Monday, May 2, 2011
Top 8 things to know about a mortgage
Deciding what type of home loan is best for your needs is an integral part of the home-buying process. But it’s not always easy. Here are the most important factors you should compare when shopping for a mortgage.
1. The principal
Your mortgage principal is simply the amount you are borrowing to buy your house. In other words, it’s the price of your new home minus your down payment. When you shop for a mortgage, each bank will tell you how much it is prepared to lend you based on your income and your credit score. This will help you determine how much house you can afford.
2. The type of mortgage
Traditionally, mortgages fall into two broad categories: Those with a fixed interest rate and those with an adjustable rate. With a fixed rate mortgage, you usually pay the same amount each month for as long as you carry the loan. These mortgages can mean less risk and less worry about the future, but typically have a slightly higher interest rate than the initial rates offered by adjustable rate mortgages. Adjustable rate mortgages (ARMs) usually provide you with a lower initial interest rate, but their rates change with the market, so there is always the risk that your payments will increase.
Lenders also offer other options, some of which combine the features of both traditional mortgage types. Some begin with a fixed rate for three or more years and then convert to an ARM. Others let you choose how much you pay each month. When you discuss these mortgage types, make sure you understand the pros and cons of the loan and that your lender understands both your risk tolerance and your level of financial discipline.
3. The interest rate
Interest rates are the most visible part of any mortgage advertisement, but finding the best deal isn’t as simple as looking for the lowest posted rate. A loan with a lower rate but higher closing costs -- more on those later -- may end up being more expensive. The best way to understand the overall cost of a mortgage is to look at its annual percentage rate (APR), which takes into account the interest rate and the loan’s other costs.
If you choose an adjustable rate mortgage, you also have to understand how your interest rate may change. ARMs are usually adjusted according to an index, which is a published interest rate set by a third party, such as the federal government. The lender then adds a “margin” to determine the interest rate on your loan. For example, if the index is at 5.5 percent and your margin is 1.5 percent, your rate will be 7 percent. Many ARMs have caps to protect you against drastic increases from year to year.
4. The monthly payment
One of the most important things when choosing a mortgage is to make sure you can comfortably afford the monthly payment. However, it’s not enough to simply choose the loan that provides you with the lowest payment. Interest-only mortgages, for example, carry the lowest possible monthly charges, but they do nothing to reduce your principal -- even after years of payments, you’ll still owe as much as you did at the outset. Also, because your payments on an interest-only loan may rise later, you should make sure you can afford the higher payments. In most cases, you’ll want a mortgage that also helps you build equity in your home. (Equity is the market value of your home minus any outstanding mortgages or liens.) If you don’t build equity, you may not be able to refinance if your house decreases in value. And, when you want to move to a new house, you can put the equity of your current home towards the down payment of your next home.
5. The term
The mortgage term is the number of years your loan will be active. Mortgages with shorter terms carry higher monthly payments, but they can save you a lot of interest over the long term. For example, if you borrow $150,000 at 6 percent with a 30-year term, your monthly payment will be $900. The same loan with a 15-year term will cost $1,265 a month, but you’ll pay almost $96,000 less in interest and you’ll own your home twice as fast.
6. Discount points
Lenders may offer you the chance to pay discount points to lower the interest rate of your mortgage. One point is equal to 1 percent of the principal, so on a $150,000 loan, each point costs $1,500. Generally, for each point you purchase you can lower your rate by about 0.25 percent. Whether this is a good deal depends on how long you plan to keep your home -- the longer you plan to stay, the more it makes sense to buy points. The LendingTree Discount points calculator can help you determine if it makes sense to pay points upfront when taking out a mortgage.
Your mortgage principal is simply the amount you are borrowing to buy your house. In other words, it’s the price of your new home minus your down payment. When you shop for a mortgage, each bank will tell you how much it is prepared to lend you based on your income and your credit score. This will help you determine how much house you can afford.
2. The type of mortgage
Traditionally, mortgages fall into two broad categories: Those with a fixed interest rate and those with an adjustable rate. With a fixed rate mortgage, you usually pay the same amount each month for as long as you carry the loan. These mortgages can mean less risk and less worry about the future, but typically have a slightly higher interest rate than the initial rates offered by adjustable rate mortgages. Adjustable rate mortgages (ARMs) usually provide you with a lower initial interest rate, but their rates change with the market, so there is always the risk that your payments will increase.
