Find us on Google+ My Sensible Cent: August 2013

Friday, August 23, 2013

Forex Trading Strategies Every FX Trade Investor Should Know

Online currency trading takes place all over the world, throughout the day for five days a week. When online currency trading began, only institutional investors such as investment banks and hedge funds were able to trade. But as online trading expanded, individual investors and small currencies were allowed to participate in the forex markets. Investopedia defines forex market as “The largest and most liquid market in the world with an average trade value of $ 1.9 trillion a day and includes all of the currencies in the world”. Similar to other forms of investment, currency trading is about supply and demand, the spot market lets the investors to buy and sell foreign currencies at the current trading price, spot market is the largest currency market. Futures markets are another option which lets the investors to trade different currencies including the Swiss franc, British pound and Japanese Yen. 

The strength and weakness of global currency fluctuates continuously and the objective of currency trading is to anticipate a rise in a currency’s value in relation to other currencies, foreign exchange can also be used to minimize a loss in the value of funds that may occur due to inflation or other negative forces in the market. Currency fluctuates for many reasons, but supply and demand is the major force that drives global currency prices. If a currency becomes scarcer within a country or demand for a currency increases worldwide, the value of the currency will increase. Conversely, in a country where too much money is available and or there is little demand for the currency, the currency devalues.

Factors that contribute to the demand for a particular currency include the level of balance of payments and economic growth. Why trade Forex? The extreme volatility of forex markets makes it possible to make more money compared to other traditional equity investments; however, it is important to note that the same volatility could lead to huge losses. Other benefits of trading in foreign exchange are the relative low costs of trading compared to trading in stocks. How to Start Trading? Before starting to trade in the forex market, it is necessary to study foreign market and currencies using financial newsletters and researching on the internet, it is also advisable to seek professional guidance from a forex trading specialist. Watching the trading patterns of large banks that use advanced forex trading strategies would be of great help, these banks have a lot of money at risk hence they employ the best strategies. You can start trading with an undervalued foreign currency and taking into consideration your financial capabilities make a purchase, you have to wait till the rate of foreign currency you purchased equals to that of your own currency. Once the currencies are level or appreciate to a certain extent you can convert the currency back to your own currency for a profit. 

The forex market is unregulated and the lack of a central market makes currency trading an over the counter (OTC) transaction. Individuals, corporations, governments and other institutions have access to the foreign exchange market. Technical Indicators- Moving Average Converging Divergence Technical indicators help in the process of price prediction in foreign exchange trading, the Moving Average Converging Divergence (MACD) is one of the most reliable indicators, professional traders rely on this indicator. MACD is the difference of a 12 and a 26 exponential moving average, it subtracts the 26 period from the 12 period and the result will be displayed in a single line called the MACD main line. It also indicates if market is overbought or oversold, when it is overbought, it is riskier to go long and when it is oversold it is riskier to go short. A rising MACD indicates a rising price, when the two lines meet it is considered a neutral situation. Finally a decline below neutral indicates a short term declining trend.

