions. In a recessionary environment, traders may choose to explore the use of hedging tactics to protect their positions. The hedging strategy is one of the most often used tactics in the financial industry. If your investment portfolio has a total value of $100,000, it is feasible to take a short position with a value of $100,000 on the market. Because these blue-chip companies are short-term investments, their value should increase even if the general market declines in value. By using indexes, you may be able to save money on a regular basis by avoiding the need to sell your whole stock investment.

It is also feasible to use sector indices as an insurance policy for shares that are specialized to a certain industry. If you want to protect yourself against a portfolio of banking firms, you may use a financial index to do so.

Because losses may be deducted from profits for tax reasons, many investors will employ CFDs as part of a hedging plan to protect their investments.

Investments to Keep an Eye on During a Recession

The equities you should invest in during a recession will be determined by your level of risk tolerance. For traders that are willing to trade both short and long term, there are a variety of options available to them.

It’s not a surprise that during recessions, stocks with cyclical qualities are more likely to suffer. Because of the present economic environment, these companies and sectors are more likely to increase in value when the markets are rising and decrease in value when the markets are deteriorating, respectively. It is possible that cyclical stocks may provide excellent chances to go short during recessions when the markets are falling.

It is common practice to include defensive stocks in one’s investment portfolio to protect one’s assets against risk and market losses. One of the reasons for this is that they are often seen as stocks that are capable of surviving a downturn in economic circumstances. In part as a consequence of their extensive usage, the utility business and the energy sector are always in high demand as commodities. In the case of a recession, defensive stocks may prove to be a wise location to put your money.

The value of speculative stocks may change depending on the current economic environment as well as the performance of a particular company.

Cash-rich stocks, as well as companies with a large amount of cash on hand, may be very dangerous investments. If a firm has a big quantity of cash on hand, this might be a signal of significant sales, particularly if the company’s cash reserves are growing year after year.

Firms that have built up financial reserves will be able to withstand a downturn as long as they are able to use those reserves during a downturn. Most likely, it will be used to keep the company operating during times of low client demand. 

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In the Forex space, another name for the smallest price movement a currency makes is pip (percentage in point), which traders use to measure gains and losses. They usually aim to scalp between 5-10 pips from each position, aiming to make a substantial profit by the end of the day.

How Forex Scalping Works? 

Scalping in forex is a strategy that involves opening and closing multiple positions on one or more Forex pairs throughout a day, usually in seconds or minutes. 

This is not unlike day trading, in which traders will open a position and then close it again during the same trading session, never holding a position overnight or carrying it into another trading period. But while day traders may seek positions once or twice, or even a few times a day, scalpers are much more chaotic and deal with multiple trades during a session. 

While a normal trading session means you trade-off five -and 30-minutes charts, scalpers often trade off of tick charts and one-minute charts. Specifically, some scalpers like to try to “ride” the high-velocity shifts that happen around the time of the release of news and data. 

To start scalping, you will need: 

• An amount of money that you are willing to risk 
• An account on a Forex broker platform (check this list of Forex Brokers accepting US clients) 
• Time that you need to set aside to learn & trade 
• A scalping strategy that works for your personality 

Scalping isn’t for everybody. You have to be perfectly calculated for this risky process. Those who truly succeed at scalping are traders who love sitting in front of the displays for the entire session, and they need to enjoy the intense concentration that it takes. Nothing should distract you when you’re trying to scalp a small move. Even as a highly temperamental person, you must react quickly without overthinking your every move. Consider this: Closing a losing trade can be a psychological battle when you’re scalping because you need to be impulsive and make a decision as the price can always swing in your favor or against. 

• Picking More Volatile Pairs 

Spreads aren’t the only helpful criteria when picking currency pairs for a scalping strategy. Volatility should be top-of-mind criteria as well. Since this trading method seeks quick gains, the market has to move faster to generate those returns. 

Less volatile pairs aren’t fit for scalping since it might take much more time for the rates to move. So instead of a five or ten-minute trade, you might have to wait for an hour or more for the pair to reach the desired level. 

GBP/AUD, GBP/NZD AUD/JPY are some examples of the currency with relatively higher volatility. IN fact, Silver and Gold prices usually also experience a higher degree of variation during trading days. 

• Using Simple Moving Averages 

Following technical indicators used in the Forex scalping strategy, the Exponential Moving Average (EMA) or Simple Moving Average (SMA) can be a very helpful tool for many traders. Depending on your preference, you can use a 5, 10, 50 or even 100 periods EMA or SMA or higher. To do this right, you will need to look at the direction of the moving averages and open positions in accordance with them. Clearly, extended trades might require much more analysis, but in 1 to 15- minutes trades, it might generate some profit. This might not be the best Forex scalping method, but it can work for beginners.

• Following the Bollinger Bands 

This can also be a very handy scalping indicator. Bollinger Band lines indicate that the market is preparing for tight-range trading. Here’s how it works: a trader buys a currency pair that’s very close to the lower bound and sells pairs where the price is near the upper band. 

Obviously, this doesn’t guarantee success in all positions, however, this strategy might help you win the majority of the trades. 

• Choosing Pairs with Lowest Spreads 

Forex scalping strategies aren’t about making generous returns on one or two trades. Scalping is only about small pip gains. 

That said, massive differences between buying and selling prices can easily eat into those margins and take out considerable gains. Therefore, those who are considering how scalping might be more selective about the currencies they wish to trade and Brokers. 

• Look after Support and Resistance 

This might not be your favourite scalping strategy, but it is very simple. It’s similar to the Bollinger Bands technique, but instead of looking at the Bollinger charts, you can just take a look at the support and resistance. 

Fortunately, finding out about those levels isn’t rocket science. Forex news platforms publish 3 support and 3 resistance levels, and more often than not, these levels are considered stronger and more likely to hold the line compared to other ones. 

That said, you can read the latest technical data from the Forex news platforms, then buy currency pairs close to support levels and sell those which trade near resistance. 

Final Thoughts 

Scalping is without question an extremely effective trading style. But it’s important to understand that scalping is hard work. That means you will only be rewarded for quantitative work. The more you perform, the larger the returns will be. In the end, your trading strategy has to match not only your style and abilities but also your personality. 

The post Forex Scalping: Strategies and methods for beginners appeared first on Australian Times News.

Competitive Algorithm For Easy Profits

When using Bitcoin Trader, all the decisions are up to you but you have the choice to let its algorithm do all the work. The algorithm does its job by scanning for times in which it is most recommended to trade.

In this way, you are able to make good educated decisions and make a profitable income. By knowing what the market looks like, you have a better chance at making good profits.

Less work With Bitcoin Trader

While you can rely on the app to make informed decisions for you, it is much better to take the next step and set yourself up for success. By this, I mean creating the settings of the app according to your needs and comfortability.

So how does it work?

Well, you will need to follow three easy steps to get yourself started to one of the best ways to make money. These steps comprise of creating an account, depositing your $250 – that’ll act as your trading currency, and start trading!

Now, It’s as easy as one, two, three! Click here to get started with Bitcoin Trader.

The post Sit Back And Relax While The Bitcoin Trader App Makes Money For You appeared first on Australian Times News.

So, what is the UK opting for when it comes to jewellery? Using Google search data collected between April 2020 and March 2021, we take a look at what terms the UK is searching for the most and least when it comes to silver and gold jewellery preferences. 

REVEALED: The UK’s most searched for jewellery items 

Data reveals there is a tie between the second most adored jewellery items, with several terms accounting for high average monthly search volumes of 40,500. These terms include ‘gold chains for men’, ‘gold earrings’, ‘gold hoop earrings’, ‘gold necklaces’, ‘gold rings’, ‘silver chains’, and ‘silver chains for men.’

Top 10 silver and gold searches in the UK

With both gold and silver jewellery pieces making the top searches, the debate continues, though there is a clear preference towards the traditional look of gold jewellery, with ‘gold chains’ taking pride of place. Of course, there could never be a definitive answer as to which metal is the ‘best’; however, it is clear the UK has an eye for some jewellery pieces over others. Let’s take a look a closer look at the different jewellery types and see which metal more often takes the crown. 

Chains and necklaces 

As we can see from the data, everyone’s after a timeless chain to add to their jewellery collection. And in terms of gold versus silver, gold takes the lead. Gold chains have been bang on trend this year; they feature heavily in Cosmopolitan’s must-have jewellery trends. So, it’s no surprise that they’re racing ahead of the competition. Silver chains aren’t far behind, with an impressive average monthly search volume of 40,500, but there’s something about the timeless gold chain that you just can’t beat. The gold chain trend isn’t limited to certain parts of the UK either. In fact, ‘gold chains’ had the highest or joint highest search volumes in every region except for the South West, where they were pipped at the post by ‘gold hoop earrings’ which had 6,600 searches. 

Earrings 

Next up, we have earrings. In this category, gold prevailed again, with ‘gold earrings’ and ‘gold hoop earrings’ running away with the competition. A variation of ‘gold earrings’ appeared in the top five most searched for jewellery terms in every UK region, showing that we really can’t get enough! Although silver earrings didn’t prove quite so popular, it looks like our interest in them is still growing. In Northern Ireland, the term ‘silver earrings for women’ saw a growth of 743 per cent and the same term grew by 700 per cent in the South West. 

Wedding rings and engagement rings 

Although neither wedding rings nor engagement rings featured in the top ten jewellery searches, they’re both major players in the gold versus silver debate. After all, with most weddings having been cancelled or postponed over the course of 2020 and 2021, it’s no real surprise that wedding rings weren’t searched for quite as often (for example, ‘gold wedding rings for women’ accounted for just 1,300 average monthly searches). Despite this, the searches are bound to be back with a bang soon enough when the remaining restrictions lift, and big weddings are back on the cards. 