Lenders also offer other options, some of which combine the features of both traditional mortgage types. Some begin with a fixed rate for three or more years and then convert to an ARM. Others let you choose how much you pay each month. When you discuss these mortgage types, make sure you understand the pros and cons of the loan and that your lender understands both your risk tolerance and your level of financial discipline.
3. The interest rate
Interest rates are the most visible part of any mortgage advertisement, but finding the best deal isn’t as simple as looking for the lowest posted rate. A loan with a lower rate but higher closing costs -- more on those later -- may end up being more expensive. The best way to understand the overall cost of a mortgage is to look at its annual percentage rate (APR), which takes into account the interest rate and the loan’s other costs.
If you choose an adjustable rate mortgage, you also have to understand how your interest rate may change. ARMs are usually adjusted according to an index, which is a published interest rate set by a third party, such as the federal government. The lender then adds a “margin” to determine the interest rate on your loan. For example, if the index is at 5.5 percent and your margin is 1.5 percent, your rate will be 7 percent. Many ARMs have caps to protect you against drastic increases from year to year.
4. The monthly payment
One of the most important things when choosing a mortgage is to make sure you can comfortably afford the monthly payment. However, it’s not enough to simply choose the loan that provides you with the lowest payment. Interest-only mortgages, for example, carry the lowest possible monthly charges, but they do nothing to reduce your principal -- even after years of payments, you’ll still owe as much as you did at the outset. Also, because your payments on an interest-only loan may rise later, you should make sure you can afford the higher payments. In most cases, you’ll want a mortgage that also helps you build equity in your home. (Equity is the market value of your home minus any outstanding mortgages or liens.) If you don’t build equity, you may not be able to refinance if your house decreases in value. And, when you want to move to a new house, you can put the equity of your current home towards the down payment of your next home.
5. The term
The mortgage term is the number of years your loan will be active. Mortgages with shorter terms carry higher monthly payments, but they can save you a lot of interest over the long term. For example, if you borrow $150,000 at 6 percent with a 30-year term, your monthly payment will be $900. The same loan with a 15-year term will cost $1,265 a month, but you’ll pay almost $96,000 less in interest and you’ll own your home twice as fast.
6. Discount points
Lenders may offer you the chance to pay discount points to lower the interest rate of your mortgage. One point is equal to 1 percent of the principal, so on a $150,000 loan, each point costs $1,500. Generally, for each point you purchase you can lower your rate by about 0.25 percent. Whether this is a good deal depends on how long you plan to keep your home -- the longer you plan to stay, the more it makes sense to buy points. The LendingTree Discount points calculator can help you determine if it makes sense to pay points upfront when taking out a mortgage.
7. Lock-ins
When you apply for a mortgage, lenders will quote a specific interest rate and a certain number of discount points. However, the market can change while you are looking for your new home, causing rates to go up or down. That’s why it’s a good idea to ask your lender to lock in these rates for a specified period, often 30 to 60 days. If you want to lock in your rate, ask whether there will be a fee, if it is refundable, and get the agreement in writing.
8. Closing costs
Lenders charge several fees when closing mortgage deals which can add thousands of dollars to your borrowing costs. Depending on the lender and where you live, the fees go by different names and can often be confusing -- origination fees, appraisal fees and prepaid interest are among the terms you may encounter. The best advice is to ask your lender for a good faith estimate of these costs (lenders are required by law to give you one) and ask for an explanation of any charge you do not understand.
When you apply for a mortgage, lenders will quote a specific interest rate and a certain number of discount points. However, the market can change while you are looking for your new home, causing rates to go up or down. That’s why it’s a good idea to ask your lender to lock in these rates for a specified period, often 30 to 60 days. If you want to lock in your rate, ask whether there will be a fee, if it is refundable, and get the agreement in writing.
8. Closing costs
Lenders charge several fees when closing mortgage deals which can add thousands of dollars to your borrowing costs. Depending on the lender and where you live, the fees go by different names and can often be confusing -- origination fees, appraisal fees and prepaid interest are among the terms you may encounter. The best advice is to ask your lender for a good faith estimate of these costs (lenders are required by law to give you one) and ask for an explanation of any charge you do not understand.
Ref: lendingtree.com/mortgage-loans/advice/getting-the-best-loan/things-to-know-about-mortgages/
Thursday, April 28, 2011
How to compare mortgage loans
Comparing mortgage loans is one of the most important things you can do when you’re buying a home. The decisions you make will determine the size of your monthly payments, how much you pay upfront, and how much interest you’ll pay over the life of the loan.
