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FOREX RELATED QUESTIONS:
- What is margin?
- What is margin level?
- What is scalping?
- What time does Forex trading open and close?
- How does Swissquote handle overnight positions?
- What happens if, during the overnight/weekend period, there is a price gap, will a pending order still be executed at the specified price?
- Are there any situations when the spread will increase?
- What are conditions surrounding precious metal trading?
- What are the minimum dealing amounts for Swissquote accounts?
- On the internet, I keep seeing references to DD and NDD. What do these terms refer to?
- What is a Market Maker?
- Is Swissquote Bank a market maker?
- Is Swissquote an ECN (Electronic Communication Network) broker?
FOREX RELATED QUESTIONS:
Q: What is margin?
A: In financial trading, the word margin is used to describe a deposit used as collateral for taking positions in the market. Trading with margin allows traders to basically open positions on credit - increasing the client's buying power. Swissquote allows clients to use 100:1 leverage, thus requiring a 1% margin requirement (for tickets up to $30M) See Spreads and Conditions for more details.The amount of leverage refers to the maximum a client may buy on "credit" and the minimum he must maintain as collateral. Dividing 1 by 100, the minimum margin requirement is found to be 1% [converted to a percentage]. If a client were allotted 50:1 or 25:1 leverage, the maintenance margin levels would be 2% and 4% respectively.
Q: What is margin level?
A: Margin level is a reflection of one's available margin determined by the ratio of one's total exposure, open profit or loss and equity on a trading account. If a client were trading with 100:1 leverage, he/she must maintain a margin level above 1%. Should this level fall below the 1% threshold, all open positions and orders will be closed automatically.To calculate margin:
Account Balance +/- Open Profit/Loss x 100 = Margin Level
Absolute Positions in USD
Example:
Trader X is long 6 standard lots of USDCHF. His account balance is $20,000 with an open loss of $1000.
20,000 USD - 1000 USD x 100 = 3.17% Margin Level
600,000 USD
Q: What is scalping?
A: Scalping is a trading system that attempts to quickly enter/exit the market, catching small, profitable price movements. A scalping strategy can range from a few trades a day to thousands. Swissquote allows clients to trade as they wish - there is no dealing desk intervention.Q: What time does Forex trading open and close?
A: The Forex trading opens on Sunday at 23.00 and CET closes on Friday at 23.00 CET.Q: How does Swissquote handle overnight positions?
A: Positions held overnight are automatically rolled to the next trading day. The cost of carry for holding a position overnight can either be a credit or debit to the clients account, depending on the assets and orientations of their positions. Swissquotes overnight rates are derived from interbank swap rates. For more information, please see Overnight Positions .Q: What happens if, during the overnight/weekend period, there is a price gap, will a pending order still be executed at the specified price?
A: Swissquote will execute your order at the best price available. In the event of a market gap, the order will be triggered with the market open and executed as close to the specific price as possible.Q: Are there any situations when the spread will increase?
A: As Swissquote does not make the market on currency pairs, our clients cannot have fixed spreads. Spreads may increase in times of extreme market volatility or lack of liquidity. However, Swissquote connects to more liquidity providers in North America and Europe than any other STP broker. This added liquidity keeps advertised spreads fairly consistent and diminishes the risk of spread widening.Q: What are conditions surrounding precious metal trading?
A: Swissquote offers spot Gold and Silver trading against the US dollar. The pairs are represented on the trading platform similar to currency pairs: Gold - XAU/USD Silver - XAG/USD. Spot Gold/Silver trading is available to Swissquote clients during liquid hours, from 0730 - 2230 CET, Monday-Friday. The standard dealing amount is 1 ounce for Gold and Silver.Q: What are the minimum dealing amounts for Swissquote accounts?
A: To trade FX, the minimum amount is 1K.Q: On the internet, I keep seeing references to DD and NDD. What do these terms refer to?
A: DD stands for Dealing Desk and NDD for No Dealing Desk. A Dealing Desk firm is also known as a market maker, sometimes abbreviated MM.Q: What is a Market Maker?
A: A market maker provides a buy and sell price in a financial instrument and acts as the counterparty of the transaction with its clients.Q: Is Swissquote Bank a market maker?
A: Yes, Swissquote is the counterparty to all clients’ transactions. Swissquote's proprietary risk management strategy systematically monitors and manages its currency exposures. This approach allows Swissquote to provide clients with more stable prices and faster trade execution compared to non market maker eForex providers.Q: Is Swissquote an ECN (Electronic Communication Network) broker?
A: No. An ECN broker electronically matches trades between the participants in the ECN platform. There are limitations with ECNs as there may not be enough liquidity available due to lack of participants placing bids and offers in the ECN which will cause unstable spreads and partial trade executions. Our business model provides consistent liquidity and stable spreads offering clients better execution conditions versus ECN platforms.Swissquote RELATED QUESTIONS:
Q: What regulatory body is Swissquote Bank supervised by?
A: Swissquote Bank SA is regulated by the FINMA - the Swiss Financial Market Supervisory Authority.Q: Where does market news come from?
A: Swissquote's market news is provided by Dow Jones News Wires and Bloomberg International. Swissquote also offers FX Insider to live clients. This feed is linked directly into the Advanced Trader platform and the information is provided by our Strategy Desk, led by Peter Rosenstreich .ACCOUNT RELATED QUESTIONS:
Q: Do clients pay fees on a deposit when opening an account?
A: Swissquote does not charge fees for client deposits nor withdrawals. However, banks may charge wire transfer fees. It is important to ask your bank what their applicable fees will be when initiating a wire transfer.Q: How does one withdraw their funds?
A: Clients may withdraw their funds by sending an email to the Back Office (forex.backoffice@swissquote.ch). Each request must provide their full name, phone number, e-mail address and account number. Once the Back Office has received the request and all security checks are in order, the client will receive the money by standard wire transfer to his/her account. In accordance with Swiss Anti-Money Laundering practices, Swissquote Bank will only send funds to a registered account under the client's name or business.Q: Is there a minimum amount of trades a customer must do?
A: No. Swissquote charges no inactivity fees nor penalizes customers for their trading habits.Q: What is the procedure for switching from one account type to another?
A: Clients may change their account type by sending an email to the Back Office (forex.backoffice@swissquote.ch). Upon request they must provide their full name, phone number, e-mail address, account number and the change they'd like to make.Q: Is it possible to keep an account open with no funds?
A: The totality of a client's funds may be withdrawn without penalty. However, in this case the account will be flagged inactive. The account will remain open until the client decides to reinvest with Swissquote or close their account.TECHNICAL QUESTIONS:
Q: How do I troubleshoot problems with the Advanced Trader platform?
A: The Advanced Trader platform is a Java-based program. If the platform is unusually slow or a problem occurs, often times this is because the client's Java Cache is overloaded; many programs/websites store information on a person's computer within their cache. To quickly resolve this issue, a person must simply clean out their Java cache.
Q: Why is their sometimes a difference between prices on Swissquote's charts and the prices provided in the Live Trading windows?
A: The prices on the charts do not show all the highs and lows of the markets and can loosely be considered the average price that Swissquote is able to offer. The Swissquote graphs do not show the prevailing spread at a given time, while showing the highest Bid and lowest Offer.Q: Is the Mobile Trader Platform compatible with the Blackberry and iPhone?
A: Yes. Swissquote’s mobile platform is compatible with all internet-enabled mobile devices. Swissquote does provide a separate platform specifically design for iPhone usage.
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