Although it was a close call for both wedding and engagement ring, gold proved to be the overall winner yet again. The wedding ring-related term with the greatest interest was ‘gold wedding rings’ with 5,400 average monthly searches. ‘Silver wedding rings’ came in at a close second with 3,600 searches. Wedding ring popularity also varied between men and women. In most regions ‘gold wedding rings for women’ was among the searches with the highest growth, but in Yorkshire and the South West, ‘silver wedding rings for men’ saw bigger surges of interest. 

As to be expected, engagement rings have been searched for a lot in recent months, and in this category, there is a clear winner in the debate. Gold engagement rings reign supreme, with 12,100 average monthly searches compared to only 4,400 for ‘silver engagement rings.’ There is something so timeless and magical about a classic yellow gold engagement ring, and this traditional style is still proving more popular than the more modern looking silver alternative. 

Men’s jewellery

Just when we thought gold had it in the bag across the board, we come to men’s jewellery. In the battle between the two mighty metals, it looks like we have ourselves a draw. Both gold and silver chains for men proved extremely popular (with 40,500 average monthly searches each) while gold and silver rings for men were also tied in popularity (both with 27,100 average monthly searches). It seems we may have solved the gold versus silver debate in terms of women’s jewellery, but men across the UK seem to love both of these precious metals equally. 

Over the last few months, we can see some clear jewellery trends. Not only can we now reveal that gold is the nation’s favourite, but we can also see which jewellery styles have grown in popularity and which have been forgotten by the public. Anklets, for example, saw the biggest decline in searches (-19 per cent for gold anklets and -33 per cent for silver anklets). However, with sunny holidays back on the cards, this classic summer jewellery style might see a resurgence soon enough. What we do know, however, is that if you want to be on trend this summer, stock up on glorious gold!

The post Gold or Silver? Which is the UK’s Favourite Metal? appeared first on Australian Times News.

However, forex is a deceptively complex marketplace, and one that offers a number of benefits and potential pitfalls to traders depending on their risk appetite and underlying investment strategy. Here is a list of the top Forex brokers.

The Pros of Forex Trading

The forex market is home to an estimated 170 major, minor and exotic currencies from across the globe, which are traded in pairs and as derivative assets. This allows you to speculate on price movements without assuming ownership of the underlying instrument, creating the potential for profit in a depreciating market.

But what are the other benefits of forex trading? Here are some of the best examples:

• Liquidity: Liquidity refers to the ease with which assets can be bought and sold, with currency pairs categorised as one of the most liquid options in the global market. This particularly applies to major currency pairs like EUR/USD and USD/JPY, which experience huge trading volumes and tend to trade within relatively narrow ranges.

• Leverage: When you first learn how to trade forex, you’ll begin to understand the fundamental relationship that exists between leverage and margin. In short, the former refers to the process of taking on debt to open trading positions that are considerably larger than your initial deposit, whereas margin is the amount of capital borrowed. It’s usually expressed as a ratio and can optimise returns when used wisely, with some reputable brokers offering leverage of upto 100:1.

• Low Capital Requirements: Due to tight spread in terms of pips (which refers to a specific unit of change in an exchange rate currency pair) and the availability of leverage, it’s possible to start forex trading with a relatively small amount of capital. This makes the market more accessible to part-time or amateur traders, who can also benefit from the fact that their profits will be completely tax-free.

What are the Cons of Forex Trading?

Interestingly, some of our forex trading pros can also be described as cons in certain instances. For example, failing to manage your risk when taking on highly leveraged positions can lead to disproportionate losses, so it’s important to keep this in mind as an inexperienced trader.

There are other risks, challenges and pitfalls to navigate too, including the following examples:

• Increased Volatility: The concept of volatility can also be viewed as either a positive or a negative, depending on your appetite for risk. For example, scalpers execute hundreds of short-term orders every single day in a bid to capitalise on real-time price fluctuations, accruing incremental profits in the process. However, volatility can be problematic for risk-averse traders or those with a longer-term outlook, as prices can fluctuate significantly during each 24-hour period.

• A Lack of Transparency: Relatively speaking, the forex market is a deregulated space, in which brokers dominate and individuals often trade directly against professionals. This creates an inherent lack of transparency, which is further exacerbated by the lack of control about how trades are fulfilled and the underlying fact that currencies are issued by banks that act as central points of control in the marketplace.

• The 24/7 Nature of the Market: The forex market is accessible 24/7 for six days during the week, with activity separated into three distinct geographical sessions (North America, Europe and Asia-Pacific). This can make it hard to regularly monitor prices and volatility, at least without a systematic trading strategy and the careful selection of currency pairs. Stop losses can also help to safeguard your capital overnight and minimise risk over time.

The post What are the pros and cons of trading Forex? appeared first on Australian Times News.

When it comes to transferring money overseas, many continue to exchange their money through banks instead of using an online money transfer service. The benefit of using an online foreign exchange service is that the customer tends to agree to avoidable commissions and fees that come with bank transfers. Most of the time people transfer internationally via their bank because it is familiar: They have always trusted their bank and have used them for years – why should they change?

In actuality, the banks are not specialists in currency exchange and are often charging customers more than they can afford. If you want to send money to South Africa from Australia, here are just some of the reasons why you might consider switching to an online specialist in currency exchange.

Transfer services are faster and more efficient than banks

Making international payments was once a pretty time-intensive process. From calling around to find the best currency exchange rates to faxing forms back and forth and physically banking cheques, it was inevitable a better business solution would come along.

As you might have expected that better way has come via digital delivery with all your international payments now able to be completed with a few clicks online.

However, not all banks are as friendly to online solutions as you might like, and you may have to visit a physical location and deal with someone face-to-face to order a money transfer. By using an online service, you can exchange funds wherever you are with a secure internet connection. Do not drop everything you are doing to spend the day in a bank; move your money efficiently online and then move onto more interesting activities.

Bank-beating exchange rates

If you are exchanging money through your bank, you are probably not getting the best deal on exchange rates. Furthermore, a bank’s currency exchange might often be outdated. Most institutions follow the interbank rate and then base their own exchanges around it. You may see a difference of up to five percent which the bank is pocketing. Forex services, on the other hand, typically work to find the best exchange rates possible.

The hidden fees and costs

Most banks charge customers a small percentage of the money transfer as a fee for their service. These small costs might not seem like much, but they add up. If you must put down an extra five percent every month, you could be losing thousands annually. You already must stretch your funds, so why are you giving so much away to a bank?

Instead, look for international money transfers that only charge flat fees on your transaction. Not only will this help you budget your expenses for the month (and year), but it will also save you significantly in the long run.

Which online transfer service should you use?

With the rise in online transfer services, you will no doubt be inundated with options. However, many online transfer services do not have human consultants on hand to assist you with issues that might arise.

We recommend always checking customer reviews and ensuring that you can find the contact numbers you will need. In the case of sending money online, make sure you use a service with impeccable reviews that is known for its great customer service. The experience becomes much easier if you speak to an expert and gain insight and advice regarding your transfer and future transfers. Saving a few AUDs in the short-term may not be worth it if you cannot fully trust the transfer service you are using, especially if you are going to be doing more than one transfer.

Send money instantly

Sending money overseas does not necessarily have to be a long, drawn-out process. Today, specialist money transfer companies offer the fastest and cheapest way to move your funds abroad with hedging tools built-in as an additional benefit.

Our forex team has been in business for over 20 years. We process transfers for over 60,000 clients worldwide every year. Our experts will always be on hand to assist you with any queries you may have and ensure that your international money transfers are as quick and convenient as possible. Call us on +613 (0) 8651 4500 or email us at forex@sableinternational.com to get started.

The post Want to send money to South Africa from Australia? Here’s how appeared first on Australian Times News.

Factors affecting the market

The following are some of the primary factors that affect the ups and downs of the market:

• Interest Rates

Generally, the interest rate has a role to play in the change in the stock market. The primary cause behind this is the impact it holds on companies’ cost of borrowing funds. But this is not wholly true because the interest rate is not the primary driver. 

Interest-bearing investments keep on competing with stocks for investor’s capital. Thus, the investors opt for the safety of fixed income when the rates are high. However, when the rates are low, stocks become more tempting than interest-bearing investments. 

• The economy’s state

One of the significant factors affecting the stock market is the country’s economy. Generally speaking, when the state’s economy is good, it indicates a stable GDP or gross domestic product. Thus business feels much more secured in expanding, and investors get encouraged to invest more.

Moreover, if a growing economy results in higher wages, people will have more money to invest in shares. Thus, they will spend more money, thus, directly contributing to publicly traded companies and increasing their earnings.

However, in the reverse situation, when the company is declining in recession, everything affects negatively. The net effect which you can see in the market is negative.  

• Supply and Demand

In an economy, you can explain the price movement by showing the difference between the supply from producers and the demand from consumers. This is the reason why economist says that market always falls back to equilibrium. Equilibrium is the point where demand equals supply.

By supply, we mean the amount of shares people want to sell, and by demand, we mean the amount of shares the investors are willing to purchase. 

If the number of buyers increases, there is more demand. Thus the buyers bid up the prices of the stock. In contrast, when there is an increase in the seller’s number, the price of the stock bids down, hoping that it would attract the investors or buyers.

Individually, stocks and bonds that act as a security instrument depend on the issuing entity’s performance. As a result, the stocks will be valued more in the future, or the entity will pay debts. 

• Sentiments

The relationship between demand and supply is often known as a sentiment. When stocks are in high demand and the investors are willing to buy them at a high price, the sentiments are positively impacted. This impact leads to fewer stock owners wishing to sell and an increase in the number of buyers. 

Extreme sentiments can ironically bring about significant market fluctuation. Thus, when the positive sentiment reaches its extreme point, it is evident the stock market will drop. 

Many investors monitor extreme sentiments and trade in the opposite and prevailing attitude. The cause of the attitude is simple there is more room for some investors to change their minds. But when the sentiment is more balanced, there is more room for doubtful investors to join and start a trend. 

