For those of you who have or have often traveled abroad, you may be familiar with currency exchange or foreign exchange (forex). If you look at it, the exchange rate can go up and down or fluctuate depending on when you exchange the money you have with other currencies.
The exchange rate fluctuations were then used by some people as one of the investment instruments and made a profit. Curious how?
Simply put, you can make an investment by storing foreign currency within a certain period of time at home or in the bank and redeeming it when the saved currency experiences a strengthening of the exchange rate. However, there are actually other ways that some investors do to make more profits, namely by buying and selling with currency exchange (forex trading)
However, it is not an investment if the name is without risk. With high profit potential, the opportunity for loss is quite large. To what extent do risks and opportunities benefit?
Financial planner Eko Endarto said, forex trading is usually carried out on a derivative basis or using contracts between one party and another (bilateral). The contract, in the form of an agreement to exchange payments whose value comes from the product, becomes a reference value, in this case both currencies will be exchanged.
"So there is a purchase contract, investors will participate in the contract transaction. The contract is in the form of derivatives,"
Forex trading is generally carried out on futures exchanges because it is not physical. In contrast to forex investment in banks by exchanging physical money.
First of all, you must choose an official broker from within the country or abroad that is directly supervised by the commodity futures trading authority in each country. In Indonesia, the authority is under the direction of the Commodity Futures Trading Supervisory Agency (Bappebti).
"It might be better to use brokers from Indonesia alone, the fear of using foreign brokers turns out to be illegal," Eko said.
Some brokers can provide forex trading facilities in Indonesia and get Bappebti permits, such as PT Askap Futures, PT Monex Investindo Futures, and PT Soegee Futures.
After choosing, you can immediately register by opening an account. Then, the broker you choose will teach you how to read charts or charts the movements of the value of each country's currency.
Ariston Tjendra, Head of Monex Investindo Futures Research, explained that investors must pour in initial capital of around US $ 500 dollars or around Rp.6.65 million (exchange rate of Rp13,300 per US dollar). This initial capital can then be used to start trading.
"So the trading will use the initial funding of US $ 500 dollars," Ariston explained.
Furthermore, you can directly trade or buy the currency you want. This currency will always coexist with other currencies, for example USD / EUR or USD / JPY.
If the USD is ahead, then it means you buy United States Dollar (US) which is compared to the Euro or Yen Jepan. However, if it is reversed into EUR / USD it means you are buying Euro which is proportional to the US Dollar, and so is JPY / USD.
"So look at the currency ahead, but still pay attention to the sentiments of the two countries," Ariston said.
An example of sentiment for the US, for example, when there is a target of raising the Fed's interest rate twice in one year, the US Dollar will immediately strengthen. In addition, Donald Trump's policy will also influence the forex movement.
"So look at the sentiment of countries whose currencies are traded," he said.
However, forex trading is different from other investments because it is two-way. When compared to stocks, investors buy shares at low prices and sell them when the stock price has gone up to realize profits.
Well, with this two-way trading, investors do not need to worry too much if there is a negative sentiment towards the currency being traded right. Because, investors can already sell their forex contracts when they do not have the contract.
"So if for example the price is US $ 100, but two days more, the investor's estimate (value of other currencies) will be US $ 80. To be able to sell, we can buy two more days at US $ 80," Eko explained.
Thus, investors will get a profit of US $ 20. The purchase fund will be deducted from the margin of the investor, along with the profits achieved.
Not for beginners
Eko argues, you should first taste the stock investment, before trading forex. Because, forex trading is more complicated and not as easy as stocks. In addition, the movement itself is more dynamic.
"So forex trading is intended for those who have long been in the investment world because of the high risk," said Eko.
In addition to stocks, maybe you can also try gold investing physically so as not to be surprised when you get a loss when the gold price drops. After that, you can switch to trading gold on the futures exchange, then forex trading.
"So feeling first has goods whose prices go up and down too," Eko explained.
With a very fluctuating currency value movement, Eko said that the average return that can be achieved by investors from forex trading in a year can reach 30 percent to 40 percent.