You might find it simpler to compare loans if you ask each lender a series of questions, including:
- What is the loan’s interest rate?
- Will I be charged points?
- What are the closing costs and all other fees?
- What is the annual percentage rate, or APR – the rate you’ll pay per year for all the costs associated with the loan?
- Is there a pre-payment penalty?
- How is the loan amortized, meaning how quickly is the principal paid off?
Find out the answers to these questions no matter what type of loan you’re considering. Each can affect the overall cost of your loan.
If you are considering an adjustable-rate mortgage, or ARM, you can compare loans by asking:
If you are considering an adjustable-rate mortgage, or ARM, you can compare loans by asking:
- When does the rate adjust?
- How often does the rate adjust?
- Is there a cap limiting the amount by which the rate can adjust? What would my monthly payments be if my interest rate hit that cap?
- What is the index and margin that will determine my rate? How has the index changed over time?
ARMs are inherently more risky than fixed-rate mortgages because you’re gambling on whether interest rates will go up or go down before your rate adjusts. Understanding the best- and worst-case scenarios can help you weigh the pros and cons as you compare loans.
But there’s one other big question to consider before you get an ARM:
But there’s one other big question to consider before you get an ARM:
- How does the discount introductory rate compare with rates for 30-year fixed-rate loans?
If there’s not much difference when you compare the two, the fixed-rate loan might be a safer bet. You won’t save much in the short-term, and could save a lot over the long term. Plus, you reduce your risk if interest rates shoot up and you can’t refinance before the rate adjustment.
Finally, to truly compare loans, you have to ask yourself some questions:
Finally, to truly compare loans, you have to ask yourself some questions:
- How long do I expect to stay in my home?
- Are my job and income secure over the long term?
- Will I be able to afford higher payments in the future?
- How comfortable am I with risk?
In the end, the best loan is the one that works for your needs.
Ref: lendingtree.com/mortgage-loans/advice/comparing-mortgage-loans/how-to-compare-mortgage-loans/
KK Flight-controller setup guide
The interest in my KK flight controllers was bigger than I had anticipated. I’ve actually sold all of the boards that I had parts for, but as so many of you wanted a controller from me, I’ve ordered some more parts and will have another set of boards ready in another week or so (or two weeks if anything I’ve ordered is delayed).
Some people have actually already got their boards and are now asking for the setup guide. I have the great pleasure to tell you that the wait is now over! So far the guide only covers Tricopter and Quadcopter configurations, but more configs are coming soon.
Update: Quadcopter-X configuration guide is now available as well.
Update 2: Y6 and Hexacopter configuration guides are now up and running.
Some people have actually already got their boards and are now asking for the setup guide. I have the great pleasure to tell you that the wait is now over! So far the guide only covers Tricopter and Quadcopter configurations, but more configs are coming soon.
Update: Quadcopter-X configuration guide is now available as well.
Update 2: Y6 and Hexacopter configuration guides are now up and running.
A big THANK YOU! to all of you that has bought a flight-controller from me. I hope that you’ll be pleased with it and that you will share your projects.
Friday, April 22, 2011
5 tips for first-time mortgage borrowers
Shopping for a mortgage can be intimidating. It’s natural to feel anxious about doing something new for the first time, and getting your first mortgage is no exception.
Fortunately, there are a few simple things you can do to make sure you’re being well-prepared before you start looking for your first home loan. Here are five tips to help first-time mortgage borrowers.:
1. Lock Your Interest Rate. Interest rates on mortgages can increase or decrease from day to day or even hour to hour. Discuss the interest rate outlook with your loan officer and try to learn as much as you can about how ups and downs in interest rate quotes might affect your mortgage payment and your ability to qualify for that loan. To protect yourself from interest rate rises, ask about a rate lock, which can reserve a specific interest rate for you for a set time period. If you decide to lock your rate, make sure your lock period won’t expire before your closing date. (Read more about locking your interest rate.)
2. Consider FHA. If you’re a first-time home buyer, you might want to shop for an “FHA loan,” which is a mortgage that’s insured by the Federal Housing Administration (FHA). FHA loans offer competitive interest rates, allow smaller down payments and have easier qualification guidelines compared with other types of loans. The minimum down payment for an FHA loan is just 3.5 percent of the purchase price of the home, although FHA loans do require that you pay mortgage insurance.