• Company inside factor

It is evident that if a company has public shares, then the company’s internal factors are directly going to affect the stock price. Thus, if a company is at its boom, with increased revenue, successful product release, reduced debts, and more investors, the increase in stock price is imminent. This is because simple people will want to buy the company’s shares that are gaining so much strength.  

In contrast, if the company is at a recession stage, failing to launch a new product, having massive debt, etc., most of its investors will want to dump the shares. As a result, the stock price reduces. 

However, other company markets that can affect the stock market are mergers, changes in the company’s management, and acquisition.

• Balance in trading

The goal of all the markets is to facilitate trading. When there is an imbalance in supply and demand, it results in market ups and downs. Prices remain consistent if there is no change in supply and demand and when they are equal or balanced.

However, if there is more supply than demand, the seller satisfies at low prices to compete for buyers’ interests. As a result, the stock reduces its price. Similarly, when a stock is in high demand, the buyers compete among themselves who are willing to pay more. Thus this results in stock price increasing. 

Natural calamities

Apart from the above factors, there is another significant factor, but we cannot do anything about it. Calamities like floods and earthquakes reduce the price of the stock. This deduction may be due to the destruction of an asset or property. Natural calamities always bring suffering to companies. The sales drop down to a large extent affecting manufacturing and transportation. Thus, during a natural disaster, it is evident that the stock price will fall.

Apart from the above factors, many more factors can affect the stock market’s ups and downs. It is essential to keep a check of all of them. However, if you cannot keep a check of all, make sure you analyze the major ones, i.e., the ones mentioned above. It helps avoid losses in the future. 

The post What are the factors that affect the stock market, Ups and downs? appeared first on Australian Times News.

The stock market usually operates on five days a week basis where the timing is 9 am -5 pm. But all thanks to its growing popularity and technological development, now you can be a part-time trader as well. Your weekends are no more sluggish because the stock exchanges are here, helping to elicit your usual enthusiasm.

Electronic Communication Networks (ECN) helps investors in trading at the pre-market and post-market hours. Stock exchanges have a business base across the countries. This helps to contribute to business at any time of the day. Especially if we consider the stock market in the Middle East, and best index funds uk, you are allowed to do full-time trade even on Saturday. These together contribute to the huge business at wee hours and on Saturdays and Sundays.

Let’s look at the different choices of buying and selling stocks over the weekend

·         Trading at Wee Hours to Benefit the Most

Many brokers offer services after the usual hours for the clients. There are specific pre-market and post-market hours assigned for the stock exchange business. It is between 4 am to 9 am and 4 pm to 8 pm respectively. This is beneficial to a great extent. You can utilise the flexible market rates for your advantage. Moreover, decisions come quite swiftly at these hours. But you also have to keep another thing in mind.

Electronic Communication Networks allow the one-way transaction. Either you can buy or sell the shares. In comparison to the actual exchange, the ECN offers a lower volume of stocks. In such a case, it may not be always possible for the buyer and seller to agree on a specific price or condition. The primary condition to strike a deal is that the seller’s bid must fulfill the buyer’s demand.

·         Using the Pre Market and Post Market Hours to Trade

The stock market has a specific timing allotted for business purposes. There is heavy traffic during the usual hours. So if traders think of choosing some other times then they have the pre-market and aftermarket hours available.

It is with the help of ECN that stock exchanges operate at hours other than the usual. Initially, it was done by institutional investors only. But eventually, with the technological revolution in the stock market, now, anyone can strike the right deal with buying and selling stocks.

There are plenty of mainstream share brokers and service providers. Some of them tend to render trading services after the usual hours. Though some choose to provide slower network services or limited access, most of them contribute to the expanse of the business.

·         Middle Eastern Stock Market gives a Pass for Trading over Weekends

The biggest advantage in the stock market is that it is spread worldwide. Though there is a standardized version to benefit everyone, often few things work differently. This helps in expanding the business and spreading it more amongst the interested ones.

There are countries which neither start nor end the weeks on a Sunday. Most of the countries in the Middle East follow the Islamic calendar. According to that, their week begins on a Friday thus allowing them to conduct the services from Saturday to Thursday.

Dubai Financial Market lays a huge opportunity for the investors to invest on weekends, quite opposed to that of the New York Stock Exchange. For conducting a hassle-free business over the weekends you just need a good and reliable broker. Some concern like IB i.e. Interactive Brokers might help to seal some good deals.

·         Different Time Zones Offering Different Business Prospects

Each country has a different time zone. In the US you might not be allowed to trade after 5 pm, according to the timings of the New York Stock Exchange. But you can trade with other countries located in different time zones.

The interested investors can take the help of an authentic site like World Time Zone or check the World clock to enquire about the markets which are open for trade. Time difference helps you to trade almost twenty-four hours if you can manage to do so.

Benefits of trading on odd hours or over weekends

·         Traffic Free trade – There is a lot of hue and cry in the usual hours. The stock market attracts a lot of investors and all of them are keen on increasing the money in the fastest possible way. This creates a rush and often the system ceases to function. You can choose the weekends and odd hours to avoid these issues.

·         Acquiring and Acting on new information – Investors can calmly act on new information coming their way. They get the information on the International market and can decide vividly. You can analyze a situation and can decide to either sell or buy the share. All these happen at a greater speed at these aftermarket hours than on the scheduled hours.

·         Offering Flexibility – The biggest advantage of post-market or pre-market investment is flexibility. It benefits both the professional and per time investors and traders to buy or sell shares. There might be a time crunch during the office hours, so flexibility helps you to juggle well.

There are certain disadvantages in trading in off-hours

·         High fluctuations of rates – Since the available options are lesser in numbers, there may be higher volatility in the prices of the shares.

·         Risk in execution – It may happen that your order does not get processed within the day because the ECN market lacks volume.

These can be overcome by choosing the right broker. Few important qualities in the broker are as follows:

·         One who has access globally

·         Offers you premier technology

·         Has the lowest cost structure for the services provided

Therefore buying and selling stocks over the weekend is not a big deal if you have the required resources and knowledge. Investors are getting inclined to such transactions more often now because of the advantages. As an investor, you must always choose the path of your convenience.

The post Can you buy and sell stocks over the weekend appeared first on Australian Times News.

Using duration, a trader can pick long-term, day trading, or Swing Trading Strategies. These types of trading suit traders of different skill levels and involvement in markets.

Digitization has made these strategies possible. Ordinary people can learn how to trade from the comfort of their homes. The Gamestop phenomenon is the boldest representation of the cultural shifts in market participation.

Duration Strategies 

The duration that a trade is open dictates how likely it is that a trader or investor either realizes profit or sustains a loss. They can customize this to suit their taste.

Generally, the longer a position remains open, the greater the possibility of significant profits or losses. Unexpected market events can strike along the way to alter the trader’s trajectory.

These are the major strategies based on duration:

• Traditional Long Term Investing

This strategy is the process of acquiring securities for capital appreciation over a significant period of time. Investors commonly refer to it as “buy and hold.” The idea is to purchase the equity and hold it over months or years. It is ideal for stable assets or those likely to appreciate with time. Accordingly, an investor can see gradual value growth, even with occasional pitfalls.  This strategy requires less management and analysis. Regardless, it still has its risks that investors should appreciate. 

• Day Trading

 This practice is the essence of modern digital trading. A person can enter and enter the market frequently within a day. Some trades even close within minutes. The idea is to capitalize on momentary movements. Accordingly, a trader has to be excellent at market analysis. This way, they can make informed decisions. Day trading comes with significant risk because losses can be swift and devastating. Scalping is an advanced form of day trading. It reduces trade execution to milliseconds and seconds. Scalping is competitive and relies heavily on automation. 

• Swing Trading 

This strategy is a hybrid between the two above forms of trading. A person can take the technical analysis of day trading and spread it over a few days. Traders can realize gains on short-term market trends and market behavior. The condensed time duration also limits exposure to long-term unpredictability. Therefore, swing trading seeks to combine the strengths of day trading and long-term investing. A trader can enjoy larger gains from strong trends. However, fluctuation mid-trade can mean that they miss out on peak gains. 

About Swing Trading

Swing trading serves as a bridge between the disciplines of trading and investing. A person can use it to realize greater capital gains without long-term exposure. 

Traders must get the process right. This process first calls for the correct identification of opportunities. The next step is to define trade parameters and enter the market. Swing traders can target corporate stocks, futures, and other contracts. 

A trader has to plan features like contract expiration, rollover, and margin requirements. These items are specific to the asset in question. The asset should ideally be liquid with a degree of volatility. After all, the idea is to capitalize on market moves through a few days. Utilize other technical indicators to identify a trade setup and define the market entry. 

Some brokers offer money management tools. These tools can help to preserve profits or limit losses. Generally, management tools help balance risk and rewards. 

Analysis and Discipline 

In this era of digital trading and advanced analysis, traders have endless options. Swing trading is one strategy that is gaining popularity. It is a balance between the two distinct forms of financial investments.

The effectiveness of each trading strategy is down to unique factors. Exact timelines, whether with swing trading or scalping may yield different results for different assets. It is not easy to create optimal time horizons using generic information. 

Accordingly, a trader has to know the fundamentals of every asset and the risk level attached. The ultimate goal is to develop discipline and mostly stay in the green.

The post Forex and crypto trading strategies in financial markets appeared first on Australian Times News.

Why has the pound surged?

Sterling’s sharp rise is a direct response to greater clarity about Brexit, as Boris Johnson’s deal is now expected to be passed in Parliament thanks to his Commons majority.

Prior to the exit polls, the pound was at €1.1819, US$1.3153 and AU$1.9045 at 21:40 on December 12. But by 22:10, when it was clear a Tory majority was expected, the pound surged by more than two cents against the euro, by more than three cents against the US dollar, and almost four cents against the Aussie dollar.