"If the average share is only 10 percent to 20 percent a year," Eko concluded.
The exchange rate fluctuations were then used by some people as one of the investment instruments and made a profit. Curious how?
Simply put, you can make an investment by storing foreign currency within a certain period of time at home or in the bank and redeeming it when the saved currency experiences a strengthening of the exchange rate. However, there are actually other ways that some investors do to make more profits, namely by buying and selling with currency exchange (forex trading)
However, it is not an investment if the name is without risk. With high profit potential, the opportunity for loss is quite large. To what extent do risks and opportunities benefit?
Financial planner Eko Endarto said, forex trading is usually carried out on a derivative basis or using contracts between one party and another (bilateral). The contract, in the form of an agreement to exchange payments whose value comes from the product, becomes a reference value, in this case both currencies will be exchanged.
"So there is a purchase contract, investors will participate in the contract transaction. The contract is in the form of derivatives,"
Forex trading is generally carried out on futures exchanges because it is not physical. In contrast to forex investment in banks by exchanging physical money.
First of all, you must choose an official broker from within the country or abroad that is directly supervised by the commodity futures trading authority in each country. In Indonesia, the authority is under the direction of the Commodity Futures Trading Supervisory Agency (Bappebti).
"It might be better to use brokers from Indonesia alone, the fear of using foreign brokers turns out to be illegal," Eko said.
Some brokers can provide forex trading facilities in Indonesia and get Bappebti permits, such as PT Askap Futures, PT Monex Investindo Futures, and PT Soegee Futures.
After choosing, you can immediately register by opening an account. Then, the broker you choose will teach you how to read charts or charts the movements of the value of each country's currency.
Ariston Tjendra, Head of Monex Investindo Futures Research, explained that investors must pour in initial capital of around US $ 500 dollars or around Rp.6.65 million (exchange rate of Rp13,300 per US dollar). This initial capital can then be used to start trading.
"So the trading will use the initial funding of US $ 500 dollars," Ariston explained.
Furthermore, you can directly trade or buy the currency you want. This currency will always coexist with other currencies, for example USD / EUR or USD / JPY.
If the USD is ahead, then it means you buy United States Dollar (US) which is compared to the Euro or Yen Jepan. However, if it is reversed into EUR / USD it means you are buying Euro which is proportional to the US Dollar, and so is JPY / USD.
"So look at the currency ahead, but still pay attention to the sentiments of the two countries," Ariston said.
An example of sentiment for the US, for example, when there is a target of raising the Fed's interest rate twice in one year, the US Dollar will immediately strengthen. In addition, Donald Trump's policy will also influence the forex movement.
"So look at the sentiment of countries whose currencies are traded," he said.
However, forex trading is different from other investments because it is two-way. When compared to stocks, investors buy shares at low prices and sell them when the stock price has gone up to realize profits.
Well, with this two-way trading, investors do not need to worry too much if there is a negative sentiment towards the currency being traded right. Because, investors can already sell their forex contracts when they do not have the contract.
"So if for example the price is US $ 100, but two days more, the investor's estimate (value of other currencies) will be US $ 80. To be able to sell, we can buy two more days at US $ 80," Eko explained.
Thus, investors will get a profit of US $ 20. The purchase fund will be deducted from the margin of the investor, along with the profits achieved.
Not for beginners
Eko argues, you should first taste the stock investment, before trading forex. Because, forex trading is more complicated and not as easy as stocks. In addition, the movement itself is more dynamic.
"So forex trading is intended for those who have long been in the investment world because of the high risk," said Eko.
In addition to stocks, maybe you can also try gold investing physically so as not to be surprised when you get a loss when the gold price drops. After that, you can switch to trading gold on the futures exchange, then forex trading.
"So feeling first has goods whose prices go up and down too," Eko explained.
With a very fluctuating currency value movement, Eko said that the average return that can be achieved by investors from forex trading in a year can reach 30 percent to 40 percent.
"If the average share is only 10 percent to 20 percent a year," Eko concluded.
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