City FX Investment | High Return Investments with variable low risk exposure
 
CityFX
Email: info@cityfxinvestment.com Call: +44 (0)20 8935 5601
INVESTMENT
  •  
  •  
     
    Home > Foreign Currency Investment > FX Careful Trading


     
    Careful Trading Policy

    City FX Investment has a strict careful trading policy and also an excellent trading record. Whilst no high return investment is completely without risk, City FX Investment trades with a very low leverage, low risk model. Ensuring any large fluctuations in currency rates will not push your investment into an unmanageable or untenable position. The key to a good long term currency investment is having the ability to buy and sell currencies when you want to, not when the market gets too extreme for your investment level to handle.

    City FX Investment combines a small trading technique with a long term higher investment model. This allows us to generate small profits continuously, from the day to day fluctuations, whilst managing the bigger long term movements of currencies, with our larger investments.



    What is Leverage and Low Leverage?

    Leverage is the increased multiples of a currency you can purchase with the amount of physical money you have invested. Due to the control that banks and trading organisations have over the currencies you have purchased, they are very willing to leverage you huge sums of money based on a small investment. However they do keep very strict tabs on your potential losses and will be quick to close out your position if your negative position gets too large.

    Some trading platforms will allow you to trade at a 200:1 leverage, so with just a £1,000 deposit you can buy £200,000 worth of your chosen currency.



    Example: High Leverage



    Example: Low Leverage



    This is a simplified example but does give you an idea of the difference leverage can make. With the same £1,000 amount you can purchase two different amounts of a currency, depending on what amount of leverage you are using.

    However, as you can see with the high leverage example a slight movement the wrong way, just a 0.5% change in the currency pair value, which occurs very easily, and your account is -£998.26. If you do not have more funds to cover your losses the bank will close your position, selling or buying out the pair you selected. You are then left with no currency, no leverage and just £1.74 of your original investment amount.

    If you had opted to go for a Low Leverage of 20:1 you would have only been able to buy £20,000 worth of Yen with your £1,000. Now if the currency pair shifted against you by the same 0.5%, you would only suffer a -£99.26 loss. A far more manageable amount that does not wipe out your entire investment and gives you time to re-evaluate your trade decision or more time for your currency pair to move in your favour.

    Higher Leverage allows you the ability to make far higher profits in a very short amount of time, but if your cash resources are tight and your trades go against you, you may very well lose your whole investment very quickly. With a Low Leverage your profits are not as high but neither are your potential loses. Low Leverage allows the investor time to manage and control their investment far more easily.

       
       
       

       
        Read more on Foreign Currency Investment
       


     
    News and Forecasts
      Legal & General targets climate change laggards  
      Mon, 11th Jun 2018 12:55:00  
      Legal and General Investment Management (LGIM) has said it will take action against companies that are not addressing the risks of climate change. LGIM, one of the biggest investment funds in Europe,...read more  
         
      China leads as the largest investor in renewable solar energy, investing $126.6 billion in 2017  
      Tue, 5th Jun 2018 19:00:00  
      China is on a mission to become the next green superpower. Currently the largest investor in renewable energy, China invested a total of $126.6 billion into clean energy in 2017 - a 30% increase from the...read more