Also see: The 5 biggest forex myths you need to know

Jake Trask, FX Research Director at OFX, said:

“As it turned out, the pollsters and the bookmakers were correct with a Tory majority realised, and the margin of victory was always going to determine sterling’s rise.

“A narrow victory by 10-20 seats would have seen a small rally for GBP/USD through US$1.33 and beyond which had been priced in, to a certain extent, by markets already. But as the majority was much higher than that, it jumped towards the US$1.35 handle, as it means PM Boris Johnson’s Withdrawal Agreement Bill should be signed off ASAP.”

Unless there is ongoing in-fighting within the Conservative ranks, the country should now see a straightforward move onto Brexit’s next stage of negotiating the trade deal with the EU. But, to complete this within a matter of months to meet the transition period deadline – currently the end of December 2020 – is a tall order, and any delay could cause further uncertainty, potentially weighing on the pound again.

What does this mean for your global money transfers?

As it stands, sterling’s rally is good news for Brits sending currency abroad. Anyone moving £100,000 to Australian dollars could have gained AU$5,500 in the space of just 10 minutes, from before to after the exit polls were announced. The equivalent transaction to US dollars could have yielded an additional US$3,400. To capitalise on GBP gains, an OFX Forward Contract allows businesses and individuals to fix future payments at today’s rate.

Get in touch: Reach out today to learn more about OFX can help you understand the latest currency market movements

The pound is likely to remain volatile in the coming weeks as Brexit plans take shape, but fast-moving rates can be advantageous for anyone moving money overseas if you know how to make them work for you. Working with a currency specialist to help navigate the complexity of an uncertain market can help to control your exposure and maximise potential upsides with a variety of products that are available to both individuals and businesses.

To find out how to make the best decisions no matter what happens to the pound in the coming weeks, get in touch with OFX experts 24/7 worldwide on one of our regional contact numbers below, or by email at customer.service@ofx.com.

United Kingdom: Personal +44 207 614 4194; Business +44 207 614 4195

Australia: Personal 1300-300-424; Business 1300-300-524

AustralianTimes.co.uk is a proud partner with OFX on The Currency Zone. To stay on top of global currency events and movements, sign up with OFX to hear from their currency experts with OFX daily or weekly market commentary.

IMPORTANT: The contents of this post do not constitute financial advice and are provided for general information purposes only without taking into account the investment objectives, financial situation and particular needs of any particular person. UKForex Limited (trading as “OFX”) and its affiliates make no recommendation as to the merits of any financial strategy or product referred to in the blog. OFX makes no warranty, express or implied, concerning the suitability, completeness, quality or exactness of the information and models provided in this post.

The post Pound surges as UK’s Conservatives return to power. What does this mean for your global money transfers? appeared first on Australian Times News.

Get in touch: Reach out today to learn more about OFX can help you understand the latest currency market movements

Myth #1: Forex is a short term strategy

The factors that underpin movements on the foreign exchange market are macroeconomic factors, and most of the time, those factors don’t change that fast. So while the day to day news cycle can cause volatile swings, there are still long term trends that exist in many currency relationships. This means that having a currency strategy that takes these long-term trends into account is important for maintaining a stable cash flow when operating a global business.

Myth #2: Your forecast is the way to win

Predictions and forecasts can cause you to lose sight of what’s really happening in the market due to cognitive bias. Behavioral economics has shown us that when you’re predicting, you’ll most likely end up seeing only what you want to see instead of adapting to what’s happening in real time in the market.

That said, having a forecast or a level in mind is not a bad idea, it’s just that many people become too emotional and don’t stick to their plans. A common saying in trading is to “plan the trade and trade the plan”. In order for your forecast to work, you need to detach from emotions, constantly reassess your strategy and be prepared to walk away if it’s not working.

Myth #3: The forex market is really risky

Many people are under the false impression that the foreign exchange market is actually a riskier option than other markets. The reality is that any market, any investment, and any trade needs to be assessed, and the risks need to be contained in order to achieve the best results. More growth usually means accepting more risk whether you’re trading currencies, stocks, bonds or investing in real estate.

Myth #4: Risk management is expensive

A common misconception is that it’s expensive to implement a currency strategy to mitigate risk, which isn’t necessarily the case at all. Managing foreign exchange exposure is one way to ensure that your business can carry on with a stable cash flow in the event of currency volatility.

OFX offer risk management tools like Forward Exchange Contracts, which allow you to lock in a favorable exchange rate and then transfer at that rate up to 12 months in the future. The benefit of using this tool is that it costs nothing, no deposit and if you need to cancel it, no fee. Similarly, Limit Orders, which let you choose a target rate for the team at OFX to monitor the markets to see if it’s reached and contact you if it does, which costs nothing to book and cancel.

How OFX’s risk management tools compare:

Myth #5: The trend is your friend

There’s a lot to learn about the factors that influence exchange rates. From milk in New Zealand to the travertine trade in Turkey, most professionals make the most money from focusing on specialised pairs and gaining a solid understanding of those key relationships.

Many newcomers to forex look at historical data and long term relative exchange rates to evaluate currencies. Professionals in forex understand that the fundamental relationships, like the commodities that drive the value of the AUD, will generally hold true over the long term. That said, forex is also heavily influenced by what’s going on right now.

Also see: Brexit dictates currency moves as Boris takes control

New governments and trade policies, political and military turmoil, populist sentiment and current economic conditions will always trump historical valuations when it comes to pricing currencies in real time.

Trade wisely with the help of facts, not myths

Overall, using foreign exchange as a component of your overall investment portfolio, or to manage the ebbs and flows of running a global operation, can be a strategic way to diversify your assets, but staying informed is critical. Global money transfer specialists OFX provide comprehensive market news on all the major currency pairs daily and weekly. The quarterly Currency Review also takes a deeper dive into the nuances of what’s impacting major currencies like AUD, USD, GBP and more.

AustralianTimes.co.uk is a proud partner with OFX on The Currency Zone. To stay on top of global currency events and movements, sign up with OFX to hear from their currency experts with OFX daily or weekly market commentary.

IMPORTANT: The contents of this post do not constitute financial advice and are provided for general information purposes only without taking into account the investment objectives, financial situation and particular needs of any particular person. UKForex Limited (trading as “OFX”) and its affiliates make no recommendation as to the merits of any financial strategy or product referred to in the blog. OFX makes no warranty, express or implied, concerning the suitability, completeness, quality or exactness of the information and models provided in this post.

The post The 5 biggest forex myths you need to know appeared first on Australian Times News.

The ongoing drama, as a result of the Brexit impasse, is playing havoc with the pound’s value and creating significant volatility, which is influenced by the smallest amount of good or bad news.

The pound reached a 23-month low against the euro in August as concerns over a no-deal Brexit escalated. On August 11 it reached €1.06 but has since recovered to €1.12 in September.

Hamish Muress, Senior Currency Strategist at OFX, said: “We all thought there was a General Election on the cards, but that has currently gone out of the window. Although there are some clients who are taking a ‘wait and see’ approach to book transfers, other clients are actually taking advantage of the volatile pound with the right strategy to lock in rates.”

Get in touch: Reach out today to learn more about OFX can help you understand the latest currency market movements

Government loses control of the process

Despite a new deal being approved by the EU and UK Prime Minister Boris Johnson, the main problem has been Johnson’s forceful approach to pushing through Brexit ‘do or die’ on October 31. This prompted Parliament to act and pass a law to try and prevent a no deal Brexit happening.

Johnson’s do or die approach has lost his majority in the House of Commons thanks to a combination of defections to other parties and his sacking of 21 of his own MPs who decided to vote against their party on Brexit, leaving the Government relatively impotent. The minority Government the PM holds makes it very difficult to judge the outcome of any vote on any bill or amendment. This often leaves the pound on tenterhooks.

On the weekend of 19th October the Government lost a key vote that stopped approval for Johnson’s deal till the withdrawal agreement itself is cemented in law. More recently, Boris has partially side stepped this law by sending two letters to the EU, one officially asking for an extension, whilst personally also sending one advocating the opposite.

Even so, all areas of British and Brexit politics are moving at pace, so it is hard to predict exactly where Britain goes next.

Pound volatility continues

The constant upheaval means the pound is fluctuating wildly against other currencies, with the slightest bit of good or bad news prompting significant moves – essentially the position we have been in with sterling for a long time now. It looks unlikely that things will become more settled in the short term.

Also see: Six factors influencing exchange rates and what you can do about it

The strengthening US dollar, one of the key safe-haven currencies, has done little to help the pound with GBP/USD hitting 1.20 on August 10, but again the pound has rallied and is at 1.23 at the time of writing in September. The volatility is unnerving but can be beneficial for businesses who need to move significant amounts of money overseas if they can time it right.

For example, if you’re in the UK and your business needs to buy microchips from Silicon Valley, and you transfer pounds to USD 100,000, the difference between buying USD in August versus a few weeks later could be costly. On August 10 it could have cost £83,333 but at the time of writing in September it could have cost £81,300 – £2,032 less.

Mr Muress said: “The most common question we are asked – and forget about the different scenarios here for a second – is ‘how low can the pound go?’ As things stand, I think we have reached the bottom. We have gone under USD 1.20 when things have looked very uncertain, and that is when it looked like a no-deal Brexit was on the cards.

“If we end up with a no deal Brexit and Boris has broken the law [to make it happen], it could drop further. ”

What happens after a potential General Election is unclear, as there is in-fighting in the Labour Party about their approach to both Brexit and the election, and only the Liberal Democrats are definitive about wanting to stay in Europe. So much so, they have now voted at their party conference to revoke Article 50 on day one if they are swept to power.

What can businesses do to plan for Brexit volatility?

Jake Trask, FX Research Director, is working with global businesses to plan ahead in volatile times.

