Foreign Exchange in Kenya
Foreign ExchangeÂ is defined as the rate or the value in which one nationâ€™s currency is traded for another foreign currency. Forex exchange is an industry and a profession just like any other. The industry requires proper training and dedication. Enough information about the trading is available from numerous sources including journals, online and from other sources.
How government regulates Foreign Exchange
Forex Exchange involves the comparison between foreign/international countryâ€™s currency as compared to that of our own. When the government regulates the exchange rate, it is said to be fixed or pegged rate. They regulate the trade through the central bank. The central bank sets and maintains the official exchange rate. This set price is determined by the other major trading currency mostly the US Dollar, Euro, yen and other basket of currencies as Foreign Exchange.
The most common way of determining the foreign exchange rate is through the fixed or the pegged rate. The central bank buys and sells and its own currency on the Foreign Exchange market in return for the currency to which it is pegged. Therefore, the central bank ensures that it is supplying the market with the currency being traded. This in turn maintains the trading rate of the central bank and keeping high level of the foreign reserves. This way the reserved amount of the Forex Exchange held by the government can be used to release and to absorb extra funds into the market.
Foreign Exchange investment requirements
Establishing a suitable broker which offers the best brokerage services; who will provide good consultancy and offer analytical information with the best strategies to win the trade is one of the requirements in Foreign Exchange.
Then the trader should open an account containing the minimum balance ranging from$500 to $1000. The minimum balance ranges from brokerage firms. FX account is opened is used to control the transactions in Forex online in Kenya. The account is opened in one of the common currencies, usually dollars, Euros or rubles.
Lastly, a special computer program is then installed; the PC used should of high speed. Certain software meant for Forex Exchange is then installed. The software enables the trader to reach market information in time. They are easy and fast to operate.
This way they ensure security and effectiveness in the Forex Exchange. Examples of such softwareâ€™s include, Meta Trader 4, TradeMatser, Ninja Trader, Devlani trader 4 and many others.
Vital knowledge about Foreign Exchange
Foreign Exchange needs a lot of skills and self discipline is required to succeed in this industry. More so, the trader must develop the tendency to explore the market charts to record the changes and the variations that may affect Forex Exchange. It is also very important to stick and follow the market trends. Traders participating in forex trading are encouraged to register in certain journals periodically.
Journals are very educative and informative in Foreign Exchange. They help the trader to investigate and understand charts, conversations and other scenarios that need to be known. The softwareâ€™s are important tools as they assist the Forex traders to supervise the irregular market states in exchange trading. This ensures that appropriate purchases are done during the right volatile time.
The government should also ensure properly regulated fluctuations in the market. Thus the central bank adjusts the official exchange rate whenever necessary to maintain the right rates during Foreign Exchange