3. Take the Tax Credit. If you haven’t owned a home in the past three years, you may be able to qualify for the federal First-Time Home Buyer Tax Credit, which is worth up to $8,000. The credit is refundable, which means you’ll even get a rebate of sorts from the federal government if the income tax that you owe is less than the full amount of the credit. The credit is subject to income limitations and you’ll have to act fast since it’s set to expire after Nov. 30, 2009. Some lenders may allow you to use the credit as a down payment, to pay settlement fees or other closing costs or to pay discount points to reduce the interest rate on your loan.
4. Educate Yourself. A plain-vanilla 30-year or 15-year fixed-rate mortgage is fairly easy to understand. But other types of loans can be more complicated. If you want to consider an adjustable-rate mortgage (ARM) or other less common type of loan product, do your homework and make sure you fully understand how your loan works before you sign the loan documents.
5. Shop Around. Interest rates, loan products and loan terms vary among lenders. That means all borrowers, whether novice or not, should shop around for loan offers. Ask about the benefits and risks of each loan and be sure to compare the quoted points and estimated closing costs as well as the interest rates on different loans before you decide which would best fit your personal situation.
Ref: lendingtree.com/smartborrower/first-time-home-buyers/first-mortgage/first-mortgage/
Sunday, April 17, 2011
Student Loan Debt Consolidation Uk: Go for it
By: Antonio Vargas
Balancing debts and studies is a very difficult proposition for students. With the rising education fees in UK, it has become difficult for students to pursue a course of their choice. With loans for each and each and every purpose available and the availability of credit cards, arranging finances has become easy. But with reckless expenses, the debts multiply and it becomes impossible to manage the debts. The enormous bulk of the debts affects in the study, which is not at all good for students. But now lenders in UK are offering loans to consolidate the debts. Student loan debt consolidation UK offers rational and practical loans to clear the multiple debts.
Student Loan Debt Consolidation UK is a perfect way to wipe out the multiple debts. The loan is especially designed for the student community in UK. Unlike any other loans, student loan debt consolidation UK is quite different. The policies are extremely friendly which suits the pocket. Even the repayment term starts after the loan applicant has completed the studies. This enables the loan applicant to repay the loan after getting a suitable job.
The sole aim of student loan debt consolidation UK is to help you finish off the multiple debts. With lower interest rates and easy repayment schedules, it becomes easy for the loan applicant to erase the debts. By merging all your existing debts in to a single manageable debt, you get to pay low interest rates. By this you save substantial amount of money. The loan is also eligible to borrowers who are having adverse bad credit record.
Student loan debt consolidation UK can be sourced from different lenders available online. It is here that the applicant can derive the loan at lower interest rate that too without any hassles. By comparing the quotes available online, the applicant has the freedom to choose the best deal available.
Student loan debt consolidation UK is an ideal option for students facing the problem of debts. With easy terms and conditions, it is an ideal option to completely get rid off the debts.
Student Loan Debt Consolidation UK is a perfect way to wipe out the multiple debts. The loan is especially designed for the student community in UK. Unlike any other loans, student loan debt consolidation UK is quite different. The policies are extremely friendly which suits the pocket. Even the repayment term starts after the loan applicant has completed the studies. This enables the loan applicant to repay the loan after getting a suitable job.
The sole aim of student loan debt consolidation UK is to help you finish off the multiple debts. With lower interest rates and easy repayment schedules, it becomes easy for the loan applicant to erase the debts. By merging all your existing debts in to a single manageable debt, you get to pay low interest rates. By this you save substantial amount of money. The loan is also eligible to borrowers who are having adverse bad credit record.
Student loan debt consolidation UK can be sourced from different lenders available online. It is here that the applicant can derive the loan at lower interest rate that too without any hassles. By comparing the quotes available online, the applicant has the freedom to choose the best deal available.
Student loan debt consolidation UK is an ideal option for students facing the problem of debts. With easy terms and conditions, it is an ideal option to completely get rid off the debts.
ref: streetdirectory.com/travel_guide/167742/student_loans/student_loan_debt_consolidation_uk_go_for_it.html
Finding Auto Loan Rates in a Recession
by passivefamilyincome
Have you looked at auto loan rates recently? If you are in the market for a new or used vehicle, you may find that it is not as easy as it once was to get funded for a automobile. My wife and I have recently started our search for a new vehicle as our current car lease is set to expire in a few weeks. I had figured that dealerships would be doing anything they possibly can to get buyers in the door with special incentives. We found that there are some deals out there for current year end models, but the inventory of these vehicles is extremely limited. Furthermore, we found several occurrences of misleading advertisements to get buyers in the door. While this is nothing new (and wasn’t a big surprise), we were disappointed that dealerships still promote these types of ads in the midst of a recession. My personal feeling is that the buyers have all the power now with what has been going on in the auto industry.