“With the pound still engulfed by Brexit uncertainty and a no deal Brexit still a very real threat despite the passing of a law to stop this, businesses would be wise to consider mitigating the impact this scenario could have on the value of the pound.

“Those concerned by the damage a no deal Brexit could cause on profit margins should think about forward buying currency now, while sterling has staged a slight recovery.

“Targeting a better rate of exchange via a Limit Order has been a good way to take advantage of recent sterling gains. Or if you import supplies or services from the UK, you may be looking to take advantage of the pound at a weaker moment. Our team of currency experts watch the market 24/7 on your behalf to leverage desired rates of exchange. We automatically buy currency when the rates are beneficial. Our clients count on us to protect their business from uncertainly, more so in this current volatile climate when the timing of a transaction can be critical.”

Talk to OFX to learn more about how we can help you mitigate currency risk with Forward Contracts and Limit Orders.

Britain’s economy on a knife edge

Economically, Britain is still in a difficult position, although the anticipated recession has been staved off for now. GDP grew more than expected in September¹, even though it was still only 0.3% up month-on-month.

Yael Selfin, chief economist at KPMG², said: “Given the time that has passed since the vote was cast, a casual observer would have assumed that by now arrangements between respective governments would have been made, businesses would be prepared and everyone would know what to expect from the future relationship between the UK and the EU.

“The reality is different…[but] a last-minute deal coupled with a two-year transition period could give the UK a respite to find its new place in the world economy. It is rare to live in a period with such bipolar short-term prospects.”

A Brexit deal could boost the pound

What happens to the pound will very much depend on whether a Brexit deal is reached or not, even though a no deal option has all but been taken off the table unless the Government chooses to break the law. KPMG anticipates that a Brexit deal could increase GDP to 1.5% in 2020, tempered by the background of slowing global economic growth.

Even with a deal, the full details of the trading relationship with Europe will take time to resolve, said Ms Selfin, but on news of a deal the pound could appreciate by as much as 10-15%. For businesses trading overseas, the potential strengthening of the pound would be good news if they buy goods and services from outside of the UK.

AustralianTimes.co.uk is a proud partner with OFX on The Currency Zone. To stay on top of global currency events and movements, sign up with OFX to hear from their currency experts with OFX daily or weekly market commentary.

IMPORTANT: The contents of this post do not constitute financial advice and are provided for general information purposes only without taking into account the investment objectives, financial situation and particular needs of any particular person. UKForex Limited (trading as “OFX”) and its affiliates make no recommendation as to the merits of any financial strategy or product referred to in the blog. OFX makes no warranty, express or implied, concerning the suitability, completeness, quality or exactness of the information and models provided in this post.

¹https://www.theguardian.com/business/2019/sep/09/uk-recession-economic-growth-gdp

²https://assets.kpmg/content/dam/kpmg/uk/pdf/2019/09/britain-at-a-crossroads.pdf

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The latest 10% tariffs to be added on another US$112 billion of Chinese goods came in to effect on September 1, with further tariffs on US$160 billion of goods set to be added on December 15 – the latter being delayed to avoid peak retail shopping seasons, and ensure the majority of consumer goods, such as toys, smartphones, clothes and shoes, are in the country before the tariffs come in.

By the time the December tariffs are added, the average rate will have reached 21.4%. With China’s retaliatory tariffs on US goods, there shows little sign of the trade war ending anytime soon, and the consequential fallout from the world’s two biggest economies slugging it out is being keenly felt elsewhere, including Australia.

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What impact is this having on the US dollar?

With stock markets falling in recent weeks and many signs that the world’s largest economy is facing a possible recession in the not-too-distant future, the US economy is feeling the pressure. A phenomenon known as an ‘inverted yield curve’ where two-year bond rates are higher than those paid on 10-year bonds is a key indicator of recession and was seen in US bond markets numerous times in late August as President Trump ‘ordered’ US companies to avoid trading with China.

Strong US dollar means great terms for those transferring to relatively weaker currencies

There has been a noticeable flight to safety in currency terms, with the traditional safe havens – the Swiss franc, Japanese yen and the US dollar, which is still considered the main safe-haven currency even though most uncertainty is being caused by the country’s own President – all strengthening in recent weeks.

For those looking to move their money from US dollars, a strengthening of the currency means they will get significantly more for their money.

For example, if you’re transferring US$10,000 to Australian dollars;

• The interbank exchange rate of AU$1.4428 at the end of May could have resulted in AU$14,428
• The US dollar strengthening to AU$1.4940 on 26th August 2019 could have resulted in AU$14,940 – an extra AU$512 within a matter of weeks
• The picture is similar against a host of other currencies as the US dollar continues its march higher versus other units such as sterling, euro and New Zealand dollar.

What impact is this having on the Australian dollar?

If you are in Australia, there is enormous pressure on the Australian dollar at present thanks to the devaluation of China’s yuan. The country devalued the yuan to less than Yuan7 to the US dollar, which prompted President Trump to further label the country a currency manipulator, which causes further problems for Australia. The move is a clever one for China, since it effectively reduces the impact of any tariffs on Chinese goods being imported to the US as they will be cheaper because of the relative weakness of the yuan to the US dollar.

Also see: Six factors influencing exchange rates and what you can do about it

However, it is bad news for the Australian dollar and the New Zealand dollar, because when the yuan weakens, these two currencies tend to follow suit. So much so that the Australian dollar is being quoted as collateral damage in the trade war.

Australian exports to China become more expensive

Australia’s exports to China, particularly of iron ore and coal, hit the second highest level on record in June this year. The concern is that a devalued yuan means exports to its one of its biggest trading partners are now more expensive, threatening the Australian economy.

The Australian dollar is at a crossroads

While the two global economic superpowers slug it out, there is a very real fallout for other countries exposed to either of these key economies. In Australia, the key ASX200 fell for five consecutive days at the beginning of August, to levels not seen since June this year; a direct result of its awkward position as a key trading partner of China, but a strategic ally of the US. However, the market has been saved somewhat by it reaching a high not seen since 2008 just prior, meaning the fall was a correction more than a rout.

As a result, the Australian dollar is being squeezed in two directions which could prove costly for customers moving Australian dollars to US dollars, whether for business or personal transactions. The expectation is that the Reserve Bank of Australia will also make a 0.25 of a percentage point cut in September, and this has already been priced into currency markets.

Also see: Four things to look for in an international money transfer provider as an alternative to the banks

At the time of writing, the Australian dollar was staying stubbornly below the US$0.68 level, and while the volatility in world economies and world currencies continues, we are unlikely to see any significant progress in the strength of the Australian dollar.

What should Australian customers do?

For Australian customers or businesses who need to move US dollars overseas, now could be the time to talk to a currency specialist to discuss how you can protect your transaction, perhaps by fixing your exchange rate for up to a year to protect you from future fluctuations, or setting a target rate, so your transaction occurs automatically for you when rates hit that level.

Our specialists can also give you guidance on where the Australian or US dollar may be heading, so you have the most up-to-date information when you are making decisions about your transactions.

If you need to move money overseas and want to know how to make the most of your currency transactions, speak to the OFX team. With global offices, there is someone you can talk to 24/7.

AustralianTimes.co.uk is a proud partner with OFX on The Currency Zone. To stay on top of global currency events and movements, sign up with OFX to hear from their currency experts with OFX daily or weekly market commentary.

IMPORTANT: The contents of this blog do not constitute financial advice and are provided for general information purposes only without taking into account the investment objectives, financial situation and particular needs of any particular person. UKForex Limited (trading as “OFX”) and its affiliates make no recommendation as to the merits of any financial strategy or product referred to in the blog. OFX makes no warranty, express or implied, concerning the suitability, completeness, quality or exactness of the information and models provided in this blog.

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But what influences movements in exchange rates? And more, what makes them ‘volatile’? That word gets thrown around a lot in the foreign exchange space, but what does it mean?

Exchange rate volatility refers to the tendency for foreign currency to appreciate or depreciate in value and ultimately affects the profitability of a trade (or transfer) overseas.

Now that we understand what volatility is, what common factors influence it? Let’s break it down below:

1. Inflation rates

Inflation rates impact a country’s currency value. A low inflation rate typically exhibits a rising currency value, as its purchasing power increases relative to other currencies. Conversely, those with higher inflation typically see depreciation in their currencies compared to that of their trading partners, and it’s also typically accompanied by higher interest rates.

Government debt also plays a part in inflation rates. A country with government debt (public or national debt owned by the central government) is less likely to acquire foreign capital, leading to inflation.

2. Interest rates

Exchange rates, interest rates and inflation rates are all interconnected. An increase in interest rates cause a country’s currency to appreciate, as lenders are provided with higher rates and thereby attracting more foreign capital. This can cause a rise in the value of a currency and therefore the exchange rate. Cutting interest rates, on the other hand, can lead to a depreciation of the currency.

*The image above is provided for general information purposes only and is not an accurate representation of the live exchange rate.

3. Monetary policy and economic performance

If a country has a history of strong economic performance and sound monetary policy, investors are more inclined to seek out those countries. This inevitably increases the demand and value of the country’s currency.

Also see: Four things to look for in an international money transfer provider as an alternative to the banks

With the state of the global economy at the time of writing, it’s evident that we’re in a global slowdown and fears of recession are looming. A recession may also cause a depreciation in the exchange rate because interest rates usually fall, however, this isn’t always the case.

Other recession factors that can influence currency value include the determent of foreign investment, which would decrease the value. However, if a recession causes inflation to fall, this helps a country become more globally competitive and demand for the currency becomes greater.

4. Tourism

Let’s use the US as an example here. If someone travels outside the US to another country, they will get more from a money transfer to that country when the USD appreciates against the foreign currency. Similarly, depreciation of a currency means that foreigners will be more inclined to visit that country and spend more while there.

