There are plenty of different tools that you might find useful, during your Forex trading career. Some are more useful and of course more important than others, however one of the more obvious Forex trading tools that you might have already heard of, is the currency converter. Although these sorts of tools are generally used by business people going away on meetings, holiday-goers going to different countries and just about anyone going abroad to a different country with a different currency to their home nation’s currency, they can also prove to be useful to currency traders.
A currency converter will be able to provide you with constant, valuable information, so long as the converter is up-to-date. These types of tools will be able to tell you the retail exchange of one currency in terms of another. This basically means that these types of tools will be able to tell you how much one currency is worth, in terms of another currency. Because you are always buying or selling one currency against another, converters can of course prove to be very useful, despite the fact that they are actually very simple tools indeed.
You should bear in mind when using a converter though, that the rate that you do see on your converter won’t match or reflect the currency prices that you will be given by your broker. This is because Forex brokers make money through spreads; brokers embed the costs of their services into the differences between the buy and sell prices of currencies. Also, you might want to remember that the price feeds that your broker delivers might be delayed, which is something to think about when using a currency converter in Forex trading.
A converter can be a great tool though and they are very easy to find. When looking for a converter, ensure that it is live, not delayed and is not from a broker. If you have a good Forex broker though, you will most likely be able to access a converter within your trading platform, provided by your broker. The main advantage of using your broker’s converter, is that the prices you see on your converter are the prices that you are actually trading. This allows for less confusion and hassle, which will in turn allow you to get on with your trading. Do bear in mind though, that if your broker isn’t one of the more credible and legitimate ones in the business, you should try to keep track of more than one price feed every so often so that you can be sure that your broker isn’t cheating you. This really involves price feeds more than converters, but this is still something to think about; remember, always go to a broker that can offer fixed spreads. If you use a converter provided by a broker who gives you floating and ever-changing spreads, it could confuse you a lot and mess your plans up.
In conclusion, a currency converter is an extremely simple tool, yet it can be extremely useful too. Every Forex trader should have access to a converter. Live converters will also be able to tell you what retail trends for particular currencies have been like, during time periods of your choice. Although converters at first glance look very simple, although they are admittedly simple, they shouldn’t be underestimated. So not only should those going abroad considers converters, but also those who trade currencies.