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Forex

How to choose a broker: tips for beginners

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broker Pelliron.com

You have decided to invest in securities — this means that you cannot do this without a broker: according to the law, it is not possible to trade on the stock exchange without an intermediary. Transactions can only be carried out by legal entities that have a brokerage license — banks, investment, and brokerage companies. How to choose a reliable and appropriate broker for you.

What a broker does

A broker executes orders for transactions on the exchange; prepares reports on transactions and movements of funds, counts, and remits taxes on profits. A good example is Pelliron. The broker also develops investment and trading strategies, creates asset portfolios, and offers personal financial advisors.

What do you expect from a Pelliron.com broker or other companies? 

Think about why you want a broker, other than formal access to the stock exchange. It is better to choose a broker with a clear idea of your goals. For example, broker Pelliron.com will suit you for all purposes. 

What do you need to pay attention to?

The license

This is the first thing to check: without a license; no company has the right to conduct operations on the stock exchange. The regulator conducts regular inspections and, if it notices violations, withdraws the license. 

Reliability

Legislation strictly regulates brokerage activities, and any unauthorized action with customer assets entails criminal liability. Large brokers with a long history and serious turnover do not benefit from it. To study the rating and at the same time the statistics (the volume of client operations, the number of registered and active users) is available on the website of the Moscow Exchange.

Markets

Find out what markets are available. Find out what assets the broker has access to. For example, you want to invest in the securities of U.S. companies. You can do this directly on one of the American stock exchanges. In the latter case, the commission will be lower and the selection of securities will be larger.

If you are a beginner and haven’t yet figured out exactly which securities you need, you can invest in ETFs (funds that hold a portfolio of assets and trade them in pieces) or in a ready-made portfolio with predictable income and risk levels.

Rates

Some people want to earn from intraday currency trading, while others want to buy bonds and leave them untouched for several years. Portfolio composition, returns and fees depend on the choice of tariff. If you are just starting to invest, choose the easiest one.

The broker earns a commission on the transaction amount, and the commission will vary depending on the tariff. Brokers can also charge a commission for depositing and withdrawing funds, using a trading platform, voice orders for a transaction and so on. 

Training

If you are new to the securities market, a little education on the subject will be useful to you. Many brokers offer webinars, seminars, and personal consultations. Classes may be paid or free, and sometimes brokers offer promotions and give away paid classes. You can practice on a demo account.

Advice

Talk to the broker’s support service before opening an account. Pay attention to how quickly and informatively they answer you. For example, the Pelliron review states that this company cares about its clients and tries to quickly resolve any questions they may have. A prompt response is not just an important part of the company’s image, but also a guarantee that problems are resolved quickly.

Briefly

  • Before choosing a broker, think about what purposes you need it for, besides the obvious one — access to the exchange.
  • Examine the documents confirming the reliability of the broker. First check the availability of the license.
  • Familiarize yourself with the rates: different rates are appropriate for different purposes. Also, the amount of commission depends on your choice of rate.
  • Free training is a good bonus if you are a beginner.
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Forex

BofA projects EUR-USD to hit 1.12 by year-end, above consensus

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Bank of America (BofA) released its currency market forecast, projecting the EUR-USD exchange rate to reach 1.12 by the end of the year. The bank’s analysts expect the majority of the euro’s appreciation to occur in the second half of the year, positioning their forecast above the consensus estimate of 1.08 for 2024.

In addition to the euro, BofA’s analysis remains focused on the G4 currencies. The pair is currently trading around the bank’s year-end forecast for 2024. However, BofA noted that there are still risks of intervention in the currency pair.

The British pound (GBP) is also on BofA’s radar, with the bank maintaining a constructive outlook on the currency. This optimism is fueled by stronger-than-expected UK Consumer Price Index (CPI) data. Nevertheless, BofA acknowledges that the upcoming UK general election will likely dominate short-term market attention.

BofA’s broader view on the currency markets includes a forecast for a gradual depreciation of the US dollar across most of the G10 currencies throughout this year and into the next.