Another factor here are ‘visitor-weighted exchange rates’, which measure a destination’s currency market with those of its primary visitor market. In essence, countries that have a diversified range of visitor markets tend to be more resilient against specific exchange rate margins, compared to those who rely on specific visitor markets.

5. Geopolitical stability

The political state of a country, coupled with economic performance, can also affect the strength of the currency. A country with less risk for political turmoil will be more attractive to foreign investors, leading to an appreciation of the value of its domestic currency from foreign capital.

‘Geopolitical risk’ is the risk posed to foreign investors by unexpected political developments. If a country’s economy and political landscape remains predictable, investors are more likely to buy the currency. The opposite effect is also true, unexpected events lead investors to pull their money back, sending the currency down in value.

The impact of Hong Kong’s Extradition Bill is an example of this in recent times. The bill, also known as the ‘fugitives bill’, would enabled almost anyone who enters Hong Kong – whether in transit, to visit or as a resident – to be extradited to China or any other jurisdiction that Hong Kong does not have an extradition treaty with. The fear is that even multinational executives could be held and removed to a foreign country, whether the charges are unfounded or not.

Despite the protests following prompting the bill to be suspended, the fact that it has not been thrown out altogether creates ongoing uncertainty for businesses and investors in the region, which could potentially see an impact on the Hong Kong dollar.

6. Import and export value

A country’s balance of payments (BOP) summarises all international trade and financial transactions made by individuals, companies and government bodies complete with those bodies of that country. These transactions can consist of imports and exports of goods, services and capital.

The reason BOP is included here is that it influences the ratio comparing export prices to import prices. If the price of a country’s exports are greater than their imports, its ‘terms of trade’ have improved. This creates a greater demand for that country’s exports, and in-turn, greater demand for the currency.

Like many of the other factors influencing exchange rates, the converse reaction can also occur. If the exports rise by a smaller rate than the imports, the value of that country’s exports and currency decrease in value.

What can you do to make volatility work for you?

Now that we know what influences the markets, you’re already far more prepared than the majority. From here, you can use these factors to your advantage when planning a currency strategy that uses any potential volatility to your advantage.

For example, by partnering with a global money transfer specialist, such as OFX, when dealing in different currencies around the world, you can take advantage of tools designed for that specific purpose.

Forward Exchange Contracts for example, allow you to lock in an exchange rate if it suits your transfer needs and then transfer the funds at a later date, even up to 12 months in the future. For example, if you needed to transfer money from USD to GBP and the GBP drops drastically, like it did when the Brexit referendum outcome was announced, a Forward Exchange Contract may help.

OFX also offer other tools that can help you manage your global money transfer needs. See how they compare below:

So while volatility may sound like a bad thing, it doesn’t have to spell the end of a businesses international expansion. With the right help and tools, you can develop a currency strategy that takes into account how volatility can be favourable, rather than feared, providing you with the confidence to dive headfirst into the next market.

With OFX, you can get bank beating rates on global money transfers.

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AustralianTimes.co.uk is a proud partner with OFX on The Currency Zone

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1. Global reach, local feel

When it comes to getting the best rate at OFX, we have 16 partner banks (which means over 150 bank accounts in locations around the world, across 55 currencies). We call this system Global By Local (GBL), and this means that we are able to send funds directly between these banks accounts, rather than using an expensive network of external banks.

2. Understand that risk management and global expansion go hand-in-hand

As a company that has been established for over 20 years, OFX are always looking to new means of ensuring our customers get the best deal. Say for example that an online seller wants to keep cash flows predictable, the ability to lock in an ideal rate for future payables and receivables (like paying overseas staff and suppliers and bringing profit back home) using OFX’s Forward Contract means that you can protect against market uncertainty in the wake of world events (think Brexit).

A Forward Contract allows a customer to lock in an ideal rate and then transfer that amount at any point for up to 12 months.

Similarly, OFX’s Limit Order option means that you can set a target rate, and if it’s reached, a dedicated dealer or someone in the customer support team will contact you via email or phone to complete the transfer. You can then choose to have the transfer processed automatically, or at a later date, even potentially rolling it into a Forward Contract.

3. Find tools for ecommerce success

Risk management tools are great for business customers more generally, but what tools exist specifically for online sellers? As an emerging market, there are few players who understand the unique challenges faced by online sellers. That’s why OFX created the OFX Global Currency Account, which essentially gives online sellers the equivalent of a local bank account in the US, Canada, UK, Europe, Australia and Hong Kong.

David Nichols, Director of Enterprise Development and e-commerce at OFX explained in a webinar with Seller’s Choice that this enables clients to collect their overseas revenue in the currency they’re selling in internationally, and the ability to move that back to their home currency at a much better exchange rate than they would with a marketplace or a bank.

Alternatively, clients can use the funds they’ve accumulated internationally to pay their taxes or suppliers, which essentially removes the requirement of moving money around the world unnecessarily.

4. The trust factor

The nature of dealing with people’s money means that trust really must underpin every aspect of financial services, be that banking or foreign exchange. So it makes sense why people revert to their banks for managing currency flow. However, the financial services industry is a heavily regulated one, which means that the players in that market need to abide by a strict set of rules.

At OFX, our parent company is publicly listed on the Australian Stock Exchange (ASX) and is regulated by over 50 regulators globally. Along with this, the skilled fraud and compliance teams work with many partners globally to ensure our clients’ money is in safe hands.

While the growing market of foreign exchange is seeing many players rapidly appear then disappear, it doesn’t mean that the bank is the only way to go. In fact, a valuable foreign exchange specialist can often have a better understanding of the needs and challenges of businesses of all sizes.

This means that choosing a reliable provider can be key to building a successful international business. At OFX, we strive to be the stable voice of understanding and support for our increasingly global world. We understand that your world never stops moving, so neither will we.

With OFX, you can get bank beating rates on global money transfers.

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AustralianTimes.co.uk is a proud partner with OFX on The Currency Zone

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What is happening with Brexit?

As the Brexit saga carries on in the UK, drawing out an almost three-year decision-making process, parliament seems all but but paralysed in terms of reaching a decision. 

This has lead to the EU granting the UK an extension until the 31 October, 2019 in which UK Prime Minister Theresa May must come to a decision with the British parliament to avoid crashing out of the EU without a deal.

How does this impact businesses today?

The impact of this uncertainty cannot be understated, further delays mean that households and businesses remain hostage to the crippling economic uncertainty that has already been plaguing the UK since the referendum in 2016.

In terms of currency movements, on June 22, 2016 – the day before the EU referendum – the pound was trading at £1.30 against the euro. By July 8 that year, it was down at £1.16, and has been bouncing around at that rate ever since. Every new headline shows how volatile the pound is in response to any Brexit movements.

Also see: OFX: Where the world’s moving for international money transfers

Similar, the pound fell nearly 20 cents against the US dollar to just under £1.29 after a comfortable period at £1.47 during June 2016. Overall, while the impact of Brexit negotiations is having less of an impact in other areas of the economy, the pound has still lost about 10% of its value since the day before the UK voted to leave.

Along with the lack of certainty at the moment, the impact these fluctuations have on prices impacts importing and exporting is also evident. Suppliers in the EU are more expensive to trade with, yet the cheaper pound makes exports more attractive to overseas buyers. This means businesses working with EU partners will need to be more creative in their approach moving forward.

How can businesses prepare in this age of uncertainty?

There are several ways to stay ahead in the meantime. One way is to work with a currency strategist who can offer tools in risk management. The currency specialists at OFX can offer tools like Forward Exchange Contracts, which allow you to lock in a favourable exchange rate and trade it at a later date. You can also use tools like the OFX Daily or Weekly Market Commentary or Rate Alerts to stay ahead of the game when it comes to currency movements.

Another method is look outside the EU to other locations where you can get your suppliers and/or customers. While the uncertainty of Brexit and its impact cannot be understated, it does allow for businesses to look outside their typical supply chain, which might not have been done otherwise. This provides the opportunity to broaden horizons and potentially increase profits.

AustralianTimes.co.uk partners with OFX for Currency Zone

Join OFX today (click here to get started)

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Don’t let bank fees eat you out of house and home

Preferential rates will help you save money and you’ll enjoy zero OFX fees when you make a transfer.

Also see: How to buy property abroad

Protect your future against fluctuating exchange rates

We’ll help you understand and manage the volatility of currency markets. Our team of experts can walk you through products such as Forwards Contracts that allow you to book in currency at today’s rates for delivery in the future. You can plan and budget with confidence even if rates change between purchasing the property and completion.

Unparalleled 24/7 customer service

Our dedicated dealers can help you create a custom currency strategy that suits your unique needs. We operate 24/7 in 6 locations across the globe including London, Sydney, and San Francisco, so you can book a transfer when it’s convenient for you.

Your money is safe and sound

We have an extensive, highly regulated global network of bank accounts that allows for swift and safe transfers. The OFX website is secured by a global leader in next generation cyber security, Symantec, to offer you peace of mind.

Register now to get started

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TOP IMAGE: Image by Jörg Hertle from Pixabay

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International mortgages

When purchasing property in another country, it could be difficult to find the appropriate financing option, especially since some countries might not have any financing options for foreign buyers at all. In some countries, banks cannot take a foreign asset as a security for the loan, so you may not be able to get a standard mortgage from your domestic bank the way you would for a local purchase.

Still other international regulations may prohibit banks from even initiating a conversation to a client about a mortgage if the client is based overseas, even if you’re a citizen of the country in which you want to buy. So how can you get a mortgage for an overseas property purchase?

While traditional bank financing might not be available for overseas assets like it is in your home country, developer financing may be available.

Other payment methods might include using the funds in your retirement account or pulling equity from your primary residence in your home country. You may qualify for business or personal loans that you can use to pay for your down payment overseas. Certain banks, like HSBC, offer mortgages for international borrowers, if you can maintain a minimum bank balance at a designated threshold.