Unfortunately, for some of the dealerships we visited, the lack of deals and incentives was somewhat out of their control. Take for example our current Ford vehicle that we are leasing. I called the dealership to find out what our buyout on the vehicle would cost and to see what financing options they had. One of our options is to purchase the current leased vehicle we are driving as our next car. We know the history of the vehicle and it has less than 20,000 miles on it in 2 years. There is a lot of value in that purchase and is an option we are considering. However, when I spoke with the Ford dealership, the salesperson (who I have a lot of respect and trust for) told me that Ford Credit should not be an option for me. He said that the current rate they could offer was over 10% APR. I about fell over when he told me the rate. He also mentioned to me that we had excellent credit and that was about the best rate they could offer on a used vehicle. He suggested that we seek out our own financing if we wanted to purchase our existing vehicle. This is always a smart thing to do regardless of the economic climate. You should always shop around for the best rates and financing options available to fit your needs.
After my discussion with the Ford salesperson about the buyout option for our current vehicle, we discussed options for leasing or buying a new vehicle. I asked him what deals were available, expecting all sorts of excellent incentives and savings. To my amazement, the deals were very lean. While they had some decent rebates on some larger vehicles, there was nothing that jumped out to us as an excellent deal for a new lease. Then I asked about 0% financing options on purchasing a new vehicle. The salesperson told me that they had 0% financing options on 24 and 36 month purchases. I asked if they offered 60 month 0% financing, which would fit into our budget. He explained to me that the banks won’t give the automobile companies loans past 3 years because they are worried they will go under. Basically, all of the news that I watch on television and read on the internet about the banks and the automobile industry hit home. While I think the auto dealers would love to entice buyers with great deals, I think it is somewhat out of their control. The 0% financing on a new vehicle is a nice option, but the 36 month period is difficult for many families to fit into a budget.
The financing troubles are not just exclusive to the domestic automakers. We decided (for the first time ever) to consider buying a foreign made car. I have mixed feelings about purchasing a vehicle that isn’t from a Detroit Automaker. The top priority is to find a safe, reliable, and affordable family vehicle. If that means purchasing a foreign vehicle, then that is what we will do. We visited multiple Toyota dealerships recently and were also a little disappointed in the available deals. The foreign automakers are not in that great of shape either, so my assumption is that they would be making great deals. Once again, we found that financing has become an issue. The best rate Toyota could offer us was around 7% on a new vehicle. One of the salespersons we spoke to also told us that their rates are expected to rise even more and suggested we look outside their internal lending to outside banks for better rates.
I decided to conduct a search on the internet looking for great auto loan rates after we visited the dealerships, looking to see what we could find. The cheapest rate for a new vehicle I could find was in the high 6% range. I searched long and hard to find a better rate and looked at banks like Wachovia, BB&T, Fifth Third Bank, and Chase Bank to name a few. How can we get our economy moving again when the cheapest interest rates for a new automobile are in the upper 6% and go up over 10%. These are rates for people with very good credit. I can’t imagine what people with poor credit are being charged.
We still have some affordable options available to us for purchasing or leasing a vehicle in the short-term. However, the great deals that I was expecting were not out there. I was surprised that dealerships were not begging us to buy from them and throwing in all kinds of incentives and options. While I believe some of it is a result of poor management for many years catching up to the auto industry, I also blame the financial crunch for the lack of deals.
ref: passivefamilyincome.com/2008/12/15/finding-auto-loan-rates-in-a-recession/
Wednesday, January 26, 2011
Reading a Forex Quote
Total newbies to the foreign exchange market can find reading a Forex quite intimidating (even baffling) at first. In fact, this is the most common initial hurdle. The quote is brief, but it packs in a great deal of useful information. And although it doesn't make a lick of sense to a newcomer, here's a quick, simple explanation of what it means.
A Forex quote is always based on a pair of currencies, where you're simultaneously selling one currency and buying another. And there are two prices, one for selling and the other for buying (bid price and ask price). When reading a Forex quote, it might typically look like this: USD/JPY 106.52/56
The first currency is called the base currency and the other is the quote currency. The base currency value is always 1 (in this case 1 US dollar). The number in the quote tells you how many of the quote currency (Japanese yen) you can buy with one US dollar.