10 Things Millionares Avoid Like Plague

Everyone admires millionaires and wants to get where they are, be like them or even do better. It is okay to do this but many a times people do not work towards acquiring wealth, but just procrastinates. Yes, there is that time you had a very brilliant idea that you thought it is actually a crazy one, but never did anything towards it. Only to see someone else implementing the same idea and succeeding in it.
The millionaire’s next door does a lot to get ahead. They make sacrifices, work smart and put in a lot of effort to get to where they are. I have interacted with several millionaires and actually worked for one, a self made millionaire who started from nothing. He reports to work every day at 6.00 am, yes when most of us are asleep or just waking up. I recall being told when he started the company he was the messenger, writer, receptionist, and manager e.t.c basically doing everything.
However many of us just admire their money not know what they have gone through to get there. Some have made mistakes and  failed but they do not remove their eyes from the goal.
Here are some of the things that millionaires do not do:
1. Think He Knows It All – People who think they know it all stop learning and thus become unaware of new opportunities. Once you lose awareness, you lose.
2. Use Time as a Measurement for Success – The millionaire next door measures success based on output quality, the results. The amount of time spent on something means nothing if the results do not meet the expectations.
Millionaire3. Socialize with People Who Waste Money – The people you socialize with influence your habits. It is impossible to save money if you constantly hang around people who blow it all.
4. Desire Instant Gratification – You have to think long-term to attain long-term success. The millionaire next door desires long-term deferred compensation over instant gratification.
5. Waste Time on Senseless Activities – They say time is money. In actuality, time is far more important than money. Time is your life. If you waste it, you will fail.
6. Focus His Attention on Negative Obstacles – If you focus all your attention on negative obstacles, you will lose sight of the finish line. You can’t get there if you can’t see it.
7. Pay Retail for Name Brand Clothing – You can easily save hundreds of shillings a year on clothing purchases by waiting for sales or shopping at discount retailers. Better yet, avoid name brand clothing all together.
8. Replace What is Not Broken – The millionaire next door fixes things. Fixing something is usually significantly cheaper than buying a brand new replacement, especially if you fix it yourself.
9. Impulse Buy – Impulse buying wastes money and leads to a cluttered house full of “stuff” you don’t need or use. If you see something you like at the mall, walk away. Think on it for a day or two. If it still holds value in your mind, maybe it’s worth buying. Never buy something the first time you see it.
10. Rent – The millionaire next door has a long-term mindset. In the long-term, owning something is always more cost effective than renting it. The key is to purchase quality products for long-standing use.

Monday, August 5, 2013

Understanding Labour Laws in Your Job Dilemma: To Leave or Not

A reader wrote this to me recently and I thought it is wise to shed some professional light on it.
“I have just started my career in an upcoming organization – 6 months into it. My close working relationship with the management makes me feel like it is my second home. However, I’m a graduate Civil and Structural Engineer and working as a site supervisor (Foreman) doesn’t offer me much growth career wise.
I have just got an offer from one of my dream companies in the Structural Engineering / construction Industry. I’m to join the team as a trainee engineer with opportunity for growth.
My confusion is that I  need to give my current employer a one month notice and I still do not think he will let me go since I’m their key supervisor and have been assigned their mother project.
The pay in my new job offer is slightly higher (by 5,000) than what I’m getting now. But that is not what I’m looking for. If I terminate my job without the 1 month notice, I will be required to pay the company my one month salary, which I don’t have.
Kindly advice”
From your email, it’s clear you are not satisfied with your current job as it doesn’t give you much experience and it is not in your career line. Also your closeness to management which makes you feel like your work place is a second home seems to tie you to the job which you confess, doesn’t offer you much growth career wise.
It’s good you are in good terms with the management, but this should not prevent you from following your passion in a career where you will grow in your profession. Remember that in any job both the employer and the employee need to gain mutually and experience growth in terms of profits and skills.
If the opportunity does not afford you the ability to develop new, in-demand skills every year, it could be a dead-end job that will become increasingly difficult to leave as your skills become less and less marketable to other employers.
Additionally, you need to take charge of your career. Be informed that making accepting a new job offer is one of the most important career decisions that you can make in your life. Put your interest first and then your employer’s second. Don’t be blinded by your relationship with your employers, so let go the idea that s/he will not let you go.
The other company that gave you a job is your dream company according to what you say. So I want to believe this is a dream come true for you. Grab it!  You have nothing to lose, in any case only risk takers succeed in life; the higher the risk the greater the returns. You will be passionate in your work and not only gain professionally, but also get a better pay.
For Vacation Notice:  The labour laws provide an employer/employee shall give a month notice for any dismissal/ vacation failure to which you are  fined an equivalent of one month’s salary. However, the same laws provide that an employee can give two weeks’ notice in lieu. Meaning you can give a notice of two weeks to your employers who will then pay you half of your salary. You can take the second option.
Lastly, leave in good terms with your current employer. The world is very small and you never know where you might meet each other. Explain to the HR or whoever you report to about your notice until they understand you. Thank them for giving you the opportunity to work at the company and the skills you have gained while there. Remember your employer  may be asked for a recommendation letter and therefore he needs to put you in good light.
Also, let your new company know that you are working and need some time to clear with your current employer. Give them a time period when you can be done.
Remember you are the person to make final decision even if you are persuaded not to leave. Take charge of your Career! You are responsible for your own destiny!
Good luck.