Read this breakdown of international banking policies for Australia, UK, and the USA here.

The impact of currency fluctuations on the real estate market

As you do your research into where to buy property abroad, one of the primary factors affecting the viability of your investment will be the exchange rate. Aside from doing a quick currency conversion, you may want to review the current economic standing of a foreign currency against historical rate charts.

Keep in mind that currencies will fluctuate, sometimes quite dramatically, over time. And sometimes currency exchange rates will change rapidly over a short period of time. This could make the difference between a bargain and being outpriced from a market, so you need to ensure you plan and protect yourself from market fluctuations.

As an example, after the UK’s shock Brexit vote the pound’s value fell sharply against the USD in just one day.  In The Telegraph, Rhiannon Bury reported that in the three months following, 78% of commercial property sales were paid for by foreign investors swooping in on a bargain.

When you’re ready to transfer funds overseas to purchase a foreign property, why not work with the team at OFX to develop a sustainable currency budget. With 20 years’ experience, and 24/7 customer support, their global currency experts provide market insight and guidance so you can plan ahead with confidence, even when currency markets are unpredictable. OFX will be with you every step of the way to ensure your transactions are seamless.

Register today to get started

TOP IMAGE: Image by Nattanan Kanchanaprat from Pixabay

The post How to buy property abroad appeared first on Australian Times News.

What’s happened?

Citing a convention dating back to 1604, Speaker of the House of Commons John Bercow ruled out another vote following two rejections of the same deal. At the time, GBP/USD dipped below 1.32 in response to the votes carried out 12-13 March.

The week commencing 25 March has set up for a number of movements on the Brexit front.  Tuesday 26 March was considered as a possible day for the third meaningful vote (initially planned for 13 March). This was subject to Bercow conceding that May’s deal is sufficiently different enough to allow a third vote.

On Wednesday 27 March, Parliament were given eight options as an alternative to Brexit, which included leaving the EU without a deal, a second referendum and cancelling Brexit altogether. Any option that gained the support of more than half of MP’s would be debated the following week as an alternative to May’s deal.

What to look out for next

None of the eight alternative options provided on Wednesday gained MP majority, which means MP’s will now narrow down the list of options and continue to hold more votes Monday 1 April. 

Indicative votes are not legally binding however, so we don’t know how the EU will respond to any vote that gains majority. Britain now has until April 12 to make a decision or end up leaving the EU without a deal altogether.

Also see: How to buy property abroad

If the third meaningful vote has not taken place by Thursday 28 March, this was another possible date to vote, however, Bercow has since poured cold water on May’s attempts saying the deal needed to be significantly different.

The expected leave date for the UK (and that which is currently written into law) is Friday 29 March. Although May has said that she will pass legislation to remove that legal binding in the meantime.

Take control of your finances

As the pound responds in turn with recent developments on the Brexit front, it’s likely that volatility will ensue into the foreseeable future. 

In OFX’s recent Currency Corner video, currency expert Hamish Muress explains that if a long extension is granted from the EU (which is one of the alternative options to May’s deal), investors and businesses are given two years to plan and prepare. A long extension could also see the GBP rise to 1.35 against USD, which has many taking advantage of OFX’sLimit Order option.

If you’re not sure of what rate you want exactly, you can also take advantage of favourable movements using aForward Exchange Contract. This means you can lock in a rate and transfer at any point up to 12 months. 

OFX also offers tools in understanding market movements throughDaily and Weekly Commentary, and rate monitoring tools like Rate Alerts, so you’ll be notified of favourable movements without committing to a transfer right away.

Register with OFX today to get started

The post What’s next for Brexit and what does it mean for your finances? appeared first on Australian Times News.

*Please be advised that while every effort is made to keep this information up to date, OFX nor AustralianTimes.co.uk do not provide tax (financial) advice. Consult a tax professional about your unique circumstances.

*AustralianTimes.co.uk proudly partners with OFX on the Currency Zone

Do Expats Have to Pay Taxes?

The simple answer: yes. Expats may be required to pay income tax in any geography where they had residency and were earning during the tax year. If you are a U.S. citizen, you are usually required to file income taxes in the U.S. every year, and may be required to pay income tax if your income is above the Foreign Earned Income exclusion. Most other countries do not require citizens who reside abroad to pay income tax on money earned overseas, but you may need to pay taxes like capital gains tax or inheritance tax on the sale of assets in the jurisdiction where the assets are held.

What is a Foreign Tax Credit

Some countries, including the United States, the U.K. and Australia, have foreign tax treaties in place. These treaties usually offer foreign tax credits when you are able to prove that you’ve paid tax elsewhere. These credits help to prevent double taxation, and they may apply to income taxes (including pension payments), inheritance taxes, gift tax and/or and some interest payments. Speak to a qualified tax professional about your unique situation.

In order to be eligible for a foreign tax credit or offset:

• You must have a tax imposed on you.
• You must have paid that tax in a foreign country.
• The tax must be a legal and actual liability.
• The tax is on income, in lieu of income tax, or must otherwise be included in assessable income.

Limits to filing For Foreign Tax Credits in Australia

In Australia, as of 2017, you have four years to file regarding a foreign tax payment.¹ If you paid a foreign tax on income that has already been filed in Australia, you can submit an amended assessment within the four year time period.

Limits to Filing For Foreign tax Credits in the United States

In the United States, you can choose a credit or a deduction for a qualifying foreign tax within the year of accrual. It is an annual choice for foreign taxes paid or accrued during the year, so the decision must be made with every annual filing. You may be able to amend a return up to three years after filing.²

Limits to Filing For Foreign Tax Credits in the U.K.

If you are a U.K. resident, you do not need to fill in a tax return on foreign income if your total dividends are under £300.³ The rules may be different when your domicile is abroad. If you have already paid a foreign tax and are trying to recoup that fee under a double-taxation agreement, it is important to know you may not recover the full amount of foreign taxes paid. There are two factors for this:

What is a Foreign Tax Treaty?

A foreign tax treaty is an agreement between two countries to prevent double taxation. Residents may have access to tax credits, deductions, exemptions or reductions based on taxes paid to a foreign government. Benefits of a foreign tax treaty are dependent on a taxpayer paying taxes in a foreign country then submitting documentation of those tax payment when filing elsewhere.

It is important to look at specific agreements when it comes to a foreign tax treaty. The United States Internal Revenue Service, for example, has tables for withholding rates, compensation, and benefits under foreign tax treaties.⁶ The U.K. provides detailed worksheets for filers claiming foreign tax payments and calculating returns.⁷ The Australian Taxation Office also provides a worksheet that can be downloaded and completed to determine tax offsets.⁸

What Types of Benefits are Part of Foreign Tax Treaties?

Benefits under foreign tax treaties vary by country, but you may have benefits waiting for you if you meet certain criteria. Here are a few categories that may have special tax treaty credits:

• If you are a professor or teacher doing research in a foreign treaty country
• If you are a student, trainee or apprentice and receive funds for study, research, business, professional or technical training
• If you receive some grants, allowances or awards associated with a non-profit organization
• If you have a non-government pension or annuities
• If you have investment income like interest or dividends
• If you have received capital gains other than sales of real property

Consult a tax professional to help you reduce your international tax burden.^9,10

What Records Do I Need to Keep to Claim a Foreign Tax Benefit or Offset?

You will need written evidence that you have paid a foreign tax. This documentation should be retained for at least five years after all filings have taken place. In the United States and the U.K., this information is provided at the time of filing and specific forms must be completed when tax documents are remitted. In Australia, the Taxation Office advises that you keep evidence of foreign income tax offset, so it can be provided upon request. If they require information that is held overseas, they will provide time for it to be acquired and remitted.¹¹

The written evidence should include the following information:

• Amount of foreign income or gains in the foreign currency
• The foreign tax year (may be different than home country tax year)
• The nature and amount of the foreign tax levied
• The date of payment of the foreign tax
• Any balance due on the tax

Which Foreign Taxes Do Not Qualify for a Credit?

In the United States there are some taxes that you pay to a foreign government that do not qualify for a foreign tax credit. These include, but are not limited to:

• Taxes which qualify for an itemised deduction
• Taxes on foreign mineral income
• A portion of taxes on combined oil and gas income
•  Social security taxes paid or accrued to a foreign country where there is a social security agreement in place¹²

What Limits and Exemptions Exist for Foreign Tax Credits in the United States?

Your foreign tax credit cannot be more than your U.S. tax liability multiplied by a specifically determined fraction. That fraction is as follows: Your taxable income from sources outside the United States over your total taxable income from the U.S. and foreign sources combined.¹³

However, there are a few exemptions to this foreign tax credit limit.

• If your foreign source of income is passive income, you may not be subject to the limit.
• If your foreign taxes are not more than $300 single, $600 joint filing (as of 2017).
• If you otherwise report all of your gross foreign income and taxes on a payee statement.
•  If you determine to exempt yourself from the foreign tax credit limit for the year.¹⁴  

Which exchange rate should be used to pay foreign taxes?

Australian Exchange Rate for Tax Purposes

If you are in Australia and need to convert foreign income for tax purposes you have two options for this calculation:

First, you can use an exchange rate from a specific time period as determined by Australian tax law. A table of specific times is available on the Australian Taxation Office website for ordinary income, expenses, obligations, liabilities, receipts, payments, and other values that apply to revenue accounts, capital accounts or otherwise.

Second, you can use the average exchange rate. This means you can use average, daily or rates consistent with those used in an audited financial report. The goal of using average exchange rates is to find a rate that would be considered a “reasonable approximation” of an exchange rate if you had used spot rates.

An example of using average exchange rate is such: Say you are receiving a foreign pension. Instead of calculating the exchange rate at each and every payment, the average exchange rate can be applied to the entire yearly amount.