And that number - 106.52/56 - is a shortened version of two numbers (106.52 and 106.56). The lower number is the bid price; the other is the ask price. The bid price shows how much a dealer will buy the base currency for. The ask price shows how much a dealer is willing to sell it for.
If you saw 106.52/56 when reading a Forex quote, it would mean that you could sell US dollars and receive 106.52 yen per dollar. On the other hand, if you wanted to buy US dollars, you would have to pay 106.56 yen for each dollar.
The difference between the bid price and the ask price in a Forex quote is called the "spread," and each tiny 0.01 unit is called a "pip." In our example, the spread for our USD/JPY quote is four pips. The spread for the most commonly traded currencies is usually that small. In general, you'll do most of your trading in US dollars, Japanese yen, Great Britain pounds, Euros, Swiss francs or Australian dollars. Also please keep in mind that when the competition really heats up some spreads will be as small as one pip.
On the other hand, for less heavily traded currencies, you may run into much larger spreads. But don't think that a small spread means tiny profits (or losses). When you're trading hundreds of thousands of units, even that one pip spread can mean big money.
Let's say you're dealing with just 100 US dollars. Selling your hundred dollars for 10,652 yen and buying them for 10,656 yen only amounts to a four yen difference. But most Forex traders will be dealing with amounts of 100,000 US dollars (or many multiples). So now we know, when reading a Forex quote, that even such an unimpressive little four-pip spread amounts to considerably more (at 4,000 yen, and probably several multiples of that).
And of course, similar trades may be repeated throughout the day and the week. This means that anytime you're reading a Forex quote, you'll recognize that this tiny little spread is more important than its meager size at first suggests.
A Forex quote is always based on a pair of currencies, where you're simultaneously selling one currency and buying another. And there are two prices, one for selling and the other for buying (bid price and ask price). When reading a Forex quote, it might typically look like this: USD/JPY 106.52/56
The first currency is called the base currency and the other is the quote currency. The base currency value is always 1 (in this case 1 US dollar). The number in the quote tells you how many of the quote currency (Japanese yen) you can buy with one US dollar.
And that number - 106.52/56 - is a shortened version of two numbers (106.52 and 106.56). The lower number is the bid price; the other is the ask price. The bid price shows how much a dealer will buy the base currency for. The ask price shows how much a dealer is willing to sell it for.
If you saw 106.52/56 when reading a Forex quote, it would mean that you could sell US dollars and receive 106.52 yen per dollar. On the other hand, if you wanted to buy US dollars, you would have to pay 106.56 yen for each dollar.
The difference between the bid price and the ask price in a Forex quote is called the "spread," and each tiny 0.01 unit is called a "pip." In our example, the spread for our USD/JPY quote is four pips. The spread for the most commonly traded currencies is usually that small. In general, you'll do most of your trading in US dollars, Japanese yen, Great Britain pounds, Euros, Swiss francs or Australian dollars. Also please keep in mind that when the competition really heats up some spreads will be as small as one pip.
On the other hand, for less heavily traded currencies, you may run into much larger spreads. But don't think that a small spread means tiny profits (or losses). When you're trading hundreds of thousands of units, even that one pip spread can mean big money.
Let's say you're dealing with just 100 US dollars. Selling your hundred dollars for 10,652 yen and buying them for 10,656 yen only amounts to a four yen difference. But most Forex traders will be dealing with amounts of 100,000 US dollars (or many multiples). So now we know, when reading a Forex quote, that even such an unimpressive little four-pip spread amounts to considerably more (at 4,000 yen, and probably several multiples of that).
And of course, similar trades may be repeated throughout the day and the week. This means that anytime you're reading a Forex quote, you'll recognize that this tiny little spread is more important than its meager size at first suggests.
ref: forexarticlecollection.com/forex-beginner/reading-a-forex-quote.html
Thursday, January 13, 2011
Forex Trading Information
FOREX — the foreign exchange (currency or forex, or FX) market is the and the most liquid financial market with the daily volume of more than $3.2 trillion. Trading on this market involves buying and selling world currencies taking the profit from the exchange rates difference. Forex trading can yield high profits, but it is also very risky. Everyone can participate in Forex trading via the Forex brokers.
ref: earnforex.com/
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