The forecast also suggests a slightly greater depreciation for the US dollar against higher-beta G10 currencies.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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UBS shifts stance on Swiss franc, now sees it as neutral

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UBS modified its outlook on the Swiss franc, adjusting the currency’s status from “least preferred” to “neutral.” This reassessment comes amid expectations that the U.S. dollar will maintain its strength, with potential for intermittent increases in value.

However, UBS does not anticipate a sharp rally or significant depreciation of the dollar when the Federal Reserve begins its rate-cutting cycle, which is expected to start in September.

UBS’s forecast suggests that geopolitical uncertainties, particularly those related to the Middle East, are likely to persist. The firm notes that unless there is a surge in oil prices due to actual disruptions in supply, these geopolitical factors should not lead to a substantial increase in market risk aversion.

The firm continues to encourage investment in currency crosses, which involve trading between two currencies, excluding the U.S. dollar. UBS’s adjustment to the Swiss franc’s status indicates a change in the perceived risk and potential return of holding or trading the currency.

The reassessment of the Swiss franc by UBS reflects a broader analysis of the currency’s position in the market. Previously considered as a less favorable option, the Swiss franc’s new “neutral” rating suggests that the risks associated with short positions in the currency may have diminished.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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Dollar steadies after sharp gains post Fed minutes; sterling retains strength

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Investing.com – The U.S. dollar handed back some of the previous session’s gains Thursday, but remained near a one-week high after the release of hawkish minutes from the last Federal Reserve meeting suggested U.S. interest rates would remain elevated for some time. 

At 04:20 ET (08:20 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded 0.1% lower at 104.705, after gaining 0.3% overnight.

Dollar boosted by hawkish Fed minutes

The of the Fed’s late-April meeting showed policymakers were growing increasingly concerned over sticky inflation, with some Fed officials talking about potentially raising rates further to bring down inflation.

“While the general view was that policy was ‘well positioned’, many members were open to more hikes if needed. Incidentally, ‘many’ participants questioned whether policy was restrictive enough,” said ING in a note.

Several Fed officials have subsequently cautioned about inflation levels in speeches following the gathering.

But the Fed is still seen as unlikely to raise interest rates further, and so markets are now pricing in a greater chance the central bank will keep rates high for longer. 

Atlanta Fed Chair is set to speak later in the session, and traders will look to his comments as well as data for May for further clues.

Sterling retains firm tone after election news

In Europe, rose 0.1% to 1.2730, with sterling retaining its firm tone after Wednesday’s data showed that U.K. inflation fell by less than expected in April.

Prime Minister Rishi Sunak called a national election, which his Conservative party is widely expected to lose to the opposition Labour Party after 14 years in power.

“The pound also seems to have been only very lightly impacted by the news,” said ING, as “crucially, many of the volatility-inducing events that had been associated with UK politics in previous years (UK-EU trade relationships, unfunded budget spending, the Scottish referendum) all seem to be rather marginal risks now.”

traded 0.2% higher to 1.0839, after data showed that eurozone business activity has expanded at its fastest pace in a year this month.

HCOB’s preliminary climbed to 52.3 this month from April’s 51.7, beating expectations for a more modest lift to 52.0, supported by buoyant demand for services, while the manufacturing sector showed signs of approaching a recovery.

The European Central Bank has largely confirmed it will start its rate-cutting cycle next month, and the current debate is how many more cuts, if any, the policymakers will agree to this year.

Yen flat despite PMI improvement

In Asia, largely flat at 156.76, after surging close to 157 in overnight trade, with data for Japan showing manufacturing activity expanded for the first time in 11 months. 

traded 0.1% higher at 7.2443, trading just below a six-month high.

Beijing was seen banning certain U.S. firms from participating in trade activity relating to China, while also banning some arms shipments to Taiwan. The move was seen as retaliation for steeper U.S. tariffs on key Chinese industries, which will go live from August 1.

China also carried out military drills near Taiwanese territory, ramping up concerns over heightened tensions in the area.

 

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