If you receive funds in the currency of your home country, then the amount total can be used without applying an average exchange rate.

US Dollar Exchange Rate for Tax Purposes

All items on a U.S. tax return must be reported in U.S. dollars. In general, the Internal Revenue Service advises that payer use a spot rate, or the prevailing rate when an item is received, paid or accrued. Some qualified business units (QBUs) can use a foreign currency. The IRS has no official exchange rate and generally accepts posted exchange rates that are consistent.

Note: When the IRS receives a tax payment in a foreign currency, the exchange rate of the date  the currency is converted to U.S. dollars by the bank processing the payment will be used.¹⁶ To keep control of the exchange rate you get when paying taxes abroad, use OFX to lock in an exchange rate for up to 12 months.

U.K. Exchange Rate for Tax Purposes

The United Kingdom provides a list of monthly exchange rates as guidance for remitting payments or calculations. These exchange rates should be used to convert any foreign currency.¹⁷

How Do I Save Money When Paying Tax Abroad?

Transferring money internationally with banks is expensive. Most banks charge a margin on the exchange rate of up to 5% in additional to hefty international transaction fees. Use OFX to pay tax abroad, so you can keep more of your hard earned cash. Our margins are substantially less than the banks’ and we can help you lock in a rate today, for payment at a later date.

If your payment date is flexible, you can use a Limit Order to set your desired exchange rate, and your payment will be made when the rate is right. These services all give you more control over your money, which is how we think it should be.

Also see: 10 things you should absolutely do before you move abroad

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1) Find a Place to Sleep

When you move internationally with a company, you may only have a few weeks of accommodation provided for you before you have to find a place to live for yourself. If possible, fly out beforehand to see some properties in person, and ask for assistance from a local realtor who can teach you about the market and its costs of living. You’ll want to check out a few different neighbourhoods before making your choice. Ask about utility hookups and which utility costs are typically included in the rent.

2) Notify Everyone About Your Move

This doesn’t just include your friends, family, and boss, but also your banks, creditors, credit card issuers, insurance providers, and other professionals who would need to know that you will be changing your address and moving overseas. Let your post office know about your move, so you can have your mail redirected. If you are a registered voter and you wish to continue voting while abroad, be sure to register as an overseas voter. When you move overseas, you’ll often be required to file an official change of address document with the tax authorities.

3) Register With the Embassy

A good way to be alerted to emergency news is by registering with your embassy. In the United States, the State Department even offers a Smart Traveler Enrollment Program (STEP) that communicates information to citizens living abroad. Other nations may have similar programs for their citizens, so check your country’s State Department equivalent to find out if there is a program that you can register for before heading off. Your embassy could help you gain access to valuable information and may be able to assist you if you need help, such as if you lose your passport or get arrested.

4) Get Your Visa

Research the visa requirements for the country that you are planning on moving to. A simple internet search will start you off on the right track. It is highly recommended that you sort your visa requirements prior to leaving, as it is often harder to get a visa or change your residency status after you have already entered a country.

5) See Your Doctor

Make an appointment with your doctor to let him or her know that you are moving abroad. You can get a full checkup before your move, and your doctor can also provide you with the vaccinations that are necessary to keep you healthy in your new country. Your doctor could also provide you with an International Certificate of Vaccination, as taking a record of your health and vaccinations with you can be helpful when seeing medical professionals abroad, especially if you happen to be in an area where an outbreak occurs and you need to prove that you have already been immunised. Also, don’t forget to refill your prescriptions, or have your doctor give you a letter of authorisation, so you can get your prescriptions abroad without taking the medications through border security. Many medications have different brand names and slightly different formulations in other countries, so check with your doctor to make sure any substitutions are appropriate for you. Be mindful that infant vaccination schedules vary in different parts of the world, so be particularly careful when getting the next scheduled vaccination for children in another country.

6) Get Travel Insurance

Some countries will require proof of travel insurance before issuing a visa to you, so do your research into requirements before you move. Give yourself enough time to enroll and to receive all of the documents that you will need to prove that you are covered.

7) Start Learning a New Language

If you are moving to a non-English speaking country, be aware that you will need to learn the new language if you want to get around easily once you settle into your new home. Because learning a new language is a long-term commitment, start as soon as possible. That way by the time you move, you should at least know the basics necessary to get around, including how to read street signs and ask for help.

8) Apply for an International Driver’s License

With an international driver’s license, you may find it easier to drive abroad, and you may need it if you are planning on renting a vehicle in most nations. Once your original driver’s license expires while you are abroad, your international license will expire as well, so you can then apply for a license in your new country of residence. Be sure to take a copy of your driving record with you when you move so that you can use it to apply for a new license and potentially avoid having to take any tests. You may also need a copy of your recent driving record for getting auto insurance, if you buy a vehicle abroad.

9) Sell What You Don’t Need

A good way to get some extra cash before your move is by selling whatever belongings you do not plan on taking with you. Once abroad, most non-essential items become cumbersome, so try to cull any items that you don’t need. If you’re leaving a home that your own, you may want to compare the market value of renting it out with the furnishings included, or putting your things into storage. No matter how careful you are with packing and preparing, your life will change in unexpected ways while abroad. You may need to adjust your household budget accordingly and expect to acquire some things new.

10) Find a Reputable International Shipping Company

To make moving abroad as easy as possible, take as little as possible. For the items that you can’t leave behind, use an international shipping company to have them securely packed and shipped. Get quotes from various companies, so you can find the most affordable match that will provide the best value. To save money, think clearly about the gap between when your shipment arrives and how long you will have to live without your things. For instance, if you can’t go a month without a frying pan or microwave, there’s not much point to paying to ship items that you’ll probably end up purchasing for immediate use. Similarly, don’t pay a premium for expedited delivery if you don’t need it. Faster shipping may increase your costs of warehousing and storage, if you haven’t found a permanent home by the time your goods arrive. And to be certain a company is a reliable choice, check its credentials and accreditations, such as FIDI Accredited International Mover (FAIM) accreditation. Avoid companies that have terrible customer reviews, that request cash or large deposits, and that don’t provide insurance or storage options.

If you liked these tips, you can delve even deeper into how to relocate to another country by reading the OFX ‘How To Manage Your Finances Abroad’

Feature courtesy OFX.com

AustralianTimes.co.uk is a proud partner with OFX on Currency Zone. Find out more about transferring your money home or abroad

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Myth #1: Forex Is a Short Term Strategy

The factors that underpin forex movements are macroeconomic factors, and most of the time, those factors don’t change that fast. So while the day to day news cycle can cause volatile swings, there are still long term trends that exist in many currency relationships.

Myth #2: You Can Make Money In Many Currency Pairs

There’s a lot to learn about the factors that influence exchange rates. From milk in New Zealand to the travertine trade in Turkey, most professionals make the most money from focusing on specialised pairs and gaining a solid understanding of those key relationships.

Myth #3: Your Forecast Is The Way To Win

Predictions and forecasts can cause you to lose sight of what’s really happening in the market due to cognitive bias. Behavioral economics has shown us that when you’re predicting, you’ll most likely end up seeing only what you want to see instead of adapting to what’s happening in real time in the market. That said, having a forecast or a level in mind is not a bad idea, it’s just that many people become too emotional and don’t stick to their plans. A common saying in trading is to “plan the trade and trade the plan”.

In order for your forecast to work, you need to detach from emotions, constantly reassess your strategy and be prepared to walk away if it’s not working.

Myth #4: The Forex Market Is Really Risky

Many people are under the false impression that the forex market is actually a riskier option than other markets. The reality is that any market, any investment, and any trade needs to be assessed, and the risks need to be contained in order to achieve the best results. More growth usually means accepting more risk whether you’re trading currencies, stocks, bonds or investing in real estate.

Myth #5: The Trend Is Your Friend

Many newcomers to forex look at historical data and long term relative exchange rates to evaluate currencies. Professionals in forex understand that the fundamental relationships, like the commodities that drive the value of the AUD, will generally hold true over the long term. That said, forex is also heavily influenced by what’s going on right now.

New governments and trade policies, political and military turmoil, populist sentiment and current economic conditions will always trump historical valuations when it comes to pricing currencies in real time.

Trade wisely with the help of facts, not myths

Overall, using forex as a component on your overall investment portfolio can be a strategic way to diversify your assets, but staying informed is critical.

Check out the Currency Zone on this site for the latest AUD and GBP values and register with OFX to get the best forex transfer rates for sending money abroad.

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What should we expect

Economic data from the US has been largely positive over recent months. Unemployment has fallen and durable goods, industrial production, housing construction and retail sales have all showed signs of growth.  Naturally this has created a stronger outlook for the economy.

As a result, the Fed Futures have projected the chances of an interest rate hike from 0.25%-0.50% to 0.5% to 0.75% at an overwhelming 95% – 100%. If the Fed follow through with raising interest rates, the impact on the currency markets could be muted.

Nevertheless, a key factor in volatility will be any comments made surrounding future hikes that are likely to be scheduled as early as May next year. This future guidance will be vital to the near-term direction of the US dollar and if the Fed do decide to schedule an aggressive increase in interest rates then we could see an extension of the current trend of dollar strength.

Expect the unexpected

As it is the year of surprising outcomes, we should expect the unexpected this Wednesday. Although unlikely, the Federal Reserve may still decide to keep interest rates at current levels. Given the fallout from Brexit, the fragility of the euro, plus Trump’s election victory, the Fed may take a cautious stance.  In this scenario, there would almost undoubtedly be a hit to the US dollar. In addition, investors would be compelled to seek out better yields.

Plan for the future

At OFX, much of our work includes protecting our clients from future volatility by keeping them abreast of relevant trends.  We’ve got the right products such as: forward contracts, limit orders and spot trades to help develop a tailored strategy for businesses to ride out currency fluctuation.

To find out more, go to OFX.com

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