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Date of Forex Trading
In forex trading or trading in foreign exchange one cannot afford to forget that someone is actually waiting for your response somewhere in this world for exchanging his currency with yours in real sense. The bank on the other end will have to deliver money to the other party when you have decided to buy certain amount of currency from them. As per the strict rules of forex trading there are certain dates that can affect your financial condition to some extent. These dates of forex trading may include value date and trade date.
The position of relative values between two currencies changes frequently in forex trading. People buy a pair of different currencies like USD or Euro with an anticipation that the value of one currency say Euro will increase in comparison with the other say dollar. You will sell the same pair if you assume that the value of dollar will increase. So you can buy or sell the currencies to close your forex trade. The size of your trade and size of changes in the relative values of both the currencies at the start of the trade will help in deciding your profit or loss in the trade.
There are certain dates of forex trading that can influence your financial situation in forex market. Some of these dates are worth mentioning here.
Settlement date: Both the parties selling or purchasing a security are given a period of time to deliver the transaction of each side. The act of payment and delivery of securities is termed as settlement in forex trade and the day of settlement is the settlement date which is also known as value date. Both the parties in the trade settle the value of their securities on that date, while trading them officially. You will have to pick up or deliver the currency of your choice by the value date of your settlement.
Date for rolling forex settlement: In most cases when a trade is settled between two parties it requires few days to close the trade transaction. Suppose you have decided to pay the price of the stocks you have decided to buy within three working days. But your settlement date will automatically rolls forward for one day if you keep the transaction open even after settlement date. The date of rolling settlement does not affect the closing and opening value date of forex trading, regardless of the number of days you have kept it open.
Date of reporting the forex trades: The existence of forex markets is to facilitate the exchange of various currencies in realty. There is no difference between the customers trading the change in the values of the currencies or selling or buying currencies for a forex broker. The companies that are exchanging money understand the importance of value date of forex trading whereas trade date on the statement of forex trading is important for a trader. The date of reporting forex trade is important as per the rules of IRS as it helps in calculating the days of holding stocks.
In forex trading or trading in foreign exchange one cannot afford to forget that someone is actually waiting for your response somewhere in this world for exchanging his currency with yours in real sense. The bank on the other end will have to deliver money to the other party when you have decided to buy certain amount of currency from them. As per the strict rules of forex trading there are certain dates that can affect your financial condition to some extent. These dates of forex trading may include value date and trade date.
The position of relative values between two currencies changes frequently in forex trading. People buy a pair of different currencies like USD or Euro with an anticipation that the value of one currency say Euro will increase in comparison with the other say dollar. You will sell the same pair if you assume that the value of dollar will increase. So you can buy or sell the currencies to close your forex trade. The size of your trade and size of changes in the relative values of both the currencies at the start of the trade will help in deciding your profit or loss in the trade.
There are certain dates of forex trading that can influence your financial situation in forex market. Some of these dates are worth mentioning here.
Settlement date: Both the parties selling or purchasing a security are given a period of time to deliver the transaction of each side. The act of payment and delivery of securities is termed as settlement in forex trade and the day of settlement is the settlement date which is also known as value date. Both the parties in the trade settle the value of their securities on that date, while trading them officially. You will have to pick up or deliver the currency of your choice by the value date of your settlement.
Date for rolling forex settlement: In most cases when a trade is settled between two parties it requires few days to close the trade transaction. Suppose you have decided to pay the price of the stocks you have decided to buy within three working days. But your settlement date will automatically rolls forward for one day if you keep the transaction open even after settlement date. The date of rolling settlement does not affect the closing and opening value date of forex trading, regardless of the number of days you have kept it open.
Date of reporting the forex trades: The existence of forex markets is to facilitate the exchange of various currencies in realty. There is no difference between the customers trading the change in the values of the currencies or selling or buying currencies for a forex broker. The companies that are exchanging money understand the importance of value date of forex trading whereas trade date on the statement of forex trading is important for a trader. The date of reporting forex trade is important as per the rules of IRS as it helps in calculating the days of holding stocks.
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Forex